If you are looking only at what new products you can offer, you are missing a chance to connect with your customers in a significant way
Here's something to ponder: The only difference between a rut and grave is that a grave has four sides instead of three.
We mention this fact because if your innovation efforts are limited exclusively to products, you may be in a rut. At the very least, you are missing a golden opportunity to delight your customers, increase sales, and save some money along the way. Wherever there is interaction among your brand, your people, and your customer, there is an opportunity for service innovation and increased profits. That is absolutelly no small thing these days, when the bad economic news keeps coming in waves.
That's even true in places where you would not expect. Consider, for example, Six Sigma and its focus on minimizing errors and maximizing quality. Lean Six Sigma followed and changed the focus to simplifying process and eliminating steps.
You could argue that McDonald's (MCD) was a pioneer in Lean when it numbered its meal deals. Instead of ordering a Big Mac, fries, and a Coke, now all I have to say is a number. ("I'll have the No. 1, please." As a result of letting people order by number, McDonald's saved people time, increased the flow-through at the drive-in, and made it easier for low-wage employees to do their jobs. That's lean service innovation.
Questions to Ask
So, how do you serve up your products? What behavioral hoops do you make your customers jump through to get what they want? How much of how you are selling is due to tradition, habit, or a business model that has not been challenged?
I recently went to the bank to make a deposit. I had to find a parking place, find the right form, find my account number, fill out the form, stand in line, show an ID, and wait for a receipt. If I wanted my balance, the process would take even longer.
If my bank eliminated some steps with, say, SpeedPass technology, which would let me wave a tiny bit of technology containing all my account info over a scanner, it would save us both time. Moreover, the bank would get a chance to make me feel special, and I'd might go to the bank more often and give it more of my money to invest.
Service innovations are often disguised as product innovations. Think about the airline kiosk, where you check in yourself, and the wedding gift registry. These enabling technologies are all born of the insight that the buying process was too cumbersome. Technology made a transaction easier, but only after the experience was examined and challenged.
Which brings up an important point. The primary arguments against service innovation usually come from high-touch, service-minded people.
They will tell you that by adding technology, or simplifying the ordering process "you are dehumanizing our business" or "that is not the way this business is done"??r something like that. Don't listen. Push your team to create a totally new experience based on what your customers are saying or how they are behaving.
Then test the new experience. You will know soon enough if you have made life better for your customers. If you choose, you can then add a halo of people to the mix to make the service more personal. Southwest Airlines (LUV) has kiosks. That does not mean it has used them to replace its incredibly well-trained and thoughtful employees.
Typically, when we think about innovation, it is on the product side. How can you introduce something new, or improve an existing product?
Both those things are vitally important. But if you miss (or forget about) the chance to improve the service portion of your offering, you are missing a huge opportunity.