Innovation is All About Value   Leave a comment

Innovation = Value Creation x Value Access x Value Translation

“… you will notice that the components are multiplicative not additive. Do one or two well and one poorly and it doesn’t necessarily add up to a positive result. Doing one poorly and two well can still doom your innovation investment to failure. Let’s look at the three equation components in brief:Value Creation is pretty self-explanatory. Your innovation investment must create incremental or completely new value large enough to overcome the switching costs of moving to your new solution from the old solution including the ‘Do Nothing Solution’. New value can be created by making something more efficient, more effective, possible that wasn’t possible before, or create new psychological or emotional benefits.Value Access could also be thought of as friction reduction. How easy do you make it for customers and consumers to access the value you’ve created. How well has the product or service been designed to allow people to access the value easily? How easy is it for the solution to be created? How easy is it for people to do business with you?Value Translation is all about helping people understand the value you’ve created and how it fits into their lives. Value translation is also about understanding where on a continuum between the need for explanation and education that your solution falls. Incremental innovations can usually just be explained to people because they anchor to something they already understand, but radical or disruptive innovations inevitably require some level of education often far in advance of the launch.Done really well, value translation also helps to communicate how easy it will be for customers and consumers to exchange their old solution for the new solution. My favorite example of poor value translation and brilliant value translation come from the same company and the same product launch – The Apple iPad. It’s hard to believe, but Apple actually announced the iPad with the following statement:“Our most advanced technology in a magical and revolutionary device at an unbelievable price.”This set off a firestorm of criticism and put the launch at risk of failure. But amazingly Apple managed to come up with the Out of Home OOH advertisements with a person with their feet up on a couch and the iPad on their lap see above by the time the product shipping. If a picture is worth a thousand words, this particular picture will probably end up being worth billions of dollars to Apple.Never Forget!Value creation is important, but you can’t succeed without equal attention being paid to both value access and value translation…Because innovation is all about value…

 

 

Value Creation x Value Access x Value Translation = Success! ”

via Blogging Innovation.

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Posted August 14, 2011 by arnoneumann in Innovation

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