Innovation - Technology Driven (or) Market Driven.

This was a topic of debate at a symposium held in my company. After attending the debate and listening to various points of view - wanted to put together some perspectives on the topic -

Innovation – Market Driven or Technology Driven – or Both – should I say? Innovation is all about finding and exploiting the intersections between unmet needs, enabling solutions (e.g. technology) and marketplace opportunities. But If I have to take a stand and I say Every Innovation is fundamentally driven by markets and is guided by an inherent need. Sometimes the need is explicit and other times it may be latent. The iPod is an example of innovation from the market side by observing that portable electronic devices such as cameras, and phones were on a rapid path of miniaturization with ever increasing functionality. This observation allowed direct entry of innovation from market side, since there was little question that a much smaller portable music player was needed. A huge market for the product is the driving factor behind most of the companies.

Markets are the backbones for pragmatic implementation of the ideas conceived in distinguished laboratories across the planet. Take the example of our very own GE MAC 400. ECG machines existed before. But this product came out as a result of an identified need for an affordable & accessible ECG machine in Indian rural market. Technology played a major role in MAC 400. But no-one thought about the technology of MAC-400 until it was driven by the need in indian rural market place. The disruptive innovation from Tata – Nano car came from Ratan Tata’s observation of people, in families, traveling precariously on motorcycles and scooters in rural India. The vehicle is the result of innovation of ideas, price and most importantly, people, which translates to markets!!

The ultimate goal of any innovation is to create value in the minds of customers. Deep understanding of customers and their needs will help in searching for strategic innovation opportunities. This will act as a 'creative fuel' for the innovation efforts. With this fuel, it will become easier for companies to see potential technologies and solutions through a clearer lens and increase the change of creating really big ideas. PDA was highly innovative product, which flopped when it was first introduced by Apple, Tandy and Motorola. These companies did not choose the right target customer to get market moving, nor did they understand how these customers would get the best value out of the innovation. Palm introduced essentially the same product but, by studying how their customers would use it, the company was able to market a feature with strong customer appeal. Their version of PDA sold millions.

When a company approaches product development from a customer perspective it helps them identify strategic opportunities in the marketplace. Examples: Shampoo sachets came about when the founder of Cavincare observed Indian rural(bottom-of-pyramid) customers using only small doses of shampoos, hair-oil on an ad-hoc, sporadic basis. As there are rampant power cuts in rural india – Nokia realized the benefit of having a torch built into a mobile phone and it’s 1100 model incorporates a torch.

Invention is the first occurrence of an idea for a new product or process while innovation is the first attempt to carry it out into practice, whether it leads to societal benefit, or commercialization . Inventions may be driven by technology, but Innovation is invariably driven by market. The innovative product E-Chaupal by ITC brought a lot of benefit to the farmer by direct procurement of agricultural produce, thus fetching farmers more correct and better prices.Tim Berners-Lee invented the World Wide Web. When applied to various unmet and anticipated needs of the marketplace, it brought about a complete paradigm shift in way things happen. It created a new universal space for information sharing, collaboration and commerce. On the contrary, clinical medicine is replete with inventions that never made it to the market place.

"Whether humans will embrace or resist an innovation is the billion-dollar question facing designers of novel products. Fortunes are made and lost on the answer" The answer lies in the market centric approach that companies should take – in fundamentally reshaping or adapting the underlying "inventive" product into a package that truly meets the need of the market"

Great Design (Vs) Optimal Design

This was the topic of another debate held at my company, and  here are some of my own thoughts on the topic.

Design As I understand is the process of developing a plan for a product, or a system. That process could be documented as a set of drawings, models or whatever. After the whole debate, it was still not clear to me what is a great design ? I think there are no "Great" designs on paper.

Eiffel tower was definitely "Designed to be great ", and it stood the test of time.. Columbia ( space shuttle ) was also "Designed to be great", but it was a disaster.Though both were designed to be great, everyone today would quote eiffel tower as an example of a great design, and columbia as that of a disastrous one.

The whole point is that design is only a means to an end (product) and until the product is out in the market and turns out (proven) to be great, you can not really judge whether the design of the product was great or not.

Probably another way to think about great design is to look @ it as being the "best design"

Tata "Nano" - a bad example for great design I suppose. No doubt it is a "Great" Idea or concept that Ratan Tata came up. Without the additional attribute of being a "cheap" car that suites the Indian roads, just look at it as a car in itself. It does not match up to the standards set in the car industry. How can we call it's design great or best ? But it is an "optimally" designed car for Indian market and Indian roads. Even to call it "great" for the Indian market, it is not on the Indian roads yet and not proven itself.

Talking of optimal designs.. For all practical purposes most commercial products are designed to be optimal for the current set of requirements (or) anticipated near future requirements and current needs of the people. Windows may be a good example. It is not the best operating system out in the market. it's products are never the best. But when they are released into the market, they are "greatly" optimized for the current needs of the society. That's why there is so much penetration & market share.

Products are optimized for use by a certain set of people (or) for particular domain (or) for a specific user experience (or) for use within a specific country. Optimization is the key ! From a business perspective, optimization can be looked at as the process of maximizing ( profits and efficiency) given a set of constraints. One main constraint for example can be time to market. It is important to reach the market before your competition does so.

As we design our products, we could optimally design them or design them to be the best but from my perspective if you go for the second option, it may take longer time and there is more risk involved.