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12 of 14 people found the following review helpful:
3.0 out of 5 stars
Good Thesis - where's the action?, November 19, 2007
This review is from: Hidden in Plain Sight: How to Find and Execute Your Company's Next Big Growth Strategy (Hardcover)
I've had a chance to review Erich Joachimsthaler's book "Hidden in Plain Sight", which I've found to be an good book.
First, let me start out by saying that this book is not necessarily a book "about" innovation. This is a book about corporate strategy and what I like to call strategic intent. Hidden in Plain Sight addresses a far-too-common problem - the fact that many firms have become comfortable with their understanding and view of customers from the "inside out". In this manner, many firms have segmented the customer base and determined the specific needs and wants of customers - which is traditional marketing best practice. The problem is that too often this segmentation and understanding of needs is based on the company's perspective of the customers' needs and opportunities, rather than from the perspective of the customers themselves. What happens in these cases is learned myopia and artificial comfort from the fact that we "know" our customers and understand them. Eventually what happens in these cases is that an unexpected competitor disrupts the market because they had a better understanding of the opportunities and challenges the customer faces.
So, what Joachimshtaler proscribes is an "outside in" mentality, combined with a "demand first" innovation model. In the book, he describes how Frito-Lay undertook extensive research to understand how and why people used snack foods - going well beyond traditional quantitative research to understand the reasons behind why people ate what they ate and when they ate. Much of the work Joachimshtaler describes sounds like Voice of the Customer research, although he does not describe it that way. He calls this creating the "demand landscape".
According to Joachimshtaler, Frito Lay was concerned that many of its long held beliefs were being proven incorrect. For example, Frito Lay pioneered the point of purchase rack for its snacks and assumed that most decisions for purchase were based right at the cash register. In watching consumers however, it became clear that was no longer the case. Many individuals ignored the point of purchase racks to select a specific snack. Frito management decided "We had to start thinking more about why consumers consume our products and not longer about how they purchased them". This meant that Frito Lay management had to change their thinking about customers from "point of purchase" to "point of consumption or use" - what Joachimshtaler calls "point of purpose". This last concept is why I label the book as a book about corporate intent rather than a book about innovation. In this context, innovation becomes a method or an approach to providing solutions to the new corporate intent.
The first two sections of the book do a great job laying out Joachimshtaler's concepts about customer advantage and demand-first innovation. In these two steps, the author depicts a major shift in how most firms understand and react to their prospects and customers. In his estimation, most firms are operating under an "inside out" view of customers that is tainted by internal perspectives of customers wants and needs, and by a product centric rather than customer centric approach. Additionally, years of segmentation and other marketing efforts have eliminated a number of potential customers and markets that could be viable. Once the firm decides to understand its customers in a new light, it can begin to shift its product and service development models to understand the customer demand, then create ideas for new products and services based on this new understanding. Again, this advocates using innovation and the tools and techniques for innovation (including ideation, brainstorming, consumer contradictions or seeming irreducible tradeoffs) as an outcome to generate ideas after the company has adopted a new strategic intent. I don't argue with that approach, but this switch to become much more consumer focused will require a dramatic investment in time and energy to refocus the corporate culture and the "old habits". The question the management team must answer at this juncture is: What is causing our lack of growth and differentiation? A poorly defined strategic intent, which means we can innovate but often miss the mark due to an "inside out" approach, or is our strategy ok but we simply don't innovate very well? Joachimshtaler has a very clear approach in the first case.
There is a lot to like in this book - several examples used in the book could be cribbed from customers I've worked with recently. As I've pointed out to many of my clients, innovation needs to be tightly aligned with strategy and strategic intent, or it will not be successful other than as a product extension strategy. Joachimshtaler takes this concept and reverses it, demonstrating that a new strategic intent - customer advantage - will ultimately drive new innovation approaches.
In the last section of his book, Strategies for Realizing Customer Advantage, Joachimshtaler turns his attention to marketing strategy, brand strategy and portfolio management and an examination of how to connect and engage with customers. Using examples from BMW, VW and MasterCard, he demonstrates how the consideration of marketing strategy and brand helped reposition these firms in the minds of their prospective customers, and the customers they already had. Much of the first two chapters in this section is interesting, but really targeted to a chief marketing officer who has the capability to rethink branding and customer experience.
Joachimshtaler saves his best chapter for last - Internalizing the Innovation and Growth Agenda. In this chapter he examines the steps Jeffrey Immelt took to change the way GE thought about itself as an innovator. Immelt entered a well-oiled machine that was excellent at execution and wanted to create a firm that excelled at sustained innovation. To that end, he created a number of initiatives. First, the concept of Imagination Breakthroughs. Each business unit leader had to submit ideas for their business unit that could become a new product or service worth at least $100M in organic revenue. This shook up the culture because traditionally, innovation had been the responsibility of the product management team - now more people and a broader perspective were involved, and the stakes are much higher. Second, he tied senior management compensation to the ability to generate and follow up on these Imagination Breakthroughs. Finally, they created the idea of "One GE" - that is, one united face to a customer, regardless of the opportunity or challenge. Then, using the demain-first innovation concept, they worked to get much closer to the customer - using "dreaming" sessions where executives and customers looked at product and service opportunities. Can you imagine Jack Welch in a "dreaming" session?
