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Breakthrough innovation—an accident, an act of desperation, an afterthought? NO. Breakthrough innovation can result from a deliberate, strategic innovation community process. But it will take COURAGE: courage to create an entrepreneurial culture to support it, courage to take risks, courage to place big enough bets to succeed.
Enterprises are really good at incremental change. In the past, innovation was the purview of Research and Development (R&D) and its engineers. It didn’t take much customer input to churn out one product extension after another. Customer input or input from the people in the field organizations who would have to execute came at the end of the process.
Now with the new Enterprise Feedback Management tools, Enterprises can be even better at incremental change and involve more people.
- Input comes earlier in the process.
- Stepped up Voice of the Customer research and Social Media Monitoring tools allow Enterprises to listen for product and process innovation ideas in the input they get. A critical problem with that is the Enterprises are overwhelmed with the ideas flowing to them. So much so that good ideas are overlooked.
- Another Enterprise Feedback Management tool, Community Ideation Collaboration software, attempts to solve the volume problem. With the software, interested parties can submit an idea and/or vote on their own or others' ideas. But the most popular ideas aren’t necessarily game changers.
Taken together these new tools make it very easy to find incremental change ideas, and do so very democratically.
But the narrow way these tools are generally used is not adequate for breakthrough innovation—it wastes their potential value.
Even more of a problem is that three more great opportunities are also wasted.
- It is not just the ideas that are of potential value to the Enterprise, but the engagement (the Interactions) around innovative ideas is a great way to develop relationships with all interested parties—all stakeholders. Relationships drive business. See our HACK Measure Performance Innovation. Relationships are built one Interaction or experience at a time over a lifetime. When that engagement record is lost, two more very important things are lost:
- The foundation for repeatable process and continuous improvement, and
- The ability to correlate the Interactions used in the innovation process to business results—revenue, profit, referrals, adoption, up-sells.
Game-changing, breakthrough innovation tied to business results is the outcome from a process that takes advantage of the best of past approaches and the collaborative promise of the future.
We predict that major Enterprises will run their businesses through their Stakeholder Community within the next five years. Leveraging the relationships--with Suspects, Prospects, Customers, Employees, Partners, Suppliers, Influencers, and Interested Parties and collaborating with them—is how Enterprises will compete, how they will innovate. An innovation strategy that collaborates with these stakeholders will be much more successful than one that isolates innovation within a traditional business department like R&D.
- Stakeholder Community members will become more and more involved in the work of the Enterprise through various open and closed Initiatives—to collaborate with a business purpose. For instance, an Innovation Community Initiative will become externally-focused by moving from a Research and Development approach to a “Collaboration and Development” approach.
- An elegant, new breakthrough Relationship Value metric tracks relationship development with these strategic stakeholders. The back and forth of developing a relationship is the ultimate collaboration.
- Relationship Value is the Key Performance Indicator (KPI) for relationship development, directly tied to each Individual Contact’s role, attitude, contribution, engagement, and influence.
- Through Relationship Value, the contribution of stakeholders can be tracked, recognized, and encouraged. Relationship Value operationalizes that intelligence in the context of CRI (Customer Relationship Intelligence) and Social CRI (Community Relationship Intelligence).
- The use of Relationship Value enables real-time management, operational control, and profit. The Stakeholder Community becomes monetized.
An Innovation Community Initiative with top priority customers--lead users as well as other key internal and external players--is a place to start. See FIRST STEPS for how to use the new Enterprise Feedback Management tools as part of a more strategic, focused approach for both incremental and breakthrough innovation.
Not only are both breakthrough and incremental product and service innovations more likely to be adopted and more quickly by more customers, BUT also… the process itself will develop deeper relationships with key stakeholders—customers as well as employees and others. Relationships drive business, drive retention where the MONEY is.
Relationship value unlocks the unique, sustainable competitive advantage that comes from understanding and acting on customer behavior and profit patterns better, fast, and more responsively than competitors do.
Step One: Gather product and process innovation ideas from top priority customers in a specific geography and within a narrowly defined product group using Enterprise Feedback Management Tools. Identify lead users as well as other internal and external key players.
Step Two: Develop pro forma high-level Customer Relationship Process model of ~ 100 major Interactions and some 30 associated Voice of the Customer Interactions. Determine what data is available to support it.
Step Three: Identify critical process gaps. Map the customer experience to understand Customer Value. Innovate incremental and breakthrough change. See our HACK Measure Value Creation with CRI and our Thought Leadership Paper on Value Creation.
Step Four: Populate the pro forma model’s major Interactions with Relationship Value and Variable Interaction Costs. Correlate to actual historical Interaction Record of customers. Demonstrate the efficacy of RV as a leading indicator.
Step Five: Track RV-Q and what people DO going forward with a Social CRI-->CRI (Customer Relationship Intelligence) Tracking System. See our HACK Measure Management 2.0 with CRI.
Facilitate a new, breakthrough Innovation Community with lead users/ key players at its core. Open new relationships with existing customers. Open new customer segments.
It Takes a COMMUNITY and dedicated, innovative professionals to collaborate on the scale needed to develop Relationship Age business processes to:
- Retool from a company/product focus to a customer focus from strategy to execution to profit,
- Share operational control among Frontline Staff, Managers, and Executives,
- Reward the unsung heroes in sales and marketing and customer service for the value they create every day by developing relationships with customers,
- Build on proven methods, many of which our team has pioneered including profitability segmentation, Voice of the Customer, customer experience engineering, and valuing intangibles, and
- Invent new ones like Value Creation Mapping, Product Relationship Roadmap, and the Social CRI-->CRI Tracking System with its revolutionary metric Relationship Value.
Thanks to all the others on the Religence CRI Team: Jim White, Bob Sabath, George Fruehan, Dave Pearson, Dick Morgan, Kathleen Robinson, Ray Dunaway, Eve Thompson, John Kauke, Steven Cox, and Anne Chambers plus our late colleague Richard Taylor. This team of experienced senior people represent marketing, operations, finance, IT, and change management. A customer-focused enterprise is everyone’s job. Together we have commercialized our CEO’s business process patent and built out the Religence Framework for CRI. What a total pleasure it is to collaborate with this innovative, multidisciplinary team. Thank you.
Many, Many More Acknowledgements can be found at the end of our HACK Measure Management 2.0 with CRI for Real-Time Management/ Operational Control/ Profit.
FREE Electronic Copy of CRI Book. At the end of our HACK Measure Management 2.0 in the Helpful Materials section is an electronic copy of the second edition of our CEO’s book—Customer Relationship Intelligence: A Breakthrough Way to Measure and Manage Sales and Marketing.
©2013 Religence®, Registered USPTO, Patent Number US 7,526,434