Wednesday, January 11, 2006

Innovation in a Manufacturing Context

In our increasingly competitive world, manufacturers are faced with pressures to achieve many different simultaneous outcomes with their products. With some of these outcomes being seemingly inconsistent at first sight. Manufacturers may at times be pressured to produce products that are:

* cheaper * faster

* more reliable * higher quality

* longer life * more functional

* more visually attractive * recycleable

* smaller * lighter

* more robust * safer for consumers

* more exciting * ecologically friendly

* easily available * upgradeable

to name but a few.

Whilst achieving these outcomes, manufacturers are urged to do so in a way that is;

* ecologically sustainable * politically sensitive

* serving stakeholder interests * being a caring employer

* law abiding * ethical

* safe * risk managed

* enhances national reputation * leads to employment opportunities

* benefits humankind * contributes to national economies

* respectful towards communities (both local and global)

It is perhaps not a surprise that such pressures result in wide ranging challenges for manufacturers. These challenges may be simple or extremely complex. They are seldom easy, yet often rewarding and frequently fun (for some of us).

Today, manufacturing is about so much more than just great products, and caring manufacturers!

As manufacturers toil to surprise and delight consumers with new products that are positively differentiated from their competitors (and their own past products), they inevitably make the task of the consumer a more challenging one. Many consumers may at times risk being overloaded with information about products, to the point that the choices available can become either stressful or uninteresting. Efforts by manufacturers to make the consumers’ task easier have become more and more appreciated by those consumers, and thus a further source of competitive differentiation. These efforts have moved manufacturers more and more towards a service orientation, where their products are at the core of such services. One example of this being, the moves by many car manufacturers to offer finance, insurance, extended warranties and break down cover to car purchasers. All these are aimed at making the consumer experience easier, regarding the cognitive effort necessary in purchasing choices. Rather than just selling a car, manufacturers are increasingly focused on providing a stress-free motoring experience.

If innovation is the answer, what is the question?

It is perhaps not surprising that with so many pressures to perform, business leaders, consultants and academics around the world have a history of looking for simple answers to complex business questions. In recent years human resource management, organisational learning, knowledge management, change management, management of intellectual capital, human capital management, talent management and performance management theories, have been presented as offering simple answers to the business challenges faced by many companies. Many of these theories have resulted in organisational implementations and changes in organisational structure becoming commonplace. However, established links to anticipated increases in business performance are much rarer. Return on investment (ROI) assessments are rare as many organisations move quickly onto the excitement and promise of the next answer.

Those organisations that have successfully answered their business questions have tended to be those that have worked to understand the question on the way to understanding the answer.

If innovation is to realise the many hopes that are attached to it, then we need to build upon the understanding that ‘innovation is good’ to develop an in-depth understanding of the following innovation dimensions in any given context:

* sources

* types

* drivers

* quality

* intelligence (related to context)

* degree

* measurement

* timing

* value

* management

* leadership

* strategy

* communication

* business exploitation

* influences

* blockers

* resourcing

* collaboration and co-operation

* application

It is only when the dimensions of innovation are understood that we can hope to manage the risk of innovation processes and move towards the certainty of successful innovation outcomes.