Structured innovation and creativity processes are commonly used to develop new products and corporate strategies. The same principles and techniques can also help companies become more customer-centric.
This second article in the four-part series by the Business Authors Leadership Alliance (BALA) describes how your organization can use innovation and creativity processes to capture, manage and apply customer insight to achieve strategic goals.
The article suggests ways to
- Build the best team to address each problem.
- Extract creative juice from professional experts.
- Organize thought processes to produce new and innovative solutions.
Once again, to recap, the overall BALA process for building profitable customer-centric strategies involves the following four phases:
- Identify key strategic customer-centric opportunities and challenges.
- Focus staff innovation and creativity to develop solutions for these challenges.
- Ensure and refine the profit potential of new initiatives.
- Address leadership and performance issues to ensure the company can meet its objectives.
Last week's BALA article covered Phase 1. We now present the five steps in Phase 2, as shown in the following chart:
To illustrate the steps in Phase 2, we continue to use the example of an amalgam of client engagements that we call Midwest Telecom.
In Part 1 of this series, we learned that Midwest Telecom realized that it would keep losing market share and competitive position until it made the customer more central to its business. It understood that to become customer responsive, fundamental changes were required, including new knowledge and operational systems, new product and service offerings, and better skills regarding creativity, teamwork, and integration. To implement lasting customer centricity, every function had to change.
In Part 2, we follow the birth of one strategic idea for Midwest—explaining, as we go along, the creative process and rationale applied by management. By the end, Midwest will have developed several possible solutions with the potential to enhance customer understanding and response.
Part 3 will assess the profit potential of each of those alternative solutions; that assessment constitutes Phase 3 of BALA's process.
The Process for Creating Innovative Solutions
The innovation process begins with articulating the challenge; it moves on to identifying the right people to address the challenge, and finally to formally staging the thought process to develop the solution.
Creative problem-solving requires the following thought processes:
- Gathering and analyzing information
- Retrieving prior approaches
- Brainstorming new possibilities
- Applying common sense and evaluation
- Using different levels and forms of judgment
- Making decisions
- Questioning and fine-tuning solutions
The sequence and content of these thought processes will determine whether Midwest develops exciting solutions or compromises with weak ones and ends up frustrated. Therefore, to get the most out of the process, Midwest engaged an outside facilitator who was trained in creative processes.
The five steps in the process are described below.
Step 1. Dimension the task for creative work
The key stakeholders at Midwest Telecom—the CEO, COO, heads of strategy, marketing, and product development—met with the facilitator and went over the problem, immediate and long-term objectives, and potential opportunities and pitfalls.
Midwest management had previously agreed on four goals:
- Keep current customers and win back those who have left.
- Anticipate market and competitive change and develop ways to increase our value to customers, often before they become aware of their needs themselves, because by then they will have begun to look around.
- Make the customer more centric to our own thinking and operations—so much so that providing a closer customer relationship and higher value along more points of customer contact becomes part of the DNA of our business.
- Increase corporate responsiveness through better internal integration, better internal teamwork and more seamless and instant communication—among ourselves and between us and the customer.
Summary of Step 1:
- Obtain multiple perspectives (e.g., problem owner, internal expertise, objectivity).
- Draw out different sides of the issue (from different perspectives).
- Recognize that perfect information is not possible (accept the ambiguity and risk).
Step 2. Build the ideal creative team
To create new solutions that address the above objectives, Midwest Telecom needed a creative team encompassing broad perspectives, functions, expertise and influence. The team needed expertise and functional ownership in marketing, sales, customer relations, information (gathering, storage and management), strategy, R&D, distribution, vendor relations and Web interaction.
Representatives from operations and finance were also included, as their thinking and complicity would be necessary to an integrated solution. The project leaders sought special expertise in market trends and emerging technologies. In this case, Midwest Telecom engaged a data-mining consultant and psychologist from outside.
Finally, as part of bringing the right minds together, the team selected customers sophisticated enough to lend insight, feedback and guidance during the invention work ahead: one was the IT director from a large and loyal institutional customer, and one was a “high volume” individual who used wireless as part of her business.
