Innovation is often cloaked in some degree of mystery – a black box where “change happens” and the world is transformed. Success is often fleeting, and, when failure does occur, there is usually a multitude of views as to what went wrong, with the only commonality being “it was the other guy’s fault.”
Why is it that some inherently good ideas fail and some rather questionable ones seem to stay around forever?
Recently, Raghu Santanam posted in a Center for Services Leadership blog that innovation must take into consideration issues of consumer capability and consumer involvement. This resonated with me. Both of these issues speak to the need to have a customer-centric approach – trying to understand the situation from the perspective of the individual/organization undergoing the change. This does not negate the importance of the views of internal stakeholders, but it underscores the importance of willful and deliberate customer adoption of a new offering. I would like to build a little more on this theme.
I published a book a short while ago based on extensive consideration of existing research as well as examinations of successful and unsuccessful change initiatives. In the book, I laid out a number of fundamental elements that must be present in any successful change context. Let me cover three of the more critical factors here.
The Value Offer: “Hey everyone, this version has Q17 architecture and Upsurge compatibility, why aren’t you excited?”
The first issue of critical importance is that a clear value proposition be articulated. This often seems straightforward enough, but, again, this has to be considered from the perspective of the customer. Do they see the value of the new offering?
Certainly in some less-than-successful change initiatives the value is simply not evident. My guess is that few would pay more for a singing accountant. Sometimes, though, there is a potentially valuable offering, but failure boils down to not adequately conveying the information in a form that is readily understood by the customer. Managers and technical personnel are frequently so close to the product that they engage in “feature speak” – talking about the product attributes and details in extensive depth. Q17 architecture and Upsurge compatibility might mean something remarkable to the people who developed it, but are you translating this so the customer will truly understand how his or her life will be positively impacted? Does the Q17 architecture enhance profitability? Reduce costs? Decrease errors? Increase competitiveness? Does it ensure that the system is compatible with emerging industry standards?
Takeaway 1. Make it clear what benefits you offer and how their world will be rocked (in a good way) because of this. You can, and probably most times should, make sure you describe the features of your offering. Remember though, the customer probably does not have all of the background you have and may not be able to translate how all of the features you offer translate into relevant and important benefits to them.
Stability With the Current Alternative: “Sure, ok…thanks for stopping by, but I am hooked on what I have now.”
Even when a truly superior alternative is present, people may find it hard to migrate away from the existing alternative.
It is easy enough to develop a myopic focus and dwell on the virtues of one’s own offering. As a result, adequate time may not be spent understanding why people might not want to part with their current alternative. On occasion the culprit for customer inaction is blind ignorance or complacency – potential clients are not aware there is a problem to be solved or that an existing system is rather inadequate. Sometimes “status quo” is perceived to be the safe alternative – even if it is not optimal, at least it works. Indeed, rarely do people get fired for “doing what has always been done.”
Stability can also be enhanced when contractual constraints are in place (think of cell phones), whereby the customer might consider it woefully expensive to switch until the allotted time period is up. Yet, on other occasions, it could be system removal costs or the belief that all of the existing skills and technology people have invested so much in will have to be given up. The list goes on. You think you have a superior alternative, so what is it about the existing system that people might want to cling to? Perhaps you could pay out an existing contract, handle the removal of the existing system or adequately demonstrate why the current alternative is inferior.
Takeaway 2. Pinpoint factors that keep people bound to their existing alternative and find ways of reducing the stability that exists.
Fear and Uncertainty: “Will your product really work the way you say it will?”
You may be familiar with the adage, “better the devil I know than the devil I don’t.” Sometimes people might be completely unsatisfied with their current state of being but even more frightened about elements surrounding a switch to your offering. You might have incredible faith in your products and services, but you cannot assume that customers will accept your claims at face value. Many before you have over-promised and under-delivered. Why should they believe that you would be any different?
Perhaps it is not so much an unwillingness to trust you as much as it is some level of apprehension regarding your product/service-class in general. What can you do to instill confidence that you will deliver as promised? Can they be sure that adopting your offering will be relatively painless and that transition costs will not be an issue? What testimonials, certifications, guarantees and communication can you offer to solidify in the mind of a prospective customer that you truly walk the talk?
Takeaway 3. Build confidence in your offering. Remove aspects of fear and uncertainty that might be present.
Tying it Together.
In sum, any successful change initiative must clearly present the core value (differential advantage) in a manner that truly matters to the customer. Second, efforts must be taken to reduce the stability around the current alternative. Third, fear and uncertainty surrounding your offering must be reduced. Among a wide range of projects, I have successfully applied these concepts to the adoption (or lack thereof) of certain healthcare services, selection of geothermal heating units over more conventional methods, and the non-use of the metric system in the United States. The point I am trying to raise is that the three principles covered in this post are robust and often overlooked when trying to figure out which factors will lead to innovation success.
Ralph Waldo Emerson, perhaps in a profound display of naiveté, noted that if you build a better mousetrap the world will beat a path to your door. Unless one clearly conveys the value offer, unseats existing stability, and reduces fear/uncertainty, very few of even the very best mouse traps will be sold.
Douglas Olsen is an Associate Professor in the Department of Marketing at the W. P. Carey School of Business and the Academic Director of the Service Leadership Institute (SLI) offered by the Center for Services Leadership. Douglas may be reached via email at email@example.com.
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