06.10.2020 Fabian Roschig
If we didn’t perceive the external driving forces before COVID-19, Corona now drastically increased the pressure to be innovative.
90% of executives believe that COVID-19 decisively changes the way you operate your business in the next 5 years.*
85% of executives are worried that COVID-19 has a long-term impact on customer needs.*
84% of german executives say that the future of their business lies in innovation.**
3/4 of international executives agree that changes brought about by COVID-19 will be a big opportunity for growth.**
So most executives agree that the pressure is on, innovation budgets are critical now to post-crisis growth and that the past is no longer a predictor to the present.
On the other hand due to the effects of COVID-19 cash flow is a critical criteria. What in the past could have lead to action bias and impulsive decision making, now transitioned to carefully selecting where to put every innovation €/$ to reduce waste and effort.
Being risk-averse has upgraded to another level.
As one of the largest European industries, France might be a valid indicator.
64% of large French companies were planning to cut their innovation budget.***
71% of companies said that return on investment is under more scrutiny too and was the main performance indicator for innovation.***
So shooting a shotgun in the wrong direction while blindfolded and hoping to hit the target seems to come to an end. The collection of concepts looking for a problem to solve aka “innovation theatre” came with high costs, imprecision and were often largely ineffective in producing usable and commercially viable concepts.
Innovation will be
Now that we know what to do the big question is how.
How to innovate efficiently?
As described in a prior post (Ideas don’t matter. Problems do.), I think we all agree that the problem is not a lack of ideas. There is normally a sheer abundance of ideas within a large organisation, but generating more ideas makes the problem even worse.
When looking for a needle in a haystack, the best approach is rarely to add more hay.
The problem of problem solving is to know which problems to pursue. So how can we prioritise and quantify problems?
We can only know with precision which solution will be adopted by customers if we know
Check the Jobs-to-be-done theory to deep dive on these topics.
So what are valuable problems to solve. To get closer to this abstract question we can make data-based decisions:
Value of the potential opportunity = (Number of target customers x purchase or usage frequency x willingness to pay for the current solution) / level of satisfaction with the current available alternative
Innovation will be
The wastefulness inherent in failure just increases the economic pressure to succeed.
To be more efficient executing innovation you don’t have to generate more ideas, but spend more time on the right problem to solve and invest more time and money into a systematic and repeatable discovery phase understanding the different dimensions of user needs, how the customer measures value and which specific issues you are addressing with your solution approach.
BeyondFortune is a new business design and innovation strategy agency.
We help businesses navigate uncertainty and taking the guesswork out of innovation by applying a repeatable process + data-driven mindset + customer-centricity at heart.
We are de-risking value creation by capturing deep user insights and transforming them into predictable growth strategies and successful products.
We are looking forward to, together with you, systematically driving innovation to success.
Why “fail fast” and break things is not en vogue any more. was originally published in BeyondFortune on Medium, where people are continuing the conversation by highlighting and responding to this story.