Professor of Strategy and Entrepreneurship and Faculty Advisor, Executive Education
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There are many misconceptions about innovation and innovators. Most common is the idea that you have to be a genius to come up with something new. Or earth-shatteringly creative.
But that’s really not the case.
Many innovators say it is just about looking at the world from a different perspective. While others confess to begging, borrowing or stealing their ideas from somewhere else.
Being innovative can feel particularly challenging when you are working for a large organisation. So it helps to have a framework for thinking about innovation.
Here are three lenses used by successful entrepreneurs to help them get into a different frame of mind so they can think of new business models, products, services and management approaches.
It’s not an exhaustive list. The whole point about creativity, of course, is that it can’t be programmed. But each of these lenses provides a way to have a structured discussion to help the creativity flow.
The first lens is about tapping into unarticulated needs, sometimes called “design thinking” or “ethnography”.
Rather than asking customers what they want, you need to tap into some unmet need they have.
When Apple first developed the iPhone, Steve Jobs was asked if he’d done any market research; would people actually want an iPhone? His disparaging reply: "Did Alexander Graham Bell do any market research before he invented the telephone?" Jobs' view was that rather than asking customers what they want, you need to tap into some unmet need they have. And, if you get it right, the world beats a pathway to your door.
LVarious techniques exist for trying to discover this unarticulated need and one from marketing is ethnography. This means visiting customers in their homes and watching them as they use your existing products or services, to try to identify their unmet needs.
There is a story of a financial services team who were trying to come up with a new product. They went into a woman’s home and asked her about what savings products she used. She took them into her kitchen, opened her freezer, pulled out a Tupperware tray with her credit card encased in a block of ice, and said: “This is my savings product. If I get the urge to spend money, I take the tray out of the freezer, and when it melts I’m free to spend. But usually in the time it takes to melt, the urge to spend has worn off, and I just put the credit card back in the freezer.”
It’s a funny – perhaps apocryphal – story but it helped this company think more creatively about how to help people balance their urge to spend and their desire to save, and create a new financial services product. And the argument is they couldn't have done that without going to that person's home and seeing the issue for themselves.
The second lens is about challenging current orthodoxy. Every industry has its way of doing things; a set of rules or traditions that even the people operating in that industry aren't completely aware of.
Simon Woodroffe challenged the orthodoxies of the hotel industry when he founded the hotel chain, Yotel. He saw that traditional hotels operate according to a fixed daily cycle that doesn’t meet everyone’s needs, in particular those of business travellers. Usually you can’t check in to a hotel room before 3pm, and you have to check out by 10am. Whereas a business traveller might get in from a long-haul flight at 6am, want a shower and a snooze, before heading off to a meeting at 2pm.
Draw upIt’s worth drawing up a list of standard practices, standard assumptions, that everyone in your industry makes, and asking yourself: Why do we do it this way?
Woodroffe thought of creating a hotel chain where people can book rooms in four-hour chunks. Most Yotels are based at airports. And the chain has succeeded in challenging the assumptions of the hotel industry.
It’s worth drawing up a list of standard assumptions that everyone in your industry makes and asking yourself: Why do we do it this way? You can then draw up a list of contrary assumptions, to see if these spark some interesting ideas. Another exercise is to ask yourself, “how would Richard Branson or Google approach this problem?” Both are famous for their deliberately heretical ways of doing business.
The third and final lens is the idea that many business ideas are simply begged, borrowed or stolen from other contexts.
Take the Ford car assembly line. How did Henry Ford have the idea of creating an assembly line? He stole it from the local slaughterhouse, where they had already developed the idea of a step-by-step process for chopping up meat carcasses. (What you might call a disassembly line.)
So he stole, or borrowed, the idea by applying what was happening in another industry.
Many, arguably most, new business ideas are actually ideas that have been taken and adapted from other contexts.
The same applies to another of entrepreneur Simon Woodroffe’s innovations, the restaurant chain Yo! Sushi. He went to Japan and saw how people sold sushi there – by rotating it on a conveyor belt – and created a business out of it. He set up restaurants in the UK … and now six other countries. The innovative approach extends to the neat way of navigating a landing page featured on its website.
Many, arguably most, new business ideas are actually ideas that have been taken and adapted from other contexts. So the good news is that the search for innovation gives you a licence to spend time talking to people from different industries and go on business trips to other countries, all with an open mind.
Those are three lenses that can stimulate thinking about where new business ideas come from. And you will need plenty of them because, typically, for every ten ideas you develop, only one or two make it to fruition.
The idea generation stage is really only the first step in what’s often called a stage gate process. Most big companies have a version of this where the original idea has to pass through three or four filters or validation mechanisms before it goes ahead and serious investment happens, or change is made.
The key point, of course, is that at each stage along the way, a bunch of potentially promising ideas will be killed off. And that’s why it’s good to use your “innovation lenses” to come up with as many ideas as possible.
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