While family firms develop fewer innovations and inventions than non-family firms, those innovations tend to be more relevant to the market. In addition, a tightly knit, well-connected board will encourage more innovation.
Dedicated collaborative spaces for cross-functional and open innovation (mixing internal and external participants) teams can encourage and enhance collaboration, but can also generate their own constraints. Co-location alone is not a silver bullet strategy for seamless collaboration among diverse teams.
Management controls can be used to overcome the challenge of aligning conflicting corporate strategies with functional tasks, such as new product development.
Companies must be ambidextrous: they must focus on winning the present while at the same time laying the foundation to win the future. The challenge is that emphasizing one priority can undermine the second. A recent study offers some guidelines for overcoming the challenge of ambidexterity by examining key factors – sometimes complementary, sometime conflicting – that enable companies to focus on the present and the future.
Using a case study of Hyundai in India in support, two professors show how multi-national corporations from developed countries can access a growing middle class in major emerging companies. The two key success factors: engaging in frugal innovation, based on frugal engineering, bricolage and modularity, and developing collaborative ecosystems.
A team of researchers offers a framework to help organizations support creativity more effectively. Elements of this framework including balancing the usefulness and originality of creative ideas depending on the organization’s needs and choosing the best approach to creative ideas: 1) focusing on the sheer quantity of new ideas, 2) exploring the potential of a category, or 3) looking for creative ideas across categories.
The use of innovation intermediaries to find outside solutions and ideas or innovation partners is becoming more common. Choosing the right intermediary can depend on factors such as the type and complexity of problems or needs, whether the search for partners or solutions, and the extent of the envisioned collaboration among innovators.
For a novel idea to be accepted and implemented, decision-makers must buy into its future success. Unfortunately, the managers who decide the fate of new ideas are the worst predictors of market success.
Not all dimensions of social capital have a clear positive influence on organizational exploration activities. A new study shows that the acquisition of new knowledge, ideas and insight can be both helped and hindered when members of a team have close, trusting relationships.
Many companies separate short-term activities focused on the present (e.g. customer service, marketing) from long-term activities focused on the future (e.g. new product development). A new study, however, reveals the power of ‘ambidextrous’ teams, where cohesion overcomes the challenge of pursuing both present and future objectives.
New scientists can bring new knowledge and expertise to a research team and improve the output and results of the team. However, companies need to beware of long-tenured incumbents who won’t take kindly to the arrival of these upstarts. Nor will they be welcomed into a non-collaborative environment.
Many companies recognize the importance of innovation yet continue to be ineffective innovators. The reason: their leaders lack the right skills to encourage, manage and implement innovation. Recognizing that innovation requires a structured process, multiple perspectives, silo-busting boundary-free and polarity thinking are important first steps.
New research shows that innovation efforts benefit from giving employees free time (aka ‘slack time’), but not for the reason you might believe. While Google’s free time initiative might have led to creative new ideas, the real benefit of slack time is to allow innovators to get the administrative and other execution-oriented tasks done.
Who is most likely to find the innovative breakthrough: an expert with a deep knowledge of the domain or a cross-functional team with broader knowledge and a variety of experience? New research shows that the cross-functional and diverse knowledge approach to innovation can be a double-edged sword: shattering the myopia of experts but not providing the expertise needed to generate novel ideas in the field.
Customers tend to remember the end of an experience (for example, the last days of a vacation) and also tend to become used to a level of experience (for example, the view from their hotel room). Keeping these two psychological tendencies in mind, companies can structure a customer service encounter that leaves satisfied customers with memories of a great experience — and have them coming back for more.
Innovative companies can find success in export markets, but is there a correlation in the other direction: Can exporting lead to greater innovation? A researcher in Australia, dissecting data from thousands of Australian SMEs, discovered some correlation between exporting and innovation, but concluded that it is wiser to focus on innovation first, before attempting to conquer export markets.
From self-customized motorcycles to modified software, end-users have the capabilities to develop and diffuse into their market their innovations. Producers have to choose whether to ignore these innovators or adapt their R&D processes to include them as partners.
Who will invent the new Nylon? Unlike the DuPonts of the past, large corporations are focusing more on applied research, which can lead more quickly to products, than basic, longer-term scientific research that benefits society as a whole.
Understanding future customer needs is a key success factor for competitive advantage. However, an equally important success factor, and one that is often overlooked, is the ability of companies to influence customers on their future needs. Companies that can both understand and shape future customer needs have the greatest chances of future success.
Social media channels have enabled organizations such as Dell, Starbucks, and NASA to successfully reach out to external contributors to collect suggestions, which have in turn stimulated innovation. This research, however, shows that most initiatives to source external contributions fail and that organizations seeking external ideas need to proceed with care and establish proactive processes to avoid potential pitfalls.
Conventional wisdom has it that technology based entrepreneurs are better off commercializing their product by contracting with an incumbent (i.e. licensing). But this trade-off may not always be optimal, because if the innovator can learn from its own commercialization experience, albeit losing some profit initially, it could avoid making the same trade-off with future innovations, thus securing long-term profitability. Alternatively, joint commercialization may be the best approach.
Emerging markets such as India or China represent lucrative new markets but also present a set of challenges, including lower income customers, poor infrastructure and poor service availability. There are three fundamentally different types of product and service innovation that can serve these markets: cost, frugal and good-enough innovation. Understanding the differences can help companies choose the right emerging market product innovation strategy for them.
Financial incentives for managers of innovative projects, a firm’s tolerance for failure, and the number of managers involved in the projects all influence resource allocation (and chances for success) for those projects.
Traditionally, new product development teams generate ideas for innovations by ‘continuous’ group interaction. This method has its drawbacks, however. Many good ideas get lost in the ‘noise’ of the debate. Taking a short break from discussion to allow people to reflect and gather their thoughts could make a real difference to the number and diversity of ideas — and, importantly, the quality of the final concept.
Product designers and marketers might be very excited about a new product with impressive new features and a bold new design. But consumers will not recognize the newness of the product if they cannot figure out what the product is in the first place — which can lead to a major disconnect between the reaction that companies expect from consumers (“Wow, what a great innovation!) and the actual reaction (“What is it?”).
Is your organization thinking of using online crowdsourcing applications to collect ideas for new products and services? If yes, it is not the only one; a number of large companies have been turning to crowdsourcing in recent years, including the technology corporation Dell. Read on to find out what an analysis of their application can tell you about how to use crowdsourcing in your own organization.
‘Making a market’, or creating a need for something no-one has experienced before, is difficult enough for the most well-known sellers, but for entrepreneurs it is doubly so. To overcome the hurdle of succeeding with a new product, they need to work not only on the innovation itself but also on educating potential customers. This research sets out an approach to market-making for entrepreneurs in certain complex markets.
Product choice is linked to the amount of prior attention or conversely, inattention, that we give to something before encountering it again at a later date, when we either choose or reject it. Leaders should ask themselves what their organization can do to guard against the risks of its brand or products being overlooked.
Food marketing has a profound — and complex — influence on consumers and is often blamed for the (increasingly global) obesity epidemic. Food companies are not in business to make people fat, however. They’re in business to make money. Research into the effects of the ‘4 Ps’ of marketing — ‘price’, ‘promotion’, ‘product’ and ‘place’ — on food consumption suggests there are profitable changes they could make to help people eat more healthily.
A company’s ability to develop new products is not solely a function of its resources. Managerial cognition and organizational context play a big part. Negative perceptions of changes in the operating environment and defensive strategies are likely to lead to less innovative products and stifle creativity and entrepreneurship. We need to take an integrated, multi-dimensional approach to understanding innovation and new-product development decisions.
