The quality profession has evolved from full inspection to sampling plans to Six Sigma. We must maintain our resolve to help our organizations improve their financial performance. Innovation provides quality professionals with a great opportunity to contribute more significantly to corporate performance. Understanding the overarching framework will help us begin our creativity journey.
For nearly 100 years of quality journey, we have taken great care of our customers by giving them what they want. Our customers now take quality for granted. Moreover, in the information age, our customers are more aware of competing suppliers, as well as suppliers with poor performance. Quality performance has reached its peak worldwide, and aspects of quality have passed from the line worker to the corporate executive.
Activities that improve quality no longer yield any significant benefits. What can be done to improve business performance and bring joy to customers?
In an interconnected and competitive global economy one has to find real competitive advantages based on characteristics and capabilities, not just quality. Providing unique solutions to each client is more important than providing standard solutions of absolutely optimal quality. Instead of managing the costs of goods or services, companies will need to manage growth by offering customers innovative solutions. The quality of innovation becomes a differentiator. The quality of innovation means how complete/perfect each company is prepared to innovate and deliver customized solutions of high volume. Thus, companies will move from improving quality to improving innovation.
Interestingly, innovation has become a global issue of concern to national governments. In the European Union, for example, every country must have a national policy on innovation, which is required to create an innovation infrastructure, and to take innovation measures to grow the economy and maintain and improve the standard of living. India has set up a knowledge committee to develop a national innovation policy. In China, the Chinese Prime Minister launched an initiative called self-innovation in order to change its image from that of a low-cost factory to an economically self-reliant country that offers new products and services. As for the United States of America, the US government enacted the Innovation Act in 2005 to encourage innovation in the field of manufacturing. In other words, we are in the age of innovation, and this provides ample opportunity for quality professionals to move from improvement to innovation.
Innovation means the use of intellectual resources – the people and their intellectual participation, knowledge management and innovation of new products. Innovation presents a significant opportunity for quality professionals to lead the organization in improving the quality of work by contributing to profitable growth. They have an inherent advantage of knowing the pulse of the customer and the capabilities of the organization. They just lack the innovation methodology to take advantage of the available resources to take advantage of the opportunities presented by customers.
To be a quality professional means to successfully transition to an innovation professional, I see a strong common denominator between quality improvement and innovation. Ultimately, innovation means change, and improvement also means change. The only way to understand the difference is that improvement can be a one-dimensional change, while innovation can be a multidimensional change.
The three rules of creativity
We must learn about innovation as a process. It begins with the belief that one can be innovative. Innovation is for everyone, and it can be applied to everything. The debate is no longer between manufacturing and service. Many experts tell us that we must learn to be creative, because we were not born creative. I think we are all creative. Our actions are the best proof of our creativity. We rarely do something exactly the same way twice. After teaching creativity class at Illinois Institute of Technology, I’ve come to the conclusion that the following three steps help everyone become more creative. When I worked through these three steps, my students’ response changed from five percent creative to 100 percent creative in 10 minutes. Here are the three rules of creativity:
Rule 1: Decide to be creative. Look for innovations around you, admire creativity, do research on any topic that interests you. Learn as much as possible.
Rule 2: Start combining two or more elements or ideas in unique ways. Each creativity is a unique combination of many ideas. Analyze other creations to see what sets them apart. Linking and adding is the natural activity of our brain.
Rule 3: Practice constantly to become a quick thinker. We must be quick-thinking by gathering all the information we have collected and enjoying what we do. The Five Stages of Methodology Once we have learned the creative process, we have to realize that creativity and innovation are two different things. Creativity is just an idea, invention is a prototype, and innovation is production. Unless an idea becomes a reality and is used repeatedly to create value – and people are willing to pay for it – it is not an innovation. For example, suppose no one bought an Apple iPod. Is it called innovation? Of course not, it would simply be a creative product. Thus we must learn the full cycle of innovation, from concept development to monetization. I see the innovation methodology as consisting of the following five phases,
Objective: Studies show that innovations based on research and development have only 4-5 percent success. Reducing/reducing product life cycles requires speed of innovation, which leads to innovation on demand. Determining what to innovate to meet customer needs helps improve the success rate of new products.
