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Innovation defined: New, useful, real and critical to long-term success

Find out how industry experts define innovation and why they believe it’s critical to every company’s long-term success.

Innovation. Every company wants it. Entire books have been written about it. Scores of business consultants make their living off it. And the press are always applying it as a label to whatever product, company, or idea is hot at the moment. But the use of the term ‘innovation’ to describe so many different things has pushed the concept dangerously close to becoming nothing more than an overused corporate buzzword with no real meaning. And meaning matters.

Knowing the definition of a concept gives us a target at which to aim our efforts. Without a clear understanding of what ‘innovation’ actually is, we won’t know how to get there, how to measure our progress toward the destination, or even what the destination looks like. (This holds true even if ‘innovation’ isn’t an endpoint, but in reality a process.)

INNOVATION: NEW, USEFUL AND REAL

What is the definition of ‘innovation’? In her book Collective Genius, Dr. Linda Hill, the Wallace Brett Donham Professor of Business Administration at the Harvard Business School, and her co-authors describe innovation as “the creation of something both novel and useful.” And that specific ‘something’ can be a product, service, process, business model, or even a novel way of organizing. Innovations can big or small and occur via a breakthrough or incrementally.

Dr. Darin Eich, founder of InnovationLearning.org and author of Innovation Step-by-Step: How to Create & Develop Ideas for your Challenge, also uses the concepts of newness and usefulness to define innovation, but takes it one step further. “An innovation is a high-impact new idea that was developed and brought to life in response to a challenge,” Eich wrote. “An innovation could be for a product, service, technology, communication, method, application, or new and better way of doing something.” And that innovation can be built off something that already exists or be completely new. Eich likes to define innovation so that it’s accessible to anyone and the unique challenges they face.

So, innovations must be new and useful. Anything else? Yes. There’s at least one more concept we should add to our definition, and it’s a big one. Innovations must also be real. According to venture capitalist and speaker Terry Jones, “creativity is about thinking up new things, innovation is about doing them.” Jones, who was also the founder of Travelocity, founding Chairman of Kayak and Chairman for Wayblazer, told me that it’s all about putting ideas to work. “I hold four patents but they are not innovations, only paper on a wall, as the company I worked for never reduced them to products!”

I know defining innovation as something that’s new, useful and real might seem overly general and meaningless, but the work of Hill and her colleagues shows otherwise. “The leaders we studied,” Hill told me, “wisely defined innovation in broad terms as well, which sent a message to their teams that innovation is not the sole province of one group or function — it can come from anywhere in the organization.”

INNOVATION IS ALSO NECESSARY

Now that we have a better understanding of what innovation is, we must ask ourselves if it’s actually something we should work toward. Answering this question is critical, because building a culture of innovation within an organization is often a difficult process, especially for companies that don’t have a history of fostering creative behavior or following through on new ideas. So, is innovation critical to a company’s success?

“Even very traditional organizations are starting innovation initiatives because they know their future growth depends on it,” Eich told me. IT and business leaders agree. In a 2015 Tech Pro Research study, over 90 percent of respondents said innovation was ‘very important’ or ‘somewhat important’ to their company’s success right now. An even greater number (95%) said the same when thinking about the success of their company over the next five years.

“Most companies will have to be more innovative whether they like it or not because new technologies, methods, trends, and business models are transforming multiple industries,” Eich continued. “These changes or new innovations have ripple effects, sometimes in a disruptive or game changing way, that cause non-innovative companies to have to respond or wither.”

Jones echoed the importance of innovation for a company’s future growth. “Innovation is critical to any company’s success if they are in it for the long term,” he wrote. “And the long term today is getting shorter and shorter. Consumer tastes and technology are pushing companies to innovate at a quicker and quicker pace if they mean to stay relevant to the market.”

Innovation must also be a continuous process. A single innovative product or service does not ensure long-term success. Companies, like popstars, can be one-hit-wonders. “There is no question that innovation can drive success, but in today’s rapidly changing and uncertain world, it actually takes more than a breakthrough to sustain competitive advantage,” Hill said. “What will really set a company apart is if it can innovate not just once, but time and again.”

“That is why we admire innovators like Tesla, Apple, Google, Amazon, Netflix, and even our local coffee shop or design firm who is committed to adding value for its customers in new ways,” said Eich.

WEAVING INNOVATION INTO THE VERY FABRIC OF YOUR COMPANY

Armed with a definition for innovation and the knowledge that it is critical to one’s long-term success, organizations must take the next step, which is building a culture of innovation. And this is when the real work begins, because organizations can’t just spend their way to successful innovation.

Corporate leaders must manage innovation as a core business function. They must put policies and practices in place that cultivate innovation. They must provide adequate resources for the process. And most important, leaders can’t become roadblocks.

“Many of the challenges we now face as a global community are so complex that organizations also need to become skilled at building innovation ecosystems that can cut across industries and even sectors,” Hill said. “In order to do so, we need to rethink much of what we have previously learned about leadership.”

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Apple Watch Success Will Hinge on Apps

The value of a wristwatch is typically defined by its materials, design, features and brand. For the new Apple Watch, all those factors will apply, but so will something else: apps.

