Innovation System Works for Services, Too
A self-proclaimed technology and innovation evangelist, Brian Bowers of Bell and Howell is interested in ways to use change to foster growth. In fact, that’s part of his job description as Chief Technology Officer for the company, which is a CIMS member and based in Research Triangle Park. It produces mail-inserting and sorting systems for companies in the insurance and banking industries, among others.
This interest led Bowers to the new book by CIMS leaders Paul Mugge and Steve Markham, “Traversing the Valley of Death: A Practical Guide for Corporate Innovation Leaders.” The book outlines a system for practicing innovation that CIMS has taught dozens of organizations looking for a way to achieve consistent top-line growth. Bowers asked CIMS for help in putting the system into place in his company. As Bowers writes in the November-December 2015 issue of CIMS’ Innovation Management Report, the process was eye-opening and, ultimately, valuable. Here’s an excerpt from the article:
We knew we had to grow our bottom line, and we brought together our best thought and business leaders to discuss various ways to do that. In the end, we chose to follow the very systematic process defined in the book. So how did we do it?
We determined to get this done in three workshops with the CIMS leadership facilitating our endeavor. The three workshops covered four areas:
- Define an idea
- Build an opportunity
- Elaborate and evaluate
- Develop business case
The first workshop in “defining the idea” was hard because we had to first determine what we wanted. We defined who our Champions and Sponsors were, together with the Gatekeepers. These roles are extremely important if you want to traverse the Mugge/Markham “Valley.”
Our first step was to think about Service as a Product. Bell and Howell sells products and we service them, too. Another way to think about it, though, is that we are a service company that also sells hardware and software. Once we started thinking about Service as a Product, the ideas flowed quickly and abundantly.
The exploration now started as we “built an opportunity” in our second workshop. We thought about what we knew and made lists of the things and ideas we didn’t know and had to explore. We thought in terms of ROIs and margins to the business.
Out of four areas or market segments, we chose what we believed to the best one to focus on. High-potential ideas share three characteristics:
- They are unique.
- They promise an overt benefit.
- They present a good reason for believing it will succeed in the marketplace.
High-potential ideas can create blue oceans, high profitability, intellectual capital, or any combination of the three. Our market segment had to create profitability and intellectual capital for us.
In understanding customer needs, we also create a belief system for the customers to believe in Bell and Howell. Their physical and emotional needs must be fulfilled in creating innovation and market segments.
All the data gathered during this process matched the previous research data we had acquired. We discovered that although we thought we had chosen the best market segment, we hadn’t. So we went back to the start and selected our next best alternative. To our surprise, it met the criteria for a high-potential idea. We found through our research that we could create the enduring customer needs and a higher revenue potential for the business.
The third workshop was exciting. We had to validate our findings with customers and others in the organization. We laid out the steps to implement and also create a rough business plan. As part of this, we completed a SWOT (Strengths/Weaknesses/ Opportunities/Threats) analysis.
Our strengths in geographic coverage and our infrastructure are huge assets for the company. In reviewing the weaknesses, we developed the plans to convert weakness into strength or opportunity. When we considered the threats created by digital media and our competition, we once again looked at how to convert these into opportunities to grow and strengthen the business.
With all this data we created our business case and established budgets and ROIs. The data were still fairly rough but this is expected at the front end. We used this information to make our business decisions while understanding that as we progressed across the “Valley of Death” there would be refinements.
So we started to look at new areas of service and then realized that we have some major strengths: We had a national footprint that was expanding in Europe and the UK; we had a very experienced workforce in inserters and sorters that made us respected for our mechatronics support and knowledge. Then it hit us—why not make service a product? Why not sell these strengths as capabilities and look at other industries that require a high level of mechatronics and data integration? A new product was born!
We learned that the “Build Opportunity” module was the most critical of all the workshops. The module gets you to list the enduring customer needs and your ability to deliver. The questions to be answered create the opportunity statement. The opportunity statement then creates the value proposition. The value proposition states what we provide and what sets us apart from the competition along with the customer needs to be satisfied. Once these are created, we then look at the portfolio, how the proposition fits within the portfolio and how we can deliver it.
At the time of this writing, we have launched our “product” with a goal to capture several millions of dollars in new services for the company. We can now approach other companies that buy high-technology products to deploy in other industries. We can service what they sell, and we can sell our experience in mechatronics and knowledge in data management along with our supply chain systems and deployment expertise. We have a national network in place that allows for two-hour response time or better.
Bottom line: Bell and Howell has embraced the CIMS process and is using it to create new opportunities in its other business segments.—Brian Bowers, Chief Technology Officer, Bell and Howell