Can you spot the hidden product innovation?


Can you spot the hidden product innovation?

A few days ago, T-Mobile announced its new JUMP (Just Upgrade My Phone) initiative. The company has established itself as an innovator in recent years, and for good reason. As a small up-start, it needs to distinguish itself from the bigger players like Verizon and AT&T.
 

T-Mobile’s JUMP plan is pretty interesting. For an extra $10 per month, T-mobile subscribers can upgrade their phone every six months to whatever the latest and greatest mobile device happens to be at that point in time. The typical mobile phone subscriber upgrades phones every 18 – 24 months, so this seems like a good deal, right?
 

Well, it depends. The Verge has a great write-up on the pros and cons of T-Mobile’s JUMP plan, and the short answer is that if you don’t upgrade every 6 months, the plan might not be great for you. Why wouldn’t you want to automatically upgrade? Well, you may want to wait for an upcoming killer phone, or you may feel that your current device is just fine. You may forget, get lazy or just not feel like it. The point is, not everyone is going to want to upgrade every 6 months. For people in this situation, that monthly $10 charge plus the net proceeds of selling a used phone on the secondary market exceeds the value of forgoing the plan all together.
 

So to summarize, T-mobile has just announced a service that provides economic value to those who use it at certain times, and that economic value is effectively subsidized by people who don’t use the service. Ladies and gentlemen, T-Mobile’s triumph of innovation is nothing more than an inexpensive consumer insurance policy.
 

Innovation is all about finding novel applications for existing offerings.

 

That’s right. This high-tech mobile network operator is getting written up as a clever innovator on technology sites like CNET, PC Magazine and getting press from business publications like Bloomberg  and Business Insider.
 

When people think about innovation, they often think of technology or new product development. The reality is that innovation can take many forms. In T-Mobile’s case, the company has innovated by taking a relatively humble insurance product and using it to fulfill a need faced by its customers.
 

So there you have it. A new product, a lot of press, and a new revenue stream all built on the back of a simple $10 monthly insurance policy. It’s all about the packaging.
 

Are you an insurance player looking to understand how you might be able to deploy your products in new, innovative ways? Are you a retailer who wants to understand how to differentiate your offerings by pairing them with financial service offerings? Are you curious about how you can repackage existing offerings to develop new ones? Why not give us a call? We can help.
 

About the Kabardian Group: We help clients achieve profitable growth. Short, simple and to the point. Our clients include companies large and small and at every stage of their development, including start-ups. www.kabardian.com
 


Could your culture be stifling innovation?


Could your culture be stifling innovation?

Each firm has its own unique culture. Often times, this culture evolves from the original founders of the company and continues to thrive even long after those founders have left the organization. At other times, firms receive a kick in the pants from new leadership and culture is changed in step-form. HP is an example of the former, while GE under Jack Welch is an example of the latter.
 

Without getting into an academic debate, culture is the set of norms that govern positive and acceptable behavior in an organization. It is more than simply determining what is right and wrong; it is what determines what is “all right”. For example, supporting one’s superior no matter the outcome might be part of the culture at one organization, whereas open and honest debate, regardless of role in the hierarchy might be part of the culture at a different organization.
 

Ultimately, the culture of most firms can be categorized into those that are rules-based and those that are normative.

 

Rules-based organizations

Firms in this category tend to be very hierarchical, with written rules governing daily activity. For most of their history, auto manufacturers were prime examples of rules-based organizations. One major American auto manufacturer used to have very tightly written rules about what sort of furniture and fixture was appropriate for each level of executive leadership. This same firm is said to have gone so far as to pay for the expense of removing carpeting and wood paneling if an office was reallocated to an executive of a lower standing. That’s a pretty severe set of written rules.
 

Normative organizations

Firms in this category are often very flat meritocracies. Written edicts are few and far between; rules still exist, but they are embodied in the collective mind of the organization, rather than on a written piece of paper. One firm we had the pleasure of working with illustrates this beautifully. The company had one written rule as regards to vacation: There is no limit on vacation time available, and all vacation time is paid. The founder of the firm felt that vacation time was an opportunity to recharge one’s batteries and clear one’s mind. The policy turned out to be a powerful tool to attract and retain colleagues, and on average, individuals at this firm take no more than a few weeks of vacation time per year. The comfort (and support) that more is available “just in case” is what drives value.
 

