Doblin's 10 Types of Innovation®
Spread Your Creative Efforts Across Your Organization
Leading companies are usually successful because of some form of innovation. However, when they think of innovation, many organizations focus on just one part of the business. For instance, they may look at improving customer services or designing new products, but overlook opportunities to innovate in areas such as logistics or business processes.
But, when organizations spread their creative energy over multiple areas, they boost their potential to create value and to produce unique offerings that are difficult for competitors to copy. So, where should they – and you – look to innovate?
In this article, we look at Doblin's 10 Types of Innovation®, a useful tool that identifies different areas where you can innovate across your organization.
Innovate to create more value by analyzing these 10 key areas of your organization.
What are Doblin's 10 Types of Innovation®?
Doblin Group, an innovation consulting firm, developed the 10 Types of Innovation* after 27 years of research into organizations' creative processes. Doblin Group says that you'll more likely have a successful organization if you focus on innovating in at least four of the 10 areas.
The 10 Types of Innovation are in three broad categories:
This relates to a business's internal operations. It is innovation in:
- Profit Model – this is how your organization makes money. (Film-streaming service Netflix™, for example, designed an innovative online subscription model that transformed the movie-rental sector.)
- Network – this is how you create value through relationships and strategic partnerships. (Multinational conglomerate GE taps into a global network of thinkers and industry leaders through its Ecoimagination™ project.)
- Structure – this is how you organize and align your assets, both tangible and intangible. (The Whole Foods Market chain decentralized authority to give each store the freedom to respond to local customers' needs.)
- Process – this relates to the processes that are common to all businesses, such as accounting, as well as those that are specific to your organization. (Retail giant Walmart™, for example, brought in real-time inventory management systems that revolutionized how supermarkets respond to customer demand.)
This category concerns the products and services that a company offers. It is innovation in:
- Product Performance – these are the features and functionality of your product. (Homeware company Oxo™, for example, devised the "Good Grips" range of well-designed and easy-to-use utensils.)
- Product System – these are the complementary products that connect or bundle together to create additional value. (Personal care company Gillette created the Gillette Venus™ range of shavers for women and supplemented it with disposable and refillable products.)
This is about how end-users experience a business. It is innovation in:
- Service – these are the support and services that you provide to potential clients or customers. (Luxury fashion group Burberry, for example, created a "direct-to-buy" live streaming service that allows customers to buy clothes straight from the catwalk.)
- Channel – this is how you reach customers with a product or service. (Supermarket chain Tesco set up virtual supermarkets on railway platforms in Korea to help time-poor commuters to shop for food.)
- Brand – this is how you communicate the identity and value of your company, product or service. (The Virgin brand has diversified into a number of wildly different sectors, from space travel to banking.)
- Customer Engagement – this is how you interact with customers, and what they feel about you when you do. (Motorcycle manufacturer Harley-Davidson has fostered a worldwide community that allows it to engage with bike owners.)
Applying the 10 Types of Innovation
There are many ways to innovate in each area. For example, San Francisco-based home-cleaning products company Method focused its innovative energies on five of Doblin's 10 Types of Innovation: Structure, Process, Product Performance, Brand, and Customer Engagement.
It aimed to enhance its green credentials so that it would stand out in a crowded marketplace.
The company looked at its structure, and decided to outsource production to more than 50 subcontractors, making its manufacturing "nimble and flexible." It also worked with its suppliers to gauge the environmental effects of making its products. This allowed it to focus on the best ways of ensuring it used water, energy and materials efficiently in the manufacturing process.
In the area of product performance, Method emphasized its principle of using only "safe" ingredients by avoiding toxic chemicals.
The company designed bright and colorful packaging that boosted its brand. And it also launched an innovative customer engagement campaign, "People Against Dirty." This involved building an online community, offering customers perks and deals, and involving them in the company's green mission.
We've highlighted some strategies below to help you to get started with an innovative approach for your organization.
1. Profit Model
Think about where your revenue comes from. Are there any bottlenecks that are limiting it, or could you be doing other things to generate it?
Try using SWOT, PEST and Core Competency analyses to identify opportunities to increase your profit. Porter's Diamond can help you to ensure that you're thinking in the right areas, and Porter's Five Forces is a useful tool for figuring out how to take advantage of market power.
