In today’s contested markets, simple innovations alone are never enough for long-term success.
Innovation is one of the last remaining sources of trend-breaking growth, yet all too often, companies fail at it because they approach innovation as if it is an art, assuming brainstorming and random moments of genius will help them win. They won’t.
For many years, executives equated innovation with the development of new products. But creating new products is only one way to innovate, and on its own, it provides the lowest return on investment and the least competitive advantage.
In truth, innovation almost never fails due to lack of creativity, but almost always because of a lack of discipline.
The Innovation Code
At the heart of any new discipline, there often lies a simple, organizing system—an underlying structure and order governing what works and what fails. This is what the Ten Types of Innovation framework brings to innovation. Consciously understanding it makes innovation easier and more effective.
The Ten Types framework was derived by analyzing hundreds of successful innovations throughout history and trying to answer a simple question: “What makes these innovations successful, and what is common about them?” The innovation strategists at Doblin by Deloitte had their big epiphany moment when they observed that any one of those successful innovations could be explained by a combination of a finite number of types: the Ten Types.
This is the genetic code to innovation, a useful tool businesses can use both to diagnose and enrich an innovation they’re working on, and to analyze existing competition. It makes it especially easy to spot errors of omission—missing dimensions that will make a concept stronger. Quite simply, if you want your next innovation to be successful, try to hit at least five of these types, simultaneously.
The resulting framework is structured into three color-coded categories. The types on the left side of the framework are the most internally focused and distant from customers; as you move toward the right side, the types become increasingly apparent and obvious to end users. To use a theatrical metaphor, the left of the framework is backstage; the right is onstage.
There are more than 100 innovation tactics—specific, known ways you can use the Ten Types of Innovation. These are like the elements that bond together to form molecules; you can use them to construct the breakthroughs that will help you make a real impact on your industry.
Six Principles for Using the Ten Types Effectively
- Understand all ten types. Virtually all projects can improve just by knowing and deeply understanding the value and subtleties of each of the types.
- De-emphasize reliance on products and technology. These are the easiest capabilities for competitors to copy.
- Think about categories as well as types. Consciously try to imagine new ways to configure assets, build platforms and foster fresh experiences.
- Use the types that matter most. Use diagnostics to understand which types you and others in your industry tend to overlook.
- Understand what your users really need. User research can help you know what is relevant to customers and what surprises other types might help to deliver.
- Use enough of the types to make a splash. Using five or more types, integrated with care, is nearly always enough to reinvent a category and become newsworthy.
Strength in Numbers
Simple innovations use one or two types of innovation, and every company needs to pursue them. Failure to consistently, relentlessly improve the known is one of the surest routes to failure. Unfortunately, too many companies do only simple innovation. In today’s contested markets, simple innovations alone are never enough for long-term success. They can build a lead on competitors, but they don’t create the firms, brands or platforms that thrill us.
When a market grows up and gets complicated, it demands more sophisticated innovation, which uses many types of innovation combined elegantly and orchestrated with care. Under the covers, inside your firm, these require working across internal boundaries and silos—challenges that bring additional complexity. You can cut through this with multi-disciplinary teams to bring in the necessary talent and knowledge, and with systems in place to tell everyone how they can tackle tough challenges with curiosity, confidence and courage.
Naturally, sophisticated innovations are more difficult to pull off, not least because they have longer development horizons than simple innovations. But consider the flip side: once you launch them, they are likely both to delight customers and confound competitors. Often, you will be able to succeed with them for years before challengers can catch up. Almost all of the enterprises we identify as leading innovators routinely use multiple types of innovation—and handily outperform the average firms that innovate more naïvely.
Finding Your Innovation Breakthrough
As the pace of change continues to increase, innovation is imperative. Customers demand it. Competitors may outflank you if you don't achieve it. Talented employees might not join your firm if you don't deliver it. Analysts expect it. Investors reward it.
The innovation strategists at Doblin by Deloitte have laid out fresh viewpoints and have a Ten Types of Innovation book, app and tactic cards that can help companies innovate their way to meaningful and sustainable growth. For more information, visit doblin.com/tentypes. iBi
Francesco Fazio is a principal at Doblin by Deloitte.