Every business faces increased competition and reduced margins.
The obvious solution is to has innovation to come out with new offerings. But that is not enough.
Your innovation needs to stand out among the myriad of choices available. In fact, today customers are so overwhelmed with choices that a good value-adding service is to help customer decide and choose the right one. More choices increases stress and result in poorer decisions being made. See Sheena Iyengar on the art of choosing | Video on TED.com and Choices could be Bad – Dummies are right!
Hence we need, not just more features and functions in our innovation, but to learn how to be more meaningfully differentiated.
Beginning with the correct understanding of innovation as business value creation rather than just a creative idea or a new product or service, understanding the value mind set of customers, going through the systematized method(BVITS ideas generation, BvOtech’s Business Model Template, Customer Experience Feature Matrix, Differentiation Chart & Cross, Simplified & Intensified Map) , and process (Innovation is also a process!), and using the framework proposed with maximized value with minimized costs, you can master the know how to create the new business model and delivering the wow customer experience and thereby achieve sustainable and breakthrough innovations on demand.
High Returns and Not Just High Value
Most people can easily list down a number of key features that iPad or iPhone lack. Most iPad killers that are coming out stress on more functions, more powerful, bigger here and better there. They seems to forget that
- for every feature or function added, there is a cost to it.
- for every feature added, it is another item to list of choices . Is this the feature that Customer really desired and not be further confused?
- for every feature added, it consumes power and kills battery life. Battery life is a KEY feature for mobile devices. It is easy to see that the Apple Killers usually do not have battery that last 6 hrs. iPad has it as 10hours. New Amazon Kindle has it as 1 month!
- for every feature added, it may also add extra weight – directly with additional component, or indirectly for increased battery size.
- for every feature added, it increases the possibility of bug and reduces reliability
Payoff or Returns = Value Customer willing to Pay – Cost of Production (features)
Adding features may or may not increases the value but definitely increases the cost of production and hence reduces the possibility of high payoff. I admired Apple Inc for optimizing this balance of maximum value and minimum costs of production, i.e. maximizing the payoff.
The Secret – Simplify & Intensified
I think the secret is to simplify the list of features, more is not merrier, to those that bring significant and meaningful value to the customers. A simplified and integrated list of features make for greater ease of use, elegance, reliability and lower costs (See 10 Design Rules for the Dummies.).
The other is “Intensified” the difference against the competitor. For example, the battery life needed for the mobile device for a day of outdoor use is about 8-10 hours. I am glad that the new Amazon Kindle extends the life from 1 week to 1 month. It may be marginal after 24 hours of batter life, but it creates an unforgettable impression. Battery life is not a concern or worry any more.