As companies shift gears from managing the bottom-line to growing their top-line, many
will look to product innovation to accelerate growth. This is no surprise as new products
are key drivers of growth, especially ‘game-changers’. As top performing companies have
discovered, product innovation, if approached with a strategy-in-hand is a proven winner.
Top Performing Companies Approach Innovation Differently
Companies
that consistently deliver successful, game-changing products do something that most other
companies do not do when it comes to product innovation – they place
their bets on ‘strategic arenas’ before they brainstorm new product ideas. In other words,
they pick the best mines to explore and they focus their exploration efforts in those mines
only. One of the biggest misconceptions about successful product innovation is that
‘focus’ hinders creativity.
According to the world’s top innovation management scholars, Robert G. Cooper and Scott
J. Edgett, if you monitor the performance and practices of top performing companies
like Apple, Corning, J&J and P&G, having the discipline to ‘focus’ your innovation efforts
does not hinder performance. In fact, it improves performance results!
A Step-by-Step Playbook
In their latest book, Product Innovation and Technology Strategy, Cooper and Edgett
outline how executives in top performing companies take a strategic and focused approach to
product innovation in their quest for marketplace dominance. This step-by-step playbook
guides companies in selecting strategic arenas – the platforms, markets and technologies
that make the most sense for the company to invest and innovate in – in order to
support and advance the company’s business strategy. They also isolate six
elements of a Product Innovation and Technology Strategy that are consistently core in
the top performing companies.
The objective of a product innovation strategy is to align product innovation efforts
to the overall business strategy. For all organizations, a well-defined strategy is the
most critical element to increase return on innovation investment.
Real Company Examples
Peppered with numerous real company stories and examples, this book brings together the
salient points of effective product innovation, strategic management, and innovation governance.
No other business authors give you this kind of uncomplicated narrative, informed by significant
industry experience and rigorous academic research.
Real company cases and examples referenced in this book include Apple’s® iPod,
Procter & Gamble’s Oil of Olay™, Cover Girl’s Outlast™, Johnson & Johnson’s
Viactiv®, Corning’s® Technologies, Lego’s® Mindstorms® and many
more.
- Fact: The Most Popular Innovation Strategy Yields the
Worst Performance
The performance impact of product innovation strategies was investigated by Cooper
and Edgett in this ‘first of its kind’ study undertaken on a large number
of businesses.
“The overriding conclusion of the study is that product innovation strategy and
performance are strongly linked. The types of markets, products and technologies
that firms elect, and the orientation and direction of their product innovation efforts,
have a pronounced impact on success and profitability. Strategy really does
count!” “Some strategy types perform better than others. Conceiving
and pursuing a deliberate innovation strategy similar to Type A, or Type B is certain
to yield better results. Type C, the most popular strategy, yields the worst
performance results.” Chapter 1, pp 15-20, Exhibits 1.6, 1.7, 1.8, 1.9 and 1.10.
- Top Performers Consistently Include Six Key Elements
in their Innovation Strategies
“Six elements of a product innovation strategy strongly distinguish
the top performing businesses in product innovation. They also serve as the basis for
the ideal logical flow or thought process to guide leadership in developing an insightful
product innovation strategy.” Chapter 1, pp 23-28, Exhibit 1.6 for a visual chart
and an overview.
"The six elements are:
- Objectives and Role of Innovation for the Business
- Arenas and Strategic Thrust
- Attack and Entry Strategies
- Deployment – Spending Commitments, Priorities and Strategic Buckets
- Strategic Product Roadmap
- Project Selection and Prioritization."
- Ten Signs a Company’s Innovation Governance
may be in Trouble.
“New product and R&D projects are often initiated solely on their
individual merits with little regard to their fit into the grander scheme. The
result is that the business finds itself in unrelated or unwanted markets,
products and technologies.” Chapter 8, pp 229-234, Exhibit 8.1-8.2.
“Ten signs a company’s innovation governance may be in trouble:
- Inefficiencies
occur due to duplication of effort.
- Decision-making
is not clear and is lacking in accountability.
- Effective
investment decisions are not being made.
- Resource
deployment is not clearly aligned with the business’s strategy.
- The
value of the innovation pipeline is insufficient to meet targets.
- No
process in place to manage innovation and provide oversight.
- Decisions
are not timely.
- Internal
politics play too large a role in funding projects.
- Lack
of visibility regarding decision-making.
- Frustration
around the level of bureaucracy.”
- Top Performers Demonstrate that ‘Focus’ Does Not Hinder
Creativity
The performance impact of product innovation strategies was investigated by
Cooper and Edgett in this ‘first of its kind’ study undertaken on a large number
of businesses. The overriding conclusion was that a ‘focused’ approach
to product innovation guided by a product innovation strategy yields the best performance.
