Platt Perspective on Business and Technology

Meshing innovation, product development and production, marketing and sales as a virtuous cycle 11

Posted in business and convergent technologies, strategy and planning by Timothy Platt on February 26, 2018

This is my 11th installment to a series in which I reconsider cosmetic and innovative change as they impact upon and even fundamentally shape the product design and development, manufacturing, marketing, distribution and sales cycle, and from both the producer and consumer perspectives (see Ubiquitous Computing and Communications – everywhere all the time 2, postings 342 and loosely following for Parts 1-10.)

I have been discussing marketing and communications issues in the last several installments to this series (see in particular, its Part 9 and Part 10.) And I have done so from two perspectives: business-to-marketplace with its consumer oriented marketing and communications, and business-to-business marketing and communications, as for example arises for need when entering and participating in mutually beneficial supply chain and other collaborations. (Note that for purposes of this discussion, I include the more traditionally conceived business-to-business where businesses serve as consumers, as fitting a business-to-consumer pattern.)

I begin this posting by noting that effective communications and effective formulation of message to be communicated, makes all else possible for a business and for the outside participants that it conducts business with too. And that line of discussion as presented up to here, offers an essential background perspective for what I would turn to here – innovation and I add at least the foundation building steps leading up from that, to the production of marketable offerings as well.

More specifically, I begin addressing all of that here by at least briefly recapitulating a dichotomy that I have developed and offered in earlier postings and series here, that holds particular relevance in this context too. Innovation as a whole can be parsed in a number of meaningful ways, that shed light on both what businesses do and how, and on how successfully they perform at that. Here, I distinguish between:

• Market and consumer-facing innovation that is expressed in the products and services developed and offered by a business, and
• Business process innovation, that can arise and remain essentially entirely in-house for an innovating business, or that might be shared, or even marketed and sold but in a business-to-business context (e.g. within the collective partnerships of a supply chain collaboration.)

My focus here is going to be essentially entirely on the second of those two possibilities and on innovation in what a business does, operationally and I add strategically as a matter of process. Note, in anticipation of what is to come, that the tagline text that I appended to Parts 9 and 10 of this series was “rethinking markets and the consumers that comprise them,” parts 1 and 2. And my tagline text for this one that will accompany links to it in browser searches, is going to be the same, part 3. This is in keeping with my having partitioned marketing in consumer market directions, and in business-to-business directions too. So I do at least attempt to offer all of this discussion and its underlying analytical reasoning as fitting into a single, overall consistent pattern. And with that explicitly noted, let’s consider business-to-business contexts and business process innovation.

• Business A, or rather people working there develop and test out an innovative new way for carrying out or performance tracking one of their core back office business processes. Would it make sense to keep this as entirely in-house as possible and even as a proprietary trade secret if possible?
• Or would it make sense to in effect share (e.g. license or sell) it to other businesses?

At least for now, think of this portion of this series as addressing innovation diffusion issues, with initial business process innovations assumed, and with their prototyping or other initial vetting carried out, and their beneficial usability verified, at least in-house for the innovating business. So at least in-house, and there where it is initially developed, any such innovation has already established itself as a positive and known value proposition.

My goal in setting those innovation defining parameters is to at least limit the type of uncertainty that a new but untested innovative idea, or a pre-release research build of one under development would carry. Assume here that any innovation under consideration in this discussion, actually productively works, and in ways that create more positive value than adhering to it would consume. Now let’s directly consider those two Business A oriented bullet pointed questions just offered above. And I do so by raising a set of basic questions, the answers to which, would at least frame and parameterize an answer to them too.

• Does an innovation under consideration here, connect into and directly improve core business processes that are essential to creating the marketable sources of value that a developing business would bring to market, as their unique value proposition?
• Or is this a business process innovation that fits into and directly supports more supportive areas of the business, and even just what might traditionally be considered a cost center operation for their business type?

These questions consider innovative change and development from a critical needs versus a supportive needs perspective, and from essentially entirely in-house. And depending on which of the two would garner a yes answer and which would more merit a no, the business in question would have greater or lesser overall impetus to retain such an innovation in-house – at least if businesses in their industry and business sector do not face what amounts to cut throat competition from business rivals. Then, any advantage, however small that would make a business more cost-effectively competitive, can and will come to hold special value for its incremental improvement in that business’ competitive strength and position when facing its markets, and its competitors for them.

Now let’s parse these innovations in a second direction:

• Would use of a business process innovation of the type under consideration here primarily offer value in-house and in the internal back-office systems in place there?
• Or would it also significantly benefit a business if deployed in a business-to-business context, and with collaborative partners as found in a supply chain or similar system?
• Focusing on that second possibility, is this something that would best work, at least over immediate and shorter term timeframes when the innovation developing business was actively involved and in effect enabling it for wider use?
• Or would this innovation be more readily transferable to new settings, and even by direct competitors to the innovation developing business?
• Could it be patented or otherwise protected, with for example, supply chain partners offered opportunity to licensed use of it?
• Could such an innovation be developed into a standard of wide-ranging utility? This is a tricky question, and particularly where the (consumer as well as business-to-business collaborative) marketability of such an innovation might mean bringing others to see the innovating business as a market leader and best choice to buy from or to work with. Note that these considerations connect directly back to the issues raised in the first two questions of this overall list, dealing with profit and cost centers.

I am going to continue this discussion in a next series installment, as to how innovation and its development fit into larger business systems and their contexts. And in anticipation of that line of discussion to come, I will do so at least in part, in terms of markets and marketplace dynamics, as I have begun to do here. Meanwhile, you can find this and related postings and series at Business Strategy and Operations – 4, and also at Page 1, Page 2 and Page 3 of that directory. And see also Ubiquitous Computing and Communications – everywhere all the time and its Page 2 continuation.

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