What Makes an Idea Innovative?
A rudimentary set of criteria to determine how much change a particular new idea will unleash on the world around it.
Since I work with a variety of corporate startup teams across different companies and sectors, people ask me all the time: “is my idea innovative?”
I usually shrug and reply, “I don’t know”.
Is there a specific criteria for being innovative?
According to Slack’s boss, Stewart Butterfield, innovation can be measured by “the amount of change in human behavior”, which emerges from a deep understanding of customer needs and desires, the result being a complete shift in how a market functions.
Taking Stewart’s statement one step further, I derived my own list of impacts to determine the level of innovativeness of a particular internal idea:
- How much does it improve the customer’s life?
- How much will it change the status quo in the current market and complementary markets?
- How much will it redefine rules, regulations, and legal structures?
- How much will it transform the company?
How much does it improve the customer’s life?
Ideas are often recognized as innovative for its impact on customers. Essentially, according to the Jobs-to-be-Done Approach, a new solution can succeed in the market if it helps a customer do their “jobs” better, faster, easier, or cheaper. Thus, the benefit and reach of that solution can be measured, i.e. is it an incremental improvement or a radical improvement?
- Incremental: improves upon the current process with some to most of the existing customers
- Moderate: makes a significant leap forward in helping all existing customers solve their job
- Radical: completely changes the approach, the format in how the customer does their job while drawing in new customers into the market
For example, when looking at private transportation and the taxi market, a taxi hotline to hail taxis would be incremental, a mobile app to hail, track and evaluate existing licensed taxis would be moderate, while a platform that allows anyone to be a transportation provider, fully democratizing and expanding the market would be radical.
How much will it change the status quo in the current market and complementary markets?
Ideas are innovative when they can shift behaviors not just in customers they serve but also in the market as a whole, establishing new ground rules for how companies in that market operate and compete with each other.
- Incremental: provides the obvious, next step in how the market is developing; most competitors are also working to launch similar concepts
- Moderate: takes a leap forward in a concept that is mildly discussed in sector circles but without any real, concrete examples
- Radical: takes everyone in the sector by surprise, and fundamentally changes how the market and complementary markets operates
For example, consider several innovations by Domino’s Pizza in the pizza delivery market over the years: while online and mobile ordering would be incremental, providing live pizza order tracking via web and mobile would be moderate, while delivering pizza via drones or automated vehicles (still in progress) would be radical.
How much will it redefine rules, regulations, and legal structures?
New ideas create new values for customers but can also push the boundaries of current governance and regulations, requiring governing bodies to examine how those ideas and approaches are utilized and regulated in order to protect society as a whole.
- Incremental: has none to low impact other than an inclusion as a new case that fits into the existing legal framework
- Moderate: pushes the gray area in the current legal framework, demanding new definitions and clarity about how existing rules and regulations will apply
- Radical: invites governing bodies to deliberate and create entirely new frameworks to handle the changes brought forth
For example, in the area of mobility technologies and solutions, in-car navigation would be incremental, embedded black boxes and similar telematics solutions would be moderate, level 4 or 5 full autonomous driving would be radical, requiring entirely new legal frameworks to manage its impact on society.
How much will it transform the company?
Finally, ideas not only impact the environment around them, but also internally, the organizations in which those ideas are hatched. Ideas can change corporate outlooks, trigger mass organizational changes, and redefine the core competencies of a business.
- Incremental: inspires colleagues to think about their work and approaches differently, as well as to come up with new ideas of their own
- Moderate: adds new skills and abilities to the company, thus transforming how the company operates or is organized, maybe even resulting in the formation of new departments and the closing of existing ones
- Radical: creates complete new core competencies which inspires the Board to redefine the vision and nature of the company, thus taking the company in an entirely new business direction and competitive position
For example, consider the innovations at Apple: while Aluminum iMac would be incremental, putting increased emphasis on design and experience, the iPad would be moderate, essentially creating a new mid-market for tablets leveraging existing technologies and capabilities, the creation of the iPod and iTunes would be radical, moving Apple to the forefront of devices and services, leading eventually to their cash cows of the iPhone and the App Store.
- How much does it improve the customer’s life?
- How much will it change the status quo in the current market and complementary markets?
- How much will it redefine rules, regulations, and legal structures?
- How much will it transform the company?
Make Innovation Work
Core Strateji is a strategy consulting firm that specializes in supporting leading companies to transform into ambidextrous organizations. Are you ready to move your innovation activities forward?
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