Innovation strategies
M. S. S. VARADAN
THE GAME-CHANGER — How Every Leader Can Drive Everyday Innovation: A. G. Lafley, Ram Charan; Penguin Books India Pvt. Ltd., 11,Community Centre, Panchsheel Enclave, New Delhi-110017. Rs. 399.
The authors have give a framework for innovation as an integrated management process in this book, drawing from the experiences of Proctor & Gamble (P&G) and a few others in the field of innovation, and given it a conceptual framework. “Customer-centric” innovation is the key. The story of Carlos & Marta in Mexico city, which illustrates the “consumer closeness theme” through P&G employees living with lower income families for several days to get an insight into their needs and coming out with an innovative and successful fabric softener, is an interesting one.
Eight factors have been identified in fostering innovation. They are unique core strengths; enabling structures; consistent and reliable systems; courageous and connected culture; inspiring leadership; motivating purpose and values; stretching goals and choiceful strategies.
Integrated management
The success story of P&G in focusing on the four core categories and 10 leading brands have been well illustrated. A distinction has been made between disruptive and incremental innovation. Disruptive innovation changes the game by creating entirely new consumption, making obsolete the current markets. Incremental innovation is one which adds value to the customer through new benefits, new sizes and so on. Innovative design is important. The right structures have to be created for organising for innovation. P&G’s “Future works” is an organisation consisting of a multi-disciplinary team led by a general manager. Also the theme of “connect and develop” has been emphasised, P&G scientists travelled extensively to find an anti-wrinkle technology. They found this is in Sederma, a small French company. P&G bought this, a key ingredient for Olay and launched it in Olay regenerist, an anti-aging cream, which fetched over $ 250 million in annual sales!
The company contracts with an Indian partner to supply lower cost computer-aided design and engineering. It is even working with the government labs in India to identify high efficacy botanical actives and technologies for use in beauty, baby, and oral care products, since this is an expertise it does not have!
Risks
There are risks in innovation. Mention has been made of a museum in Ithaca, New York, named “The museum of failed products” which is home to more than 65,000 different brands and products that have failed in the market place. Its 11 biggest innovation failures have been also been candidly tabled. The lesson is to have proper metrics to measure innovation. Experiences of a few other leading companies like Samsung have been cited which created a value innovation programme (VIP). The value of leadership in providing the missing links in innovation has been highlighted. The leader’s job is to develop an innovation culture like that of DuPont whose leaders were the role model of five behaviours — collaborative, connected, curious, open and courageous.
The book, filled with cases, makes interesting reading.
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