Innovation is essential for sustainable revenue and profit growth and, most importantly for every enterprise and brand, to remain relevant to today's consumers and customers. More and more, however, it seems that innovation is easier said than done, particularly for larger consumer goods companies. In fact, the biggest innovation threat to some of the leading companies and brands comes not from their traditional large company peers and rivals. Rather, it comes from nimble, creative individuals and smaller companies who embrace experimentation, look outside their four walls for ideas and resources they are lacking, and engage them when and where they are needed. These companies are reinventing innovation from the outside in, and reaping great rewards.
I’ve been a student of innovation for most of my professional life. During my 28-year career with P&G, I was encouraged and allowed to be entrepreneurial, collaborative, and risk taking, even while learning and following the structured discipline of the P&G innovation process. I was also fortunate to have access to in-house experts who embraced a spirit of experimentation. This enabled me to create, develop and qualify true blockbusters for flagship brands, which in turn created new business opportunities and built categories, including Crest White Strips, Crest Pro Health, Olay Regenerist, prestige beauty brands (SKII, Gucci, Dolce & Gabbana fine fragrances), Prilosec, and Aleve.
Since retiring from P&G in 2012, I've guided several F100, private equity, and new venture companies on their innovation journeys. And I’ve learned as much from them as I have shared. I now look at innovation through a different lens. A new model for success is emerging that brings together the best of two worlds … companies with top notch experts in-house, core competencies and resources at their fingertips, and structured, disciplined processes in place, who can learn from smaller, nimble companies and individuals that innovate quickly and creatively. Regardless of their size or where they are in their business lifecycle, what these companies all have in common is a willingness to experiment with different approaches to accelerate innovation. A new normal for successful innovation is emerging.
This week, I'll talk about how companies of all sizes are reinventing their innovation approach. In my next blog, I'll discuss the five keys to taking this new normal from theory to practice.
Both/And, not Either/Or
It starts at the top, with a leadership culture that is willing to venture outside their comfort zone and embrace an experimental approach, even when they have internal structures, processes, and resources in place. Both the Chief Innovation Officer and the President/CEO recognize the potential of tapping into new talent, co-mingling internal/external resources, and combining the best of big company expertise/discipline with small company agility. The messages they deliver to the organization and the reward systems they deploy support this approach. When something works, it is celebrated and the team is rewarded; when it doesn’t, the experience is used as a learning opportunity. Often, senior leadership will leverage a highly experienced innovation practitioner and leader who is F50 trained and has small company experience to serve as an advisor and coach, with their full support and blessing.
To keep thinking fresh, innovative companies embrace the idea of infusing the organization with outside thinking and converting that into action. They combine and guide the best of internal and external worlds, bringing in specific expertise on a temporary basis for ideation sessions, to overcome roadblocks, or fill knowledge gaps. This approach is enabled by an increasingly large pool of highly experienced, qualified, and creative talent that enjoys the flexibility of interim or project-based assignments. “Early retirement”, “downsizing”, and other large-company employment practices have resulted in a large talent pool of very experienced, creative people who are ready, willing, and more than able to help others innovate, or to innovate themselves.
Trailblazers in this emerging innovation model are passionate about the foundational role and power of consumer and customer insights, trends, and intuitive, tacit knowledge holders to identify new opportunities. They also heavily leverage crowd-sourcing models and tools to “co-create” with early adopters, tapping into their delight factor. I am familiar with several new ventures in personalized skin care, oral health, pet care, and savory snacks that have used social media to refine their idea, design, and advertising, making it even more relevant to their millennial target audience.
It Starts with The Innovation Brief
This is the front end of innovation, and it is critical to get this right. The best innovation briefs are crafted collaboratively by the Business and Technology Executives, are driven by a clear business vision, and grounded in deep consumer insights. This business vision is translated into innovation strategies/choices for the brand or business (sustain, transform, or disrupt), and form the “lighthouse” for a very robust brand innovation program for the short, mid, and long term.
The innovation brief for creative ideation outlines the specific space of the team’s focus; it reflects the part of the innovation strategy that the company wants to blow out. While it may seem counter-intuitive, the tighter the innovation brief, the greater the potential for an explosion of ideas and creativity, if it is 1) grounded in consumer insights and 2) the expert team is carefully selected for not only subject matter expertise but also their ability to creatively connect and build on each other’s ideas. Our experience across multiple brands and categories suggests that the outcome of these small, nimble ideation teams often leads to a mix of sustaining and transformational/disruptive ideas.
We observe that the best innovation work happens when the business vision, innovation strategy, and innovation brief are in place. I often find I need to help leadership teams develop theirs before beginning the actual exercise of creating this lighthouse for a brand or category.
It’s Driven by Select, Small Teams
Not only does the innovation brief define the task at hand, it defines who should be selected for that specific innovation team. Working with the business leader and senior innovation leader, I hand-pick specific participants, both internal and external to the company, against each innovation brief. Internal experts bring product/category-specific expertise, institutional knowledge, and data access. External experts bring fresh perspectives, a broader set of experiences to draw from, a gut feel about what’s possible/doable, and push boundaries. I look for those who are both top-notch experts in their disciplines and highly creative. Those who bring a diversity of experience across different categories and businesses and possess the rare ability to connect ideas and processes from one industry/category to another. Those with a well-connected personal external network and capabilities that can be tapped into as needed. Those who can build effortlessly on others’ ideas and collaborate seamlessly. Those who appreciate and identify consumer insights and then bring applications to meet that need. Those who dig deeper and are open-minded.
Keeping the core team small, and bolting on and off members for limited periods as needed to address specific needs keeps the process flexible, frugal, and fast.
In larger companies, these “tiger teams” often co-exist beside the existing innovation organization. In smaller or start-up companies, they may be the innovation “organization”. As noted above, it is not “either/or” … it is “both/and”.
Try this new model of innovation in your own organization. Be willing to experiment … remember, it’s not either/or. You’ll be amazed at the high-impact results you’ll deliver and the new energy your innovation efforts will inspire.
About Shekhar Mitra, Ph.D.: Dr. Mitra is a Consulting Partner for YourEncore and top expert on the creation of innovation strategies, ideas, open innovation connections, and organizational culture. Having retired from Procter & Gamble as an SVP of Global Innovation, Dr. Mitra specializes in helping companies develop their innovation capabilities and portfolios through proven methodologies. He also serves on several Boards and Advisory Committees for companies and private equity firms.