Excerpts

PREFACE What to Expect from This Book Two guys walk into a Starbucks and wave to a woman at a table. After getting their lattes, they head over and join her. Paul: Hey, Caroline, looks like you got here early. Caroline: Traffic wasn't bad today. Did you two come together? Rick: No. We just happened to arrive at the same time. How are you doing? How's work? Caroline: It's pretty interesting these days. Today we had a planning meeting to set objectives for the next few quarters. We had a poor performance last year, and budgets are getting cut. I was asked to reduce cost by 20 percent and increase profits by 150 percent. She smiles. Paul: Are these just goals to see how high you can jump? Or are they somewhat realistic? Caroline: It's part of an ongoing internal discussion. We've gotten really efficient at delivering high quality with decent costs. But, you know, everybody else is pretty good at it now. So the discussion is about what to do next. For years, we've had the dual strategy of beefing up quality and reducing costs, and that strategy has worked well for us. But now, we're pretty close to the efficient frontier, and everyone else is catching up pretty quickly. Rick: I know what you mean. We're lost as to how to respond to the latest competitor who is trying to drag everyone into a death rattle on price. It isn't like there is much more we can do with our manufacturing costs or quality. I am a black belt Six Sigma, and we've integrated the latest on lean manufacturing into our StageGate process. Now that we're accustomed to putting out high quality at low cost, we've settled back into our old bunkers. The sales force is on our back to put out some new product that can compete on cost. But we're putting out great stuff, so we wonder why sales can't move product by just showing buyers our quality difference. Paul, now that I think about it, you guys don't seem to be in this cost battle at the moment. You guys are thinking innovation instead of costs, aren't you? Paul: Yeah, I told you guys about the new CEO a while back. He has a different focus. Still too early to tell what will happen, but I have to say that there's excitement in the air that wasn't there before. He believes that we can no longer compete on price but instead need to be leaders in innovation. A couple of weeks ago, he sent out a memo with suggested reading. I read an article in Business Week about the power of design. Usually, articles about design just talk about industrial design and how they make products better. But this article was different. It said that product design means that everyone has to be innovative, not just the industrial designers you hire. Another article talked about the challenge of the growth of China, stressing how companies in Asia are getting smarter, not just cheaper, and that means innovation is the only way to compete. He also sent some literature about programs that a number of B schools are teaching on "entrepreneurship and innovation." He is actually willing to support us getting into those programs. Even he admits the innovation seminars we are constantly attending can only get us to the beginning of what we need to do. I've not yet read the book The Design of Things to Come that he suggested, but I've heard it has some pragmatic ideas on creating profit and growth by focusing on customer needs and desires, and that it has techniques that any of us can understand and incorporate into our process.... Deconstructing Innovation Everyone is talking and writing about innovation. It is the fuel of business strategy. Design and innovation are words that are often used together or interchangeably. Design for us is both a broad concept of change through human problem solving and a word used to describe specific fields such as engineering design, interface design, or industrial design. The power of the new design for innovation is fueling an engine of change that is driving the production of things to come. It is the result of interdisciplinary teams, and it dynamically leads to comprehensive solutions that consumers respond to emotionally, cognitively, and then economically. Few books, however, provide an understanding of how to deconstruct the process in a way that anyone can use to turn a cost-centric approach into an innovation-driven strategy. The challenge in design for innovation is to help everyday people stretch and grow to accomplish extraordinary things. As authors from three different disciplines, we are strongly committed to understanding the innovative process. We represent three core areas that companies rely on for innovation of physical products: business, engineering, and industrial design. As a result of our diversity and commitment to the topic, we believe it is possible to provide a distinct useful, usable, and desirable angle on the current trend of how companies are growing organically through innovation. We have developed an ability to see current and emerging issues through three sets of eyes translated into one common transdisciplinary voice. The result is something that can educate the novice and help experienced practitioners in business alike. The potential in companies is not just the ability to create a pool of talent and capability, but how to give diverse teams of people the power, methods, and courage to be creative and to explore new opportunities. As our own example of the power of teams, writing this book required significant give and take for each of us as individuals. The result is a product that is better than any one of us could have written in isolation. In our roles as university professors, our work has evolved into a balance of research, consulting, and teaching that has allowed us to become an example of what we talk about in the book. We are not just reporting what we have observed; we have lived it. We know what it is like to manage interdisciplinary teams of bright, headstrong people and help them produce innovative and patentable solutions through our methods. We have impressed company executives with the ability to take a vague discussion of possible new markets and, using an integrated product development process in a university context, produce insightful, thoroughly developed and patented products. We have consulted with a wide variety of consumer and business-to-_business companies and helped them produce successful products. The first book of two of the authors, Creating Breakthrough Products, has been incorporated into the product development process of many small and large companies alike. As research professors, we have had the opportunity to step back and reflect on