Is there a right Innovation Method ?

This article try to response theses fundamentals questions: In the industries plagued by the most uncertainty, how do companies hold on to their ability to innovate? And how do they achieve, and keep, an innovation premium on the market?

Nathan Furr and Jeff Dyer found in their recent research that managers who help their firms create and maintain an innovation premium use a different set of tools than their more traditional counterparts— tools honed in start-ups and specifically designed to manage uncertainty. All those tools have a remarkable commonality but differ on the steps of the innovation process they emphasize. For example, design thinking emphasizes understanding customer problems, whereas lean emphasizes solution experiments. One other important difference: They tend to be tools that start-ups easily adopt, but that managers wrestling with day-to-day execution have struggled to incorporate.

In their, summarized in The Innovator’s Method, they synthesize these perspectives into an end-to-end innovation process and show how successful corporate innovators have adapted these principles to increase their innovation premium:

Innovations Methods

Insight

Innovations always begin with an insight about a potential need, solution, or business model. These are the flashes of inspiration, the clues there is a problem, and the surprises that are lurking in the world around you.

Problem

Once you have an insight, most innovators make the mistake of leaping to straight to solutions without first understanding the real problem, the job-to-be-done.

Solution

After you know what problem you are solving, you need to find the fastest path to the solution. Everyone understands the value of prototypes and many have heard of the idea of a minimum viable product. What we found was that innovators used four types of prototypes: theoretical prototypes, virtual prototypes, minimum viable products, and finally the minimum awesome product, in that order, to reduce their risks and quickly validate the solution.

Business Model

Finally, although incremental innovations can leverage your existing business model, most new innovations require a new business model. You have to experiment to discover the right business model, particularly your go-to-market strategy, or the unique way that your customers find out about, evaluate, purchase, use, and connect to your product. After you have nailed these elements of your innovation, then you are ready to scale. Before that, scaling will kill your innovation because it obfuscates the real source of value and burns your precious resources.

Although the innovation process is messy and non-linear, every innovation we studied went through similar steps. If you are starting with a problem, work through the steps. If you already have a technology or product, go back to understand the problem you are solving. Avoid using surveys and market studies — really go deep and understand the hearts and minds of your customers during the process. Although you won’t eliminate the risk of innovation, you can dramatically reduce it and dramatically reduce the cost of failure, giving you multiple chances to launch a home run.

Nathan Furr is a professor of entrepreneurship at BYU’s Marriott School of Management. He is the lead author of the just published The Innovator’s Method and of Nail it then Scale It.

Jeff Dyer is the Horace Beesley Professor of Strategy at BYU’s Marriott School of Management. He is the lead author of the best-selling book, The Innovator’s DNA, and co-author of the new book, The Innovator’s Method. To learn more about our research on uncertainty and innovation,