What defines successful Innovation?
Innovation is the process of using intellectual capital to create new products or services that generate positive business results in the form of financial returns. Discovering new findings then spurs more innovation which leads to further financial returns, and so on.
Innovation is successful when positive outcomes result in return on investment (ROI). That is why Value Creation is so important. Adding perceived value to a new product or service will drive ROI. The value proposition is the key to successful innovation. Develop an innovation with high perceived value to your customer, and strong sales will follow.
It’s all about understanding your customer and giving them what they want. Customer input and feedback is key. Look at Ford Motor Co. for example. The car manufacturer observed and listened to their large customer and prospect base on what they wanted in a car. They launched the “Your Ideas” initiative that invited people to make suggestions for improvement in all areas of comfort, convenience, connectivity, performance and safety. The result? Ford added iPod, MP3 player and USB connections, touch screens, voice activated communication systems, intelligent push-start buttons and more. Sales are soaring – not because of the traditional four wheels and performance but because of value added features. Ford Motor Company now has one of the highest customer satisfaction rating among all major automakers.
When was the last time you tried or experienced your product or customer experience? Create value and not just onerous processes. Consumer input should be considered at multiple stages of your new product development process in order to increase perceived value. Enhanced product value means higher margins, greater returns, improved loyalty and increased stakeholder value.
Finally, when you find that delicate balance between cost, manufacturability and consumer perceived value, be sure to protect your intellectual property (IP) portfolio through patents. Invest the time and money into constantly updating patents and managing your product or service portfolio because it will lock in the value of your Innovation IP.
Robert Brands is the founder of InnovationCoach.com, and the author of “Robert’s Rules of Innovation: A 10-Step Program for Corporate Survival”, with Martin Kleinman – published Spring 2010 by Wiley (www.robertsrulesofinnovation.com).