Innovators don’t need more ideas. You just need to know which ones will work.
They don’t call it “fast-moving consumer goods” for nothing.
In the consumer products business, the imperative to innovate is strong. And yet, innovation is one of the biggest headaches for many companies – because it costs too much, takes too long and might not even work.
The proportion of new products that survive is famously low: fewer than a quarter of new products are still listed after a year, according to research company Nielsen. The number of truly breakthrough innovations that achieve big success is even smaller.
This is not for want of ideas. In fact, in our experience, creativity is almost never the problem.
As Wilbur Strickland, who leads product development for chocolate at food giant Mondelez, puts it: “My problem is not ideas. Anybody can come up with wild, wacky ideas. I have more ideas than I can possibly ever consider. I need to be able to discern those ideas that I can move forward on a fairly fast timeline, with confidence. That may sound obvious – it’s not.”
Ifan Jenkins, marketing manager for Glenfiddich whisky at William Grant & Sons, agrees. “Coming up with ideas is the easy bit,” he says. “Coming up with things that see the light of day in the marketplace is much more difficult.”
We believe one of the key reasons that so many innovation ideas never see the light of day is that companies don’t consider their own production capabilities. In other words, they forget to factor in what factories and production equipment they own, and what they can actually produce.
This means companies either waste time on ideas that they can’t bring to life, or end up investing huge amounts in new production equipment because the new product they’ve developed can’t be built using their existing equipment.
We have developed an innovation framework that addresses this very problem – it’s called Asset-Out.
Asset-Out harnesses the innovation potential that lies dormant in factories, identifying product features that you can produce with little or no investment, and then coming up with ways to use them to meet consumer demand.
Big names including Mondelez, Glenfiddich, Arla Foods and Omega Pharma have learned that, by studying what their businesses can supply, they can build in feasibility from the very beginning of the innovation process.
It’s an approach that can halve the time it takes to get to market while cutting costs and minimising risk.