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A lot of business people that I meet are puzzled by the ongoing dialogue about innovation. To most of them, innovation is something that doesn’t apply to them, they believe that they aren’t inventors or product developers. How do we innovate without inventions? Tell you what
Airbnb didn’t have to invent anything new while creating the largest hotel chain
Uber didn’t have to invent anything new while creating the largest taxi business in the world
They have been copied world over and plenty of new businesses have been created.
What you see with these innovations are great ideas; they looked at problems customers faced and put together very innovative solutions that created outstanding value.
Uber, for example, didn’t create another taxi company. That would have only brought in one more player with the same challenges as existing taxi companies. What they did was come up with a solution that solved problems with existing taxi services.
Innovation, unfortunately, is equated with technological innovation; which means that we always think of some new gadget or technology. This makes us believe that innovations require a technology team and big-budget R&D.
INNOVATION IS CREATIVE DESTRUCTION, WHERE ENTREPRENEURS COMBINE EXISTING ELEMENTS IN NEW WAYS. This is how Joseph Schumpeter defined it in 1939.
Innovation can have two starting points;
a) You have a wonderful piece of gadget/technology. Let us find potential use for the gadget
b) Customers are struggling with a lack of a solution for a specific problem. Let us find an innovative solution.
The first is called technology Push and the second is call Innovation Pull. To succeed with them you require very different approaches and capabilities
To succeed with technology push, you must discover how this can be commercialized and how the gadget or technology will create value for customers. You must create a business model that will unlock value for both you and your potential clients. Very often you see people complaining that the market/customers weren’t ready for the great product they came up with, it was ahead of time. It’s probably a case of poor business model or lack of customer value
The second is a case of Innovation push and requires you to find solutions that are unique as well as reliable. Innovation demands that you are able to put together a solution by combining existing technologies in unique ways. Start-ups are doing this regularly and disrupting existing markets. You really don’t require inventions, but you need to know about technology and be aware of what is available.
To be able to innovate without inventions you need the following
1. Customer insights and experience analysis
a. Be very close to the market and customers and understand what their pains are and what are the things they want
b. More than your customers, try and understand why people don’t buy from you
c. Understand customers' usage of product or service, the benefit they seek and get and the pains they experience
d. Seek ideas from customers, suppliers, and employees. Satisfaction surveys are not for auditors, but for capturing ideas. Just recollect when was the last time your customer asked you for an idea
2. Keep a close watch on what technology can do for customers. Watch all the latest trends.
3. Create a network of technology providers, be in touch with universities, incubators and be on the lookout for promising startups. Visit local universities, there are thousands of youngsters with great product and technology ideas
4. Finance startups, your easiest way to acquire technologies
Remember innovation doesn’t have to be just a product. (watch out for the next video where I discuss about the 10 types of innovation). You can be an innovator without actually inventing anything.
Hope you found these insights useful. Let me know if you like this video and leave your comments on the subject. Write to me directly email@example.com or connect on LinkedIn for more discussion on the subject of innovation.
Krishnan is a consultant with more than 25 years of experience. His purpose is to help India and it's entrepreneurs be global leaders in innovation