Exploration: R&D today is a little research and a lot of development. I think this is lagging. Preliminary research is critical to maximizing the benefits
innovation. Good innovation depends on excellent exploration. In other words, before developing an innovative solution, we must extend and broaden our thinking based on exhaustive research. In the absence of serious research, the products that emerge from R&D will be of marginal quality in terms of design, innovation, and customer expectations.
Development: Once information about customer needs has been gathered and sufficient research has been done, multiple innovative solutions can be rapidly developed. The result is that there are many alternative innovative solutions to choose from rather than taking the traditional approach and developing the first (and possibly only) solution.
– Optimization: From various innovative solutions, the best and most economically feasible solution is identified and optimized for good production and delivery. Today, new products often have early failures, and many companies lose money in the first year of product introduction. For example, a car in the year it is offered is considered a risky purchase due to the failure rate being higher than normal for that car. A well executed optimization/improvement phase will reduce these risks.
Commercialization: In turning a creative solution into a successful innovation, excellence in marketing the solution to potential customers plays an important role. If there are no sales, then what you introduced is not innovation, it is that simple. We should not be content with simply developing a creative product or service or developing a business model. For any innovation to be successful, we have to be innovative in driving revenue growth.
Four types of innovations
One of the dilemmas that an innovator faces is how to manage innovation, that is, to provide innovative solutions when needed, to allocate the necessary resources, and to define the innovation process. Most companies devote time and budget to developing new products. However, they are unable to deliver on time, within budget, and make money. Our analysis shows that for most companies, the return on innovation is between 15 and 20 cents, on average, for every dollar spent on development. This supports the hypothesis that the current innovation process is inefficient.
Understanding the types of innovations and their characteristics will help prepare for innovation. I came up with the following four types of innovations:
Fundamental Innovations: These are rare and represent a major discovery. These innovations include the development of the transistor, the theory of relativity, photocopying, and mobile phones. These innovations usually occur in large laboratories specialized in new thinking and discoveries.
– Basic innovations: These are the basic products of companies. These innovations take basic innovations and launch a new industry or market. Most large companies start with a basic product and grow with success. Among those innovations were the Microsoft operating system, Oracle databases, the Razor Motorola cell phone, the IBM computer, Service Master services, agricultural products by Caterpillar or John Deere, low-cost flights by Southwest Airlines, and the iPod by Apple. Also, some small companies have base products and grow into a larger company. Fundamental innovations align with the long-term strategy of companies.
Derivative innovations: They differ from basic innovations. They are by-products of the base products (by-products of the base products). The Apple iPod nano had a shuffle; It was for Motorola Razr, Crazio, and BiblurRock; Had Microsoft Office PowerPoint, Excel, Access and Word. Once successful, companies pump capital and spend on successful bottom-line innovation by developing derivative innovations. Derivative innovations take much less time to develop than basic innovations.
Divergence innovations: These are applications intended for base or derivative innovations through options, services, or integration. Innovations can be developed by the user or supplier to personalize or customize the product. For example, iPods feature imprinting a customer’s name, and cell phones can be personalized with colorful covers or unique ringtones. Variation innovations can also be very focused implementations of other innovations for a specific use. Variation innovations can be developed at the right time to respond to the customer’s need.
Types of change
Figure 2, above, shows the frequency and time of different types of innovations. Classifying innovations in this way also allows us to allocate the necessary resources. For example, variation innovation can be planned with 1 to 10 people, derivative innovation can be planned with up to 100 people, base with up to 1,000 people and basic with up to 10,000 people or more, as a proportional limit of allocated resources.
What are you inventing?
One of the frequently asked questions about innovation is “what do you innovate?”. We must always think innovatively, ie constantly identifying the market or value potential of creative ideas. Be open to opportunities, research employee dissatisfaction, low-yield processes, management issues, inconsistencies, and clashes. In other words, look for weaknesses and decide to find an innovative solution. Believe that if a problem exists and can be articulated, there must be a solution. Here is your chance to innovate. As quality professionals, we should seize these opportunities to create innovative value. The opportunity for innovation can be procedural or technical. The opportunity can be short term or long term. The short-term opportunity corresponds to difference innovations and derivative innovations, and the long-term opportunity is associated with the base innovations and the fundamental innovations.