Following Robert’s Rules of Innovation, value creation is the key to optimizing sustainable innovation programs within your organization. Successful innovation is the process of using intellectual capital to create a financial return by creating a new product or service.
While the value of the idea is important, adding the perceived value of your customers will drive ROI (Return on Investment). Develop an innovation with high perceived value to your customer and strong sales will follow.
Innovation is critical for value creation but you must anticipate or even embrace the possibility of failure. Your company may struggle with NPD (New Product Development) and innovation in anticipation of an uncertain economic recovery, all the while working to keep costs down for your organization’s existing products and services. You must have a willingness to invest without ROI assurance.
With an investment in time and money for innovation, do not let your intellectual property stagnate. Valued intellectual property should convert into patents and other IP into revenue opportunities.
- Return on Investment – Think of innovation as a process that uses intellectual capital to generate positive business results, new findings and as a result, even more innovation.
- Observe and Measure – Remember to monitor start-up costs, speed to market, scale to volume and other metrics.
- Customer Value – develop an innovation with high perceived value and strong sales will follow.
- Intellectual Property Protection – IP and Patent protection lock in your competitive advantage and support sales results and market 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.
The Reward of Risk
American Chemical giant, DuPont, shared their strategy for a “Robust Pipeline of New Innovations and Investment in High-Return Businesses Drive Company’s Future Growth” at their 2013 Investor Day as reported by Wall Street Journal. DuPont Chair and CEO Ellen Kullman stated:
“We stand on a strong foundation of scientific capability and market knowledge. We leverage these strengths across our portfolio of businesses to find new growth opportunities. At the same time, we continually evaluate the ability of each business to contribute to our overall value creation goals for our shareholders and we determine the right path forward.”
DuPont has been in business since 1802 and has appeared on every year’s Fortune 500. The list was created in 1955 and lists the top 500 American Companies with the highest gross revenues of the previous fiscal year.
Intellectual property will drive the future. The future business era will focus on the processes that drive IP and the real value it delivers. Progressive companies invest countless man-hours, dollars and other resources in investigating and pursuing innovation.
Your company’s investment in time and money for value creation combined with perceived value from your customers will generate positive business results, even more innovation and the ultimate goal of Return on Investment.