Busting Innovation Myths
Sitting
under an apple tree may have played a part in Isaac Newton’s law of universal
gravitation but it takes more than an epiphany to innovate.
The
notion that innovation starts with a sudden flash of insight, an electric light
bulb or Archimedes in the bathtub moment, is far from accurate. Innovation
takes time and effort. It’s less an idea and more a process. Here are the four
big myths which, more often than not, act as barriers to innovation and the
development of new concepts and designs.
Myth 1: It’s about a BIG idea
Perhaps
the most widespread misconception is that innovation comes from one big,
brilliant idea. The odds are that you’re more likely to be struck down by
lightning while waiting. Finding an idea is like hunting for buried treasure in
a desert. You can wander around hoping to stumble on the treasure or starting
digging in one spot and trust you’ll get lucky. A more systematic approach is
to dig many holes – in other words to come up with lots of quick, short,
descriptions of ideas and work from there.
If
you look deeper into the creative process of people or industries that make
their mark, there is rarely one defining moment. In the pharmaceutical industry
for example, people don’t say “Let me come up with the smartest idea for the
newest drug”, they come up with hundreds of thousands of compounds and what
follows is a systematic iterative process to finally get to a drug that works.
An
example of a business that has done very well is Pixar, the computer animation
film company responsible for many innovative and financially successful movies.
If you look at their creative process, it’s not one person that comes in and
pitches a film. There will be dozens of people pitching hundreds of ideas about
cars, birds, superheroes. They will select a number of ideas and work on them,
developing characters, expanding on the subject before moving onto a plot. The
whole process can take three to five years to become a feature film.
Companies
and individuals thinking about innovation need to encourage a pool of ideas and
adopt a systematic selection and refinement process; a funnel approach
converging the multitude of ideas down to a handful of projects that can be
pushed to rapid completion.
The
challenge in this approach is to broaden the mouth of the funnel, expanding
access to new ideas and information, and to narrow the neck through stringent
screening processes so limited resources can be spent on selected projects with
the highest expected result.
Myth 2: Innovation is about new products or technology
It
can be, but innovation can also be focused on improving processes and systems
within the company. Business model innovation looks at disrupting the way
things are done and bringing in new approaches that contribute to a business’s
success.
There’s
no argument that Henry Ford made an impact on the car industry, but he didn’t
really come up with any new technology. What he developed was a new way of
making cars – the assembly line or standardised business model which
revolutionised the car industry. Similarly Toyota became famous for introducing
the ground-breaking “just-in-time” production approach completely changing
management philosophy and practices.
And
then there’s Dell Inc. The multinational computer technology firm’s success
didn’t come from inventing better computers but from the introduction of a new
model of on-line selling and its “build–to-order” model of manufacturing.
Business
model innovation entails relatively lower degrees of difficulty and uncertainty
than traditional forms of product innovation and demands neither a new
breakthrough technology nor the creation of a new brand market. It
delivers existing products based on existing technologies to existing markets.
As such it’s inherently less risky than product innovation and can be
introduced in both small and large companies and in sectors where other types
of innovation often fail. It often involves changes that are invisible to the
outside world, bringing advantages that are harder to copy and easier to
sustain.
Myth 3: A good idea is instantly recognisable
It
isn’t. If you look at data measuring the predictability of a successful idea,
it’s surprisingly low, even amongst people who know the industry well.
Nobody
knows how the market will respond to a new product or system. It’s a matter of
looking at and testing all the ideas, developing those that look the most
promising and slowly weeding out those that don’t. As part of the funnel
mechanism, mentioned earlier, hundreds perhaps thousands of concepts, are put
through hurdles. Does the idea make sense? Is it financially feasible?
Assumptions must be tested and ideas taken through market studies and
competitive analysis. Along the way ideas are best judged by a diverse group of
targets.
Myth 4: Get funding ASAP
Once
an idea’s been identified the next step is finding the big money to develop it.
The conventional approach if you have a big idea is to go ‘all in’. This may be
the case if you’re pressed for time but chances are if you take this path you
will lose a lot of money along the way.
Going
big makes sense if you know a good idea from bad but as noted a lot of testing
needs to be done before this can be assured. Low cost processes have the
ability to change and refine ideas through every step of the funnel process,
weeding out ideas that don’t work so resources can be focused on the most
attractive opportunities. This process is known as “pivoting” and implies the
need to stay flexible and let the business model evolve.
There’s
a lot of quick, cheap testing that can be done to gather information about what
will work and what won’t. A new product to come out of one of the MBA module at INSEAD was Knixwear - sweat
resistant, absorbent and odour reducing underwear for women, which shows how
fundamental and low-cost testing can be. Variants of the idea were explored
using data about women post-pregnancy and by surveying the student population.
The product was tested on campus using simple simulations such as moistening
the prototype and asking students to wear it and judge its comfort level.
Another involved getting people to hold the test fabric on their hand and test
how dry it felt and for how long.
The
product was later launched through the crowd-funding platform Indiegogo raising
$60,450, more than one and half times the target.
The
bottom line is innovation takes more than brilliance. It takes courage, it
takes time, it takes tenacity and first and foremost it takes action.
n
Karan Girotra, Assistant
Professor of Technology and Operations Management at INSEAD |
Read more at http://knowledge.insead.edu/innovation/entrepreneurship/busting-innovation-myths-2586?utm_source=INSEAD+Knowledge&utm_campaign=9fe3a4bdc2-26_Dec_mailer12_20_2013&utm_medium=email&utm_term=0_e079141ebb-9fe3a4bdc2-249840429&nopaging=1#v8XlwyF9fgdWDomi.99
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