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Archive for October, 2013

The Innovation Journey for technology businesses – Phase 2 report

Monday, October 14th, 2013

 

Report on innovation programme 2009-2013

Today we are publishing the Phase 2 report of ‘The innovation journey for technology-rich product businesses’. This provides an updated report on our study of innovation practices and performance in technology-based product businesses. The study covers a total of 43 UK and Danish companies and was supported by our academic partners, The University of Exeter  in the UK and The University of Aalborg in Denmark. This study programme commenced in 2009, with a Phase 1 report in February 2011. We then extended the study with additional focus on ‘Disruptive Innovation’ adding 18 more UK and Danish companies. Our study took an ‘end-to-end’ view of product innovation as shown in Figure 1.Blog picture - 3 balls

Figure 1: Innovation Journey model

Practice – Performance correlation

Our study found significant correlation between the practices in place across the innovation journey processes and the resulting innovation performance (see Figure 2). Some stages of the innovation journey had more impact on innovation performance than others. In particular, innovation performance leaders were typically more user-focused across the innovation journey than other companies. Specifically the leaders (i.e those companies with the stronger innovation performance) were significantly ahead in the practices applied in the ‘Idea Exploration’ and the ‘Go/No Go to Market’ stages and ahead in ‘Development’ itself.  The differences between the innovation practices of leaders and others can be seen in Figure 3. We also examined how companies seek to manage the potential for ‘Disruptive Innovation’ in their market – we found that in general few companies have robust approaches in place.

Figure 2:  Practice v Performance for innovation

 

Blog picture - Scatter

Learning points

We have identified key learning points from this study and made recommendations for businesses who are seeking to improve their effectiveness in their own ‘innovation journeys’.  Our report is intended for a broad audience of business practitioners as well as academic researchers and we have especially sought to provide clarity and application for business readers. All participating companies were sent a copy of the report together with their unique code to enable them to review their performance on an anonymous basis.

Blog picture - snake

Figure 3: Differences between innovation leaders and others

 

Improvement recommendations

We made a number of recommendation based on the study findings:

  • Increase user focus throughout the innovation journey with the ‘voice of the user’ represented throughout the end-to-end innovation process.
  • Keep flexible to enable late changes from users – a key practice of innovation leaders.
  • Focus on users not customers.  When it comes to product innovation, it is the users who are key.
  • Examine your New Product Introduction/Development) process – to ensure it is covering the front end Idea Generation, Exploration and Selection steps and the back end steps. All too often these areas are not covered.
  • Give sufficient emphasis to the management of Intellectual Property in your innovation processes. IP can offer key strategic benefits if managed effectively.
  • Review your overall innovation system. Whilst the innovation processes as reviewed in this study are a key enabler to innovation success, there are other key factors such as Leadership, Culture and Strategy within the business that are major determining factors in innovation success. Businesses that wish to become successful at innovators need to improve their overall innovation practices.
  • Consider the opportunities and threats of Disruptive Innovation. With the rapid development of technology and the ability for new start-ups to quickly enter a market and receive venture capital funding to support rapid growth, established businesses need to actively look out for the opportunity/threat of disruption.

Overall we believe that companies would benefit in taking a broader ‘end-to-end’ view across their innovation journey to enable improved innovation performance.

If you would like further information about this study or would be interested comparing your company’s innovation practices against this model, then please contact Alastair Ross.

Energizing Change

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