The 10 Types of Innovation
Because It Is Not Always About the R&D Team
“… much of the time, innovation actually means updating something that's already out there.”
from Denver South Economic Development Partnership
How do you tell your R&D team that while you value their work, their innovation on Product Performance matters the least to customers?
That was the topic of conversation two years ago during a walk around a Lake in Minneapolis, MN. The executive I was with has had this very conversation and was able to demonstrate how, for his business, a tech company, Customer Engagement was the most impactful type of innovation.
Personally, I was part of a team that, following a series of acquisitions, was looking for the innovation potential in the newly formed business. And we found it predominantly in Process and Structure.
The Ten Types of Innovation explores these insights to diagnose patterns of innovation within industries, to identify innovation opportunities, and to evaluate how firms are performing against competitors. The framework has proven to be one of the most enduring and useful ways to start thinking about transformation.
Since the late '90s, the Doblin group has been working with the Ten Types framework, led by Larry Keeley. The ten types are split into three areas. At the center is the Offering, which contains the core product elements and how the product is organized and integrated. To the left is Configuration, how the company is organized to make a profit. And to the right is the Experience, how the company interacts with the customer.
Here are the ten elements in detail:
Configuration
Profit Model
How the organization turns its value into profit, how to make money: expensive high-end products, cheap mass markets, subscriptions, lease-vs-buy, …
Network
The value that is created by working with others. We are more connected today than ever, and it becomes essential for companies to work with others to gain processes, technology, or brand credibility.
Structure
How you organize the talent and assets within your company. When done well, these are very hard for competitors to copy.
Process
How a company goes about producing its products and services - its core operations. Signature or superior methods for doing your work.
Offering
Product Performance
The distinguishing quality, feature set, capability, or functionality of a company's products. This is often considered the only source of innovation and revolves around the R&D department.
Product System
How you create additional value by adding other firms’ products and services to yours, or how you combine multiple products to create significantly more value.
Experience
Service
Support and enhancements that surround your offerings. How you make your product easier to use, more enjoyable, or get better value from.
Channel
How you connect with your customer. It differs from Network, in that it’s not about whom you work with to make those connections, but more about the ways in which you connect.
Brand
Your brand can be a powerful innovation in itself; it can represent the values you stand for or a simple but big idea that resonates with customers.
Customer Engagement
How you understand and then leverage the desires and needs of your customers. They can be hard to spot, often sitting among one of the other nine types.
A discussion as to which type or area of innovation is most important is pointless!
The answer is always, "it depends." And research shows that the most successful companies innovate in more than one area at any given time, and likely touch all ten areas over time.
Phil Krone raises this question: “Can your salespeople contribute to developing wallet-opening great products? The short answer is ‘Yes, they can.’ The more important question is ‘How?’ Selling is outward-looking. It's getting products and services out of a company and into a marketplace to increase the top line. New product development is ultimately inward-looking, actually happening inside a company with greater or lesser support from marketing.
Successful companies know that product and service innovation are forever linked to a strong sales process, especially to the effectiveness of consultative selling skills-the discovery skills-of their sales representatives. In addition, an effective, discovery-based sales process can propel innovation throughout an organization because, ultimately, its result is to persuade. Innovators must persuade from the time they get an idea to the time that idea goes to market. These skills can be learned but without training are difficult to put to work in the field.”
Interim and fractional sales leaders come with the experience of a few innovation cycles. Talk to us to find out how they can help you.
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Neha Khandelwal – Understanding Doblin’s 10 types of innovation with examples
Tim Woods – The Ten Types of Innovation Framework – and How to Use It
Phil Krone – Salespeople as Innovators?
Larry Keeley – Ten Types of Innovation
Ten Types of Innovation
Photo by Anne Gosewehr