Summary of Step 2:
- Look for problem ownership, all related expertise, diversity of thought.
- Look also to include those who must commit to the ultimate solution.
- Look outside the company, and include non-resident expertise.
- Consider including the customer.
With objectives articulated and participants recruited, Midwest Telecom was ready to start creating new solutions. The actual creative work is described in steps three through five, below.
Step 3. Create a broader perspective
Innovation methodologies developed by Synectics, Inc. guided the creative process. The lead facilitator, studied in those methodologies, decided to hold one initial two-and-a-half day innovation laboratory as a start, and organize other smaller ones later if needed. A second facilitator was engaged so that the 20 participants could be broken into smaller groups from time to time.
The idea-generation technique of “wishing” was introduced and practiced. For many, wishing is a lost art… mostly used by children, then forgotten. But for the young it has a special quality: a wish does not have to be possible—one could wish for a “skazillion” dollars as easily as one could wish to fly.
Later, growing more practical and conservative, most people are shamed away from wishing. Experience has shown that when people relearn to wish—and it is quickly relearned—ideas grow more speculative, rich and broad. Breadth and speculation were certainly important to Midwest Telecom; they already had plenty of ready ideas that were not solving their problems.
The wishes started slowly. The first ones covered the usual possibilities: “I wish for customer focus groups”; “I wish for a customer complaint hotline.” But soon the team ran out of the easy wishes and started struggling into newer territory: “I wish we rotated customers on and off our board”; “I wish each managing executive met with a new customer for one hour each day.”
Summary of Step 3:
- Begin with wishing.
- Allow—encourage—expansion in two directions: broad (how many different perspectives can you get?) and speculation (how removed from “the expected” can you get?).
- Expand beyond the point where you feel you have expanded enough.
Step 4. Dig into expertise imaginatively
Once the team started to achieve new territory, it was time to begin steering fresh information into the discussion. Information on new customers, trends and technologies was trickled in and became part of brainstorming. Information from experts was introduced piecemeal, because the large quantity of information had to guide speculation but not overwhelm it.
The facilitator established a pattern of introducing information in bite-sized pieces, followed by discussion, and then speculation. The cycle was then repeated, like folding flour into cake batter gradually, stirring for a while between additions.
For example, the data-mining expert explained how some companies were learning to sample word frequencies across Web traffic and discern the hottest topics each hour of the day. Rather than letting the group jump immediately from this information to making connections, and then ideas, the facilitators took a different tack. They engaged the creative team in exploring first, in order to enrich the understanding of the new information in each participant's mind.
They asked for the implications of such a technology in general, and the team articulated such hypotheses as these: “This could accelerate responsiveness in manufacturers, accelerating change itself, which could lead to a vicious cycle growing faster and faster”; “new forms of gambling around the world might emerge”; and “pretty soon the system will be only able to look at its own navel and shut down in confusion.”
Soon the facilitators asked the team to look over the Web-mining technology, including all the implications; make some connections; and fashion new wishes that might enhance Midwest Telecom's need for making the customer central to its business.
The wishes that then emerged included these: “I wish we could use new predictive models to jump three trends ahead so we would lead change instead of follow it” (from the “new forms of gambling” hypothesis); “I wish we could try radical forms of research like psychics and gurus” (from “looking at its own navel”); and “I wish there were advanced psychological mechanisms so we could understand deeper motivations that drive customer behavior” (a secondary wish from the earlier “psychics and gurus” wish).
Summary of Step 4:
- Have experts prepare and introduce information in small (bite-sized) pieces.
- Do not find connections and wishes immediately, but enrich understanding of the new expertise in the minds of the team members (in this case, we developed implications, and the implications of those implications).
- Then connect back, look for connections that have potential, and fashion new wishes from them.
Step 5. Focus while staying creative
The facilitators asked the group to select the most important and the most intriguing directions to pursue: the important ideas have often been considered but not yet tried; the intriguing ones are newer, could have more impact, but may be harder to carry out.
