The World's Obsession with Innovation

An innovation is a product or service that adds greater value to customers than what already exists.

How's that for taking the sexiness out of a very sexy and hot topic?

The reason I like that simple definition is that it makes being innovative so much more accessible for everyone as opposed to only being a skill that a privileged few can implement. I'm going to use the company, Apple, Inc., to demonstrate a few methods of innovation. They can be applied in any industry at any time. It does require a little thinking time however.

Innovation Method #1: Reverse the situation.

In the 1970s computers were a very big deal. I mean that quite literally. They were very, very big and took up an enormous amount of space. Steve Jobs and his comrades at Apple thought, "Let's reverse the situation. Let's make the computer small enough to sit on a desk so that anyone can use it." In 1984 I was a senior in college. In my dorm, the guy next door and I had to hand in a project for a mechanical engineering course. Due to my rather extraordinary lack of engineering knowledge, I was named to the key position of typist. His roommate had this new funky typewriter called a Macintosh. Somehow it stored all of the information in its little box, and then when I wanted it to print I just pushed one button. Man, did I ever look impressive when I handed in my portion of the project.

How can you reverse a current situation and create additional value for your customers?

Innovation Method #2: Add a thing or two and keep getting better.

Apple did not create the concept of downloadable music. I know that's hard to believe since they just sold their 100 Millionth iPod recently, but there were actually companies out there that were providing downloadable music. However, there was a problem. They were giving away the music for free. Musicians were losing out on tons of money, and the music pirates started to get prosecuted. So there was a situation in which to add value, but no one had pieced together the last few steps that were needed.

In stepped Apple. They created iTunes Music store and the iPod. Now you could download music legally, and musicians could survive.

Of course, there were more innovations involved here. They created a very cool looking device that epitomized simplicity. And they kept making it better and better. In 2001, the first iPod cost $400 and held 1,000 songs. By 2006, you could buy a $400 iPod, but it held 15,000 songs. They kept the price the same, but increased the capacity by 15 times within 4 years.

How can you take a current product or service offering, add a thing or two, and increase the value to customers dramatically?

Innovation Method #3: Combine what's out there.

Now the world is gaga over the iPhone. What is the iPhone? Seems to me it's a cell phone, a computer, a camera, an internet browser, an iPod, a keyboard, and maybe there's a pocket knife in there somewhere. In other words, Apple combined existing products to create something more. Now you can carry your entire music library in your pocket while checking your e-mail and calling a friend while taking a picture of a beautiful scene and typing up ideas for your meeting tomorrow. Now that's cool.

How can you combine existing products and/or services to create something that truly adds more value to your customers?

Why bother innovating?

Two reasons come to mind: first, you create an amazing buzz that can attract new customers to you, and, second, you reinforce why your current customers should stay with you. As customers get more value, they are more likely to stay with you. It's never enough to maintain the status quo.

Book Recommendations:

I just finished reading a fascinating book called, Preventing Strategic Gridlock: Leading Over, Under & Around Organizational Jams to Achieve High Performance Results by Randall Stross. It should have been called, Demystifying Edison, because that's what it did for me.

Edison had an inventive mind and incredibly faithful media relationships. While he did have ideas on the phonograph and the electric light bulb and battery-powered automobiles, none of his products actually became commercial successes. He was more like Leonardo da Vinci than he was like Steve Jobs.

Other far lesser known individuals actually carried ideas through to completion. The lesson I learned from this new book is that innovative ideas do attract interest from the public at large. That's the good news. The bad news is you don't really generate any revenue until you carry the idea through to completion. That's why Apple is on such a roll right now.

Take the three questions I've posed in this newsletter, and gather your team around you. Simply go through the questions one at a time and have your team members write down their answers and discuss them with each other. Then combine ideas to make even better ideas. This is not hard to do, but it does require the discipline to actually do it.

Innovation is not necessarily technological or difficult, but it does require that we stop constantly doing activities and step back to think about what would add more value to customers.

New White Paper – Accelerate Your Strengths

On June 16th I gave a half-day seminar on “Accelerate Your Strengths: practical ideas to boost business momentum” for GE Capital. It was such an interesting project that I wrote a white paper for the group after the seminar based on what we talked about. In turn, that white paper was forwarded on to 7,000 GE employees. Consequently, I thought you might like to read the paper, except this version has all the references to GE taken out. Here is the link for the

Accelerate Your Strengths white paper: http://thecoughlincompany.com/accellerate_your_strengths.html

New Book, Find a Way to Win: Management Insights from Terry Michler, America's All-Time Winningest Soccer Coach

This book focuses on business lessons that can be learned from soccer. The foundation of the book is how Terry Michler used the powerful simplicity of Dutch soccer to win more games than any other U.S. coach in history.

On July 11th, the finals of the 2010 World Cup in South Africa between Holland and Spain was watched by more than 700 million people. While I was cheering for Holland at the beginning of the game, a major decision by their coach led me to learning a valuable lesson all over again.

Dutch soccer, which is highlighted in my book, is all based on extraordinary technical skill, efficiency, and precise attacking soccer. This is how a country with only 16 million people competes so extraordinarily well with the world's super powers in soccer including number-one ranked Brazil, whom they beat in the quarterfinals. However, in the World Cup finals Holland abandoned what made them great and instead focused on playing brutal, violent soccer. They wanted to intimidate Spain, and in the end they lost the game and the respect of so many people who love Dutch soccer. What happened and why did they do it?

They felt they couldn't compete with Spain if they allowed them to get into their normal passing game. So they consciously decided to physically attack the Spanish players with violent tackles all over the field. One Dutch player even shoved his metal cleats into the chest of a Spanish player. They received numerous yellow cards, a red card, and ridicule from the world-wide soccer press after the game.

What's the lesson to learn here for every business? Stay true to who you are. When the prize is close don't abandon what got you to be one of the best organizations in your industry. Too many companies in the past ten years have decided that what made them very, very good wasn't going to be enough to make them number one in their industry, and so they got away from their strengths. Big mistake.

I believe Holland will return to their traditional style of play, focus on precise, skillful, attacking soccer, and get away from their violent style of play. I think they learned a huge lesson. And hopefully every business that got away from its core strength in the pursuit of being bigger and more successful financially than anyone else in the industry will also return to its core and get back to winning again.

You can learn more about Find a Way to Win at http://thecoughlincompany.com/book_store.html

Republishing Articles

Each month my e-newsletter gets republished in approximately 20 blogs, on-line publications, and internal publications for businesses, universities, and not-for-profit organizations. If you would like to republish all or part of my monthly articles, please send me an e-mail at dan@thecoughlincompany.com with "Republishing Article" in the subject heading. I will send you the article in a word document. All I ask is that you include my name as the author of the article and a short paragraph at the end of the article about me with a link to my website.

Take care and have a great month!

Dan Coughlin

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