January 1, 2012
Innovators at some companies, particularly in the technology arena, believe that customers can’t drive innovation. We disagree. While customers may not be able to design the innovative products they will ultimately use, they can describe their challenges, their needs, and their likes and dislikes. In our view, understanding customer behaviors and meeting unmet needs is what drives successful innovation. We aren’t alone in this view. Innovation professionals from 40 companies around the world responding to a Booz & Company survey1 chose ‘a strong identification with the customer and an overall orientation toward the customer experience’ as the most important cultural attribute in achieving innovation success. We asked Bruce MacGregor, Managing Partner and the Chief Capabilities Officer at IDEO to share an IDEO innovation success story with us about an innovation based on customer insights.
Which company surprised you as an innovation success story?
Western Digital was a great success story. They were a distant third in the marketplace when we started working with them to create a cost-effective but differentiated design that would help them establish a leadership position in the external hard drive category. We looked holistically with the division at the meaning of data storage, finally coming up with the concept that meaningful things like photos and music are often stored in books or albums that protect, organize and make accessible important parts of a person’s life. The resulting innovation transformed the storage unit from a functional square metal box to a device called the MyBook which looks like a book standing on end with a rounded spine and user-friendly features. MyBook was the first in a series of physical and digital products that created new market opportunities for the external hard drive division of Western Digital. Each of these new opportunities came with new implementation challenges for the organization. The company has always been driven by technical innovation and was now taking a much more human centered and iterative approach. The new approach led to changes both in how the products were perceived and marketed and how they were engineered and built. Although it was a lot of work to incorporate these changes, the division was able to evolve and deliver a series of successful innovations. They made the products simpler and more beautiful, taking the MyBook, for example from 14 parts down to two. They expanded distribution to mass market stores like Target and Walmart and even Apple stores. And, they achieved the number one hard drive share position in the Americas growing revenues from $200 million to $1.2 billion in a four year period.
Key Things to Know about Innovation
- You don’t have to change the whole organization to benefit from innovation but you do have to know how to sustain your own culture of innovation
- Be realistic — don’t assume it’s all going to be easy or you won’t plan for the difficulties
- Innovation involves both rational and emotional elements; the emotional elements are harder
1The Global Innovation 1000: Why Culture is Key, Booz & Company Strategy+Business, Winter 2011