Innovation: Process or Outcome?
The easy answer, of course, is that it is both. The term however, is currently being bandied about as a catch-all, and I don’t think that is particularly helpful for anyone.
In business, or in product development, or in service development … if you don’t achieve the outcome you have targeted, you don’t have an innovative process. The converse can also be true. Where you have achieved the outcome you targeted, it doesn’t necessarily mean you have been innovative to get there.
I have just completed my first visit to CES. I had heard the stories, and thought I was well prepared. I was wrong. The enormity of the show is overwhelming; the distances between venues, the number of conference sessions and exhibitors, the crowds. Not just inside the venues. The queues for the monorail and shuttles took me back to the Sydney Olympics. You simply cannot see it all.
Once inside, you are the proverbial kid in a candy store. The number of shiny new gadgets, the high tech manufacturing, literally hundreds of 4k TV screens some as large as 95” for the home. Then the odd 8k screen.
Gaming is a legitimate part of the technology industry, so I had an obligation to test the VR and AR headsets!
The big brands put on dazzling displays, such as Parrot delivering synchronised dancing to music by flying and land-based drones simultaneously, Samsung with its virtual reality rollercoaster, and Intel with sensors on a whole range of things.
It was inspiring to talk to inventors, to see their prototypes in action, understand how they’ll generate feedback, fine tune and be sure it is ready for market, what their go to market strategies are, their price points, and how many units will be required to deliver a sustainable product range.
The Internet of Things was dominant. Anything that can be connected was. Then the question became why? And here is the rub.
Technology by its very nature allows people to demonstrate their creativity. And if you are following a passion, it is enjoyable and self-satisfying … much like any artist.
Creativity and innovation however are not the same thing. Innovation has a market context to it. Innovation is about creating value, and to successfully create value, you first need to understand who your customer is and what the challenge is that you are solving for them. The dynamics of the market then come into play of whether the market is of sufficient size, and whether you can capture a sufficient share to deliver the product or service at a price point that is profitable and sustainable. And profitable in this context is not simply a number, but also the opportunity cost if you had put your energy and resources into another area, would this investment hold the greater return?
Let’s take a case in point. While I really enjoyed seeing household robotics in action, their applications had me dumbfounded. They were all single purpose. In addition to the already crowded markets of pet robots for companionship and entertainment and robots doing the vacuum cleaning, there were robots cleaning the bbq and robots cleaning windows. How many robots would you want in your home, and where would you put them? Running them still requires human intervention. Where is value created?
Value creation is not one size fits all. In some markets, customers holding common challenges are in sufficient volume to achieve a profitable and sustainable product.
As a sports nut, I watched with interest what companies were showcasing to improve your game. Whether it was basketball, baseball or golf, what they were doing with sensors was really eye catching. Regretfully I no longer fit into those target markets, it probably wouldn’t be wise for my health to have a dashboard encouraging me to increase my swing speed and power. I have no doubt there are large markets for these products, I just don’t happen to be in them.
GoPro CEO Nick Woodman participated in the YouTube keynote at CES this year. GoPro would be considered synonymous with innovative products, yet Woodman commented: “people don’t buy things, they buy solutions”.
Innovation to me equates to value creation; it is an outcome not a process. To say it’s both runs the risk of leaning more towards the process side.
