Connected Innovation: Advantages of an In-Touch Process
“Necessity is the mother of invention” – Plato
We find ourselves at a juncture where two things are true:
Innovation provides a path to solve for the needs and challenges of humanity.
Digital technology has vastly exceeded the cognitive capacity of the human species.
What does this mean for organizations that innovate, or should, as a way to grow themselves or move society forward in general? The launch of the World Wide Web (WWW) to the general public in 1993 contributed to the largest expansion of information access in human history. This access to massive bodies of knowledge has exponentially impacted the rate at which humans are able to innovate and demand innovation. One of the many ways in which we at GrowthWorks think about innovating is through New Product Development (NPD). We understand that this increased wave of information in the Digital Age fuels three major external forces that push for new product development:
New technologies and technological advances that make for faster and more efficient processes and experiences
A rise in better equipped competitors that have the market knowledge to differentiate themselves and the necessary platforms to reach consumers
An upsurge of informed and knowledgeable consumers with a better grasp of what is offered and possible, who are not willing to conform if their needs aren’t met and are not afraid to voice opinions
While understanding technology and competitive activity is critical, it is the third external force where we think organizations can build long-term relationships with consumers though innovation. Innovation decisions should not happen in a silo, especially in our current digitally connected world. We need to truly deliver better products (solutions) that meet the needs of those who benefit from them, the customers. In return, the organization benefits by not only reaching new customers that have an unmet need, but by possibly extending the customer lifetime value (and loyalty) of an existing customer base.
Organizations that successfully deliver products or services that consumers trust have a competitive advantage, one that may have been gained through a specific production expertise. Because of that, it is not uncommon for firms to gravitate towards innovating based on production capabilities, approaching NPD by asking questions such as “if we know how to do product X, what is its next evolution?” or “what are our facilities good at making?” There is certainly nothing wrong with asking these questions along the development process, especially if one of the goals for embarking on this journey is to maximize the organization’s production capacity. However, we believe that these types of questions shouldn’t be the North Star, and that production (or R&D) driven innovation should not happen in a vacuum.
We strongly encourage innovators to use an ‘in-touch’ NPD approach that starts by listening to consumers, analyzing their needs, and integrating those insights with the organization’s internal capabilities to help guide decisions even before starting the idea generation and concept development phases.
This first step is crucial and will set the foundation for innovation. There are various ways to get in touch with and hear from consumers – here are just a few you can do through internal or externally sourced efforts:
Leverage social media to not only learn from what consumers organically share, but to actively connect with consumers – ask them about their likes and dislikes on products or services they purchase from you and how they can be improved upon.
Conduct focus groups/ethnography/other deep qualitative methods with consumers to hear first-hand what is missing for them, what they expect, and what their pain points and struggles are along their journey.
Make use of email campaigns to incentivize consumers to voice their opinions.
Hire outside consultants with expertise on gathering and analyzing consumer data, and the ability to integrate it into actionable next steps for more impactful and long-lasting innovation.
Guiding NPD efforts with both a production and a consumer lens is analogous to conducting a SWOT analysis for this endeavor. Not only is this tool useful for guiding big-picture business strategy decisions, but it can also serve product development purposes. As an insider, you are constantly reminded of what the organization’s internal capabilities are – the strengths and weaknesses.
But understanding what drives consumer needs and consumer behavior will shed a brighter light on what the potential opportunities and threats are to future product launches. Consumer behavior is very dynamic and certain external factors carry a lot of weight on influencing such behavior. Particularly recently, we’ve seen how COVID-19 has shifted consumer thinking and behavior. Generational values, the state of the economy, and family dynamics are some other influential factors as well. Knowing what dictates consumer movements and priorities will help your organization also prioritize and move in harmony.
Information access has empowered technology developers, competitors, and consumers. However, it isn’t a one-way street. This access to information can also help you as an innovator to better connect with consumers and help you develop products that fit into the internal capabilities of your organization while meeting the needs of those that promote and support your brand. As I mentioned in the beginning of this post, innovation is necessary to solve for the needs and challenges of humanity, and what better time to do so than now.
If you are interested in learning more about how GrowthWorks can guide you through ‘in-touch’ new product development, contacts us at email@example.com.