It’s sort of amazing when top management in a variety of industries from high tech aerospace to comparatively low tech outer packaging seem to be disengaged and “hands off” in the first three stages of of innovation (see previous post on the 5 stages). Top leaders start taking interest when the product is in serious development(Stage 4) and many top managers become alert and awake as the product is getting launched(Stage 5). At this time things are too far ahead to change except at high cost. These include airfreight when sea freight might have worked on the supply chain side, customer apathy in the market because concept testing was not done well and there was no time to do product and market testing because top management was so un-involved that the budgets were not approved when the New Product team had put them up.
It is as if top leaders got to know of the new product just as the media plan and budget was being approved. A paradox because these top managers are experts with years of experience in the industry and sometimes the company and would have spotted the problems far in advance and then the New Product team would have devised solutions to these obvious problems.
Therefore leaders from the top management team including chief officers from marketing,supply chain, production and finance need to review projects tightly at the early parts of the process and here are some questions to ask:
- Opportunity or idea generation Top managers don’t need and should not be responsible for ideas to encourage well -innovation. Leaders should encourage and ask their teams as to how the portfolio of new products are shaping up. Merely asking helps a great deal. The executive team should have a brief in every monthly meeting about the status of projects in this stage.
- Concept generation tries to articulate multiple concepts that tap into the same customer needs. Merely asking each New Product Team to provide a brief on how concepts are shaping up to the executive team will allow some discussion. And this converstation will build strategic consensus and provide guidance to the New Product teams.
- Concept evaluation has two parts as mentioned in the previous post (a) marketing evaluation that involves market research and concept testing with potential customers and (b) a number crunching sales and financial forecast of the concept. Top leaders sometimes do not demand some form of market insight as in (a) and do not vigorously question the numbers in (b) at Executive review meetings. After all money is not spent yet – so why upset a colleague to whom one of the New Product team reports? Not to suggest that executives understand the flaws and keep quiet- its just that the individual mental bandwidth is not deployed at this time.
Yes not much money is spent in the first three stages and that is the point. Because as you slip into the stage 4 Development and 5. Launch and Commercialization suddenly large amounts of money are involved. After all it is in the launch stage you start advertising and for consumer products this can be in millions.
Thus, at the risk of being “spoil-sports” top managers must be critical at the first three stages of innovation projects. If you stop one project be sure to ask for a new one and your New Product team will be glad to oblige.