How To Develop A Growth Mindset - Innovation on Low (or No) Budget

The Boeing 787 Dreamliner can seat up to 250 passengers and haul a half-million pounds. The Boeing (BA) jet has a range of up to 8,200 nautical miles and reaches a maximum speed of nearly 650 miles per hour. Its development required an investment of some $30 billion.

The new Big Dinner Box from Pizza Hut (YUM) can haul two medium pizzas, eight wings, and five breadsticks. It has a range of a few zip codes and reaches a maximum speed of what the delivery driver can get away with. Its development required, well, a different kind of cardboard box.

My point? How simple some innovations can be. You don’t have to have a monstrous research and development budget (or even a test kitchen, for that matter) to innovate. You just have to be alert to your customers’ needs and wants—and creative and responsive in addressing them.

Some innovations do require many years and billions of dollars to develop; witness the Chevy (GM) Volt, which took nearly four years and more than a billion dollars to go from concept car to street legal. (The verdict is still out as to whether it will become a commercial success.) Contrast that with Dr Pepper 10, a soda that targets men who don’t like the taste (or the idea, perhaps) of diet soft drinks. By using a different sweetener and throwing in a tad of good, old-fashioned high fructose corn syrup, Dr Pepper Snapple Group (DPS) came up with a formula that is showing such positive initial returns that the company is already expanding the concept to five of its other brands.

“A Better Way to Deliver Value”

The key to innovation is to not wring your hands about what you don’t have—a giant research budget and staff of PhDs—and focus on what you do have: a relationship with your customers.  Saul Kaplan, founder of the Business Innovation Factory, defines innovation in very simple terms: “a better way to deliver value.” In a recent interview, Kaplan explains what he means: “It is not an innovation until it solves a problem that a customer is having—it delivers value in the real world, solves a problem, and helps get a job done that a customer is trying to do. A lot of people confuse innovation with invention, and think that they just need new technology to solve a problem. But an innovation is not the same as an invention.”

He’s right. Inventions are almost always innovations, but innovations don’t have to be inventions. They just have to be a better way to deliver value. This Christmas, many personal-care product makers such as Procter & Gamble (PG) and Unilever (UL) are putting together gift boxes of toiletries as prosaic as deodorant and toothpaste. If that sounds like the contents of your medicine cabinet, it is. Still, by packaging their products as “affordable luxuries,” these companies are meeting consumers’ needs for simple, inexpensive stocking stuffers. That may not work so well in neighborhoods with circular driveways, but for the rest of us, it’s a gift we could really use. And while our gift-giver stretches his or her budget by (literally) getting a package deal, the manufacturers get to increase exposure and move more product.

Who would have thought a handful of personal-care items would make a great Christmas gift? Not me, but some enterprising packaged goods makers were paying attention to what highbrow cosmetic brands have done for years and have simply applied the concept to their own customers. That’s a helpful template for fostering creativity in innovation—combining two previously unrelated ideas into something refreshing and new. Dr Pepper found something refreshing by combining a diet soda and a regular soda and positioning it for people whose desires weren’t being fully met by either. P&G discovered something new by combining consumer staples with fashion thinking to create a simple, practical gift for challenging economic times. Pizza Hut combined a delivery box with a confectioner’s sampler so it could sell more of every kind of product it serves. You may read this splendid article in entirety via businessweek.com

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Jim Woods is president and founder of the InnoThink Group. He is a no nonsense "tell it like it is" author, speaker, and a strategic management, innovation, commoditization and hypercompetition expert to business and government. He advises clients with an objective view of their competitive capabilities and defines a clear course of action to maximize their innovation return on investment to achieve profitable growth. To build your capability for ongoing innovation across your company or to secure a riveting speaker for your next event - Call 719-649-4118 or email us for more information on hiring Jim. Check Availability.