Apple on Monday held a media event to explain how its long-awaited Apple Watch works and how much it costs. Just as important, it also demonstrated what the watch was capable of doing with apps made by other companies.

If the watch is going to succeed, those other companies will have a lot to do with it because few devices — not even those made by Apple — will sell well without the help of a whole lot of app developers.

“All of Apple’s devices really come alive with third-party apps, and it’ll be the same with the watch,” said Jan Dawson, an independent technology analyst for Jackdaw Research.

When Apple released the iPhone in 2007, it was essentially a blank slate. When the App Store opened a year later, the device became much more than a fancy phone.

Just by downloading an app, the iPhone could become a musical instrument, a medical device, a TV remote and gaming device. It became the ultimate Swiss army knife of gadgets.

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For the Apple Watch to be remotely as successful, Apple will have to find a way to take that world of apps to the wrist. But a watch presents unique challenges with its tiny screen. And the way app developers make money from it will be different than with other Apple products.

Unlike the iPhone or iPad, the Apple Watch is not a stand-alone product. It relies on an iPhone to fully operate, partly because the brains of watch apps will live on the iPhone. So users will have to install watch apps on the iPhone as well.

The economics of that combination are tricky. Developers working on watch apps have to make an iPhone app first and expand it to include support for the watch. And it remains unclear whether they can double-dip. Apple has not said whether developers can charge for the iPhone app, then charge again for the watch extension.

Still, companies are trying, even though some are worried the watch’s tiny screen can limit features or — even worse — ads.

Christian Gaiser, chief executive of Retale, said his company found a path to using a watch app to complement its smartphone app. Retale’s iPhone app displays weekly deals for retailers like Walmart and Target.

Retale users who see something they want to buy in the iPhone app can push the nearest location of the retailer to the watch app, which will map out turn-by-turn directions on the watch screen. Retale collects fees from retailers whenever customers engage with their ads, so the watch app is meant to increase usage of the smartphone app, Mr. Gaiser said.

At its event, Apple also demonstrated an app from Uber, the ride-sharing service, to summon a car. The watch app shows where the driver is on a map, and from there, the user can place a phone call to the driver.

Apple also showed an app developed by Starwood Hotels. Starwood’s iPhone app can be used to book a hotel room. The watch app sends a notification to the watch wearer when he or she is near the hotel. When the guest arrives at the hotel, the watch app shows the room number, and after that the watch can unlock the user’s room door just with a hand wave over the lock.

“The end goal is to build loyalty with our most valuable guests,” said Chris Holdren, who led development of the Starwood watch app. “It continues to deepen the relationship we have with them.”

Unlike past Apple products, the Apple Watch has a complex pricing structure. Because a smartwatch is both device and fashion accessory, Apple designed the watch to be highly customizable to suit the tastes of various users, from fitness buffs to collectors of luxury watches.

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Apple will offer three models, each with a casing made of a different material: Watch Sport, a version with an aluminum case; Watch, which has a stainless steel case; and Watch Edition, which has a case made of 18-karat gold.

Each model comes in two case sizes — 1.5 inches and 1.65 inches. And for each watch, customers will be able to choose from a variety of interchangeable bands in different colors and materials.

The cheapest model is the Apple Watch Sport, the one tailored to athletes, which starts at $350. The larger Apple Watch Sport costs $400.

The next step up is the Apple Watch, with a more fashionable stainless steel case. The smaller version of this watch costs $550 to $1,040, and the larger one costs $600 to $1,100. The price range for both depends on the band.

The golden Apple Watch Edition is a sure sign that Apple has entered the luxury market. Pricing for this high-end version starts at $10,000.

Preorders start April 10, and the watches will go on sale on April 24. They will first be available in a select number of countries, including the United States, Australia, China and Japan.

At the event, Apple also stressed some of the signature features of the device.

The company has highlighted the crown as its latest signature innovation for controlling a device, similar to the mouse for the personal computer, the click wheel on the iPod and the touch screen for the iPhone. On the Apple Watch, the crown can be twisted to zoom in or out of the screen or to scroll through a web page.

You can take and even make phone calls, as long as your iPhone is nearby.

“I have been wanting to do this since I was 5 years old,” said Timothy D. Cook, Apple’s chief executive.

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The watch includes a heart rate sensor and a sensor for tracking movement to complement fitness applications. It has a chip that helps it make wireless payments.

The watch also includes Digital Touch, an application that enables a new method of communication between watch users. Watch wearers can scribble sketches on the watch screen and send them to one another, or even send their heartbeats.

Apple also added to the watch a so-called taptic engine, which taps users on the wrist with a tactile sensation when they receive alerts, messages or notifications. Apple said the watch’s battery would last 18 hours.

Apple also announced a new MacBook laptop with a 12-inch high-resolution “retina” display. It weighs two pounds and measures 13.1 millimeters at its thickest point. It also includes a new port called USB-C. It is a versatile port that can be used for charging, plugging in a video monitor, or hooking up a USB accessory like a keyboard.

The MacBook’s starting price is $1,300 and it begins shipping April 10.

