What Is the Right Innovation Process?

To kick-start innovation, understand the frustrations that customers experience in their dealings with you – and competitors.

I need an innovation process like I need a… I was at an event the other day when two things really spoiled my day. The first twinge came in the plenary session. Our host announced that we were about to be shown some videos of front-line staff describing their work frustrations and, in particular, the obstacles that prevented them from doing a better job. Now that sounded like a great initiative, so my curiosity was aroused. The camera focused on a broad group of internal stakeholders, and, very soon, a number of consistent themes and issues began to emerge. My attention was now well and truly grabbed. I waited with interest – and high expectations – for the host to explain how these concerns will be addressed and resolved. And I waited… and I waited… and slowly it dawned on me that I was going to be seriously short-changed. “These videos illustrate how important it is to listen to your front-line staff,” he explained – completely ignoring the fundamental truth that front-line feedback is only valuable when it is turned into actionable, positive outcomes. We had witnessed loyal staff displaying real courage and passion in their filmed interviews – but the all-important reactions and resolutions, together with the two-way communication from an appreciative management, were never even mentioned. Then something else happened that stunned me – and many of my fellow delegates. See also: How to Create a Culture of Innovation   I attended a breakout session on the topic of innovation. One of the key speakers was an independent consultant who specializes in helping major enterprises establish a culture of innovation. I was happily nodding along to his presentation when he dropped this bombshell: “First and foremost, you must have a common approach to innovation. Control is critical. You can’t permit people to innovate in completely different directions.” There was a metaphorical thud as several jaws hit the carpeted floor. By definition, innovation is free-thinking and radical. It shatters the mold by breaking conventions and rules. Thought control is anathema to innovation… or is it? That got me thinking… I have spent most of my life working on highly innovative projects. And I have to concede that most of these projects needed a process. However, this process is certainly not designed to inhibit freedom of thought. It is simply there to focus minds on real-world issues and solutions. Innovation projects have to be anchored in genuine need. If you lose sight of this reality, you will end up with a bunch of brilliant, tangential ideas that have absolutely zero commercial merit… and that is the quickest way to lose management support and funding for innovation. So how do you create a process that focuses innovation without inhibiting it? Well, I hope my diagram will help to concentrate minds… Every innovation effort should start with – and be driven by – the Voice of the (Internal and External) Customers. These key stakeholders can tell you what you need to fix. With a little encouragement, they will also give you rapid feedback on ideas – objective guidance that can you stop you wandering up costly and unproductive blind alleys. And one of the most instant and engaging ways to capture these stakeholder insights is via mobile video. One of our Clustre innovation firms has perfected software for capturing these sentiments. It is a remarkable tool that offers deep analytics and sentiment assessment to surface really valuable insights. Used on a regular basis, it is a unique asset to any innovation project. To kick-start the innovation process, you need to understand the frustrations that customers experience in their dealings with you – and, just as importantly, with your competitors. The same goes for internal customers and stakeholders. Their opinions will reveal the honest (often sobering) truth about the health of your culture and organization. Uber’s success was born out such research. Consumer frustrations with finding reliable private transport and the inconvenience of having to pay in cash for minicabs shaped the whole Uber service concept. It has transformed the global minicab industry by understanding consumer frustrations, addressing real areas of need and resolving them with a bespoke, infinitely scalable service. The message is clear: focus on addressing real Needs and Frustrations and you will deliver relevant, highly commercial solutions. The trick is to: First: Capture and focus on the things that frustrate the majority of people. Second: Concentrate on issues that have the biggest impact on your business and on satisfaction levels. Third: Avoid being side-tracked by the vocal minority who shout and complain the loudest. One of the firms we represent has recently invented a tool that automatically seeks out those core areas of frustration. It reveals to companies not only where consumers are frustrated but also the nature, size and extent of that frustration. This tool has now been used on multiple occasions to help consumer companies conceive entirely new products. Indeed, some of these products have rapidly morphed into the most profitable lines for these companies… the ultimate bottom-line justification for innovation. See also: Innovator’s Edge enhanced to make direct insurance innovation connections If the starting point for innovation is to understand needs and frustrations, then the next step in the process is to Conceive Solutions. Some people think of this as a scientific process – a technology-fueled trip into the outer realms of possibility. I disagree. Essentially, innovation comes from inspired team-building – blending talents and personalities to create the right human chemistry. Here are a few guidelines: Balance. From my experience, you need to strike a balance between radical, out-of-the-box thinkers and down-to-earth, practical engineers. Tether blue-sky thinking to grounded reality. Objectivity. Again, experience has proved the value of involving the people who will ultimately be the customers for your solutions. Cross-pollination. Look outside your specific company and industry for inspired solutions in parallel universes. But, of course, the true merit of any pie is in the eating. Most people struggle with concepts – they can only judge an idea when they see the reality of a product. That’s why I always urge clients to move swiftly from conception to creation:
  • Prototyping. This is probably not the forum for diving deep into the prototype process. However, I would like to share the fascinating experience and advice of a close client – the global head of innovation for a global loyalty card operator…
  • 30-day limit. His hard and fast rule is to set aside a maximum of 30 days to build a prototype – and not a day longer. It’s a rigid discipline that contains costs and delivers rapid results.
  • Outsource. He also tends to outsource the development of the prototype (frequently to firms recommended by Clustre). This allows him to reduce his own headcount, capitalize on the best external services and run several projects at the same time.
  • £10k budget. He also sets a hard and fast budget of £10,000 for each prototype. Now, to many people, this will seem a laughable – perhaps even derisory – budget. However, my client always has the last laugh because he has unfailingly delivered a fully functioning (albeit with a limited scope) prototype for this price.
Once you have developed a prototype, it should be shown to the customer representatives and major stakeholders for their verdict. This is the acid test. The Drop or Build decision will be taken there and then. And we can assume that a fair proportion will be buried at this point. However, don’t despair – this is an essential part of the "fail fast, learn quickly" culture that breeds innovation success. If a decision is taken to develop the prototype further, then this should be done in a very measured but agile way. Using a multi-functional team, the goal must be to create a MVP quickly and cheaply for business viability assessment. Tools similar to the one used to surface frustrations can then be used to gauge the level of excitement generated by a new product. This can be invaluable – accurately measuring consumer appeal before any serious commitment is made to invest further in the minimally viable product (MVP). What’s more, there are some really innovative marketing techniques that can measure, with forensic accuracy, this consumer interest. See also: 4 Hot Spots for Innovation in Insurance   So that’s it – my process for innovation. Offer people unlimited freedom to question precepts, push boundaries and break rules. However, within that free-thinking environment, there has to be a healthy mix of blue-sky thinkers and grounded engineers… sensible and very essential budgetary controls… an immutable date for prototype delivery… and, most importantly, a very sharp focus on real-world customer frustrations. Those are the essential tenets for innovation success.

Robert Baldock

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Robert Baldock

Robert Baldock has been conceiving and delivering innovative solutions to major institutions for all of his 40 working years. He is a serial entrepreneur in the IT field. Today, he is the managing director of Clustre, an innovation broker.


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