Business in the digital age moves faster every day. Successful companies are those that can stay ahead of the curve and bring innovative products to market in time to ride the wave of public interest or generate a new one. But one thing is clear: They cannot do it without innovation management.
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Companies no longer rely on a small set of executives to guide the corporate vision, as specialized skills make it impossible for leadership to know every detail of the business. They must depend on their employees to not only perform in their unique roles but also to focus on the business as a whole and continually be thinking about how its products and processes can be improved.
Innovation management enables organizations to crowdsource breakthrough ideas from the employees, partners, and customers who know their business best; these ideas are a primary source of innovation for successful companies. By listening to and understanding pain points and thinking about possible solutions, the process of innovation management often turns great ideas into great products, services, and features.
There are many areas within a business where innovation management can have an impact. The focus of this article is on four categories and case studies of businesses that have reaped monumental benefits from listening to their employees and customers to improve processes, increase revenue, and create new and successful products.
Product development describes the process of bringing a new product to market. Tangible or intangible, all new products start out as ideas on paper or presented during a brainstorming session. The key to effective product management is ensuring these ideas are then broken down into specific requirements and developed into finished products that can be brought to market. This is innovation management channeled directly into the product development cycle.
Case Study: Polaris Industries
Polaris’ leadership team knew they had an untapped resource within their employee base. Their manual processes of gathering and vetting ideas were slow, fragmented, and often siloed. It was not until they found a more focused process that they were able to truly reap the benefits of their diverse workforce.
Their innovation team’s efforts allowed them to take ideas directly from their engineers and obtain feedback and communication from everyone from assembly workers to top-level executives. This resulted in four cutting-edge vehicles that are now best-sellers in the ATV market. In addition to the Slingshot, they include the single-motor EV Ranger; the lightweight, low-inertia Axys, and a growing segment of Sportsman Ace vehicles. In August of 2015, Polaris beat global mammoth Harley to the market with the Empulse TT, the first electric motorcycle in a new class of two-wheeled vehicles.
Employee engagement is a primary component of innovation management. The key to utilizing the unique knowledge and experience of your employees is to encourage and incentivize the sharing of said knowledge.
Suggestion cards are a thing of the past. Now is a time of online conversations and contributing ideas via social media, blogs, and similar platforms. Successful companies leverage these familiar venues to both ascertain what their employees are thinking and reward them for sharing their ideas.
By asking employees to help address customer needs and pain points, businesses empower their staff to help make the company better, which in turn gives employees a sense of self-satisfaction beyond taking pride in their everyday accomplishments.
While a simple “thank you” is always appreciated, other ways to reward employees for sharing their ideas include recognition in internal blog posts as well as awards or special incentives for those ideas that result in viable solutions and products.
Case Study: Facebook
Facebook is well known for leveraging their employees’ collective intelligence to stay one step ahead of the competition. Their legendary hackathons – coding marathons during which teams work to turn ideas into viable products – have resulted in many of the more popular features Facebook users know and love. These include location requests, Facebook for Developers, Facebook ads, and even the famous “Like” button.
What can you take away from this example?
Cultivating a culture of innovation within your business by encouraging employees to dream up new ideas or creative solutions to existing issues can result in unexpected surprises. Companies should also keep in mind that the best ideas may come from unconventional sources, such as different departments or individuals. Tools and campaigns that include all departments can be the game changer in finding the next big innovation that can significantly impact your company’s future.
Case Study: Global Aerospace Leader
A leading global aerospace company challenged their employees to find ways to serve customers better. One of the problems that surfaced was the difficulty of inspecting a particular aircraft part overnight. The inspection process typically took eight hours, but airlines were unhappy because planes sometimes land late and need to take off early.
The problem was not the inspection itself; it was the process of threading the camera inside the aircraft part to inspect it, which took seven hours. The subsequent inspection took only one hour.
An administrative assistant at the company who was familiar with the airlines’ complaints responded to the challenge. She had recently seen the Tom Cruise movie, Minority Report, and posted the question, “Why can’t we send a robotic spider into the part, like the ones in the movie?”
The company’s chief technology officer was intrigued. He tried putting a miniature camera on a remote control set of robotic legs and walking it into the part. It worked. He then turned the administrative assistant’s idea into a standard practice. Now the inspections take 85 percent less time than before, and the airlines are much happier.
Another good example is a Florida-based power company that recently championed an offsite meeting where they encouraged brainstorming and collected 145 ideas in the 20-minute session with 100 percent participation. While some of the ideas were far-fetched, the meeting gave the opportunity for teams to vote on and prioritize the suggestions that were offered. Eleven ideas were then star-rated to settle on five key initiatives going forward.
Imagine this exercise on a company-wide scale. Using enterprise innovation tools, companies can send out challenges over the entire enterprise asking for ideas and solutions, prioritizing and ranking them, and encouraging feedback on the ideas that go forward.
