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INNOVATION
JOHN CAIN & ZACHARY JEAN PARADIS
With contributions from Joel Krieger, Adrian Slobin and Pinak Kiran Vedalankar
OUR PERSPECTIVES
Innovation myths
Its worth debunking a few of the
common myths about innovation,
starting with the idea that innovation
only pertains to the introduction of
breakthrough or disruptive products or
services. This is not always the case.
Incremental innovation (the improvement of current products, services, and
processes) can be hugely valuable.
A second myth suggests that innovation requires a focus on key, new
products. But ranges and types of
innovation can flow from different types
of attention to people, business, or
technology. Instead of one imagined
scale and a single object, we see varieties of scales and differentiation in the
focus of innovation: external to internal,
product to system, and incremental
to disruptive.
With so much innovation present in
the innovation process itself, the third
myth is that there is a single approach
to innovation. As youll see, there is
actually a range that enables different
types of agility to increase the hit rate
of innovation at every level.
Innovation approaches
Along the range from incremental to
breakthrough, we see four main approaches to innovation in large organizations (see Figure 1): analytics-driven
optimization, hybrid agile, labs and pilots, and the spinout of a (lean) start-up.
FIGURE01
Analytics &
Optimization
Evolve
Platform
Hybrid
Agile
Build/Evolve
Platform
Labs &
Pilots
Identify New
Platforms
Incremental
(Lean)
Start-up
Identify New
Businesses
Breakthrough
Planning
Scale
Agility
Analytics &
Optimization
OUR PERSPECTIVES
Hybrid Agile
(Lean) Start-up
Hybrid agile
The second approach, hybrid agile,
seeks to deliver the benefits found in
agile development, while also permitting the long-term horizons typical in
large companies. Unlike more traditional agile (e.g., Scrum), hybrid agile
is a better fit for large programs with
dependencies across multiple groups.
We often see large organizations
with heavy planning processes built
around quarterly (or even less frequent)
releases. Internal teams are doing more
in each release, thereby accumulating
risk without value with every unreleased
change rather than splitting the risk and
value introduced over smaller releases.
Moving to a hybrid agile approach might
break a set of what would originally be
three releases over eight months to one
release per month (see Figure 2).
For a top retailer, we led a program
to redesign across the brands digital
touchpoints, re-platform its core capabilities, and move the organization from
a quarterly release cycle to a monthly
hybrid agile model. The hybrid part
OUR PERSPECTIVES
of hybrid agile allows for the introduction of milestones around each agile
delivery release (ADR), which enables
reprioritization both within and between
ADRs. Key enhancements were introduced within a month of re-launch,
increasing conversion and sales while
simultaneously minimizing risk for
later enhancements.
The bulk of major enhancements or
platform builds that companies execute
would be best achieved through a
hybrid agile approach. Ultimately, these
enhancements can flow from different
types of innovation, such as identified
customer needs, industry improvements in core capabilities, or internal
process evolution.
FIGURE02
Release 1
Release 2 Release 3
Release 4
Release 5
Release 6
Release 7
Release 8
SECOND STORY
FIGURE03
Ask
Driven
Context Building
Self
Directed
Knowledge Artifacts:
Basic Knowledge
Idea
Driven
Hunt
Discovery
Idea Generation
Test, Learn, Iterate
Package
Executable Idea
Drive Adoption
OUR PERSPECTIVES
Knowledge Artifacts:
Learning & Perspectives
FIGURE04
FIGURE05
Second Storys lab-based approach incubates by creating spike solutions in areas where there are no best practices
Second Storys lab-based approach starts with technology experimentation for example laser projection and product
scanning and then links it to an overall experience vision, which ultimately links to a business challenge. This flips the
traditional approach of business problem to application on its head, helping to ensure that the chosen vision is achievable,
while still being cutting-edge.
APPROACHES TO INNOVATION
Incubation Focused
SPIKE SOLUTION
DESIGN/IMPLEMENT
THE EXPERIENCE
SPIKE SOLUTION
(Laser projection looks awesome.
Lets figure that out.)
SPIKE SOLUTION
(Lets learn how to scan stuff
because scanning is a fascinating
technology.)
OUR PERSPECTIVES
BUSINESS CHALLENGE
(This may help us combat Amazon
by using one of our greatest
strengths: the store.)
Lean start-up
The last approach is focused on a single opportunity space. Lean start-ups
are undertaken with the idea of creating
both a business and a product. A
great example of a successful start-up
stemming from a large organization is
giffgaff, spun out of the UK mobile
telecom, O2, in 2009. Leaders at 02
recognized an opportunity for a mobile
carrier built on a new business model.