So what does this all mean?

Well, to a firm interested in growth and innovation, it means quite a bit. There will always be a place for rules in any organization. We’re not suggesting they should be thrown out all together. But no individual (and no set of individuals) can envision every future possibility. Rules that govern every possible outcome are a thing of the past. Instead, modern firms that want to thrive should set guidelines that describe model behavior and then allow culture to reward that behavior.
 

This approach might be novel for a company with unlimited paid vacation time, but it is essential for a firm that is looking to foster and support innovation.
 

Interested in learning more about how to foster innovation within your organization? Drop us a line. We’d love to hear from you.
 

About the Kabardian Group: We help clients achieve profitable growth. Short, simple and to the point. Our clients include companies large and small and at every stage of their development, including start-ups. www.kabardian.com
 


Does your firm reward innovation?


Does your firm reward innovation?

In our daily lives, we face countless tasks that are important and urgent. But not everything important is urgent, and not everything urgent is always important. This is a distinction that is often lost on most people.
 

Here, a simple example serves to illustrate the differences. Imagine there is a new product that was recently launched; sales are not weak, but they could be better. More pressing, customers like the new product, but have lots of questions about how best to use it. In this example, product refinements are important—no doubt, but responding to customer requests is an urgent matter.
 

The former can wait, but that doesn’t mean it’s critical. The latter requires immediate attention.
It’s quite easy for people to lose track of where to focus their resources, and what is true of individuals is no less true of companies.
 

This disconnect is illustrated well by many firms’ inability to capitalize on innovation and deliver growth. Growth tomorrow is important, but managing the state of the business today often takes urgency over “nice to have” investments that won’t bear fruit immediately.
 

Many companies encourage their colleagues to “take ownership” and help the firm “innovate for tomorrow”, but fail to reward or even encourage such activities. In some cases, companies even inadvertently punish attempts at innovation and growth. We’ve all experienced the “not invented here” or “not part of my job” mentality.
 

Overcoming these disconnects requires a measure of honesty from the top of the organization that then cascades down into a series of best practices for the rank and file.
 

Encourage people to take ownership

There is a distinction between management and leadership. Processes and procedures are managed. Smart people look for leadership. The former is about rules, processes and procedures. The latter is about exemplary work activities. If firms are serious about asking for contributions to growth and innovation across the firm, they need to ensure that they have a culture that truly encourages ownership at every level across the organization. Risks should be supported and rewards should be celebrated. That brings us to our next two points.
 

Forgive, but don’t forget

If a firm is not failing at least part of the time, then it is probably not taking advantage of all the opportunities to innovate and grow. No one and no firm is ever going to get it right every single time. The important thing is not to focus on success, but to encourage measured risk-taking and to openly and honestly discuss failures as learning experiences for the future.
 

Celebrate success across teams

When innovation is successful and growth becomes real, it is important to recognize those who contributed to the end result. This means looking past the “front man” (or “front woman”) leading an effort and including all those individuals that stood behind him (or her) to make success possible. Sometimes this means looking in non-obvious places.
 

For firms serious about growth and innovation, the focus should not be on ensuring success—there is no secret formula for that. The emphasis should be on “failing smartly”, supporting measured risk taking and honestly discussing all lessons learned—good or bad—as a result of any effort.
 

Do you have a sense of what makes for a “smart failure”? Does your firm understand how and why innovation takes place, or where new growth opportunities lie? When was the last time a great idea made its way across your organization? Did the idea ever make its way to a business case or experimentation?
 

If you’re not sure, maybe it’s time to give us a call.
 

About the Kabardian Group: We help clients achieve profitable growth. Short, simple and to the point. Our clients include companies large and small and at every stage of their development, including start-ups. www.kabardian.com
 


Page 11 of 11« First...«7891011