Consumer Goods Technology recently asked me to share my outlook for the next year and a half for Open Innovation trends and best practices. That report has just been published in CGT’s Prioritizing For Growth: 2015 Review and Outlook Report. I join several other industry leaders and forward thinkers. You can read their reports here. I’ll share my part:
This year I see three areas that CG Companies need to focus on in order to outperform their competitors, increase revenue and operating margins and capitalize on adjacent opportunities.
First, senior leaders must move beyond status quo measures of success. If you’re not willing to take on higher levels of uncertainty and risk, you won’t grow. It might take completely reframing your businesses to identify underserved and new segments, and then building new innovative frameworks, planning tools and new capabilities to accelerate the pipeline.
Next, if you think you already have a dynamic and diverse culture, step up your game. Engage as many external partners and business functions as you think are necessary to help bring a diverse array of new ideas into your team’s innovation processes. Consider adding team members from a wide variety of backgrounds, experiences, attitudes, personalities and ways of thinking to develop a robust knowledge bank and spur innovative thinking. “Soft skills” or people skills are important components of a progressive organization and an innovative culture. Successfully finding and engaging the right partners is not easy, but time and again we see benefits from reaching out and creating collaborative relationships to deliver growth.
Lastly, if you want to get somewhere, you have to know where you are. And if you want to know how you are progressing, you need measurements. Sadly, innovation is widely under-measured in many organizations. Metrics not only help you stay on track, what gets measured gets done.
There is no one set of metrics that works for every CPG company, but these are among the most common:
- Annual budget invested in projects with external partners
• Number and quality of patents or trade secrets assessed from outside partners
• New product sales
• Number of external ideas selected and then commercialized
Yes, these initiatives are risky in an uncertain future. But as I look forward into the next 18 months, it’s going to take tenacity and a bold commitment to embrace new ideas, the right skillsets and analytics to survive and succeed.