From the Insight Out

From the Insight Out

          
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From the Insight Out

Strategy
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    In This Article
    • Insight requires a rigorous methodology for conceiving new opportunities--and a customer-driven discovery process for testing and refining them.
    • Understanding the customer’s total experience offers clues to help identify fundamentally new value
      propositions.
    • Mapping the terrain of diverse customer needs, segment by segment, will reveal more opportunities than most companies can pursue.
     

    Behind every successful innovation is an unexpected insight. When it finds expression as a new business breakthrough, markets take off and competitors don't know what hit them. And yet, even at the best companies most attempts at innovation fail. Lacking a systematic process for developing new ideas, organizations rely too much on the random inspiration of individuals.

    It doesn’t have to be this way. Insight can be made to flourish. Genius isn’t required; ordinary mortals can generate breakthrough ideas — systematically. What it takes is a rigorous methodology for conceiving new opportunities, and a customer-driven discovery process for testing and refining them.

    Expand your business definition and map it exhaustively

    Focus may enable flawless execution, but it can impede insight. The way you see your market today can blind you to tomorrow's possibilities. Start by expanding your business definition — from “cellular phones” to “mobile communications”, from “enamel paints” to “industrial coating systems”, from “mutual funds” to “retirement services.” The new definition may seem arbitrary. It may even sound a bit pretentious. It doesn't matter, as long as it jump-starts creative thinking. Focus can come later.

    Exhaustively map the opportunity space described by these expanded boundaries. Visual representation helps. One company regularly charts opportunities on a cube whose axes list potential users of a product category, potential uses to which products might be put, and the range of benefits they might deliver. Each cell represents a possible opportunity. By identifying unoccupied cells, and conceiving products that could fill them, the company uses “The Cube” to give structure and direction to its innovation process.

    Contrast this to traditional market research techniques where, typically, a single idea is tested against the total user population. Mapping the terrain of diverse customer needs, segment by segment, allows you to explore a panoply of possibilities.

    Get inside the customer experience to tap core dissatisfactions

    Done properly, the mapping process will reveal more opportunities than most companies can pursue. Which to develop?

    Don’t rely on asking customers which they want : they almost never really know. It's the rare individual who can predict his or her own behavior or understand the inchoate emotions that motivate action. And few consumers can forecast the premium they’ll be willing to pay for a unique new value proposition.

    What they can do is articulate their dissatisfactions. Let these dissatisfactions guide you to the most promising cells of the opportunity cube. What matters most aren't so much the specific deficiencies of existing products as broad customer disaffections — for example, frustrations born of time scarcity, inconvenience, or unfulfilled yearnings for affiliation. Probe for how customers see current offerings in the context of these deeper dissatisfactions. They represent the grain of sand around which the pearl of a new innovation can grow.

    You get to these dissatisfactions through intensive, face-to-face interactions with customers. Settle for nothing less than unfiltered, real-time contact. Watch how customers use your products on site where they live, work, or play. The goal isn't just getting close to the customer; it's getting inside the customer experience.

    Doing so requires getting outside the cocoon of the executive suite. If you're a senior auto industry executive, for instance, pass up the perquisite of having your next new car ordered by your secretary, and experience first hand what the typical buyer endures at the hands of your dealer sales and service organization. You will gain an invaluable stimulus to new insight.

    Shop the way your customers shop. In fact, study the total buying and use process. In an industrial business, look at how a product is engineered, sourced, bought, received and stocked, installed and repaired, and recycled once it reaches the end of its useful life. In a consumer business, examine how consumers shop for the product, use it, and clean up or put it away afterwards. Learn how customers really use your product, how they routinely ignore or modify instructions, how they discover unimagined uses for your product, and how they define quality and superior performance.

    Understanding the customer's total experience offers clues for new ways to bundle products, shorten time requirements, or deliver a solution more directly. It's how you get behind taken-for-granted tradeoffs of quality, cost, and time, to identify fundamentally new value propositions.

    Don't delegate responsibility for insight

    All this demands enormous personal energy. New ideas are hard to come by and easy to kill. The obstacle course they must run to win approval too often reduces them to a sterile lowest common denominator. That's why companies that excel at innovation ensure that senior managers don't delegate responsibility for insight.

    Those closest to the customer may have the most first-hand data to contribute, but too often it doesn’t get through. Those at the top bring a perspective that comes with experience and a degree of distance from the trenches. It’s often easier for them to help the organization hear what customers are really saying and draw the frame-breaking conclusion. And of course, senior executives are freer to take risks and to see their convictions through to reality.

    Breakthrough innovators design top management engagement into every stage of the idea-generation process. Senior executives continuously challenge the organization to expand business concepts; they spend time face-to-face with customers; and they actively participate in exploring the opportunity space.

    When they take responsibility for insight, executives discover that there is no such thing as a mature business — you can grow any business from the insight out.

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