One way to establish market differentiation is through the introduction of innovative new products. Establishing that differentiation is one thing, but maintaining it is quite another. Here we have put together a ten part series on how to generate higher returns from your innovation investments.
From our series of highly informational articles, companies will learn: how to treat innovation as a cross-functional business process, how to align innovation execution and business strategy; how to create sustainable innovation; how to train your senior executives to successfully execute innovation initiatives; how to effectively manage process and project management; how to measure performance of your processes; how to ensure broad stakeholder buy-in; how to understand the importance of product roadmaps; how to provide the tools necessary for successful product innovation; and finally, how to ensure that portfolio management coincides with process management.
Here is one of the ten practices that leading innovators use to increase the payback from innovation spending: Providing the Tools Necessary for Successful Product Innovation.nnProviding the Tools Necessary for Successful Product Innovation
Give your teams the tools they need to succeed. Once an organization commits to putting a process in place to manage and execute on innovation, there are a variety of tools that can help ensure successful adoption. One increasingly popular way of enabling process adoption and adherence is the use of innovation management software.
Currently available product innovation solutions offer a broad range of capabilities, including support for roadmapping, idea management, process automation, resource planning, and portfolio management. The best of these systems are typically valued because they:n1. Centralize business metrics and product data so that distributed development teams can have access to the same information. n2. Streamline communication and execution of the innovation process among cross-functional team members. n3. Save time by enabling reuse of data and encouraging knowledge-sharing across divisions and business lines. n4. Facilitate strategic decision-making by allowing senior executives to easily review and prioritize projects based on their projected value to the organization.
Glatfelter is a global producer of specialty papers and engineered products. The company's offerings are used for everything from books and postage stamps to tea bags and flooring overlays. Glatfelter’s critical business challenges included commoditization of core product lines; declining product demand within traditional markets; pressure to speed creation of new products; and an escalating need to enter new markets.
Glatfelter responded by examining core aspects of its research and development strategies and practices. It was apparent that long-term growth and profitability would depend on creating new, commercially viable products with enduring customer appeal. The company chose to implement a new, better-defined innovation process, along with a technology solution that would automate that process and help Glatfelter’s executives prioritize innovation projects based on their potential value to the company.
When the system was introduced, there were nearly 200 projects in the development queue. Through use of its new process and the supporting software, Glatfelter was able to allocate more resources to the top ten most commercially promising innovation projects. In three years, the company achieved a twenty-five percent reduction in average time-to-market; a fifty-five percent increase in new product success rates; and a 500 percent increase in the number of new products introduced. Most impressive of all, during that same period, fifty-three percent of Glatfelter’s total net sales came from new products. The overall impact of the initiative was to make Glatfelter one of the largest and most diverse suppliers of specialty papers in the world.
Much like Glatfelter, other organizations are realizing as much as forty to sixty percent more revenue and profit from new products than their industry peers. Yet, recent studies indicate that more than half of senior corporate executives are dissatisfied with their organizations returns on innovation investments. To learn more about what sets these companies apart, look for the next article from our ten-part series: Ensuring that Portfolio Management Coincides with Process Management. We will additionally discuss the top practices that leading innovators use to increase their returns on innovation spending.