As I stated earlier, Hidden in Plain Sight is a great book about strategy that uses innovation as an outcome to help a firm differentiate itself through much more detailed understanding of its customers. Hidden in Plain Sight advocates a complete reversal in the way most firms generate ideas and create new products and services - changing the perspective from a highly segmented, quantitative examination of customers and products to a much more deeply understood customer experience which informs marketing and innovation to create products and services that are relevant to customers' expectations and aspirations.
If you are interested in the nuts and bolts of innovation and how it works, this probably isn't the book for you. If you are interested in the work involved to change your product and service development strategy and gain real insights into your customers and what they really want, then this is the book for you. It combines the rationale for making the change, examples of firms that have taken a very different approach to customer experience, and ideas about how to use that new perspective to drive innovation of new products and services.
Reposted from my original review on the Innovate on Purpose blog
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6 of 7 people found the following review helpful:
5.0 out of 5 stars
The Invisibility of the Obvious, May 23, 2007
This review is from: Hidden in Plain Sight: How to Find and Execute Your Company's Next Big Growth Strategy (Hardcover)
Erich Joachimsthaler offers what he claims is a "new model of strategic innovation for achieving profitable business growth" by abandoning "some of the tried and proven conventions of innovation, marketing, and strategy formulation" and by discarding "some of today's common assumptions and management practices and adopt a fresh way of planning an executing your strategies today and your innovation and growth strategies of tomorrow." The key word is "some" as he explains how.
After discussing "hidden opportunities to innovate and grow" in Part I, he focuses in Part II on several companies which exemplify a demand-first innovation and growth model (e.g. Frito-Lay, Allianz, GE Healthcare, and State Street) and then shifts his attention, in Part III, to various strategies by which to realize customer advantage.
As the title of this book suggests, Joachimsthaler asserts - and I agree - that many senior-level executives lack the ability to see - really see - "the opportunities presented by the changing consumption or usage behaviors of people [their organizations are] trying to serve. [They] cannot spot or recognize and pursue the abundant opportunities that exist in plain sight." Why? Joachimsthaler suggests several reasons which include routine but disparate processes which fragment a company's view of its customers, perpetuation of the status quo which limits a company's perspective on its competitive marketplace, a mistaken belief that "the key to growth lies in identifying customers' needs and wants [and/or] providing solutions for the tasks or jobs it knows customers must take on and get done," and an "inside-out" perspective which results in what Theodore Levitt once characterized as "marketing myopia."
Joachimsthaler suggests three lessons that can be learned from companies such as NetFlix, Sony, and Starbucks:
1. Position existing or new products or services at natural intersections of customers' consumption and use behaviors;
2. Change or enhance customers' daily routines and create transformative experiences around activities, projects, and tasks in new and welcome ways; and
3. Deliver on previously unleashed or unarticulated desires, dreams, fantasies, and urges in the social-cultural context of people's lives.
The demand-first innovation (DIG) model can be of substantial benefit to any organization (regardless of size or nature) but it would be a fool's errand to attempt to apply all of the ideas that Joachimsthaler presents. Rather, It would be a fool's errand for anyone who reads this book to attempt to apply all of the ideas that Joachimsthaler presents. Rather, he suggests that those who read this book clearly identify their organization's key demand-relevant assets and make full use of them, rigorously evaluate and develop their organization's distinctive capabilities deployed to manage those assets, choose only those major strategic initiatives that force the integration of all demand-facing processes, and "build the culture" with innovation initiatives at all levels and within all areas throughout what should be a demand-driven enterprise.
Joachimsthaler calls for nothing less than "the activation of demand-first growth platforms by whatever means [to] help customers absorb or assimilate an innovation, or retool old ways of doing things, into their daily life or work experiences." Only then can an organization find and execute its next big growth strategy.
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1 of 1 people found the following review helpful:
5.0 out of 5 stars
The Formula for Innovation and Growth, July 14, 2007
This review is from: Hidden in Plain Sight: How to Find and Execute Your Company's Next Big Growth Strategy (Hardcover)
Erich Joachimsthaler provides a systematic approach to make marketing accountable for innovation and growth of BtoC and BtoB companies. We have seen the innovative business concept of share of customer evolve and being executed over the last years. Hidden in Plain Sight pushes that practice further to the concept of customer advantage, which means consequently managing impact and relevance, products and services have on customers daily lifes - on customers share of the day.
Erich Joachimsthaler formulates an explicit model, the demand-first innovation and growth model (DIG-Model), that illuminates the advantages of creating the demand landscape and sets a plan for action to specify the necessary effort to capture the relevant parts of the ecosystem of customer demand, reframes the specific business opportunity space, aligns business processes across all functions and sets the foundation for sustainable innovations and predictable growth.
As one reads the carefully selected international cases (e.g. Procter & Gamble, BMW, Apple, Deutsche Telekom, Volkswagen, NetFlix, Starbucks, General Electric, Sony, Allianz) reference is made to all parts of the DIG model and how all pieces have to work together to execute in business practice. Based on his deep insight and understanding of many industries, Erich Joachimsthaler proves his approach carefully and outlines, how innovation and growth can be systematically and replicable managed. That is why this book is relevant for people from many business functions and a variety of industries.
Thanks for this outstanding business book.
Kevin Frantz
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