Future-proof Your Business: how to build an innovation strategy

What is Business Innovation?

Simply put, innovation is the creation of a product or service that is novel and useful for the user. A common misconception is that innovation requires a major technological or market breakthrough, but this doesn’t have to be the case. Simple upgrades to existing products that make your users’ lives easier can be just as effective, if not more powerful.

An example of a simple innovation is O-Cedar’s EasyWringTM Spin Mop & Bucket system, released in 2015. Realising that users did not like touching dirty mop heads, O-Cedar came up with a bucket that had a spin mechanism attached to a foot-pedal. Now all users had to do was to place their mop in the spin mechanism and press down on the pedal to wring the mop out, removing a major pain point.

O-Cedar was not the first to come up with the idea of a self-wringing mop (Joy Mangano’s Miracle Mop was the first in the early 1990s). But it innovated on the mechanism of self-wringing — where the Miracle Mop required twisting the handle of the mop, the EasyWring™ made the wringing process easier by only requiring the step of a foot.

Two Types of Business Innovation

Depending on your business model, there are two types of innovation to consider – sustaining innovation and disruptive innovation.

• Sustaining innovation: A strategy of making existing products better for users. Companies with an established presence that want to stay ahead of the pack typically adopt this strategy.
• Disruptive innovation: A strategy used by smaller companies with fewer resources to challenge larger businesses. This strategy can be further broken down into two tactics. New-market disruption refers to businesses creating a new market segment to address user needs that are not currently being met, while low-end disruption refers to companies offering “good enough” products that are cheaper with acceptable performance.

How To Implement Business Innovation?

After deciding on your high-level innovation strategy, it’s time to flesh out the details. And regardless of strategy, one thing that remains constantly crucial is the need to identify and address users’ needs.

Design thinking provides a useful framework for approaching innovation with its focus on an “problems-first, solutions-later” approach. Harvard Business School’s design thinking innovation framework consists of four phases: clarify, ideate, develop, and implement.

1. Clarify

What?

This first step involves clarifying the problem you are solving for and why it’s important to solve in the first place.

How?

Firstly, find evidence for the problem that you are solving through a combination of primary and secondary research. Some possible sources include referring to chat logs, speaking with customer service representatives, or interviewing existing customers on their experiences with the product.

Prior to conducting interviews, stakeholders should write down assumptions about users’ experiences and pain points so that these can be tested during the interviews as well. This can be done using collaborative tools such as Miro and Figjam.

The research process will likely yield many problems. Use a prioritization method such as the impact-effort matrix to zero in on a problem to solve at this stage of the innovation roadmap.

After the problem has been identified, create a problem statement to provide a concrete reference point for the product team to refer to as they develop the product.

2. Ideate

What?

Here, the team will create ideas to solve the identified problem.

How?

Use the problem statement to create ideation exercises for brainstorming sessions. One popular framework is the “how-might-we” approach.

For instance, for a problem statement that reads “The process of renting a house can take a long time and requires offline activities. This means people who cannot travel readily have difficulty viewing rental homes before they arrive in the location. There’s an opportunity to make renting easier, and therefore close more sales.”

Transforming this into a how-might-we, we can ideate around the following:

• How might we help users get information about rental homes quickly so they can make informed decisions?
• How might we support users through the home rental process so they can feel reassured about their decision even if they can’t see the house?

Use a prioritization method after this exercise to identify solutions for initial testing.

3. Develop

What?

This is where proofs of concepts are developed and tested to assess feasibility and effectiveness.

How?

Depending on your solution, some testing options are concept testing and A/B testing. The decision on whether to move forward with certain solutions should be informed by goals and success metrics set prior to the test. For instance, if the success metric for a concept test was to have at least half of users express interest in a concept, the decision on whether to move forward with a concept or not should be informed by this.

4. Implement

What?

At this stage, and depending on your role on the product team, you would either communicate your solution and findings to stakeholders to encourage production or shift into actual production. If responses to proofs of concepts are lukewarm, this is where the team should also decide on next steps, such as going back to the drawing board to refine the concept or benching the concept entirely.

How?

Align with stakeholders and the product team on whether to implement any product features/products. If the consensus is for implementation, meetings should also involve discussions around the product roadmap and resources needed for the product’s rollout. Document discussions in a shared document to keep track of evolving concerns.

Slow and Steady Wins The Race

A company with sustained success innovates. While there will always be elements that remain constant, such as a brand’s promise, a company that stays stagnant with its products and falls out of touch with the wider business environment will eventually sink. A design thinking framework provides an iterative process to innovation, raising the chances of success and lowering the risks of failure. All it takes is that first step.

If you want to know more about how to incorporate user experience in your innovation strategy, do check out our other resources available on our websites, such as our articles, weekly webinars, and podcasts.