Innovation Perspectives - Should Marketing or R&D lead?
This is the fourth of several 'Innovation Perspectives' articles we will publish this week from multiple authors to get different perspectives on "Where should innovation reside?" Here is the next perspective in the series:
by Drew Boyd
Who leads innovation in your company: marketing or R&D? It's a trick question, of course. But it's a useful question for Fortune 100 companies to consider. Has your company made a conscious choice of how it "allocates" this leadership role? Allocating innovation to one group over the other will yield a different business result. The approaches to innovation by marketing are dramatically different than approaches to innovation by R&D, so the outputs will be dramatically different. The question becomes: which group will outperform the other? Technical-driven innovation or marketing-driven innovation?
But there is another layer of complexity. Allocating innovation resources to one group over the other will also yield a different kind of innovation. Market-driven innovation speaks to what is salable. Technology-driven innovation speaks to what is technically possible. Which group delivers the type of innovation that is best suited to the company's growth strategy? Now the decision of who leads innovation becomes even stickier.
This question is a bit like deciding how to allocate your money in an investment portfolio. Which allocation of funds will give you the total return and the type of return (tax advantaged, etc) that you need? The tempting answer here is to assert innovation leadership should be shared between the two. Diversify your innovation allocation just as you would diversify your personal investment allocation. I'm not so sure. Here's why.
For a company that knows exactly what its customers need, then it's just a matter of developing it. A technically-led innovation approach makes the most sense. L'Oreal, for example, does virtually no market research with its customers. It gathers no "Voice of the Customer." Yet it knows exactly what customers need because...L'Oreal tells them! In that case, innovation is led by the technical team to deliver the beauty compounds and formulas that will thrill their customers. The innovation approach here is described as "Problem-to-Solution. Engineers lead this because they excel at solution matching.
A company in the refrigerator space such as GE or Whirlpool needs a different approach. Breakthrough innovation is more likely to be found in the "Solution-to-Problem" mode, best driven by the commercial marketers who excel at problem matching. The marketer needs to use an approach that relieves them of their preconceived notions about what customers want. They seek to avoid "fixedness" around their current product so they can solution spot more freely. Only then will they be able to envision new concepts of home refrigeration that never would have emerged with a technical approach.
The best companies maximize their innovation investment return by consciously allocating leadership to either marketing or to R&D. In the end, innovation is best driven with a team approach but with clear role accountability and direction depending on market conditions and corporate strategy.
You can check out all of the 'Innovation Perspectives' articles published so far from the different contributing authors on "Where should innovation reside?" by clicking the link in this sentence.
Drew Boyd is Director of Marketing Mastery for Johnson & Johnson (Ethicon Endo-Surgery division). He is also Visiting Assistant Professor of Marketing and Innovation at the University of Cincinnati and Executive Director of the MS-Marketing program. Follow him at www.innovationinpractice.com and at http://twitter.com/drewboyd
by Drew Boyd
Who leads innovation in your company: marketing or R&D? It's a trick question, of course. But it's a useful question for Fortune 100 companies to consider. Has your company made a conscious choice of how it "allocates" this leadership role? Allocating innovation to one group over the other will yield a different business result. The approaches to innovation by marketing are dramatically different than approaches to innovation by R&D, so the outputs will be dramatically different. The question becomes: which group will outperform the other? Technical-driven innovation or marketing-driven innovation?But there is another layer of complexity. Allocating innovation resources to one group over the other will also yield a different kind of innovation. Market-driven innovation speaks to what is salable. Technology-driven innovation speaks to what is technically possible. Which group delivers the type of innovation that is best suited to the company's growth strategy? Now the decision of who leads innovation becomes even stickier.
This question is a bit like deciding how to allocate your money in an investment portfolio. Which allocation of funds will give you the total return and the type of return (tax advantaged, etc) that you need? The tempting answer here is to assert innovation leadership should be shared between the two. Diversify your innovation allocation just as you would diversify your personal investment allocation. I'm not so sure. Here's why.
For a company that knows exactly what its customers need, then it's just a matter of developing it. A technically-led innovation approach makes the most sense. L'Oreal, for example, does virtually no market research with its customers. It gathers no "Voice of the Customer." Yet it knows exactly what customers need because...L'Oreal tells them! In that case, innovation is led by the technical team to deliver the beauty compounds and formulas that will thrill their customers. The innovation approach here is described as "Problem-to-Solution. Engineers lead this because they excel at solution matching.
A company in the refrigerator space such as GE or Whirlpool needs a different approach. Breakthrough innovation is more likely to be found in the "Solution-to-Problem" mode, best driven by the commercial marketers who excel at problem matching. The marketer needs to use an approach that relieves them of their preconceived notions about what customers want. They seek to avoid "fixedness" around their current product so they can solution spot more freely. Only then will they be able to envision new concepts of home refrigeration that never would have emerged with a technical approach.
