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.