what we have observed. We have identified consistent patterns that led to successful innovation. Our goal as writers was to produce a book that organizes and expresses these findings in a way that the Carolines, Ricks, and Pauls of the preceding vignette can incorporate into their way of thinking and practice. In short, it is a book written by people who have lived with, successfully managed, and thoroughly researched the topic. Said another way, we are armchair quarterbacks who have also played the game. This book deconstructs innovation into understandable chunks that form a compelling argument of what innovation is, why it is important, and how you can begin to transform yourself and your company to meet the needs of the current marketplace. You cannot just hire innovative consultants; you have to learn to create an innovative culture organically within your company. That is the only way the core of your brand can be strategically connected to every product you make and service you provide. This book is also about people who are at the heart of the innovation process. We mention two types of people throughout this book: those who purchase and/or use the product or service, and those in companies who are the innovative developers of the products and services. We include scenarios about the users throughout this book to provide a context for each chapter. The scenarios that start these chapters are fictitious. A common practice used in the early phase of development of new products and services, scenarios are often composites that represent critical aspects of the lifestyle tendencies of the intended market. The second type of people referred to are people in companies, and all of these people that we describe in our chapters are real. They have been extremely helpful and supportive in letting us find out what makes them tick and what enables them to become one of the new breed of innovators. We have worked with them in developing many of the case studies throughout this book. This book is written to help you leverage your ability to find a way to thrive in the complex world we find ourselves in. As the often-used quote from Dickens' A Tale of Two Cities states, it is the best of times and the worst of times. The side of the coin you choose depends on how effective you are at turning obstacles into opportunities. You cannot plan for the future with the hope of always being lucky to succeed, but you can learn to always take full advantage of opportunities when you see them and increase the odds of success. As you look to the future and account for global economic and societal change, innovation is not everything; it is the only thing. Innovate or perish. Or, even worse, innovate or struggle to survive in the ever-tightening downward spiral toward cost-focused commoditization. Because there can be only one cheapest provider, no other choice is left. This book is written in the sequence we would like you to read it, but each chapter stands on its own for the most part. We strongly suggest reading Chapters 1 through 3 before you roam. Chapter 1, "The New Breed of Innovator," talks about the new type of innovator, highlighting three outstanding leaders of innovation and aspects of their approach that anyone can use. Chapter 2, "Pragmatic Innovation--The New Mandate," argues that reliance on quality of manufacture initiatives can no longer be your buoy of survival; instead, innovation is the only approach to differentiation. Chapter 3, "The Art and Science of Business," gives a brief overview of the process of innovation and provides a context for understanding how to make it work for you. The rest of the chapters discuss various aspects of the innovation process. Chapter 4, "Identifying Today's Trends for Tomorrow's Innovations," talks about reading trends and converting them into product and service opportunities. Chapter 5, "Design for Desire--The New Product Prescription," argues that innovation is about meeting people's desires, about fulfilling their fantasies. Chapter 6, "The Powers of Stakeholders--People Fueling Innovation," presents a new approach to analyzing all the stakeholders who affect or are affected by a product or service, a technique we call a Powers of 10 analysis. Chapter 7, "B-to-B Innovation--The New Frontier of Fantasy," argues that the business-to-business world is ripe for fantasy-driven innovation, and that a corporate strategic plan must connect the company to its brand and product. Chapter 8, "Making Decisions for Profit--Success Emerging from Chaos," highlights the complexity of making decisions during the process of product development. Chapter 9, "A Process for Product Innovation," then highlights the detailed process focused on the earliest stages of product development, where innovation takes place. Chapter 10, "Creating a Blanket of IP to Protect Your Brand from the Elements," follows with a discussion of how to protect innovation and develop brands through the intellectual property system. Chapter 11, "To Hire Consultants or Build Internally--That Is the Question," helps you think about developing in-house innovation groups and complementing internal innovation with external consulting. Finally, the epilogue looks at the power of innovation through people and the opportunities they create. We begin Chapter 1 with three people who manage large organizations and who have consistently produced innovative solutions in challenging and highly competitive markets. These individuals set the tone and provide the foundation of this book because each exemplifies the attributes of the new breed of innovator. As these three evolved in their professional careers, they connected their vocations and avocations to form a broader view--both of what was presently going on and of what was possible in the companies where they worked. As they developed, they were able to balance creative approaches with practical methods and to understand how to balance cost with a vision of how innovation could increase profits. Through a combination of education, personal ability, and effective partnerships, these three evolved into the role of the new breed of innovator, having established and managed environments for pragmatic innovation. (c) Copyright Pearson Education. All rights reserved. Excerpted from The Design of Things to Come: How Ordinary People Create Extraordinary Products by Craig M. Vogel, Peter Boatwright, Jonathan Cagan All rights reserved by the original copyright owners. Excerpts are provided for display purposes only and may not be reproduced, reprinted or distributed without the written permission of the publisher.