Teaching How To See

Innovation management teaches many things and one of them is how to filter the world around us to be able to better identify potential markets that are within reach with nominal transformation. In innovation management parlance this is called adjacent innovation, meaning markets that are adjacent to existing lines of business that could be developed with a targeted strategy.

One of the tools that many innovation management practitioners use to filter business opportunities is called future-scenario planning. This tool is basically used as a way to visualize how a specific business or customer-base may look like in the future. Another tool is the use value-based analysis, which looks at a businesses’ workflow and assigns value parameters to each step in the process of delivering value to customers.  The aim is to find areas of competitive advantage and where a company may take a stance and compete effectively with those that are disrupting their businesses.

Value is not strictly a numerical qualifier, of course. Value can also be driven by more qualitative factors such loyalty index and/or lifetime revenue value assessments for each subscriber. Additionally, the inherent value of a subscriber can also be enhanced by their future potential to buy not-yet-defined services driven by evolving subscriber trends.

While this point may appear very obvious to many reading this article it has not always been so with telecom operators who at times seem to be indifferent of their customer’s needs and desires.

It does not take much effort for someone with a mind for blending value-based thinking with new trends to realize that the world is going mobile with subscribers owning immensely powerful mobile devices and creating and consuming content on the go. These mobile devices that happen to make ‘calls’ and we call smart-phones, have become the central purveyors of ‘life-management;’ a status that will increase in importance and relevance over the next 5 years.

Subscribers and their smart phones are in many ways driving the need for new services.  And if we were to continue the extrapolation of mobile trends and subscriber behaviors, again, it does not take much to see that other “sticky” mobile services have emerged or, will soon emerge, including backup services, device insurance services, mobile security, etc. According to Ericsson, by 2017 the volume of mobile data traffic will be 21 times greater than what it was in 2011 and the number of mobile broadband subscriptions will go from 900 million to 5 billion.

Smartphones and subscribers using them as life management devices is a trend that many Telecom operators and device manufacturers missed entirely because they were not able to see in new ways that would allow them to blend concepts and ideas that could lead them to new visions and market opportunities. They have not adopted innovation and collaboration-based organizational structures that would permit them to blend future-scenarios and instead are handicapped by operationally centered structures and thinking.

This is the dilemma. Companies that have become so operationally optimized and focused on delivering existing products that they have overlooked new ways of delivering new value into new growth markets. Recent examples are Blackberry, Kodak, and Nokia.  Innovation management theories are designed to inhibit this from happening.  And if implemented properly it can and will absolutely meet this mission.  I know, because I have seen it and experienced it.