Apple on Monday also released upgrades for some of its other notebooks, including the MacBook Air.

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Why Apple keeps winning in style

Technically Incorrect: As technology becomes more fixated on fashion, the maker of the iPhone and the Apple Watch is well placed to take advantage.

The money men took notes and couldn’t suppress their smiles. Samsung executives took their Notes and slapped them hard against their foreheads.

Apple CEO Tim Cook had just announced that the company had sold 74.5 million iPhones in the last quarter of 2014.

It was even better than the money men had estimated. It was even worse than the Samsung executives had feared.

While the money men told themselves that Apple’s was a brilliantly organized business, at Samsung they muttered expletives and, perhaps, expressions of incomprehension.

After all, what had Apple done in that last quarter? Merely released big phones, which Samsung had done years before.

A pause, then, just to remind ourselves of what Apple does right and how it might leverage that in the future. There’s no accounting for taste. But Apple has turned taste into significant accounting.

There’s almost a self-parody in Apple design chief Jony Ive talking about every new phone. He perhaps reached his peak parodic pomp with the suggestion in 2013 that the colorful iPhone 5C was “unapologetically plastic.” But Apple really does have a superior sense of taste.

While Ive can talk about a rounded edge for a round week, what real people see, the minute they set eyes on an Apple product, is something that they might not be able to define. But it’s something that their hearts and souls identify with style. It’s something they want to be a part of.

Words might fail them. They might opt for the catchall “cool.” But there’s a timelessness, an attention not merely to detail but to the effect of that detail, that makes even old iPhones look good.

There’s always been the perception that Apple products are reserved for those with more money. Money men like to talk about the margins Apple manages to maintain. But the brand now has a certain longevity and a powerful image-based presence. Its incursion into China shows that it’s seen as coveted.

More powerfully, though, look at how Apple has managed to span the generations. In a survey in August and September of last year, 73 percent of teens said their next phone would be an iPhone. Can it be that there is one style product that kids don’t mind being seen in their dad’s hands?

The company’s style superiority might now be taking on another dimension. Cook, not for the first time, mentioned Android switchers in his earnings presentation. Is it possible that some who had previously been value shoppers are now prepared to sacrifice a little more money in order to buy a more expensive phone?

The fashion fixation

After all, many is the fashion brand that has discovered new markets by understanding that people with less disposable income — those who were thought never likely to buy Gucci or Burberry — now want at least one item to show off.

I might not make a lot of money, but I can still buy a Burberry scarf. So there.

Have phones become so much a fashion item that there’s an ever greater shift toward being seen with the right brand?

As technology becomes fashionized — the whole concept of wearable tech, for example, necessarily carries a deep fashion component — Apple is well placed to take advantage.

It isn’t just that the company has hired brilliant individuals from the fashion world. (Did we mention that Apple’s new retail chief, Angela Ahrendts, had been Burberry’s CEO?) It’s that its whole ethos from the beginning has centered on looks as much as function.

Indeed, an essential component of style is simplicity. So the way Apple’s phones work nicely complements what the whole design is trying to achieve.

It’s not that Apple’s phones are without faults. The battery life still causes conniptions. The software isn’t exactly perfect. Occasionally boorish and patrician Top Gear presenter Jeremy Clarkson explained in today’s British Sunday Times (paywall) that there are times that he wishes Steve Jobs had never been born, “but I will not switch to another brand because I simply cannot be bothered to learn how it all works.”

We might be heading for a Futureworld where phones become more disposable, not less. As they lurch ever more toward fashion, we might be changing our phones every year.

Who better, then, than a brand already steeped in taste to take advantage of such a trend? The way in which fashion brands decide and drive what next year’s look will be might, just might, be a template for Apple.

If the brand continues to sell more phones, more globally, might it well decide to present an increased number of versions, of styles, of nuances?

That thought process is already present in the new Apple Watch. In describing it last September, Ive said: “We worked extremely hard to make it an object that would, one, be desirable but to be personal because we don’t want to wear the same watch. One of the reasons it takes us a long time [is] because, I think, people are very discerned. A lot of people don’t wear a watch, at the moment.”

In the end, Apple knows that it has to not merely maintain, but attempt to direct the zeitgeist. It has to foresee whether it can maintain just a few versions of its phone — keeping them as classics — or whether it must create more and more variations. Lines, if you like.

It isn’t about a bunch of ads making people feel that Apple is the coolest thing. The ads merely exist to remind you what products are out there and make you feel good about them. It’s the products themselves and the design behind them that are the best ads, the best marketing of all.

Apple starts from a position where most people still think it’s a cool brand. Annoying at times, but still cool.

How would people describe Samsung’s brand? For a time, it felt younger. It felt like the anti-Apple, at least in America. Recently, though, it lost its way. It sent out many products, but each with little definition or personality. The style, the impact, just wasn’t there. There was no core attitude, no core principle.

As the style slipped further down, so did the profits.

How interesting that, just two weeks ago, Samsung hired Don-tae Lee as its new head of global design. He used to be co-president at London’s Tangerine Studios.

Years back, one of Tangerine Studios earliest employees was Jony Ive.

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