Years ago I wrote MRT’s monthly email newsletter dubbed “The Critical Path,” which after a gap of about 5 years is now replaced by this blog, which seems to have filled the niche left behind by newsletters now that paper printing is getting closer to the fate of the dodo thanks in part to Rupert Murdoch’s underling transgressions.
In this installment I’m posting the main article that was published on February 15, 1999, it even has references to the iMac and Firewire, so you know it’s old. Since this was published, I’ve seen several others produce similar models of innovation, so I’m sure at the time, mine probably wasn’t that unique either.
Originally published in The Critical Path / Issue 1.4 / 021599 :
THE INNOVATION MATURITY MODEL
Renowned business strategist Gary Hamel, recently featured on the cover of the December 7th Fortune Magazine, was interviewed for CP’s sister publication, Product Development Best Practices Report. In this interview, Hamel was asked about his Fortune comment, “irrelevancy is a bigger risk than inefficiency.” He replied:
“I don’t think product development practices and processes are the principal issue. The big challenge most companies face today is how to innovate – how to create business strategies and business models that generate new wealth.”
Hamel goes on to talk about the lack of streamlined processes for tapping into internal sources of innovation. We have all heard about programs at companies such as 3M, who go as far as to allocate laboratory time and resources to any level employee, including shop floor workers, secretaries, just about anyone with a new product idea, but these are far more the exception than the norm. He also mentions that in companies not like 3M, new ideas fail before they are even proposed because there is no mechanism for challenging the entrenched “dominant logic” of the company, which rejects ideas that don’t originate from sanctioned channels, i.e. the R&D department.
Last December’s issue of CP talked about Eli Goldratt’s perspective on Theory of Constraints and the Toyota Production System. What I didn’t mention was my second question to Dr. Goldratt, where I asked him about TOC’s role in innovation. “There is none,” he said. “Innovation is not a constraint. There is plenty of it available.” This would seem to support Hamel’s contention that it is not ideas, but the means to use them that are the barrier. In retrospect, I wish that I had phrased my question to Goldratt this way.
I think it is important to draw a few distinctions about innovation, as not all innovation is created equal, and far too often the customer is neglected in the process. To borrow from an old advertising saying, “if it doesn’t sell, it’s not creative,” the same can be said here. Product development decisions that involve innovation need to be considered against the business objectives of the company, so that its benefits, such as increased market share, can be traded off for the expense, such as schedule delay, product cost and other factors.
The following are what I’ve defined as the five levels of innovation that exist in product development. Let’s call it the “Innovation Maturity Model (IMM)”:
LEVEL V – “Disruptive” – Borrowing from Clayton Christensen’s vernacular in his book, The Innovator’s Dilemma, disruptive innovation can be the type that renders your core product(s), and therefore your business model, obsolete. (e.g. What compact discs have done to vinyl record albums, and what the Internet is doing to intermediaries everywhere.)
LEVEL IV – “Breakthrough Solutions” – These would be new to the world products or services that address a need in a way not considered before or that nobody knew existed. (e.g. 3M’s Post-It(TM) Notes products)
LEVEL III – “Solution Enhancements” – These would be whole new products that address existing needs, but in a way that changes the paradigm. (e.g. The Zip drive, which added a new category to the already existing market for digital storage media.)
LEVEL II – “Feature Enhancements” – These innovations exist at the product feature level, and either create a new capability for an existing product or service, or improve upon its performance. (e.g. An ergonomically shaped computer mouse or caller id service on your telephone.)
LEVEL I – “Superficial” – These innovations are hardly innovative at all, but are deemed so on a purely subjective rather than functional level, such as with the product’s appearance. (e.g. Baywatch Barbie, or the iMAC, except for its new “firewire” capability).
This is not meant to be a definitive model. I am sure that there are other distinctions that I may not have thought about; in fact, the above is most likely a composite of many other people’s ideas that I’ve heard and read over the years. If you have any suggestions or think I’ve missed something, please drop me a line.