Leveraging Constraints for Innovation

New Product Development Essentials from the PDMA

Sebastian Gurtner, Jelena Spanjol, Abbie Griffin

• Publisher: Wiley
• Year: 2018
• Print ISBN: 9781119389309
• eBook ISBN: 9781119390275
• Edition: 1
• Topic: Commerce
• Subtopic: Management

Provides managers with actionable insight into a select set of innovation constraints and how to best deal with them

This PDMA Essentials Book, the third in this series, provides a framework of individual, organizational, and market and societal constraints that guides managers in identifying specific constraints related to their innovation activities and provides them with corresponding tools and practices to overcome and leverage those constraints.

Written by a team of international innovation experts, Leveraging Constraints for Innovation: New Product Development Essentials from the PDMA is presented in three parts. The first part, Individual Constraints, provides insights into how to: simultaneously solve social and commercial needs for greater creativity; apply a multi-stage approach to overcome knowledge sharing in teams; and anticipate and account for psychographic differences among customers during product launch. In the second part, Organizational Constraints, insights emerge that provide guidance on how to: identify and solve for sources of innovation constraints within the company; implement and manage virtual NPD teams; and effectively organize new service development in professional services. The last part, Market Constraints, examines how to: adapt firm capabilities to overcome constraints preventing consumers in low-end and under-resourced markets from purchasing new products; implement inclusive innovation strategies to address markets constrained by underdeveloped infrastructures; develop solutions for women and other disadvantaged market traders in emerging markets.

This book:

• Is a single comprehensive volume that covers the full spectrum of constraint-related strategies and techniques in a coherent, integrated fashion
• Provides a set of frameworks, techniques, and tools that can be immediately implemented by individuals across firms
• Offers how-to knowledge on specific tools and methods as applied to innovating products and services when facing constraints as well as for the development of new business models
• Integrates problem- and solution-based knowledge to enable companies to develop sustainable growth strategies by leveraging constraints and restrictions toward innovation strategies, processes and offerings

Leveraging Constraints for Innovation: New Product Development Essentials from the PDMA is an ideal book for all product development professionals, including marketers, engineers, project managers, and business managers in both startups and well-established firms, and from a broad range of industries from heavy manufacturing to the service sector.

Part 1
INDIVIDUAL CONSTRAINTS IN NEW PRODUCT DEVELOPMENT

Individually arising innovation constraints are imposed by or come to life through individuals who effect new product development (NPD) success. Those individuals can be customers of the new product or service, employees in the company who spend their time developing new products and services, or managers within the firm who make decisions about projects or manage innovation teams. While other types of individuals also may potentially influence new product success (e.g. suppliers and other external stakeholders), internal innovation employees and customers are the most common and account for the largest part of success or failure of new products. This first part of the book focuses on overcoming individual constraints exhibited by innovation managers (Chapter 1), members of product development teams (Chapter 2), and customers (Chapter 3), as illustrated in Figure P1.1.

Figure P1.1: Individual constraints in NPD.

In the standard innovation process (see the introduction), several gates determine when and how decision makers evaluate an innovation project and decide if it will proceed to the next stage or if it will be terminated. While ideally those decisions are based on rational predetermined decision criteria, in reality decision makers frequently use intuition or rely on personal biases to make decisions, especially in situations with high uncertainty and complexity, as is the case for NPD decisions. In the end, it is the interplay among risk, uncertainty, and decision maker characteristics that influences the decision-making process and leads individuals to select one project over another.

Chapter 1 in this part analyzes the role of uncertainty and creativity in decisions for NPD projects. The chapter considers constraints due to individuals in the firm and their managers who must combine knowledge and resources in new ways to create an innovation. In general, both research and practice agree that successful NPD needs highly creative and committed individuals as well as facilitation. Research highlights that individual innovative behavior in the workplace is determined by individual characteristics, exchange with and support from supervisors, and organizational commitment. It is the task of the organization to make sure that the creative potential of its employees is realized and that no constraints hinder the birth and growth of innovative projects.

Communication and knowledge-sharing boundaries are critical constraints that can prevent NPD teams from working creatively and efficiently. Chapter 2 tackles these constraints, specifically focusing on NPD teams that consist of individuals with different backgrounds and expertise. Based on a systematization of knowledge-sharing boundaries, the authors present a five-stage solution on how to make knowledge sharing work, despite the interdisciplinarity and heterogeneity of individuals on NPD teams.

