What is my innovation strategy?

4 04 2007

I attended an excellent strategy session today by John Metcalfe on Innovation (how do I innovate and market in an increasingly commoditizing marketplace) and Management (how do I manage innovation?). This was particularly interesting since I’ve been recently involved in some efforts and initiatives to innovate on our product offerings.

Here are my notes from his talk:

  • Darwin (survival of the fittest) is at work in the industry. Hence, differentiate or get marginalized.
  • Over time, factors that differentiate your product become commoditized, either due to your success or the collective success of your industry.
  • Innovation is key to differentiation and a competitive advantage.
  • “Best in class” is over-hyped

Return on Innovation

  • Innovate to achieve competitive separation and distinction
  • Identify your
    • core – products, processes that enable your factors of differentiation. Re-engineer everything to enhance your core
    • context – everything else
  • Know why you’re innovating – classify each initiative to aim to meet one of the following innovation goals: Differentiation, Neutralization, Productivity, Failed attempts, Waste

Innovation Strategy

  • The strategy to adopt depends on the product maturity life-cycle. New products need product innovation. Mature products may need process innovation (operational excellence and/or customer intimacy). Products close to end-of-life need renewal innovation.
  • Examples of innovation types include – eBay (disruptive), Apple (design), Nike (marketing), SAP (integration), IBM (renewal).
  • This was really eye opening to see that innovation is not limited to product/engineering; it can and should happen in all areas of a company.
  • Over-invest and over-perform on core factors

Funding Innovation

  • Core becomes context over time. Resources and priorities within the organization tend to get focused on context
  • Need to identify and extract resources from context to re-purpose them for core

Perpetuating Innovation

  •  As a manager learn to identify the innovators, deployers and optimizers in your people. Put them in the appropriate tasks.
  • Focus on role expertise (long term benefits) vs. task expertise (short term benefits).
  • Use the innovation matrix to determine priorities and resource allocation


All in all, a lot of food for thought.




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