To stay focused on growth and outpace disruption, executives can implement one, or a portfolio, of the following innovation operating models to minimize risk in this new hyper-competitive environment. Here we define and discuss the pros and cons of eight different innovation operating models that companies have used—both successfully and unsuccessfully—to stimulate innovation in their companies. Read more to find the right innovation capability to make your company profitable and sustainable.
Whereas lean focuses on reducing waste and enhancing flow, agility plays a complementary role, ensuring that lean practices do not become so rigid that they do not allow for market fluctuations.
In today’s fast-paced, “always-on” world of digital engagement, in which customers are ever-vocal about their experiences and ever-demanding of next-generation products, it can be wise—even crucial—for companies to engage one’s customers in the product development process.
Corporate venture capital (CVC) has become a key component in many companies’ quest for growth. By investing in innovative start-ups, corporate venture capitalists can access cutting-edge technologies, discover novel products or services, gain access to entrepreneurial talent, and experiment with different business models.
Today, with the movement toward putting the customer at the center of innovation, designers are increasingly being tasked with creating ideas as well as packaging them—fundamentally changing the role of the designer in the creative process.
Frugal innovation targets a wide swath of customers in developing countries, including those of moderate to lower income levels, aiming to manufacture products at ultra-low price points to serve emerging market populations. Reverse innovation occurs when these inexpensive products also meet a market need of Western customer segments. When innovation flows from East to West, it “reverses” the traditional flow of innovation from the West to the East.
Done right, incubators allow companies to combine the entrepreneurial zeal of a small, fast-moving, lean, semi-autonomous team with the resources of a large, established corporation. Companies establish incubators for one reason: to drive breakthrough innovation that results in growth and significant revenue.
Picture in your mind a funnel. Wide at one end and narrow at the other, with a single way in and a single way out. For many companies, this is the innovation process—a large number of ideas resulting in only a few new products and services. Now imagine a funnel full of holes, with multiple points of entry and exit that allow more ideas and ultimately more innovative outcomes. That’s open innovation.
The innovation operating model that came first often remains the foundation for most large firms. For companies in pursuit of innovation, traditional R&D can be an efficient and effective model. Contrary to many talking heads on the subject, traditional R&D is far from dead, and it has a solid place in the innovation landscape.
Innovation tops everyone’s agenda, yet many companies don’t have the right structures to innovate effectively and at scale. Leaders who excel at innovation don’t make random decisions, but follow a guided approach that plays to core values and strategic goals.
PwC helps business leaders create a guided path to innovation by developing the right methods that generate insight-based ideas, and to select, produce and commercialize the most valuable and viable results. We bring together customer and industry perspectives to spot competitive threats and uncover opportunities to leap ahead.
Don’t assume the new entrant in your market is a disruption. Learn to recognize different types of threats and design the best strategic response.
Innovate boldly and intelligently, to create and deliver new value.
Top findings from PwC’s 2016 US CEO Survey