4 Strategies to Inspire Customer-driven Innovation

In his best seller, "The Lean Startup," Eric Ries talked about how no truths (rather, only opinions) can be found inside the four walls of your office. The truth can only be found in the real world―talking to your customers.

I subscribe to that philosophy, and believe customer demand almost always drives successful innovation. Here are those four proven strategies I mentioned earlier:

1. Customer service process – Your daily order flow typically represents the steadiest flow of customer information in your company. This allows you to see every complaint or request for service, which creates countless opportunities to find a better way to do things. By reviewing service logs regularly to see what requests or complaints occur with the greatest frequency, you can identify the biggest pain points. “We always have been doing it this way” is never a good reason to keep doing something that causes friction and dissatisfaction among your customers.
2. Client implementation process – All new engagements should include discovery phases with the goal to uncover your clients’ real goals, going beyond just identifying the products they need, and actually engaging in dialogue about what they are trying to accomplish. If you lead with lots of questions, you can often uncover opportunities to solve problems they did not expect to be solved, or didn’t even know they had. Sometimes you may uncover needs that require you to find new products and suppliers, to create new services, or identify needs to develop new platform features.
3. Platform development – The Silicon Valley Product Group (SVPG) recommends that you create a “product council” that focuses on your technology development. This council should include representatives from every department in your company from customer service, to marketing, to accounting. Anyone in the entire company can nominate a feature enhancement to bring before the council for consideration. The council meets on a regular basis, reviews the merits of each feature and prioritizes which ones to work on next. Notice, I did not say “which one to implement next,” because at this stage you may not be ready for that. Instead, SVPG recommends a process with four distinct milestones. The first two are designed to determine the a) the actual need and business case for this feature, and how b) it should work in order to ensure its adoption and be embraced by our users. Only after completing these two steps successfully should you move to the next two milestones, and decide to spend the time and money to actually write code and develop it.
4. Customer advisory board – I have seen quite a bit of success with assembling a client advisory board, which is a small group of your top client executives that meets regularly to discuss your business strategy and plans. This group works as a sounding board for new ideas and provides feedback on key planned initiatives and solutions under development. This group can be an incredibly valuable way to establish an ongoing dialogue about your business with experts from different departments in large organizations that really understand your business.

Whatever process you have to drive innovation, I encourage you to make your customers the primary drivers of new ideas, and to put processes in place that ensure you consistently listen and improve. There is always a better way. Go find it!

P.S. Did you catch the fifth bonus strategy? It is the institution of valid and staff-elected core values I mentioned earlier. If you really want to drive change, make it part of who you are as a company.

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