The turkey burger: is it a real innovation or just a hamburger with turkey substituted for beef? Although it may not seem like a pressing question, businesses are constantly faced with choices about what constitutes the next ‘big idea.’ Far from innocuous, these inventions and spin-offs can actually make or break a company. In an article for CIO.com, Jonathan Marek explores the ways businesses can safely test new ideas by putting their CIO in charge of R&D.
Flops and Fumbles
As a testament to untested business inventions, Marek uses several examples including the Amazon / Borders synergy, Bic Razor’s disposable women’s underwear, and Netflix’s DVD-by-mail pairing with Qwickster. These ideas sounded great in the outset, but boy were they miscalculations. Of course, in-market tests and control groups help to ease the risk, but these approaches often cost more money than a business can afford. Before your company’s back is against the wall, consider the ‘innovation funnel.’
The Innovation Funnel
The innovation funnel is a standardized process for continually channeling oodles of ideas through a testing process to sort out the usable from the flops. Marek says that even the smallest ideas should get some attention. He says that the best inventions are not always the ones that sound good, or that appeal to the imagination.
CIOs Know Innovation
How can the funneling process be made über-efficient? Turn to IT and big data. With a savvy CIO on board, historical sales and space allocation data can be crunched and processed to yield profitability figures and tradeoffs.
CIOs know, maybe better than most, that iffy products and services can be gussied up with fancy names and descriptions, creating an illusion of evidence and success potential. The truth is, most ideas must be considered unproven until they are tested in the real world. A store-within-a-store concept could be an added expense with no net benefit. New promotions could subsidize customers who would have paid for the item at full price. Targeting Millennials could alienate other customer segments.
Based on what the CIO churns out, executives can prioritize in terms of investment potential, risk allocation, and a host of other metrics. Who knows, maybe the turkey burger is the next innovation ‘Whopper?’
To read the full article visit: http://www.informationweek.com/strategic-cio/it-strategy/cios-should-help-build-innovation-funnels/a/d-id/1316884