Guru takeaways so far – think big, start small

After listening to four top experts (Scott Anthony, Jay Paap, Marc Meyer, and Rita Gunther McGrath) speak at our Innovation Leadership Guru Series, I learned that the best way to deal with today’s economic uncertainty – as well as other uncertainties – is to start small. Prototype and test concepts in the marketplace, pay attention to what you learn, and invest in stages -- if (and only if) demand is there. Look at projects across a portfolio. Consider the low-end for disruptive opportunities, but realize that the high-end (and higher prices) might still be attained. In addition to "stair-stepping" development, keep product costs low, tailor common platforms to different market needs, and re-think your business model.

Here are some of my personal favorite takeaways:

- Most innovation portfolios are unbalanced, usually too close to the core. You need a different model, channel, geography, supplier, or other way to really open up avenues of growth. (Scott)

- Companies that survive over time are able to change at the pace of the market without losing control. (Scott)

- Evaluation criteria need to be more qualitative rather than quantitative. The more innovative the idea, the less you can turn to historical data and traditional metrics. (Scott, Jay)

- Map your different projects across the dimensions of high risk/reward on both the market and technical level to identify gaps and/or misalignment. New platforms may appear attractive in terms of growth, but they are often costly and difficult. Make sure to balance your portfolio with incremental products, "stepping stones" (small experiments), and "options." (Rita)

- When investing in uncertain environments, stop worrying about the rate of failure; you can afford a lot of failures if they’re cheap! (Rita)

- Platforming enables companies to achieve profitability even at much lower price points – a necessity in today’s emerging markets (i.e. BRIC countries). (Marc)

-The most effective companies have Centers of Excellence (or Centers of Competence – IBM is an example) and consider face-to-face communication very important between product teams and platform teams. (Marc)

- Rewards and alignment are crucial (all); HR is the next competitive frontier (Scott)

- Access to customers and distribution are strong determinants of success for adjacencies. (Marc)

Some side points of interest that I picked up along the way: MyMMs are really popular party favors (and much higher margin than regular M&Ms), the Honda Element was intended for young males in their 20's but is bought primarily by middle-aged men; Align was almost dropped by P&G because it didn't fit their usual channel, etc.; in fact, almost all the products discussed by the gurus morphed on their way to market...

My own conclusion is that the key to profitable innovation is not necessarily coming up with breakthrough products, but recognizing breakthrough opportunities. Scott gave examples of companies finding happiness at the low end, but Marc discussed how M&Ms went high and did extremely well. I'd say look at your market as a telescope – don’t assume you are at the right price point, though keep the cost of goods low regardless.

The next (and last) two gurus in this series, Gene Slowinski and Rob Shelton, will talk about Open Innovation and integration of technology innovation with business model innovation. I'll report back to complete the picture of how to innovate, grow and succeed - even in a down economy.