Recently, I attended the annual ISBM Members Meeting at Penn State University. ISBM is short for the Institute for the Study of Business Markets and is a center of excellence in Penn State University's Smeal College of Business Administration. They are comprised of a global network of researchers, educators and day-to-day practitioners in the field of business-to-business marketing, and led by Executive Director Ralph Olivia. Their mission is to expand the research and teaching of business-to-business marketing and sales in academia and to improve the overall practice of business-to-business marketing and sales in the industry.
This year's meeting was themed, "Reinventing Innovation: Driving Growth Beyond the Product" in Business Markets. Ralph and his team assembled an outstanding agenda that included speakers from Wesco, USG, Lord, and United Technologies to discuss innovation, value creation, driving growth, and best practices. I was particularly intrigued, and energized by, the first keynote speaker Larry Keeley, President & Co-Founder of Doblin, Inc. (a Chicago-based think tank). Larry's discussion focused on INNOVATION FUNDAMENTALS (how innovation drives growth), which talked about the need and the process to driving organic growth. It was an outstanding (and highly entertaining) presentation, followed by many questions from the audience.
Larry's key take-away was that innovation is the key driver of growth. Companies that are able to simultaneously innovate across multiple "innovation types" will develop offerings that are more difficult to copy and that generate higher returns. Those innovation types can be grouped into a logical framework comprised of 4 key areas: Finance, Process, Offering, and Delivery. Within each key area, are the more detailed, structural drivers known as the "Ten Types of Innovation":
- Business Model
- Enabling Process
- Core Process
- Product Performance
- Product System
- Customer Experience
Mr. Keeley provided detailed explanations along with excellent examples, to drive home his theme that these methods should be engrained in your culture to best position your organization to develop the next "Innovation Frontiers." The closing stressed three things organizations "must do":
- Systematically develop sophisticated offerings (using at least 6 of the 10 Types of Innovation)
- Identify "what's coming next"
- Reinvent your enterprise so innovation is "not optional" - engraining these concepts into your cultural DNA
The second "must do" is by far the most challenging and the one many companies struggle with. Essentially, it is the fuel that will propel the vehicle. So how do you do this - and not just once, but consistently and iteratively? It's a tough task but, in my experience, the companies that excel in this area, are the companies that have a methodology and consistent process to gather, synthesize, and act on CUSTOMER INPUT.
You can have an outstanding business model, established processes, world-class product development, great channels, and strong brand but still miss the mark by a mile without customer input (can you say "New Coke"?!). Do you want to consistently create true market alignment with the most impact?
- Leverage the voice of the customer
- Obtain your customer's input EARLY AND OFTEN
Your customers are on the cutting edge of their respective industries, and will gladly lead you to "what's coming next" - provided you ask. You'll also find that, as you deliver on their inputs, you will move up the value curve and become positioned as a trusted advisor.
I enthusiastically agree with Larry as he has described engraining the innovation types into your corporate culture. Additionally, you need to engrain the concept of regular customer dialog and input. So, how do we do this? What are the best ways to obtain customer input and feedback? There are numerous methods but you must start with the foundation that this WILL NOT be a one-time "event". It needs to be an on-going, committed conversation with your customers. Create a regular forum, along with a sense of "community" that includes internal resources and customers, and you will have the "fuel" to take your innovation vehicle and your company, anywhere you want!