I bet you, that in two words I can get your attention.
See? Those magic words are on everyone’s agenda – and they should be.
I was lucky enough to attend a talk by INSEAD business school professor Amitava Chattopadhyay a week or so ago on that very subject. But his focus was not on brands getting into emerging markets, it was on why brands from emerging markets were succeeding.
I won’t go into all the detail around why these brands are succeeding. What caught my attention was the type of innovation that appeared to be happening within these companies.
One thing fascinated me, the apparent lack of ‘revolution’ innovation in products and services. The consumer-facing innovations that we saw in the talk were mostly twists on a current format, evolution rather than revolution. But companies are making breakthroughs in innovation, but it’s not in product. Their revolutions are internal.
BYD are now a major battery firm that creates batteries for cars, mobiles and other electrical devices. As a small company, they wanted in on the Lithium Ion battery market. But there was a problem. The clean room required for production of these batteries would cost more than the value of the entire company. The solution? Create ‘clean boxes’ – self contained units with rubber gloves that could be created at a fraction of the cost with no impact on quality. In fact, they improved efficiency as no ‘scrubbing up’ was needed.
So BYD saved money and increased efficiency, cutting costs and allowing them to deliver at a cheaper price. Funnily enough they are now a Warren Buffett-backed global business (though they’ve admittedly have just had a terrible first half!)
So here’s the question. At Face, we do a lot of innovation work with consumers. But when was the last time you innovated within the business? Efficiency and cutting costs are critical in the modern environment – so maybe it’s time we spoke to people inside the business, not just outside.
Is that co-creation? We would argue it is, we often run internal workshops where we bring together experts and internal stakeholders working collaboratively to create solutions. Combining industrial designers, shop floor workers, management and many others provides a powerful way to disrupting systems and find ways to increase productivity.
In a world where consumers are more price-sensitive and cutting their repertoires, innovation doesn’t have to be about more products – it can be about a better business.