Continuous improvement can be small improvements over time or a monumental improvement all at once. There is always room for improvement. Once a product has gone to market – or an operational best practice has gone into effect – it is critical to continue to listen to your internal, as well as your external, customers. Using tools that allow for troubleshooting and feedback on the new product or operational change will encourage continuous improvement as the cycle begins again and your company becomes more and more responsive to the ever-changing market.
Case Study: American Gas and Electric Firm
When one of the largest U.S. utility companies challenged its employees to help them improve and “future-proof” their operations, they were showered with ideas from all levels of the company. They were looking for ideas to protect the business and shore up operations against threats such as severe weather and cyberattacks.
One of the winning ideas was to use drones to check the power lines for wear and tear and other problems. Using drones would be a huge cost savings compared to using traditional aircraft and helicopters. Drones also allowed inspectors to get closer to the power lines and therefore catch more problems earlier with less environmental impact.
When implemented, it was estimated that the drone solution helped prevent 11 power outages a year. To understand how impactful reducing 11 power outages is, consider that between 2003 and 2012, the energy industry experienced more than 600 power outages, which caused $18 billion to $33 billion in losses due to schools and businesses being closed down and emergency services slowed or hindered.
Case Study: Global Automotive Manufacturer
In another case, a leading global automotive manufacturer launched a challenge to help improve their car interior features. This public challenge, which encouraged ideas not only from the company’s customer base but also from their employees, ran for several months.
All participants had a chance to provide their thoughts, and the company selected three winning ideas from the challenge. Those that submitted the winning ideas had the unique opportunity to be part of an innovation workshop to develop their ideas further. They showcased a prototype of each idea and pitched it directly to the company’s Innovation Challenge Team. All three winners got the chance to experience the auto manufacturer’s newest model.
This innovation challenge is a great example of continuous improvement with overall engagement. They included both employees and customers when asking for ideas and kept them involved in the process of developing and using those ideas so they could see the full impact from start to finish.
In the grand scheme of innovation management, your employees are your most valuable asset. Think of them as your internal customer. Look to them as your greatest resource for ideas and inspiration. Ask senior employees questions about their experiences over the years or get a “fresh eyes” point of view from new employees. All of this valuable knowledge is out there if you know the right way to ask for it, process it, and use it.
With downsizing and cost-cutting initiatives, companies can lose years of tribal knowledge with the loss of employees who often knew the intricacies of the business even better than upper management – in essence cutting out the vital organs a business needs to survive.
In his article for Industry Week, Michael Collins makes a valuable point about such collective wisdom:
“I call this information ‘tribal knowledge,’ and it is not only more important than most corporations will admit, it is also a driving force behind innovation; is critical to the company’s competitive advantage; and is the basis of training a retiree’s replacement.”
Over the coming decades, more and more manufacturing employees will be retiring, many of whom will opt for early retirement instead of being laid off. The mass exodus will likely leave little time for exiting employees to offload years of knowledge and expertise in a span of a few weeks or days, which means companies could be losing vast stores of valuable wisdom.
Case Study: UK-Based Energy Firm
A UK-based energy firm had a problem: Their customers routinely complained about their energy consumption being higher than their usage and attributed the issue to the company’s meter accuracy. The company deployed innovation management software to leverage the collective intelligence of its 14,000 employees and establish a way to source, rank, and collaborate on ideas in order to meet the problem head-on.
The first ideation challenge they launched to their employee base was to identify products or services they could create to improve the customer experience and lower energy costs within one year. The company sourced ideas and employees voted and collaborated. As the top ideas began to surface, one stood out from the rest: A smart home app that worked out the running costs of appliances for customers.
The best part? The idea came directly from a call center operative in the Customer Complaints department. In other words, an individual who talks directly to customers on a daily basis and listens to their problems. Not only did the app make the lives of customers better by giving them more knowledge about their energy consumption patterns, but it turned into a product that had several other benefits:
- Fewer complaints about meter accuracy and consumption, and shorter issue resolve time
- Significant cost savings from not having to arrange and attend meter tests
- Cost and resource savings that helped the company recover outstanding debt quicker
Where are you on your journey to more fully developing the customer experience? Have you engaged your front-line employees in helping you to find your way forward, given their abundance of insights? Have you built a means of continuous improvement so people can experience success along the way?
In discussing the process of innovation management, we can see the importance of harvesting ideas from new and veteran employees and utilizing their insightful feedback to generate new and innovative solutions to propel your business to the forefront of your industry.
Of course, this requires finding ways to encourage collaboration and out-of-the-box thinking across all departments or even divisions within a company. The companies in our case studies recognized their employees and their customers as their most valuable assets when it came to being on the cutting edge of their respective markets and keeping their products relevant in the future.
Leveraging better employee engagement to harvest ideas for new product development and continuous improvement lead to better customer experiences.