The best companies maximize their innovation investment return by consciously allocating leadership to either marketing or to R&D. In the end, innovation is best driven with a team approach but with clear role accountability and direction depending on market conditions and corporate strategy.
You can check out all of the 'Innovation Perspectives' articles published so far from the different contributing authors on "Where should innovation reside?" by clicking the link in this sentence.
Drew Boyd is Director of Marketing Mastery for Johnson & Johnson (Ethicon Endo-Surgery division). He is also Visiting Assistant Professor of Marketing and Innovation at the University of Cincinnati and Executive Director of the MS-Marketing program. Follow him at www.innovationinpractice.com and at http://twitter.com/drewboydLabels: Drew Boyd, Innovation, Innovation Perspectives, marketing, Strategy
posted by Blogging Innovation at 6:00 AM
9 Comments:
Another approach is to join technical and marketing at hip, with both engaging the market to understand what is needed by the market for their growth. Then both perspectives can be shared and evaluated. Technical is better off because they learn first hand and marketing is better off because they can get technical alignment, focus, and better customer specifications. The team approach as suggested in the blog has worked well with our clients.
In many ways it's a false choice between technical and marketing. Both need to fully comprehend the job the customer is trying to do and how the innovation will improve it. Our experience indicates that marketing and technical folks listen with different mental models; their discussion and debate after listening to the same customer conversation is key to shortening the cycle time and increasing success rate of innovations. Our clients have found that using a standard process provides a useful framework to organize this critical discussion and debate.
Excellent post and comments. Would like to add some food for thought:
If light is what we seek, does it matter where it is emitted from Marketing or R&D?
Perhaps for new products/new business marketing is better off leading to engage all internal/external stakeholders in an upsteam fashion.
On the contrary, to improve on existing technology perhaps it is better off to let R&D decide how to "build the better mouse trap."
Appreciate the discussion and article. Please add me to your LinkedIN network.
Regards,
Vimal T. Patel
patel07307@gmail.com
but how about innovation from customer support ? from your implementation team ? from that guy in accounts who has a handle on DSO's and understands that changing some product features would help simplify contracting terms and remove a hurdle to adoption ?
Saw a great specific inquiry:
1)but how about innovation from customer support ?
2)from your implementation team ?
3)from that guy in accounts who has a handle on DSO's and understands that changing some product features would help simplify contracting terms and remove a hurdle to adoption ?
Excellent inquiry and commentary. I had dealt with exactly these type of scenarios both early in my career and still fifteen years later.
1)Customer support inquiries and complaints need to be addressed and it is the responsibility of the customer service rep to escalate the feedback to marketing or engineering services or both.
Engineering leading traditional development fixes the "bugs." Marketing driven upstream development prevents similiar complaints/malfunctions in the new products/business.
2)Same applies from other staff or line functions, every employee is responsible for sustainability and competitiveness.
Once again this is just my perspective and observations from experiences in large cap matrix organizations and small micro cap cultures.
Regards,
Vimal T. Patel
patel07307@gmail.com
P.S. Vimal is open to contract/per diem problem solving assignments in healthcare.
Taking the viewpoint out a bit further, I've seen huge value created for organizations that see innovation as everyone's responsibility. There is a tremendous amount of value to be created that is not just about new products and the marketing of those new products. So, in the end, the question to be asked is "What might be all of the ways to get everyone in the organization to see innovation as -in part- their responsibility?) One place this question will take you is to organizational systems and metrics, -- more here: http://tiny.cc/h7dVd -- another is to Senior Leader Behaviors -- more here: http://www.newandimproved.com/newsletter/2025.php
Bob,
Thanks for the URLs, I bookmarked them along with this blog. With that said, it can be a challenge to making all the stakeholders see and share the vision of innovation. On the note of cooperation, here is a PPT I developed and using the analogy of biosystems in our environment:
http://tinyurl.com/n9gh7n
Regards,
Vimal T. Patel
patel07307@gmail.com
I am in the camp that the best approach is a joint approach, but only if all parties are functioning as a high-functioning cross-functional team. We all hear different things when a customer/consumer is speaking, and we filter it based on our individual ecperiences. This is where diversity comes into play: the more different types of "ears" that listen and incubate, the more there will be on the table when its time to converge. Strategy is also an often overlooked key component, and it is the key to determining how resources will be allocated. I've worked for companies that focus on the short-term, and some that wanted to create new categories. Success is defined by meeting your criteria.
The best team I ever saw was truly cross-functional and autonomous. Aboout 20 years ago, they determined that bottled water was going to be the next big thing, and their sponsors laughed them out of the room, then dismantled the team. Who is laughing now??? It can, and does work, if everyone does their part, on the team and up and down in the company.
Julius - Would you be willing to expand upon your bottled water example for an article I'm writing on Slow Innovation or another project on Barriers to Innovation?
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