Peter Drucker once said innovations are inventions that sell and most product strategies follow the same goal. Therefore, innovation and strategic thinking are closely related and one could lead to the other.
However, in many companies innovation is usually referred to as a result but then again it would not be any different form an invention. If you can’t implement your invention it is not an innovation.
Improvements are often marketed aggressively against the improvements of the competition and incremental progressions are often labelled as ‘innovation’ or ‘revolution’.
Quite often companies concentrate their market development efforts on the wrong target audience as they come up with wrong assumptions of who could use their technology and how it would be used. We are often restricted by our own way of thinking regarding possible applications and have an insufficient knowledge exchange with the audience or stakeholders.
Before an innovation, however, has a meaning or value to the majority of them, it needs to process from a disruptive to a sustaining innovation. Strangely this puts innovations leading companies regularly at risk to fail even though they do the right things.
We are continuously forced to improve the performance of our products meeting the constantly increasing needs in order to sustain or extend our profits over time. Therefore we constantly need to innovate at high speed.
This also indicates that disruptive technologies could end in a worse customer experience at first but generally they become cheaper, simpler, smaller, and frequently more convenient to use in the end. Here’s an image that describes this shift.
This is called disruptive innovation. Not because it’s a breakthrough from a technological sense, but instead of sustaining the trajectory of improvement that has been established in a market, it disrupts it and redefines it by bringing to the market something that is simpler However, innovations that are changing the people’s behaviours and eventually breaking up or creating new markets are insufficiently covered by this. Therefore this is ideally applied to direct substitutes. It is a rather marked-centred approach. Nonetheless when the market innovation is also a technology breakthrough it clearly could be described as radical. Think of the telephone market and how long it took to establish touchscreens. This evolution is a perfect example:
Nokia was leading the smartphone market for years by sustaining their innovation. One could also say that Nokia had a digital product strategy in place at that time and sustained it. Then Apple came along in 2007 with the iPhone and more importantly the App Store and established a relationships and an ecosystem at the same time. Nokia had built touchscreens, too but it actually needed apps to disrupt the market because the internet at that time and especially websites weren’t made for 3.5-inch screens. This story has been told too many times so I am not going to repeat it. But what’s interesting about this is the date.
In 2007/2008 Nokia acquired Navteq, a provider of geographic information system data and a major provider of base electronic navigable maps. This was going to be Nokia’s ace up their sleeve.
I was working with AKQA three years later to help merge Navteq completely into Nokia and to form part of the HERE business unit as Nokia’s smartphone business was fading.
We implemented and lived a lean start-up culture as we were working together as partners and not in a typical agency-client-relationship. We taught the HERE team how to use agile project management, design driven innovation processes and digital communications and we learned a lot about the business side of things.
Together we explored unknown space for both companies.
While Google Maps and Apple Maps were focussing on the end consumer – HERE was building their business around enterprises solutions. We designed functions and features for businesses and enabled the integration into a lot of navigation systems. HERE was not only discovering a new market – it was a completely new company build on the shoulders of a dying giant. It’s never too late to re-think your strategy, differentiate from the sustained course and find uncharted business opportunities.
Nowadays HERE enables smarter management of mobile and fixed assets for a wide range of organisations using cloud-based, automotive-grade global map content. HERE maps can be found in four out of five in-car navigation systems in North America and Europe.