Created in late 2009, giffgaff is a
SIM-only mobile network targeting
price-sensitive, digital-savvy customers
who avoid traditional networks. The
network attempts to reward its customers
for doing much of the work normally
done by employees namely, customer
service and promotion.1
Which? Tech Daily. Why giffgaff is our Best Telecom Services Provider 2014." http://blogs.which.co.uk/technology/
phone-networks/why-giffgaff-is-our-best-telecom-services-provider-which-awards-2014/.
2
OUR PERSPECTIVES
VENATOR
Venator is SapientNitros internal
innovation team. Its a small, highly specialized group that integrates
business, technology, user experience,
and data science expertise with a core
mission to identify, create, and invest in
breakthrough innovation. Venator, Latin
for hunter, focuses on discovering key
innovation trends and understanding
what impact they will have on the
intersection of technology and story.
The group is a driving force for stewarding clients to see around corners toward
whats next.
The inspiration behind Venator came
from co-running an innovation center
with a client. We realized that a similar
model, operating independent of any
single client, could act as a vehicle in
defining our industrys future. The team
focuses on three main areas:
Sourcing and assessing innovative
start-ups to discover companies that
are solving business problems in new
and unique ways, but are likely not
on the radar of our corporate clients.
FIGURE06
CONCEPTS
Digital Augmentation
of Physical Worlds
Virtual Reality
Inspiration
& Discovery
Participatory
Economy
Internet of Things
Alternative
Distribution
Advanced
Analytics/Insights
Real-Time
Experience
Optimization
Customizable
Products/Services
Multisensory
Recognition
Machine
Learning
Robotics
Sensors
Non-Conventional
Interfaces
Cognitive
Science
Wearable
Computing
3-D Printing
Location
Detection
OUR PERSPECTIVES
ENABLERS
BEST PRACTICES
DO NOT DRIVE LEADERSHIP
If your goal is to drive leadership or breakthrough
innovation, then perhaps asking your teams or
partners to produce best practice reports is not
the best solution. Breakthrough innovation comes
from focus directed at your customers ecosystems
and larger journeys, the exploration of new technologies, or the experimentation of new business
models. It doesnt necessarily come from what
your competitors are already doing.
INNOVATION MUST
BE PEOPLE-CENTRIC
(EVENTUALLY)
Innovation can be effectively
driven by technology and
organizational work, but
it is ultimately realized by
understanding how it solves
problems for people.
Conclusion
Every day, large organizations struggle
with how to maximize innovation, not
realizing that their struggle stems
primarily from the singularity of mindset
and process with which they approach
problems and opportunities. What
they might need, in fact, is a portfolio
of approaches that enables different
altitudes of investigation and types
of agility.
Each of the four approaches has its
benefits in specific scenarios. Focusing
even obsessing over analytics and
optimization can garner real rewards.
The hybrid agile approach can be
used to accelerate delivery of complex
enhancements more quickly. Labs and
pilots are good ways of exploring new
technology platforms and collaborating
with start-ups. And the ability to spin
out start-ups allows for the quick testing of entirely new business models.
There is no one-size-fits-all to innovation;
however, by varying their approaches,
companies can maximize the potential
hit-rate of their innovation investments.
OUR PERSPECTIVES
John Cain
Vice President, Strategy and Analysis,
SapientNitro Chicago
jcain@sapient.com
Based in Chicago, John plays an active role in experience
and innovation research to increase our understanding
of consumer behavior. He provides expertise in advanced
analytics and data visualization, data modeling,
measurement, and reporting that shapes business
innovation and design strategy.
SapientNitro, part of Publicis.Sapient, is a new breed of agency redefining storytelling for an always-on world. Were changing the way our clients engage todays
connected consumers by uniquely creating integrated, immersive stories across brand communications, digital engagement, and omnichannel commerce. We call
it our Storyscaping approach, where art and imagination meet the power and scale of systems thinking. SapientNitros unique combination of creative, brand, and
technology expertise results in one global team collaborating across disciplines, perspectives, and continents to create game-changing success for our Global
1000 clients, such as Chrysler, Citi, The Coca-Cola Company, Lufthansa, Target, and Vodafone, in thirty-one cities across The Americas, Europe, and Asia-Pacific.
For more information, visit www.sapientnitro.com.
SapientNitro and Storyscaping are registered service marks of Sapient Corporation.