Product Innovation Process
Driving growth through innovation requires the ability to continuously adjust market offerings in response to changing market conditions. The capability is powered by an efficient and robust product innovation process that consist of four general steps. The first step is the generation of new ideas based upon market opportunities and trends, competitive landscape, and customer needs. The second step is the process of selecting which ideas merit investment of resources for development and commercialization. Here decisions need to be made in alignment with business strategy and organizational capabilities and require a portfolio management process. In the third step, the selected ideas are transformed into deliverable products and services through a development process. The fourth stage is commercialization which includes market innovation and launch practices as well as sales management. The process then repeats with the input from customer feedback and competitor reaction to new offerings.
The assessment process includes examination of core capabilities related to this product innovation process along with examination of the alignment between strategy, market conditions, and three key innovation process parameters: speed, bandwidth, and risk,
- Risk management
- Business model Innovation
- High level of competition, disruption and shifting market logic.
- Rapidly changing technology such as Internet of things
- Market knowledge
- Governance and compliance
- Long production cycles
- Market barriers
- Active portfolio management
- Brand knowledge
- A and B testing
- Uncertain market. Hard to predict trends.
- Risk spreading.
- Market knowledge
- Customer insights
- Short-term cash flow, no room for failure and no need for jackpot.
- Expensive and inflexible production system, meaning you cannot easily adopt a new kind of production.
- Risk management capabilities
- risk affection/attraction rather than risk aversion
- Optimization in a red ocean
- Optimizing what you have optimize with low short-term risk
- Customer intimacy
- High-speed iterations
- Blue Ocean strategy initiatives.
- Higher risk short-term