Sustaining innovation is an under-appreciated, yet a critically profitable section of your innovation strategy.
Usually, when we think of innovation, we think of disruptive or breakthrough innovation, which are more exciting innovation types than sustaining innovation. Understanding the differences between disruptive and sustaining innovation, and the reasons you need both in your innovation strategy will better equip you to drive results and business profits through innovation.
Types of Innovation
Sustaining innovation, also called routine innovation, refers to innovation that happens on an incremental basis, often in response to customer and market demands or improvements in technology.
Breakthrough innovations represent a significant step forward (usually in technology) that sets a product or service offering far ahead of the competition. Similarly, disruptive innovation sets brands ahead of the competition through simplicity and mass market appeal. Both breakthrough and disruptive innovation are important to your long-term strategy, but they provide very narrow profit margins on their own.
Why Sustaining Innovation Is Important
While we tend to give great attention to disruptive and breakthrough innovation, sustaining innovation is where established companies experience higher profits. You spend much less on research and development and on promotions to sell it.
Your organization should include both disruptive and sustaining innovation in your innovation strategy; one should not be abandoned for the other. However, the argument here is that you experience a higher profit margin through your sustaining innovation strategy, making it a critical area for managers focused on profitable growth strategies.
Many companies that we think of today as great innovators have grown through sustaining innovation by building on successes and improving their offering based on customer and market needs awareness; think of Apple, Amazon, and Intel as examples.
As the HBR article, In Defense of Routine Innovation, argues, there are also many examples of disruptive innovations that went nowhere because the company wasn’t able to sustain it through rapid improvement based on market response and demands. Disruptors that are unable to build on their own strengths and improve their offering are crushed by competitors—often well-established organizations—who can.
Systems for Sustaining Innovation
The bulk of ideas for sustaining innovation will come from listening to what your customers have to say about your product or service offering. Maintaining open channels for customer feedback and communication will allow you to collect data on how you can continually improve and provide greater value to your customers. Helpful communication channels include social media, online and phone-based customer service communications, and surveys.
Sentiment monitoring is another effective system for collecting data that drives effective sustaining innovation. Sentiment analysis allows brands to monitor the market’s reaction to the brand, new product roll-outs, advertisements, etc; typically by aggregating social media mentions. This might give you a slightly less direct view of specifics that will drive sustaining innovations that your customers will love, but sentiment monitoring does play an important role in providing you a broad view of how the market is reacting to your brand and communications. Additionally, many customers will not bother to call customer service to share their poor or great experiences. They will take to social media and broadcast it to the world instead. Having the tools in place to monitor and capture these communications not only provides you the opportunity to provide exceptional customer service, but also provides insights for how you can continue to innovate your product or service.
Keep up to date with what other players in your industry are doing by setting up Google Alerts. While innovation isn’t about simply copying what the competition is doing (you’re here to be a leader, not a follower!), industry monitoring does give you additional data and insights that you can use to make more informed decisions about the sustaining innovations you are evaluating. You can learn from others’ successes and mistakes, and have a better sense of how profitable your innovations may be for your organization.
Engage Your Team in Sustaining Innovation
To truly benefit from a sustaining innovation strategy, you must inspire innovation by engaging your team in making it work from inside the company as well. This means that everyone on your team must understand how your product or service works, and be engaged in helping to make it better.
In the United States, we have a saying that you have to “eat your own dog food.” It’s an ineloquent way of saying that you have to use and experience your own product or service if you expect your customers to use it and love it. This also means that you and your team are in the position to understand your customers’ experience first-hand, putting you in a better position to understand what is wrong with it and/or how to improve it to delight your customers.
To engage your team in sustaining innovation, you must create a culture of open communication and feedback. If people on your team feel afraid to bring up issues or ideas, they are not empowered in engaging in the innovation process. Know that, in many cases, it is your “lower level” and/or front-line employees that are receiving the bulk of the first-hand feedback from customers, wholesalers, partners, etc. They need to feel safe and empowered in being able to bring this data to their manager’s attention, and assured that the information will be acted upon to improve the customer experience (and, in turn, their work experience!).
Innovation benefits from team communication that is open to feedback coming from above, below, and horizontally—not just from the boss. An innovative team is less concerned about where the communication is coming from and more concerned about how useful the information is.
About Crestcom International, LLC.
Crestcom International, LLC is an international leadership development organization, training more than one million leaders for 25,000 businesses in over 60 countries across the globe. Crestcom achieves this through a blend of live-facilitated multimedia video, interactive exercises, and shared learning experiences. Crestcom implements action plans and coaching accountability sessions to ensure measured development in key leadership competency areas. For more information, please contact your local Crestcom representative found here.