TLQ 1.3 | Innovation in an Ever-Changing World

Innovation in an Ever-Changing World

Innovation drives growth, but how do brands innovate in an ever-changing world? New business models, products, and technologies are changing at a rapid pace. Competition remains fierce. Disruptors are tearing down traditional routes to market and bringing new personalized value propositions to their customers. 

Here’s the reality: yesterday’s approach does not guarantee tomorrow’s success. 

I recently attended a master class focused on innovation, led by The Lead Co. The insight disclosed by executives from thriving fashion, cosmetics, fast-moving consumer goods, and retail brands confirmed what I sensed most businesses are experiencing: the process of customer-centric innovation is evolving at an unprecedented pace. 

The way teams identify inspiration, engage new product launch processes, use data analytics and consumer insights, and structure their organizational design continue to evolve to meet the consumer needs. However, innovation, by definition, is change that can be hard for many people, especially those in companies that have been in existence for decades. 

Executives who are charged with innovating for companies have a multitude of challenges they must overcome. In a recent pulse check survey conducted by Consumer Goods Technology, 96% of respondents foresee moderate to significant changes in their go-to-market strategy. Innovators must be comfortable and inspired to work in constant change as they look to bring the very best experiences to their customers. 

TO BE A TRULY INNOVATIVE CULTURE, ADAPT AT SPEED

How well are consumer products and retail brands adopting such a holistic view of innovation management? While they are adapting to an ever-changing, highly fickle consumer base, the current pandemic is forcing them to rethink the processes and strategies that were once dependable. Design teams are collaborating across more remote environments. Growing volumes of customer input are flowing through their decision-making systems faster. Even how products are launched in the marketplace is happening in astoundingly new ways.

The moment a brand realizes how its innovation approach must change, a ground-breaking competitive advantage emerges. For example, a leading apparel brand reduced its normal innovation process from 18 months to six weeks when they embarked on a new design process to bring a collection of breathable face masks to market. Born out of necessity, the apparel company is now challenging the status quo and looking for new ways to shrink time and costs in all processes, while delivering better products that customers demand. 

This approach of tearing down legacy practices and finding new ways to bring innovation to market faster is top of mind for some leaders. For many attendees of the master class, it’s part of their plan to evolve and grow in the future. Time will tell whether these large organizations will embrace this new way of innovating or fall back on old habits.

BUSINESS-WIDE COLLABORATION AND CONNECTEDNESS ARE CRITICAL

Innovation is more than just a good idea. Recent Oxford Economics research uncovered the value of innovation as the full expression of relationships within and beyond traditional organizational boundaries, creating a unified entity that operates smoothly, dynamically, and as part of a cohesive strategy.

But creating a cohesive strategy is the challenge. Brands must orchestrate their innovation programs as a connected set of activities throughout the organization to recognize success. Today’s innovators must sell their idea to many internal stakeholders across various lines of business – including sourcing, supply chain, sales, service, and marketing. Doing so helps turn a seed of an idea into a real-life offering that customers love, a productive tool, or an experience that helps employees succeed. 

One innovator at a large fashion brand with dedicated factories discussed the success of getting one of its organizations excited about a new idea. This executive leader leveraged classic grassroots marketing strategies to inspire plant managers who have hardly any time for experimentation. Once the managers saw the passion and potential for a new product offered to open a new demographic, they collaboratively worked together and creatively unlocked time to run a pilot.

Breaking down innovation silos with purpose and connection is the key to driving the right innovation outcomes. But as the innovator’s experience proved, small teams with the right expertise must have the authority to make decisions quickly and access data from functional areas to focus on common organizational and business goals.

THE CUSTOMER MUST BE AT THE CENTER

The Oxford Economics study also revealed that, although surveyed executives indicated achieving measurable results from integrating processes and breaking down functional silos, the way data is used must be improved before committing to further business transformation. 

This finding pinpointed a common issue that nearly every executive – from large conglomerates to small startups and every business in between – at The Lead Classroom shared. There is a need for better ways to connect and collect customer feedback and integrate it with the innovation process. Even established brands with substantial data have much of it locked in organizational functions.

Insights from customer data are considered critical to better understand their customers’ needs, expectations, and experiences 

Customer data insights are considered critical to understand customer needs, expectations, and experiences to fuel ideation, design and prototyping, and delivery. Recognizing customer trends, preferences, likes, and dislikes as they interact with the brand is an important feedback mechanism in the design process. For industry leaders, incorporating customer feedback into the design process quickly and cost-efficiently improves decision-making and buy-in.

INNOVATION IS A SHIFT FOR A WORLD OF CONSTANT CHANGE

Innovating, producing, and delivering a product or service is half the battle. Today’s consumers demand so much more, especially an exceptional overall experience that is tailored to their needs. 

Organizations must serve a marketplace where constant evolution is normal. Fostering a collaborative and connected business environment allows decision-makers to look at the entire customer lifecycle – from initial interaction to digital and physical experiences and delivery. With this holistic, data-driven insight, brands will know how their products and services resonate with consumers and pivot accordingly, in real time.

Consider a company like Peloton. As an avid rider, I am amazed when companies keep a customer-centric mindset and adjust during these challenging times. A recent article highlighted Peloton’s customer centricity and agility. The company pivoted its business within 36 hours to provide a new customer experience. That is innovation at speed.

And as I learned from every executive that attended The Lead Classroom, good business leaders think about innovation in relation to every moment of the customer journey. Why? Because any opportunity to build a stronger connection with consumers is an edge that allows brands to stay ahead in today’s ever-changing world.

Discover how consumer products and retail brands that innovate beyond today’s market dynamics exhibit competitive and resilient industry leadership. Download the Oxford Economics study, “Beyond the Crisis,” sponsored by SAP.

Rick Wenger helps companies strategize and unlock value using technology.    

Currently, Rick leads SAP’s Executive Advisory practice for Consumer Industries in North America.   His team works with top brands and executives across Consumer Packaged Goods, Fashion, Retail, Wholesale Distribution, and Life Sciences.   Rick is an accomplished executive with nearly 20 years of experience helping companies identify and resolve strategic improvement opportunities through process and technology transformation.  Rick has a proven record of success in delivering results with mastery in business strategy development, delivery, and value realization.  

Rick joined SAP in 2004 and has served in various leadership roles including supply chain solutions, solution engineering, and value engineering. Rick came to SAP from Manugistics, where he worked for 8 years as a consultant, project leader and customer advisor.   During this time, he worked in developing and deploying supply chain planning and execution strategies for large multi-national consumer products and life sciences companies.   

Rick is based out of SAP’s North American headquarters in Newtown Square, Pennsylvania.