Everyone was asked to check off their top 10 selections, reserving at least four votes for “personally intriguing” wishes, even if they looked vague or impossible. After all the votes were in, the group leaders—in this case the heads of marketing and strategy and the CEO—made final selections.
Each selection needed more work. Some wishes needed to be developed into strategies, and some had to have more creative work just to become possible at all. This is where courage comes in for business leaders: it is easiest to take all the important-but-usual thoughts and cobble together a strategy from them; however, that is also what most competitors are doing. In the long run, such conservative thinking will not lead to competitive differentiation or market excitement. The harder but more rewarding work will be to salt some unique elements into the eventual customer solution.
By leaning always in the direction of newness, Midwest Telecom may be able to be more competitive longer, and may also develop a more distinctive and exciting persona in the eyes of its customers.
Among the important wishes selected were these: “I wish we could invite complaints”; “I wish every functional head spent time each week with a customer.” Among the intriguing wishes selected was this: “I wish we could use advanced psychological data-mining methodologies.” Nobody had a clue what that wish could lead to, but it sounded intriguing.
After a break, everyone was refreshed. The facilitators broke the big group into two teams of 10, and each team worked on several selected wishes. They started focusing on the selections, altering the brainstorming format toward trying to find ways to make those selections specific, possible and accepted by everyone.
While this segment of the invention process took the most time, it was also the most imaginative. Direction was established, people were warmed up and inventive, new solutions were in sight and the teams had some excitement about making those solutions possible. This was an ideal environment for creative thought. The teams worked each selected wish into a viable concept: i.e., they could articulate what it was, how they would do it and why it was good for Midwest Telecom and the customer. At this stage, the concepts could be researched, and, if promising, implemented.
Ideas were suggested about what each wish could mean and how the team might achieve it. For example, the team pursuing the psychological data-mining methodologies explored finding “who is doing forensic psychology work in crime labs and in the universities.” Someone then remembered an expert in Boston who once investigated Internet research methods and suggested, “If he could not help us, he might steer us to the right people.”
The data-mining expert also suggested some emerging statistical algorithms that could be tried. Forty ideas related to this topic were suggested in an hour, and a small team was charged with crafting a concept from those ideas that could go to research.
The small team decided the above ideas were tactics, and, with other ideas from the same session, could be synthesized into a more comprehensive strategy: “capture intelligence in our acquisition channels to guide future marketing.”
The team then started to develop another “wish” into a strategy for making Midwest Telecom more customer-responsive.
Over two-and-a-half-days, with two teams working simultaneously, 15 or so strategic concepts were created. The teams reconvened as one, heard and prioritized all the concepts, and discussed which might work well together. Overall, next steps were created, which involved researching the potential feasibility of each concept, integrating the best into a long-term strategy and identifying short-term action items.
Two other strategic solutions, for illustration, came from the session:
- Include a customer survey in online transactions to identify service problems.
- Capture intelligence in a customer contact center that will help identify vulnerable customers.
Again, a range of tactics were invented and bundled underneath each strategic concept.
Summary of Step 5:
- When selecting among the possible wishes, lean toward the new and intriguing (and often tricky and impossible).
- Continue brainstorming to make the selections feasible and aligned with the task.
- Work until you understand what the new solution is, how to make it work, and how to convince others of its worth.
Note: In Phase 3 of the BALA process, these concepts are evaluated for their effect on business profitability, and the best among them are integrated into a corporate plan. The next article of this series will describe how to assess the ROI potential of the strategic concepts developed in this creative process.
Continue reading "Building Profitable Customer-Centric Strategies: Focus Innovation and Creativity (Part 2 of 4)" ... Read the full article
MarketingProfs provides thousands of marketing resources, entirely free!
Simply subscribe to our newsletter and get instant access to how-to articles, guides, webinars and more for nada, nothing, zip, zilch, on the house...delivered right to your inbox! MarketingProfs is the largest marketing community in the world, and we are here to help you be a better marketer.