“The three most important achievements in developing an innovation strategy
are focus, focus and focus...but, on the right Strategic Arenas! Too often,
product development efforts resemble a scatter-gun approach: there is no focus; efforts
are thinly spread across many fronts (different markets, technologies and product
types); and there is little impact as a result. In military strategy, the principle
of mass is vital; concentrate combat power at the decisive place and time. The
same applies to innovation strategy.”
“Some skeptics question the need for focus at all, and can point to examples
where having no focus actually worked. But these examples are limited and anecdotal. The
hard research evidence proves otherwise: A focused approach for new product
development has been found to be an important ingredient of successful innovation
strategies. Focus improves creativity by targeting energies on those areas
where the payoff is likely to be the greatest. Focus provides direction for
idea generation, criteria for screening and project selection and targets for resource
allocation.” Chapter 1, pp 1-2 and 17-18, Exhibit 1.6 outline benchmark
statistics and company example: Apple’s iPod.
To arrange an interview with Robert G. Cooper and/or Scott
J. Edgett on these or other story ideas, contact Michelle Jones.
Robert G. Cooper and Scott J. Edgett are recognized as the world’s foremost
experts in the ever important field of product innovation. They are prolific authors,
award winning researchers, sought-after public speakers and consultants to industry. Their
research and resulting methodologies have led to some of the most important discoveries
in product innovation today. They were the first to pinpoint the practices that discriminate
winning products from losing products, to build the most accurate product success predictive
tool and the first to introduce the concept of portfolio management for new products.
Their collective works are considered to have achieved the most powerful impact on performance
in product innovation today.
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Robert G. Cooper
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- Creator of the world’s most widely implemented innovation process,
Stage-Gate®
- Celebrated author of best-selling book, Winning at New Products (Third
Edition) as well as thirteen other highly acclaimed books
- Published 100+ academic articles
- Recipient of numerous prestigious awards
- Internationally renowned for pioneering research in New Product Development
- Spent 35+ years studying the practices and pitfalls of 3,000+ new product
projects
- Professor Emeritus of Marketing and Technology Management at the Michael
G. DeGroote School of Business at McMaster University, Canada
- Distinguished Fellow at the Institute for the Study of Business Markets
(ISBM) at Penn State University, USA
- World’s Top Innovation Scholar (Journal of Product Innovation Management,
Vol.24 No.3: pp 214-229, May 2007)
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Scott J. Edgett
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- Pioneer of portfolio management for new products
- Author of best-selling book, Portfolio Management for New Products (Second
Edition) as well as eight other highly acclaimed books
- Published 60+ academic research and business articles
- 20+ years experience working with organizations in product innovation
and advising business executives
- Former Professor of Marketing at the Michael G. DeGroote School of Business,
McMaster University, Canada
- Faculty Scholar at the Institute for the Study of Business Markets (ISBM)
at Penn State University, USA
- CEO Product Development Institute and Stage-Gate International
- World’s Top 10 Innovation Scholar (Journal of Product Innovation
Management, Vol.24 No.3: pp 214-229, May 2007)
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Accolades
for Robert Cooper and Scott Edgett |
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| “A great book for anyone who wants to develop winning new products.” |
Charles S. Coffey,
EVP
Royal Bank
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| "[Product leadership] is a quite complete package
on the management of product development... Cooper's stature as a researcher
in the field is superb." |
Journal of Management Consulting |
| “Bob Cooper’s pioneering work has set the standard for excellence
in product development,” |
| “The best source for how to start or perfect a winning new product
strategy.” |
Thomas E. Chorman, CFO
Armstrong World Industries, Inc.
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| “A must-read for the business executives concerned with improving
the return from new product R&D. The authors do a great job of laying out
the pros and cons of the latest methods for effective portfolio management
and project selection and show how to integrate them in a workable process.” |
Dr. Robert S. Wood,
Director of Research
Rohm and Haas Company
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| "Cooper brings a systematic approach to the strategy and tactics of
product development…The message to senior people is this: innovate or
die! What Cooper introduces to the equation is discipline. Discipline is setting
strategic direction, in committing resources to those projects that support
it and in defining and managing the product development process…Cooper’s
lists of action items and critical success factors are useful and informative…As
a textbook for preparing for preparing for product development war, it’s
worth having on the bookshelf.” |
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| “This book is an invaluable guide to managers in helping then to ‘select’ the
right projects for development and marketing. Cooper is right on target.” |
Robert E. Davis
Procter & Gamble |
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