As the figure shows, sometimes it pays to start small, define your milestones, celebrate your successes and then move on to the next step. If your staff can see that the innovative products they helped create are selling well and are well received, they will also recognise that their own work is a success and in turn recognise the value of value engineering for the business and your customers. They will be quicker to embrace the new way of working and be better motivated to incrementally drive the transformation process forward.
In the course of achieving, or having achieved the defined milestones, many companies are unfortunately still far too focused on bureaucracy – on ensuring that all the right boxes have been ticked and all the right forms have been signed. Ditch the bureaucracy! Bureaucracy and paperwork don’t make your products more reliable or cheaper.
The key point when developing and monetising innovative products quickly is to get actual people invested in the project, not just their signatures. Getting these people actively involved in reviews, for example, facilitates the identification of key sticking points. This helps avoid unnecessary additional development cycles. As a result, the product hits the shelves sooner and you keep your costs firmly under control.
Another issue is that many businesses are still compulsively focused on greenfield projects. In most cases, the next product generation is characterised by very specific innovations which deliver value for the customer, with the remainder of the product or service generally based on an existing product. Don’t forget to look in the rearview mirror!
- What has stood the test of time?
- Where is there still room to reduce costs?
This gives you a solid foundation to build on, enabling you to focus on genuine innovation.
And in any innovation project, it’s essential to keep the focus on cost vs. benefit. Ensure that the benefit-cost ratio of your project is clear right from the outset and keep checking that this ratio has not changed over the course of the project. Start by analysing the current situation, then use this analysis to determine the potential offered by your innovation and analyse potential profitability. Then it’s just a question of ‘go’ or ‘no go’. Only take on projects that look like they will work – have the courage to discard projects if your analysis suggests they are unlikely to succeed.
Value engineering helps you focus on those innovation projects with genuine potential and to discard those projects that are likely to be a waste of resources with little prospect of success. The result is that you gain a better understanding of the needs of your customers, you can make informed decisions to successfully create innovative products and services, you enhance the innovation capacity of the business as a whole, and you permanently bridge the innovation orchestration gap. In short, turn innovation frustration to joy!
To learn more about the innovation orchestration gap, see our blog posts “The digitalization obstacles hurting innovation outcomes” and “Discover the three dimensions to successful industrial innovation”.