04 Jun Nick's #1 Pick: The Wrong Focus

Picture this: In 1979, chances are you’d be reading your news in a printed newspaper or magazine. Today, you may well be reading your news on your computer, or perhaps your iPhone, Blackberry or iPad. It’s hardly a surprise that the Internet – along with broadband, browsers and HTML – would be among the top” breakthrough” innovations over the past few decades. What made the technology such an all-encompassing example of amazing innovation is this: It simply changed the world. It changed how information is delivered, how products are marketed and sold – and fundamentally, everyday communication.

It touched every industry and every corner of the public sector , from medicine to education to law enforcement and everything in between. Nearly every aspect of business or social relations today is touched by the Internet – not to mention the industries it created subsequently, like online auctions. And it did this on an international scale.

Beyond the Internet itself are its many offspring. Laptop computers. Now, so-called “netbook” computers. These products took advantage of the new technology called the Internet. They mobilized people; they mobilized industry, and completely changed the nature of interaction. It isn’t just about computers – there’s a plethora of other devices, from digital music devices to cameras to cell phones and beyond, now even cars, flourishing upon the same interconnectivity.

A few health care industry innovations listed in the Top 30 Innovations of the Past 30 years, by Knowledge@Wharton and PBS’s “Nightly Business Report” included DNA testing and sequencing, human genome mapping, Magnetic Resonance Imaging and non-invasive laser and robotic surgery (laparoscopy). Why were these included? Not only are these innovations something new that creates new opportunities for growth and development, they also have huge problem-solving value. DNA has great promise to improve diagnoses and also enhances the pharmaceutical industry by spawning more effective drugs based on genetic factors that would have been impossible to determine without it.

Step back 30 years ago and you’ll have the invention of Sony’s The Walkman, which changed the way we listen to music. During its development Sony’s Chairman Akio Morita did stop to ask, “Don’t you think a stereo cassette player that you can listen to while walking around is a good idea?” He thought about what the customer would want. Initially – it didn’t do so well. The media didn’t expect it to take off, but they underestimated the power of the youth that would fall in love with the product. Even though it’s now been replaced by iPods, mp3 players and more, Son still manufactures and sells the cassette-based Walkman players today.

If you miss these “mega-trends,” you’ll miss opportunities to innovate, and many organizations today find themselves “behind the eight ball” to catch up. We’re starting to see Internet-connected digital cameras that can send pictures instantly (as many of us have done using cell phones) – but why wasn’t Kodak at the forefront of this technology? We’re starting to see Internet-based systems for providing security and managing house functions remotely, but why has this taken so long?

I think one of the main reasons is actually Nick’s Pick No. 1: The Wrong Focus. Focus is at the top of my list because true innovation success must be driven by a continued and systemic focus on delivering true customer value. Most innovation experts refer to this as a “corporate culture of innovation.” I believe that corporate culture is created from – or is a result of – a focus on delivering customer value.
Your success in the area of innovation is driven by your company’s ability to manage a daily organizational focus that is truly bi-directional – where you’re not just delivering great customer value, you’re observing ways to add additional customer value. You’ll always be successful if you do this, but no more clearly than when you’re adapting to a new technology or megatrend like the Internet. How many Internet products and sites did we see go by the wayside because they didn’t deliver meaningful net customer value?

Organizational focus is key. Because most organizations that fail in the area of innovation fail because they look at it from a departmental, or “siloed,” approach. They look at it fractionally. They look at the speed of the Internet or the “cool” of the Internet or some other single feature of it that will solve all their problems. It doesn’t. Just creating a website for your customers doesn’t mean you’re creating great customer service. Again, it’s like the “Grapefruit Diet”; it’s applying one aspect of what should be a holistic innovation process and assuming that that is going to solve the problem.
From the CEO down, delivering customer value must be the centerpiece, as it is at Sierra Nevada Brewing Company, presented in a previous post. They don’t sit around and talk about processes and methods all day long, they talk about beer. They talk about delivering the absolute best product in the world. They talk about doing it in a way that honors everybody in their sphere of influence, and that’s what makes the company magic.