Posts Tagged ‘VALUE CREATION’

The Reward of Innovation

Sunday, September 5th, 2010

Innovation is ultimately about return on investment at the end of the New Product Development process. With the success of a new product launch, everyone benefits – from shareholders and company employees to the consumers. Innovation done well reaps market share gain, new products and new features. Essentially, everyone wins.

The last imperative of Robert’s Rules of Innovation is Net Results, Net Reward, meaning recognizing the people who contributed to the development of a new product. It’s important to reward actions with incentives for sustainable effort.

Rewards for a successful New Product Development process can be monetary – often the key stakeholders get a product launch reward or a percentage of sales from new products. But all members of the staff need to be rewarded, and motivation isn’t always about money. In fact, non-financial motivators can rise above other incentives. Praise from managers, the attention of leadership and the chance to lead projects are strong motivators that can top even monetary rewards. People mostly want to feel recognized and appreciated for their contributions. If those needs are met, employees stay engaged until after the new product launch and for more development processes to come. Rewards enhance an employee’s commitment to the company, boost workplace morale and motivate future efforts.

The fruits of your team’s labor benefit all. These successes must be rewarded – and in the appropriate manner. Here are some tips on why you should reward your employees and how:

  • Innovation and ROI: True Innovation results in value creation for all stakeholders – in terms of financial return, increased market share and enhanced profitability; this is the ultimate goal of your sustainable Innovation program.
  • The Right Rewards: Rewards and recognition systems can take many forms, from a bonus percentage based upon new product sales to peer acknowledgment and awards.
  • Recognition: Pride…a thorny problem solved…the personal satisfaction of a job well-done – these are some of the intrinsic motivators that make creative people tick.

For more tips on Net Results, Net Reward and other Rules of Innovation Imperatives, see Robert’s Rules of Innovation™ by Robert F. Brands with Martin J. Kleinman published in March, 2010 by Wiley.

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Redefining Innovation’s True Reward: Amassing Intellectual Property and Value Creation

Friday, July 23rd, 2010

What is the ultimate goal of process-driven innovation? Open a bottle of Coca-Cola – and read its performance reports – to get a true taste of the answer.

In 1980, the Coca-Cola Company was struggling, and its market share was underperforming compared to its competitors. So at a worldwide management conference in 1981, CEO Roberto Críspulo Goizueta decided to refocus the entire organization on putting value creation first.

The company refined its marketing investment, expanded into new markets, and acquired new bottling companies and the intellectual property and patents they held. The company created new products, including Diet Coke. It embraced a global vision; to wit, some market researchers say the company became the world’s best-known brand.

This transformation of company and IP doubled the company’s market share in 15 years, and Goizueta reportedly created more shareholder wealth than any other CEO in U.S. history.

Much has been written about innovation – the imperatives that drive the process and the results borne from the exercise. The purpose of innovation ostensibly is value creation that translates to enhanced stakeholder value. Process-driven organizational innovation drives value creation that transforms ideas into vital intellectual property, IP into revenues, and revenues into increased stakeholder value.

In any for- and not-for-profit organization, “value creation” can be translated in many ways. It is

  • Improved, silo-busting, team-building collaboration
  • Amassed IP and new product development, which gives the company or organization a competitive edge on the market or competition
  • Strengthened fiscal performance, which lures additional investment

This is why organizations invest the time, energy, creativity, research, planning, refining, modeling and retesting that it hopes will pay off in terms of improved process, better teamwork, a new business model, a refined brand – and black-ink results. These are assets that add value to the company, which is why it is absolutely crucial to protect these ideas.

Yet Intellectual Property will drive the future. As we move past the Industrial Age and the Age of Technology, the future era will focus on process that drives IP – and the real value it delivers. As much as teams and share, it is imperative to build and protect IP through the use of patents. Patents protect and define the innovation so they are the key step to commercialization and enhancing value.

It is essential for every company to keep a patented Intellectual Property portfolio. The IP portfolio of Airspray doubled in value because of the patented technology that turned liquid hand soap into foam. Airspray realized – and its fiscal results proved – that the regular and persistent renewing, refreshing and updating of patents was well worth the cost.

To this day, IP remains arguably the most powerful driver in innovation’s Value Creation.

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