There’s a lot to learn from the Covid-19 pandemic and the resulting disruption.
There’s a lot to learn about human psychology. About what we prioritise in our lives. Our human desire to solve problems in new ways. Our ability to adapt and sometimes our failure to do so too.
There’s a lot to learn about how we work together to achieve things. Maybe we didn’t all need to be at our desks at 9am to deliver quality work?
There’s a lot to learn about how we build new futures in what will be the unprecedented times ahead. Notions of business as usual are likely to be pipe dreams.
Money will be tight. Huge companies will disappear. Dominant players will emerge or expand.
Things we took for granted will shift as will the priorities of our customers.
Where does this leave innovation?
In an organisation where innovation is seen as a ‘nice to have’ luxury, it will be cut. Internal innovation teams will be gutted. These organisations will say they’re ‘going back to basics’ - believing that in these times of privation, “sticking to what you know” is best and that a risk adverse attitude is the only way to keep the company afloat.
In an organisation where innovation is seen as its lifeblood, it will be elevated further. These organisations will say, ‘we are going to be laser-focused on delivering against our customer needs and we’re going to continue to serve those needs better than anyone else can’. They will believe that in these changing times, being able to innovate and adapt to a rapidly changing landscape will be their only means of survival. They will see the changes in society as an opportunity to solve newly created problems.
As C Martin‐Rios, S Pasamar state in Service innovation in times of economic crisis:
During the 2008 financial crisis, research on leading European service firms highlighted that strategic adaptation via increased R&D investment, M&A and breakthrough or disruptive innovation led to a faster recovery, higher firm survival rate and increase market capitalisation in the aftermath of the recession.
The way forward
Knowing which route to take and actually taking that route are two different things. Many organisations will find themselves heading down a road even though people within that organisation feel they should be taking the other. Sometimes organisations have a momentum all of their own which can be difficult to stop or change.
However, if there’s willingness to stop or change from those who lead, it can be done. Here are some principles that can help guide innovation thinking:
Really know your customers
I’ve worked both client and agency side. Every agency I met said they ‘do user-centred design’. Almost always, they do not. Tacking on some testing with friends and family or a familiarity with the process is not user-centred. Ask to meet their research ops team. Ask if they have research labs.
Within internal teams there’s often a reluctance to talk to real customers. Running a persona workshop without any actual customer research is at best a nice team building exercise and at worst, a waste of time that leads to complacency and poor decision making.
Really knowing your customers is vital, but it doesn’t have to be complex. Investing in quality problem-space research will give you insight that can be used to build features, products, services and even approaches to marketing. We often employ frameworks like jobs-to-be-done that can help you understand the interconnected nature of customer needs and identify areas of opportunity.
Des Traynor, co-founder of online messaging solution Intercom, notes:
“What Jobs-to-be-Done gave us was…a vocabulary and framework to unite the team behind a product strategy. Over time, it turns out it’s not just a great way for thinking about product. It’s become a marketing strategy at Intercom, as well as informing research, sales, and support”.
Recently, we undertook a problem-space research project for a well-known online property platform. It involved diary studies, in-situ research, depth interviews and quantitative research and led to a rich picture of customer needs, wants and desires leading to the creation of ‘thinking style segments’.
Thinking style segments are a new way of thinking about personas that don’t segment via demographics (unless directly relevant to behaviour); instead they represent behavioural differences between groups of people.
This knowledge will fuel innovation within that company. The insight won’t just power the design of a product, it will also inform the scale and adoption of that innovation, crafting transformation and change management around the new portfolio of products and features.
In short, it’s much easier to innovate when you have rich, contextual knowledge of the problem space to hand.
Innovation theatre must die. That means the kinds of projects that make you look good in your quarterly reviews, which have no chance of progressing beyond the 8—12 weeks that’s been budgeted for. Ask yourself, and more importantly the financial decision makers, “what would this project need to prove progress, and for you to fund it?”
Asking these question gives a clear objective to the team. For example - prove there’s a problem to solve. Prove the market’s big enough. Prove this product has traction.
A problem that came off of the back of the lean movement is that people seemed to take away one thing: the idea of MVPs. They missed the reason why you would deploy an MVP in the first place, instead it became shorthand for - ‘what’s the thing we can build within X budget’.
Start building businesses, not products. What I mean by this, is focus on building the things that will tell you if you have a viable business model rather than building ‘stuff’ for the sake of it - even if it’s an ‘MVP’. Sure, this might mean building a product, but it might equally mean building a survey, prototyping or white labelling something.
Don’t pin success to artefacts, pin it to the amount of certainty and risk that exists around your core hypotheses.
If innovation is happening across multiple projects and streams, then invest in the support structure. Tools such as design systems and research repositories will enable your teams to move faster and with more certainty.
When an international pharmaceuticals company came to us, asking to help improve the customer experience within one part of their business, we discovered over twenty individual touchpoints, serving the same customers for the same thing.
The problem was high digital autonomy and low alignment. Global pharma companies are notoriously fragmented. This is partly driven by the silos created by regulatory jurisdictions and partly down to the distributed nature of different scientific and marketing teams. This resulted in fragmentation, disjointed user experience and poor ROI. The total cost was well over $40m a year. Creating a consolidated offering, not only improved the customer experience but significantly reduced costs.
The process of analysing your current service offering and how it relates (or doesn’t) to the needs of your customers can be a powerful and energising process. By taking a service design approach, you can map areas that are underserved and highlight areas of waste. Be brave and cut these projects.
Whilst it may ruffle a few feathers, everyone on those projects will feel like they’re providing life-support to a zombie and will relish the chance to work on something that feels like it’s solving real world problems. The money you saved can be funnelled into better, more valuable and more focused projects.
It’s true that you can’t (easily) measure everything that is good and valuable. For early stage innovation it’s even harder. Often there aren’t benchmarks to work from or even customers to engage with. But defining and measuring success is critical. As humans, we want to make more educated guesses - having an understanding of what we’re trying to achieve and what signals we can use to inform and guide us is critical in achieving that.
As a rule of thumb, if it’s customer facing we’re looking at customer traction (or some derivative) as a leading metric. If it’s an internal innovation project, we’re often looking at adoption and OPEX reduction. Don’t just define the target metrics, also consider the threshold for an acceptable result – a minimum success criteria. You should expect to return and revise these measures as strategies and products evolve.
In the Northern Lights trilogy by Philip Pullman, there’s a concept called Dust - a mysterious particle that despite being ubiquitous and fundamental is a guarded secret by some and a source of power for others. In many organisations you could replace the word Dust with data.
One of the largest areas of latent value in companies is the ability to leverage their data. Sometimes, this data can be used to drive understanding and knowledge. Sometimes it can be used to signal progress. Sometimes it can be used as a valuable stock within your own or other people’s ecosystems (and no, that doesn’t mean creating more unused dashboards!).
What’s needed is a way of shifting the power base of data; away from purely technical contexts and towards the frontline of servicing customers. That might be empowering sales or support staff or delivering new features, products or platforms to customers.
In many businesses, data is seen as a storage and security issue and is pushed to IT to handle. Data literacy, data creativity and data strategy will be core skills in the successful businesses of tomorrow.
As an example, working with one of our large multi-national clients we have delivered the strategy and infrastructure to open up their API portfolio. This has led to innovation internally and externally - and the commercialisation of previously untapped business data and insight which contributed to their income diversification programme.
Despite the instinct to retract from innovation in times like these, the evidence suggests that companies should lean into it. Creativity, customer insight and the ability to deliver won’t cease to be important. In fact, it will be your most valuable asset as you fight for new markets, new ways of working and new visions in a changed world.