Kassir Hussain's Blog

I’ve been studying a lot of different approaches to innovation adopted by some of the leading brands for some time but something that strikes me as odd is that there appear to be two very distinct approaches to innovation that do things very differently but still churn out some amazing results.

There is what I’ll call for the purposes of this article the “standard” or well known approach to innovation where you have an innovation funnel of ideas, rely on internal and external crowd sourcing for ideation, use customer driven design techniques and perhaps engage with open innovation. This is the approach that is adopted by the likes of Adobe, IBM, 3M and Proctor and Gamble. This form of innovation has shown to yield some fantastic results for the participants.

However, I then look at companies like Apple and they don’t use the innovation methods used by the companies I’ve described above, but they still come up with some wow stuff! Apple is extremely secretive internally and employees often don’t often know what colleagues are up to. Apple doesn’t crowd source internally, it doesn’t go out to its customers to ask what they want and yet it consistently comes up with disruptive game changing innovation. How’s that work? Apple is not alone though, there are other companies, for example in Italy, who also adopt a similar approach to innovation as Apple. They offer things to the market that simply don’t seem to make sense at first and if you were to ask customers what they think about them you’d probably get very negative results. So how do these companies do innovation so effectively?

I was then recommended to read a book by Roberto Verganti called Design Driven Innovation and suddenly this alternative approach to innovation seemed to make sense. I’m not going to describe everything Verganti’s says but in essence some of the salient points he makes are:

• Design driven innovation is the key to success and is very different from customer driven innovation techniques.
• Asking customers what they want or watching what they do with your existing products is not going to necessarily lead to ground breaking innovation. Asking customers what they want will tend to lead to small incremental improvements.
• Disruptive innovation comes from bringing new meaning to things. An example he cites is the Nintendo Wii which changed the meaning of game consoles by making the interaction more immersive involving your whole body where as to date Xbox360 and PS3 only required your thumbs to play. In addition to that the Wii opened up game consoles to many more people and it was much more social activity. The other interesting thing to note is that Wii was far cheaper to make than the Xbox360 and PS3 but outsold both of those consoles.
• In order to give new meanings to things requires extensive research looking at the alternatives for how things might be used.
• Real breakthroughs come when you can leverage a new innovative technology and provide new meanings to things at the same time.

Going back to Apple, they were the first laptop supplier to remove the optical drives from their MacBook Air. Steve Job’s said that “we do not think most users will miss the optical drive” and he was right, at least for many people, whereas up to that point everyone thought you just couldn’t make a laptop without an optical drive. He fundamentally changed the meaning of laptops. Apples then went further and did the same with the iPad. iPods is another good example of disruptive innovation. Apple didn’t invent MP3 players, nor were they first to market with this technology. But with a super slick design for the iPod combined with iTunes Apple created a new eco-system and changed the way music was consumed. He gave new new meaning to listening to music.

Another really convincing example that Verganti gives in his book is the Swatch Watch. Swatch and indeed most Swiss watch manufacturers were rapidly losing market share and revenue. Swatch came along and turned the watch into a fashion accessory at a very affordable price, which meant that people could own multiple Swatch watches and wear them to match an outfit. This gave a new meaning to wearing watches. No-one to date has been able to emulate Swatches success and indeed even though Swatches have been on the market for a while and easily copyable, it retains its market share and allure.

I have to be honest that even though Verganti thoroughly convinced me about merits of design driven innovation, his steps on how to achieve it left me feeling unconvinced or rather I felt something was missing. Over simplifying again what Verganti suggests is that companies need to build a network of people to collaborate with. This network could include designers, technology suppliers, the media, sociologists, anthropologists and so forth. These collaborates may come from many other industries. I think there is something in that, but the mechanics of how you go about doing it will probably require you to figure it for yourself. These networks of people could take many years to build and establish.

The challenge with what Verganti advocates is that it doesn’t follow a set process and its not easily reproducible. Well if was easy to do or copy then I guess everyone would be doing it! What distinguishes a very innovative company from others is mastering this process of innovation.

I’m not going to spoil the book for you other than recommend you read it, but what are the implications of what Verganti is saying? My take is that companies need to learn to master different approaches to innovation and don’t just rely on the methods that you commonly hear about. There are many ways to skin the cat.

So what do you think? Is there something in all of this or is Verganti barking up the wrong tree?