TWO KEYS TO SMART INNOVATION
Your Innovation Mandate needs to be smart. Here are the two key identifiers that will tell you if your culture of innovation is smart or stupid. And, no, they don’t make a catchy acronym. We tried to think of one, but it just wasn’t meant to be.
Smart Innovation = Customer-Focused + Sustained
1. Customer-Focused
For an innovation to have value, it needs to contribute to your organization fulfilling its mission to your customers. If it doesn’t, it’s either irrelevant or a source of waste. And remember—your customers are the judge of value, not you.
Sometimes it’s not immediately apparent if an innovation succeeds in adding value from the customer’s point of view. Marketing can sometimes make a difference. For example, in 1998, Proctor & Gamble introduced a breakthrough air-freshening product named Febreze. Based on the chemical compound hydroxypropyl beta-cyclodextrin, the spray was highly effective in removing unpleasant odors from the air. Company leaders thought they had a winning product that would disrupt the air freshener market. Thinking logically, they advertised Febreze to consumers they assumed needed it most: people who smoked or had multiple pets.
But after spending millions of dollars, they were perplexed when the product barely moved from the shelves. The miracle deodorizer appeared to have no value to the consumer! Persistent research revealed a surprising fact based on the principle of operant conditioning.
This is the idea that a person’s behavior is influenced by its expected consequence, and that people strive to do things that make them feel rewarded. But P&G researchers discovered that consumers who lived in smelly houses were so desensitized they often didn’t realize it. They had no interest in making their houses smell good.
Desperately looking for answers, company researchers found a few consumers who regularly bought the failing product. They wanted to know why these people bought it. They found one woman who used it regularly, and she let a P&G marketing guy follow her around her house as she cleaned. Her spotless house had no problems with odors, but after cleaning she sprayed Febreze anyway, saying it felt “like a little mini-celebration when I’m done with a room.”
The P&G marketers realized the woman was using Febreze at the end of her cleaning ritual as a reward and a testament to a job well done. For her, that was the value of the product. It was her personal validation that she kept a clean house, not a tool to deodorize a smelly house.
In the summer of 1998, P&G increased the perfume content and reworked the ad campaign to show it being used the way the woman had, with fresh breezes blowing through open windows. Febreze became a pleasant treat, not a reminder that your home smells bad. Within two months, sales doubled, and a year later reached $230 million. In 2011, The Wall Street Journal reported that Febreze had become the twenty-fourth P&G brand to reach $1 billion in annual sales.
2. Sustained
While a major product or service breakthroughs, like the rollout of a new personal electronics gadget, will make splashy headlines, it’s steady, daily incremental innovations—often made by frontline employees—that give an organization the sustained growth it needs.
Sustained innovation comes from developing a collective sense of purpose. This comes from unleashing the creativity of people throughout your organization, teaching them how to recognize unconventional opportunities, and supporting their efforts with time and money as necessary.
The commitment to establishing the right workplace conditions for innovation needs to come from the top, both literally, in terms of leader support, and figuratively, in terms of the mission statement of the organization.
