My distant memories of going to the circus are mostly of standing in the cold, queuing for tickets, watching unmoved as clowns threw water over each other and unwilling animals were prodded to do their tricks.
More recently we went to Cirque du Soleil. We sat mesmerised through the telling of a story in glorious technicolour with astonishing acrobatic feats. We paid 10 times the price of entry to a traditional circus and still came away feeling we had had great value for money.
That is innovation. Taking an existing, often traditional service and making it radically better. Some 90m people around the world have now experienced a Cirque du Soleil show.
So what is the key to innovation? How can you use it to transform your own company’s performance, whether that is to grow your revenues, profitability or the value your clients receive and are happy to pay for?
This article sets out the three key steps to prepare to innovate and the four fundamental questions to answer to achieve successful innovation, and it is a tried-and-tested process.
- Consider how your company can innovate
- Innovation can be examined in other industries
- Look at who your target market is
We have used it in our own business: when we founded the company and most financial and cashflow planning was done manually (we support over a third of all advice companies today); when we started risk-profiling investments and no one else was (we cover 120 asset managers today); and when, more recently, we launched an annual review process (adopted by more than 500 companies in five months). If it works for us it can work for you.
The good news is that innovation is not invention. Innovation is about taking something that is in your business already and changing it to achieve better results for some, if not all, of the clients you already serve today. You do not have to be an inventor, you just need to know your business and your clients.
Shifts in performance?
There are a number of big benefits to innovation, not least unlocking unique value like Cirque du Soleil. Two others worth focusing on are:
• Enhancing the consistency of quality and suitability.
Local opticians in the 1980s were dominated by expert professionals with long waiting times and a low range of choice. Specsavers, founded in 1984 by a husband and wife team, asked themselves, ‘How do you take the quality and suitability provided by the professional and scale it?’
They used the following formula to grow their business to more than 2,000 branches in a dozen countries: they added consistency of quality and suitability through intelligent software; welcoming branding, experience and stores; increased product range; and reduced waiting times and prices.
• Enhancing efficiency.
We all dislike check-in queues at the airport. It was Alaska Air in 1999 that introduced the ability for passengers to check in via the internet. Subsequently, almost all airlines have innovated to adopt the process. This added convenience, speed and certainty of seating. It reduced personal contact, agent’s upgrade discretion and queues.