If you check the content we publish on our blog, you’ve already understood how important open innovation is – so important that we called it a secret weapon! For this article, we decided it’s time to be more practical: what types of innovation there is? How can you apply it to the different stages of your business? Which type of innovation should your company start from?
Doblin’s research shows there are 10 types of innovation dived into three categories: Configuration, Offering, and Experience. In this article, we will introduce you to the 10 types and give you practical examples of how companies can apply it.
The four first types of innovation are regarding the processes and strategies of businesses before the product or service reaches the clients, and these are Profit Model, Network, Structure, and Process. The first innovation type is about how your business makes money, which is, well, the ultimate goal of your company, right? So, having a strong business model is essential! Do you feel like your company’s business model is not strong enough? Maybe because it’s too similar to the competition? – Well, then it’s time to innovate. Newspapers are a good example of a sector in which the business models had to radically change to survive. Since people no longer buy newspapers as they used to, several companies charge nowadays a monthly fee for readers to access some (usually “premium” ones or a pack of 10 free articles per month) or all of their contents online.
The second one, the Network, respects all the partners involved to deliver a product or a service. As it impacts quality, price and delivery time, the network of your business should be very well analyzed, as it could make sense to look for more innovative partners, or even internalize or externalize parts of the supply chain.
The Structure is about how you organize your talent and assets. Do you give your staff the right conditions to innovate (and we’re not only talking about giving them a computer)? Google does. That extra time the company gives to employees to work on side projects led to the creation of Gmail and Google News!
Process innovation respects the way things are done in your company and how you can improve them. This is probably one of the hardest innovation types – you might think: “Things have worked out this way all these years, why should I change it now?”. Well, here’s an example of process innovation: McDonald’s encourages its franchisees to develop new receipts and launch new products and that’s how the company started offering breakfast – which nowadays represents 25% of its revenues. We also work with process innovation in TAIKAI, together with CTT, the Portuguese mail service, we’ve just launched a challenge to improve their processes: innovators were challenged to build an app able to scan packages and quickly identify the features of it simply by using a smartphone.
This category is about making improvements to a product: its Performance and System. Product Performance regards to value, features, and quality, while Product Performance is about the way products and services of a brand connect. Apple does both very well: it keeps improving its products and launching new iPhones almost every year, while at the same time, creates extra products to complement the main ones, such as, for example, Apple AirPods.
Experience innovation is the most customer-facing category, but also the type of innovation which results are harder to measure. It subdivides among Service, Channel, Brand, and Customer Engagement.
The Service you provide impacts the quality of what your company has to offer, as the clients’ perception of quality is affected, not only by what you deliver but also by the way you deliver it. Amazon revolutionized e-commerce by innovating delivery time: depending on their location, clients can get their orders in one day or even on the same day.
Channel is about the way you deliver your products. Yes, everyone buys online these days, but physical stores are still relevant, as they help brands create immersive experiences.
The third type of experience innovation helps protect and reinvent one of the most precious assets of your company: the Brand. You can enhance your brand by associating it with a social cause, it will confer it meaning and it will help clarify its values among customers. Last March, we organized a challenge focused on a very contemporary social cause: the coronavirus pandemic, through which we challenged participants to look for solutions to help fight coronavirus. “Fight COVID-19 Open Challenge” consisted of four categories: Epidemic Analytics, Health, Coronavirus Analytics by Data Science for Social
Good, and COVID-19 Information Materials. This challenge counted with Premium Supporters - companies that believed so much in the project itself and our methods, that they were willing to monetarily invest or provide services. Moreover, we had several partners which helped us built the challenge and spread the word about it. The results? 35 projects, some of which you’ve heard about for sure. Check them here.
And last, but not least… the Customer Engagement. How many times have you avoided going to a certain shop or restaurant just because you didn’t like the service? I guess that tells you how important Customer Engagement is. Innovating in this category means finding what your clients are looking for when buying from you and using that knowledge to create meaningful interactions.
So, now that you know a little more about the types of innovations and how companies are using them to leverage their businesses, do you feel ready to boost innovation in your company? Wherever you have a concrete idea or still need some help figuring out where to start, count with us to help you launch your own open innovation challenge! It can be exclusively for your staff (Facebook is quite a fan of this method – did you know?) or open to our amazing tech community.
Either way, we hope this article helped you understand that innovation is much more than simply creating new products and that innovating doesn’t have to be expensive, either hard to apply!