Four Key Elements for a Successful Innovation Strategy

May, 2018

We often work on defining the innovation strategy for clients. These projects typically start with a tough strategic challenge. After using trend immersion to get a deep understanding of the challenge and its context in a phase we call “insight and inspiration” it is time to bring some clarity to the project. During the “strategy and concepts” phase we structure the information, define key insights and create clear and actionable frameworks. These frameworks help to identify opportunities for innovation and concept development. They give direction to ideation challenges, concept development, and form the building blocks for a successful innovation strategy.

New Growth Platform

An example of a proven framework for innovation is the New Growth Platforms model by Laurie, Doz and Sheer. They define New Growth Platforms as the “hunting ground” or “opportunity space” for growth. This space exists at the intersection of a company’s capability set, unmet customer needs and external forces of change.

In other words, it discusses:

  • What trends would enable markets to grow faster or bigger  (external forces of change)
  • Where we can make a difference (unmet customer need)
  • How we can make a difference (company capability).

Read more about New Growth Platforms in this article published in Harvard Business Review.

Ikigai
But as creative strategists, we take our inspiration from more places than business theory alone. Lately, we’ve been immensely inspired by the philosophy of ‘Ikigai.’ The ikigai philosophy originates from the Japanese island of Okinawa and describes the key ingredients for a long, healthy, and happy life. These are the four ingredients:

  • Do what you love
  • Do what you are good at
  • Do what the world needs
  • Do what you can get paid for

Four key elements for a successful innovation strategy
This resulted in a framework for defining the key pillars of an innovation strategy. It combines theory from the New Growth Platforms model with the philosophy of ikigai. The framework focuses on these four elements:

  • Purpose: Define what your purpose is. What do you want to achieve with your company or brand? What functional and emotional benefits are most important. This will give direction and will guide your innovation efforts.
  • Market: Define what the world needs. What trends are relevant and are changing the market? What (unmet) consumer needs stand out? Connect these trends to identify platforms for innovation opportunities.
  • Capabilities: Define what you are good at. What skills are your company’s core strengths? How can you make a difference? This will help to identify what sets you apart from competition and defines your ‘right to play’ and ‘right to win.’
  • Value: Define what you can get paid for. Does your value proposition answer a market need? How will this innovation support your purpose and overall strategy? Do you have a business model that makes sense?

Answering these questions will ensure that your innovation strategy is financially sustainable and will support your overall strategic goals. With these four elements, you can test your current innovation strategy or develop a new one. An innovation strategy that follows the direction of your company’s (or brand’s) purpose, fits market trends and needs, and helps you excel in your core capabilities.

Want to learn more about how we can help you in developing your innovation strategy? Reach out at info@elementalstrategy.com!

Conclusion

Innovation is crucial for the success of the retail and consumer goods industry, and Emma Schootstra’s insights provide valuable understanding of the upcoming challenges and opportunities. By directly addressing the industry’s challenges and embracing purpose, innovation, and collaboration, brands can adapt to the changing landscape and shape a successful future. Stay tuned for more fascinating insights in our ongoing “The Future of…” series, where we explore the exciting frontiers of innovation across different industries.

Questions or wanting to discuss a possible project? Make sure to contact us on info@elementalstrategy.com

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