So, You Want to Innovate? A 3-Phased Approach
As a CEO, once you determine your company is ready and should begin the process of innovation, the question is …. Now what?
A 3-phased approach to innovation
I recommend you implement a 3-phased approach to your innovation journey. This allows you to get started without disrupting the entire company and keep investments manageable.
Innovation is unpredictable and requires a top-down commitment, persistence, anddedication.
As you transition from Phase 1 to 3, the amount of investment will increase, but these increases in investment will be driven by the quality of ideas and market feedback. For example, you would not move to Phase 2 without first generating team consensus on several quality ideas that are ready to be market tested. And you would not move to Phase 3 until the target market has given you a clear buying signal.
It is important to note that Innovation requires a pipeline of ideas to have the best chance of success. Not all ideas will move out of Phase 1 and fewer will move from Phase 2 to Phase 3.
Phase 1 – Changing leadership behavior and “ideation” phase
The easiest way to begin is by scheduling two lunch meetings a month (two hours each) with your top management. The goal of these meetings is to get the team to start thinking beyond your current offerings and begin to brainstorm new concepts.
Before ending each lunch meeting, each team member will be given homework where they commit to meeting with one or two current or potential customers to interview about their business and the challengesthey are having. The objective of these interviews is to learn as much as they can about the customer’s business and to uncover pain points. It is important to clear any agenda about selling your products to these customers. That is not the purpose of the interviews. This is information-gathering only.
During each lunch meeting, each participant will present a summary of their information interview(s). These meetings will continue indefinitely and will begin to set the foundation for a culture of innovation moving forward. Over time, you will most likely see opportunity trends that will be the foundation for Phase 2.
Phase 2 – Market testing phase
Two, three, orfour of the best ideas will be the foundation for Phase 2 Market Testing. This phase requires a bit more investment (time and expense), but should not be substantial.
During Phase 2, you will ask certain members of the leadership team to carve out a bit more time each week to work on market testing these ideas.
You may want to include representatives from Business Development, Marketing, and Technology.
The objective is to take each idea and create 3-6-week sprints to evaluate the opportunity in more depth. This might include deeper discussions with your potential audience, creating a clickable prototype to walk your audience through the concept, and asking decision-makers if they would pay for this solution when it is ready to test.
Getting a strong indication that future customers are willing to pay for even a simplified solution, helps to qualify the opportunity. The goal of the Market Testing Phase is to understand if the solution is a “nice to have” solution or a “MUST HAVE” solution.
Only MUST HAVE solutions should move to Phase 3.
Phase 3 – Implementation phase
Phase 3 requires a bump-up in investment and will require someone dedicated to getting this product to market. This process will require determining the features to build in the Minimal Viable Product (MVP); project managing the build; creating some initial marketing materials; securing the paying of beta customers; managing feedback from the customers; improving the MVP, andgetting the solution customer-ready.
It is important that you set some clear objectives in Phase 3 so the team can make a “go/ no-go” decision on projects as soon as possible. Again, not every solution is going to make it, so it is important to decide which innovation projects you want to continue to finance.
The idea is that you start the innovation process slowly and build in the three phases over time. The goal is to eventually have a pipeline of concepts moving through each phase at all times.
Paul Benevich has been helping to re-imagine companies through innovation for the past 20 years. Paul can be contacted through his consulting company www.nonfictionbusiness.comor by emailing him at firstname.lastname@example.org