Arguably the most crucial group that directly affects NPD success is customers, because they ultimately choose to adopt or reject an innovation. Customer constraints at the individual level differ from constraints in the market in aggregate, which are dealt with in Part 3 of this book. Chapter 3 builds on research that has found that, for individual customers, usage intensity of the product category, income, individual innovativeness, and susceptibility to normative influence determines whether an individual tries a new product or not. It is not people's demographics or position in society that drives their intention to adopt a new product or service as much as their psychographics, or values and attitudes, such as product involvement, individual innovativeness, and opinion leadership. Not all potential customers are created equal; it is their individual differences that can constrain the success of new products and services. Chapter 3 thus takes a deep dive into the personality of customers and depicts identity-related, cognitive, and emotional constraints that prevent individuals from adopting new products and services. After explaining the roots of these constraints, the author shows how to identify them and provides ideas about strategies that help to overcome those trait-based constraints.

1
FROM SUSTAINABILITY CONSTRAINTS TO CREATIVE ACTION: INCREASING MANAGERIAL INNOVATION BY SIMULTANEOUSLY SOLVING SOCIAL AND COMMERCIAL NEEDS

Goran Calic
McMaster University, Hamilton, ON, Canada

Maryam Ghasemaghaei
McMaster University, Hamilton, ON, Canada

Introduction: From Constraints to Innovation

In this chapter, we aim to advance the following proposition: Simultaneously solving social and commercial needs – sustainability constraints – results in greater product innovation. The common belief is that this position is false, because the simultaneous attention to both of these needs necessarily constrains the idea set, from which a manager can draw, to only those ideas that simultaneously do more good than harm to the environment and society (i.e. those that are socially sustainable) and those that are profit generating (i.e. those that are commercially successful). Such product ideas are rarer than are those that meet only the social or the commercial criteria. One would expect that this constraint would have negative consequences on product innovation by decreasing the number of opportunities available to a manager, but we argue that the opposite is true. In doing so, we present a straightforward yet counterintuitive way to enhance managerial innovation.

The marketplace for new products, with continuous changes in consumer preferences, presents managers with a constant stream of potential opportunities. Those opportunities are captured through innovations that meet specific consumer needs and wants. Yet innovation can proceed only if managers discover creative ideas (Stage 1) and subsequently implement those ideas as better procedures, processes, or products (Stage 2). Thus, new product innovation first requires discovery, then it requires action.

Before continuing, we must emphasize that enhancing product innovation may not result in better performance (e.g. greater profitability, higher market share, better solutions to problems, more benefits for managers). Innovation is inherently uncertain. Product offerings that are dramatically different from past products can result in inordinate losses or gains. How managers can reduce the likelihood of negative outcomes is briefly covered in Section 1.4 of this chapter.

Because pictures are good at conveying relationships, we rely on simple graphs to present the intuition behind the argument that simultaneously solving social and commercial needs will increase product innovation. The graphs are not only an alternative method of presenting the same arguments. They have the potential to provide the reader with insights beyond those explicit in the text.

The remainder of the chapter is organized as follows. In Section 1.1, we define innovation as a two-stage process – creativity as the first stage and implementation as the second stage. In Section 1.2, we link the two concepts and discuss their point of intersection. In Section 1.3, we present arguments supporting a positive relationship among sustainability constraints, creativity, and implementation. Here we also introduce some guiding questions managers can consider in order to include both social and commercial criteria in decision making. We introduce the corporate sustainability agenda, a strategy for turning sustainability constraints into performance, in Section 1.4. In Section 1.5, we cover situations when sustainability constraints reduce innovation. Section 1.6 concludes the chapter.

1.1 The Inherent Uncertainty of the Innovation Process

The innovation process begins with creative problem solving. A creative process generates ideas that are original and useful and have the potential to revolutionize or change the direction of a field. Such ideas are also characterized by uncertainty and nonobvious utility to the individual, as they are generally new and untested approaches. That is, the manage...

Table of contents

• COVER
• ABOUT THE EDITORS
• INTRODUCTION
• Part 1: INDIVIDUAL CONSTRAINTS IN NEW PRODUCT DEVELOPMENT
• Part 2: ORGANIZATIONAL CONSTRAINTS
• Part 3: MARKET CONSTRAINTS
• INDEX
• END USER LICENSE AGREEMENT