Are your company's brilliant inventions failing to make a splash in the market? You are not alone, and here is why.
Many organizations excel at developing cutting-edge technologies but falter when it comes to transforming these inventions into impactful innovations. The common misconception is thinking that innovation is complete once the technology is developed (Blok, 2021).
As Schumpeter pointed out, innovation is about creating "new combinations" that disrupt the status quo (Hospers, 2005). Drucker emphasized that innovation must have purpose and application to generate new wealth (Drucker, 1998). In essence, true innovation happens when an invention starts making a real impact. Commercialization is imperative.
Yet, according to a McKinsey survey, while 84% of executives believe innovation is critical to their business's growth, only 6% are satisfied with their company's innovation performance (Collarelli O’Connor, 2019). This disconnect highlights a critical issue: many companies conflate innovation with R&D.
Gina Colarelli O'Connor, in her article "Real Innovation Requires More Than an R&D Budget," emphasizes that innovation involves three distinct capabilities:
Discovery: Generating new ideas and inventions (where R&D plays a role).
Incubation: Developing business applications, revenue models, and markets for new products.
Acceleration: Scaling the innovation to achieve market impact.
Without a strategic approach that includes these capabilities, companies often end up with a stockpile of undeveloped inventions that never reach their potential.
At Husqvarna, we faced this challenge firsthand. We developed groundbreaking robotic technology simply because we could, with a general idea that it would serve professional users. Initially, we targeted our default professional customer segments; municipalities and landscapers. However, despite the technology's potential, we found no product-market fit in these segments.
Recognizing the need to connect more deeply with customer needs, we began engaging with different target groups. Through this exploration, we discovered new customer segments (golf and sports) with unmet needs that our technology could address. By understanding these customers' specific pain points, we redefined our value proposition and tailored our solution to meet their demands.
This shift led us to:
Identify new markets where our technology could thrive.
Develop a value proposition that resonated with these new customers.
Adjust our go-to-market strategy to effectively reach and engage these segments.
As a result, the technology became an innovation leader in these new segments, demonstrating the power of aligning invention with customer demand.
So, how can organizations bridge the gap between invention and market impact?
Craft a value proposition that resonates with customer needs: Go beyond technical features. Deeply understand your customers' pain points. Articulate how your solution delivers tangible benefits and solves real problems.
Develop a robust Go-to-Market strategy: Identify the right markets and channels. Align sales and marketing efforts to effectively reach your target audience. Plan how you will introduce your innovation to maximize adoption and impact.
Scale effectively with the right processes and business models: Implement efficient processes that support growth. Explore scalable and sustainable business models. Continuously refine your approach based on market feedback.
As Colarelli O'Connor observed, focusing solely on R&D without the capabilities to incubate and accelerate innovations often leads to missed opportunities.
I'm curious: How does your organization ensure that inventions evolve into impactful innovations? Have you ever pivoted your strategy to better align with customer needs?
Feel free to share your experiences or reach out to discuss strategies. Let's transform great ideas into meaningful impact together.
Sources:
Blok, V. (2021). What Is Innovation? Laying the Ground for a Philosophy of Innovation. Research in Philosophy and Technology, 72-96.
Colarelli O’Connor, G. (2019). Real Innovation Requires More Than an R&D Budget. Hardvard Business Review.
Drucker, P. F. (1998). The Discipline of Innovation. Harvard Business Review, 179 - 157.
Hospers, G.-J. (2005). Joseph Schumpeter and His Legacy in Innovation Studies. Knowledge, Technology, & Policy, 20-37.
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