You can also use VRIO Analysis to help you to make effective use of your resources.
Look at how your organization works with its suppliers. Approaches such as supplier relationship management, procurement management and the Kraljic Portfolio Model can help you to manage your supplier relationships more strategically.
Your organization should be focusing on its strengths, and outsourcing its weaker areas to a network of suppliers and contractors. This can help to improve its primary focus, reduce its costs, and increase its efficiency.
Also, think about whether you could create strategic alliances with other organizations to make the most of your mutual opportunities. For instance, Nike famously teamed up with Apple to combine running and music, with an in-shoe device (Nike+™) that linked to a user's iPod™ or iPhone™.
The Simplex Process, the Innovation Circle, and Teece's Win-Lose Innovation Model will help you to innovate in all of these areas. Our article on Generating New Ideas can also help you to innovate by "thinking differently."
Try brainstorming ways in which rearranging and realigning your organization, assets and talent could deliver greater value. Could you cluster departments together to create value in new ways, for example, or move to a less hierarchical, more organic structure? Outsourcing is also a potential solution in this area (see below).
Our article on Miles and Snow's Organizational Strategies can help you to align your organizational structure with your strategy more effectively.
Improving processes – for example, to shorten product delivery times, can give your organization a definite competitive edge. But some processes don't offer much competitive advantage – payroll management and IT support, for example. In other areas, such as marketing, design or specialist technology delivery, external providers may have more expertise and skill than internal ones.
In these cases, outsourcing can allow your organization to focus on core areas of the business, and to reduce overheads.
With core processes that are specific to, or customized for, your organization, search for ways to make them more efficient. Tools such as Value Chain Analysis, Porter's Value Chain, Core Competence Analysis, USP Analysis, and the Product-Process Matrix can help you to do this. (Our article on Business Process Reengineering also has some useful strategies for getting started.)
5. Product Performance
When people think of innovation, product performance is often where they begin.
How can you improve your products or services to make them more appealing to, or more effective for, your customers?
You can start improving product performance with a Conjoint Analysis. This helps you to measure buyer preference, so that you know what to improve. You can also use Kano Model Analysis to explore a product's attributes and identify potential for improvement. Design Thinking is important when you're creating new products.
6. Product System
Look at your product line or offering. There may be ways to customize or accessorize it for customers, or bundle products or services together to offer more complete solutions. Conjoint and Kano analyses can be useful here, too.
You're likely already aiming to provide the best service possible to your customers, but could you raise your sights still further? And can you improve your service at every step of the information-gathering and purchase process, as well as after someone has bought your product?
Value Chain Analysis, Porter's Value Chain, and customer experience mapping can help you to assess the service that you provide. You can also help your people to serve customers better with our article on the Customer Service Mindset, and improve the way that they manage and use complaints and feedback.
Think about the communication channels that your organization uses to get its message across, and what alternatives you could use.
Start by looking at your marketing mix and web marketing tactics to make sure that you're using all available options, and brainstorm ways that you could get your product or service in front of new customers. For instance, could you expand into new social networks, produce webinars, or start an online community?
Creating a value proposition can help you to re-analyze and invigorate your brand's message. This, in turn, will help you to identify ways to communicate its value to customers, because you will have built up a much better picture of who they are.
You can also review and revise your customer-facing material, such as packaging, to enhance your brand, and engage in a range of other brand-building activities, such as having a strong presence online.
10. Customer Engagement
You need to understand what matters to your customers to have meaningful relationships with them. When you find new ways to address their aspirations, needs and wants, you become part of their lives in a more personal way. And this can increase the likelihood of them returning to your brand, and buying your product or service again.
You can also improve customer engagement by monitoring your website closely, using analytics tools, to increase your knowledge of people's habits. Value Chain Analysis and customer experience mapping are also useful in this area, as is Future-State Customer Journeys.
Doblin's 10 Types of Innovation® was created by the Doblin Group, an innovation consulting firm.
The tool highlights 10 areas where you can innovate to create more value for your customers. This helps you to build an exceptionally innovative business – one that is difficult for competitors to copy.
The areas are:
- Profit Model.
- Product Performance.
- Product System.
- Customer Engagement.
Click on the thumbnail image below to see Doblin's 10 Types of Innovation represented in an infographic: