Now evolutionary is safer and normally requires less tool-up investment to establish the new production but step-changes in company performance typically need bigger, more bold ideas and for that you may need to look outside your organisation.The “Lead User” concept was pioneered by Eric von Hippel of MIT Sloan School of Management in 1986. It refers to a specific type of user of a product or service having two characteristics: (1) They are at the leading edge of important market trends and; (2) they have a strong incentive to find solutions for the novel needs they encounter at the leading edge. In the everyday business world these can often be found within your existing customer base. Your products are taken into the real world and sometimes into extreme situations that push the parameters of efficacy. It is these users who from necessity are driven to innovate – in some ways they know your technology and its limitations better than your research team – tough to accept, I know. And an often highlighted example is the development of advanced braking systems within the aerospace industry. Faced with a paramount need to stop aeroplanes before the end of the runway there was in effect more incentive to improve braking in that sector than in the auto industry. The new technologies of course later made their way into car manufacturing once the expensive R&D had been done. Professor Hippel’s innovation was to propose involving such users routinely in the R&D process. Teams are set-up with in-house R&D personnel combined with selected lead users. There are typically then three phases of the development:
- Go into a defined market place to “look for challenges needing a solution”;
- Upon return, establish workshops with experts in the field to come up with ideas that could potentially resolve the identified challenges; and
- Finally, set-up design teams to working on the concepts identified in phase II in order to fine tune to a finished product.
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tale is of Swan Vestas – the match makers – who asked all employees to suggest cost saving measures. The winner was a guy on the production line who proposed that each box of matches only required one strip to strike the match not two. This simple change saved the company thousands upon thousands of dollars. Furthermore, Brian Williamson suggests that tax credits can help boost cashflow among innovative SMEs. Andrew Low, who has 26 years in the Agri-business sector, is managing director of JE Invest and the owner of DiscussingBusiness.com. Image: Shutterstock
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