Keep Innovating Your Business Model According to Actual Consumer Need

InnovationThis guest column is by Anjali Chopra, Business Analyst, GreyB Research.

“The customer experience is the next competitive battleground”- Jerry Gregoire.

“Customer is King” is one of the most used cliché in business world. 95% of the businesses that exists today are customer-centric. No matter whether they are large corporations or small businesses, most of the innovation that takes place in the industry is done keeping the customer in mind- to improve customer experience and satisfaction.

In the world of stifling competition between companies, fighting to get a strong hold on consumer base, the clear winner is the one that understands the needs of its consumer and moulds its business strategy accordingly.

For instance, Uber Inc., a transportation network company understood the need for innovation in taxi industry and came out with the first e-hailing application in 2011, to hire taxis. Other companies followed suit and Uber understood that in order to differentiate itself, it had to take a step further. Instead of sticking to UberX and UberXL, its basic services, the company started UberSelect and UberBlack, a luxury car service that would appeal to high-end users. With a simple innovation, Uber ended up in the list of 10 most innovative startups of 2014, with over $2 billion in revenue.

According to a recent report by Adobe, more businesses are shifting their business models towards customer-centricity. Whether it may be improving customer experience or innovating products to meet customer requirements, the top companies are leaving no stones unturned in becoming customer-centric in every possible manner.

Being customer-centric is not limited to innovation that is sustaining in nature but coming up with innovations that are evolutionary or disruptive in nature. We mean innovations that add value to the system and perform same tasks or more than one task at same or little cost when compared to previous technologies.

For instance, consider the latest patent granted to Sanyo for its Electric washing machine, which generates water streams containing an electrolyzed liquid that cleans clothes without the use of detergent. This innovation is an improvement over others serving the same purpose as other machines while eliminating the need for detergents, an important component for washing clothes.

Most companies adopt the value quotient technique to identify opportunities for innovation. The value quotient technique is a 6-step process which is used to assess the value of the current solutions of a company to that of the competitors’ and relative to an ideal state in which a theoretical solution for a problem could fulfill all desired expectations from the system.

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Consider the example of smartphones, the perfect example for Value quotient technique in practice. Back in early 2000s, phones had the facility of messaging, calling, alarms, calendar and music player. And a camera too. A normal phone would cost around 6000 rupees(~ 64 Pounds) .

The open handset alliance knew that the future of phones was going to be something really different. The acquisition of android by Google further eased the efforts. With android being the de facto OS to back up the Smartphone, the following 6 step process was followed to build what would be in future called as the Smartphone.

Step 1: A touch screen phone capable of performing functions of an ordinary phone with extra functionalities like flashlight, higher memory storage, and support for multiple applications ranging from entertainment to education with a graphical user interface

Step 2: The desired outcomes included a proper functioning phone without any collision when more than one application ran. The undesired outcomes were multiple like the screen failing to recognize activity other than from stylus.

Step3-4: The ideal innovation was plotted and existing solutions like danger hiptop and IBM Simon, the first Smartphone’s were considered and gaps were examined to find what would work best.

Step 5-6: The value gaps mainly consisted of lack of control for the visually handicapped and the inability to transport files. With the proper use of innovation in technology, value gaps were closed with the introduction of Bluetooth and NFC for sharing files, applications like talkback for visually challenged and support for wireless fidelity to connect with the new generation of modems.

With continuous identification of value gaps and invention of technologies to close those gaps, the Smartphone’s have become what they are today: Smartphones.

Filling the whitespaces in technology is what sets apart the innovators from the followers. With the clear definition of the problem and a proper understanding of the ideal solution along with the desirable and undesirable outcomes can make the process simpler to execute and easier to implement.

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Unilever, one of the top 10 most innovative companies in the world believes that innovations will solve some of the greatest problems on the planet. With more than 17 brands in its kitty offering over 1000 products, unilever offers some of the best products that are way better than the products offered by their rivals in the market. About 80% of the products offered are
not just easy on the pocket, but also eliminates the need of any additional product to be used in conjunction with it. It kills two birds in one shot.

The Greater the level of innovation, better the results. But it is always better to innovate in the fields where the expectation levels are low, but the satisfaction derived from the products is high.

Consider for instance, the modern day washing machine loaded with features that clean the dirtiest of clothes without leaving a stain behind. But is it possible to for the clothes to come out wrinkle-free as if they have just been ironed? The answer is a mix of yes and No. They have achieved a bit of success with the wrinkle release method.

But there is a lot of room for innovation that could be done.

But what if there is no need to wash clothes anymore?

Scientists at Harvard have come out with a method to create self-cleaning clothes where the clothes are dipped in a solution of titanium dioxide which cleans itself when exposed to sunshine. Now that’s what we call innovation.

Identifying the problem of users is an important aspect before getting on the ladder of innovation. Coming up with solution is the less difficult part. We earthians have come up with technologies that took us to moon, made cancer treatment a reality and Internet of things a part of our everyday lives. It leaves us to question, is there anything that we can’t do?

Trey parker sums it all in one quote, “There is nothing we can’t do.”

Disclaimer: This is a guest column. The statements, opinions and data contained in these publications are solely those of the individual authors and contributors and not of iamwire and the editor(s).