In terms of innovation management processes, concepts perform a somewhat delicate balancing act between ideation and product development. An idea needs to be explored from a variety of angles in order for its potential to become clear. However, as experts spend more time looking at it, they may be tempted to start more serious work and in fact, treat it as an active project. They may actually skip the concept stage.
How can a concept be so managed that the appropriate levels of knowledge are acquired without excessive cost?
From Great Ideas to Concepts
In his post on Four Levels for Great Ideas, Steve Rogers lists various types of sources. Both he and Randal White (in Are You Searching for the Right Idea or the Right People?) emphasize that ideas should be generally discussed by relevant communities-of-practice. This enables them to be related to markets, to company strategy, to possible white spaces, to internal expertise and to other, existing ideas, such as those being explored in technology development projects. During ideation a wide variety of people should have time to reflect and exchange thoughts.
Executives will normally use tools such as scorecards to conduct periodic reviews in order to ensure that only thoroughly investigated ideas can be promoted to concepts. Ideas which are not (yet) suitable for consideration as concepts can be stored in an idea bank.
New concepts will be fewer in number than the original set of ideas, but still too many to promote instantly to product development projects. They should nevertheless be regarded as potential or candidate projects and will require more systematic investigation. Many companies have developed evaluation forms, checklists or scorecards for concepts.
Important questions to consider:
- Innovation type: Are these incremental changes to existing products, new products for this company or new for the whole industry?
- Which technology or markets are principally affected?
- What are the consequences for existing production and supply chain?
- Are our current core competences sufficient or is new research required?
- What intellectual property or regulatory issues will the concept involve?
- What is the degree of risk?
Careful consideration of these questions will enable an initial positioning of the concept on the company’s three-year or five-year roadmap. Clearly the questions listed above are looking at the concept as a candidate project, although precise forecasting is not yet possible. At this stage, however, the work involved is still principally desk work, so that it is important to involve a small but experienced cross-functional team which is able to provide an initial set of answers. This will limit the time spent.
Key decisions that the team will need to support:
- Which business unit will be the most suitable for executing the project?
- What is the best position in terms of roadmap, portfolio, and general need?
- When would be the best time to start the project?
The presentation of the concept to the gatekeepers should identify the strategic fit and the timing for the selected business unit to spend actual resource and insert this in their portfolio.
Concepts Based on Disruptive Ideas
We have mentioned choosing the business unit most suitable for executing each project. However disruptive ideas, involving new technology platforms or business models that do not fit well into existing business units may, if considered promising, be moved into one or more incubator units or, possibly, into start-up businesses.
Candidate Projects on the Roadmap and the Portfolio
Once concepts have been promoted from candidate projects to actual projects, they will appear on the business unit roadmap and portfolio overviews appropriately sorted by strategic category, value, short-term versus long-term execution, market attractiveness, etc.
Even at the earlier concept/candidate project stage, however, companies will normally want to have these appearing in separate portfolio reports, listed under similar categories which will aid selection and positioning to achieve the optimal time-to-production and business impact.