New innovation and customer-centric thinking is all the rage, but the fact is many companies–probably yours–have developed tons of great technology that has lots of potential use. What is the best way to drive new growth by exploiting your current technology base in new ways? How do you take advantage of what you are already great at to create new business opportunities? At a recent conference, we gathered thought leaders from a variety of industries to compare notes and discuss this question.
Not surprisingly, companies rush to develop their technologies too quickly. Success in technology push requires taking a slower path that goes through several steps. 80% of our survey respondents rated development as one of their strongest capabilities. The other areas are all much weaker. So let’s start with the first step, Assessing your technology.
Assess – determine if the technology is obsolete or still generative.
My father-in-law recently got excited about Tesla’s patents on AC power, and was pouring through them to see if there was anything that could be exploited. This may have been fun, but was probably a waste of time because Tesla’s technology has been well picked over. There is little generative potential left.
In contrast, low power wireless transmission, originally developed in a military context, has not been so well worked. This technology has generative power left for something interesting, surprising and valuable.
The potential to generate has to be aimed in a productive direction, so you also need to assess broadly who might benefit. For example, drones are an exciting technology on the rise, so it has potential. But drones deployed for neighborhood security or local law enforcement starts to shape the direction the technology may go. If you can find a technology with generative potential for a broad application area, then you are ready for the next step.
Fortunately, most companies are fairly strong at this; although a some are weak, carrying on pushing obsolete technologies, perhaps out of wishful and nostalgic thinking like my father-in-law.
Imagine – Creatively come up with possible value propositions for the technology and specific segments that would be interested.
A technology is useless unless it can do something for somebody. To get started, you have imagine what is possible and for who. What about your technology makes a difference? Who cares? What does it enable that cannot be done?
Don’t fall into the “ideation” trap. Our thought leaders have found that developing more bad ideas faster doesn’t help anyone. Nor does talking to the “same old people about the same old things,” — you will just rehash old ideas. Rogue engineering groups may generate better ideas, but they often are so disconnected from the organization that they lose their effectiveness. These tired approaches don’t work very well.
Our thought leaders have had more success with focused ways to create hypotheses. Many use technical scouts to systematically talk to lots of people in target customer sets, understand their problems, and obtain reactions to suggestions. Many use small groups that are carefully constructed to have a key leader who wants to move forward, a team of people with different perspectives, and creative people who are willing to suspend the statuesque. This requires a neutral facilitator and “yes, and..” critical thinking to improve the quality of the ideas.
You know you are done when two things converge. First, champions emerge who are committed to make something happen. Passion is an important criterion, because without it nobody will have the courage necessary to really take action. Second, if it really works, will the result have a huge impact? Do buyers really want it? These are hypotheses; they don’t have to be proven just yet, but they do need to have tangibility and specificity – who will benefit and why. Raw speculation isn’t good enough.
Connect – Demonstrate a real value proposition with real people.
No matter how good your hypotheses are, they are probably wrong. They need to be refined by interacting with potential customers.
The actions needed to Connect are relatively straightforward. Find representatives in your customer segment and test your hypotheses on them. Determine if the value proposition is real.
Resist the temptation to create a prototype and then do a show and tell. At this point, you are still far from the “development” phase. Rather, think about mock ups, interviews, pretotyping and other methods that encourage feedback to help refine the value proposition. Many of our thought leaders found that small pilots and simulations go a long way.
As you refine your hypotheses, you will probably find that they connect to other technologies as you assemble a whole solution. What does the potential customer really need to realize the value of your proposition? Technology alone is probably insufficient. Map out what will be needed to provide potential customers a step change.
Often the Connect step is difficult because the technology owners tend to be technologists, and the connect phase needs to be customer-focused. Include other functions, such as marketing and finance.
Evaluate – Assess the business opportunity and formulate a detailed learning plan.
Just because you have a great technology and a compelling customer value proposition doesn’t mean you have a good business. History is littered with business failureWhat separates winners from losers is how well they formulate an innovation as a business proposition.
While it is tempting to skip this step and just get on with development, our thought leaders identified many examples of how companies mess up or omit the evaluation phase. Among these, one of the more prevalent approaches involves developing a “business case” wherein a project champion makes a bunch of assumptions and uses them to justify his/her caseAlthough this approach gives the illusion of having done a good evaluation, it provides little insight into what it is really going to take to be successful.
Another common failure is the tendency to stay in the comfort zone. Businesses can inadvertently place too many constraints on a new innovation. Promising opportunities involves getting outside the comfort zone; seeking alternatives, taking risks and avoiding “business as usual.”
Our thought leaders recommended that evaluation needs to include several elements:
- Understand uncertainties. Which are the most important? Which ones drive the upside / downside?
- Develop several business strategies /models. Consider variations on channels, customers, pricing, etc. Evaluate several of alternatives and select the best as plan A. But expect to change course, falling back to plan B or C as you learn.
- Be rigorous about the essential things that you need to prove. It may be customer willingness to pay for example, or technology performance. Create a project plan focused on delivering definitive evidence in these few key areas. Avoid phase-gate checklists.
You know you are done when you have both a robust analysis, tested against multiple scenarios, that meet your growth goals; an actionable learning plan that maps out how you will learn about uncertainty and ambiguity, specifies what proof you are working on, and identifies the contingencies you may have to deal with.
As you proceed with your learning plan, and proofs are metn, you will find you are ready to move into the Development.
Development – Develop a product or solution that delivers on the value proposition.
Most companies have excellent processes for delivery, so not much needs to be said here, except don’t rush it. Take the time to learn and experiment so you know you have a winner before undertaking the expensive launch process.
I wish to thank the thought leaders and participants in the session for their important contributions:
Courtenay Jackson, Berg Inc., Director of Product Development
Steve Brozovich, Snap-On, Business Strategy Advisor
Jon Stark, VP & GM, Integrated Printed Electronics, MFlex
Parimal Shah, Director Project Management Office, Covidien
David Heidel, Marketing Manager, Aero Vironment
Rob Sues, President & Chief Executive Officer, Applied Research Associates Inc.
Matti Aksela, Vice President, Analytics & Technology Analytics Business Unit, Comptel, Finland.