Tooltip: Ten Types of Innovation

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Tools

People love tools. Me, myself – I am a little cautious. Most of the time, people hope to get illegal help from tools, impossible short cuts, they  want to get to heaven without dying – which, you know, is not possible. Tools are normally derived in a very specific context and most of the time used in a very different context without actually understanding why they worked in the original context. Anyways – here is a tool I love and dare to share: 10 Types of Innovation’ (TTOI)!

TTOI was developed by the great innovation consultancy Doblin. We owe them! TTOI defines 3 areas and 10 types of innovation:

  • Configuration contains the innovation types
    • Profit model – How do we earn money?
    • Network – How to connect with partners to create value?
    • Structure – How are we organized, which talents do we find and develop?
    • Process – How do we outcompete others in doing things right?
  • Offering  contains
    • Product performance – Which functions and value does the product deliver?
    • Product system – How do we complement the product with other valuable products?
  • Experience contains
    • Service – How do we create value in servicing the customer?
    • Channel – Which channels do we use to deliver the value?
    • Brand – How do we position the brand and transport our values with it?
    • Customer engagement – How can we engage the customer and deliver value by that?

Here is an overview of the model:

Ten Types of Innovation Model

Ten Types of Innovation Model

Vijay Kumar defines Innovation as „viable offering that is new to a specific context and time, creating user and provider value.” Sadly, only 4% of all inventions reach this quality. The rest ends up nowhere. The difference between invention and innovation is creating that value. Lots of times the reason is that an invention only serves one of the TTOI. Successful innovations often serve several, and rarely less than four innovation types.

Now, with that model in mind, one can investigate any idea on which innovation are served by it. Lets have a look at a classical ‘spark of insight’. A pragmatic, distant view reveals the following sad picture:

The Lone Spark of Insight

The Lone Spark of Insight

TTOI helps us with guided reframing

Up to here we have an inspired product idea – nothing more. It’s a start at least, but the work is just to begin!  We start by looking at our idea from many angles. We could, for example, start by finding a profit model that differs significantly from others or at least augments the product nicely. Another angle could be to try to think of other products, which would be complementary to our very idea. Then, these products together could create the experience of a more holistic platform. What service should be provided to further deepen the idea of an experience rather than just a product or feature? Is there a chance to disrupt by coming up with a stupefying simple production process so that we have an unfair advantage and can provide the value at a better price and / or quality? Can we possibly find better talents on the market or develop them by a better company culture? Some workshop sessions, coffees and dried out Neuland Markers later, the result might already look more lie in the following picture. Much better already! And if we don’t get there, it might be time to discard the idea. To put it back into the drawer and get it back out in a couple of months or years. Remember: Innovations are coupled to time and context and need opportunities. Its time might come. But it might also be time to completely forget about this one spark. If not, this might be the satisfying result:

Augmented Spark of Insight

Augmented Spark of Insight

Now it’s plain to see – the work is to force a simple product idea to become a deeper experience. Our creation doesn’t have to cover all areas of TTOI equally well. It is a good goal, but what counts is a package that delivers an experience that provides convincing value. There are no rules! There is no recipe! But success is more probable with a larger number of covered innovation types, simply because we have created a deeper value experience. And TTOI simply helps us to structure our thought process. It helps us to look at the problem from different, relevant angles – to reframe the problem. And reframing is the key to successful innovation. As solving the problem from several angels defines a better value and creates a deeper experience.

While reading this, you might have realized already: Like with every tool, the art is to do as much as necessary and as few as possible. It is important to stay lean and to not end up in analysis paralysis but also to gain the right level of exploration depth.

Also, it I important, to use TTOI early in the exploration, when we are still not too attached to our very ideas and biases are not yet too hard to overcome. Also remember that TTOI may not only be used with new products but also with more serious features to be added to your products – why not make them a holistic experience across your whole value chain? And for that we use TTOI in an even leaner way.

If you look at what Alexander Osterwalder is doing with his great approach of Business Model Innovation you will realize that it is not much different even though how he is doing it, is a completely different setting in its very own right.

„Business Model Innovation is about new ways of creating, delivering an capturing value“ – Alexander Osterwalder

Following are two examples of quickly matching existing offerings to the TTOI model.

Successful innovations that serve many of the TTOI

  • With its Model S, Tesla offers a revolutionary product (product performance & product system) aiming at a very well chosen market.
  • On top of that, they are establishing a very exclusive service experience (service) that the customer can take for granted.
  • On each channel – online or their own car houses (channel), which are served on an equal level – they provide to the customer is deeply involved (customer engagement) with the brand.
  • The Super Charger network, the cost free fast charging stations across the country, make up not only part of a new business model, but also are a complementary product (product system)
  • This well as it augments the depth of the service and brand experience. (service, brand)
  • The extraordinary quality of the parts that are developed and produced for Tesla’s extreme niche market opens the door to a parallel business model, providing parts for other emerging players in this business – while still being in nearly exclusive possession of the required knowledge. (business model, structure)
  • The deep integration of the required vendors supports the network and process aspects.

A short analysis already reveals the depth of Tesla’s approach, the work that is going on and with that the reason for its success.

Tesla - innovation breadth and depth

Tesla – innovation width and depth

To bring up just one more obvious example:

  • The success of the iPhone does not simply build on a good smart phone (product performande)
  • but also on the complementing qualities of iTunes and the whole eco system of iOS and MacOS and the integrated AppStores. These aspects touch product system on the infrastructure level.
  • But on the content level I also touches the network aspect, once you think of the integration of content partners for music, books, movies, TV series and more.
  • This also brought along the disruption of profit models, augmented by the new use of channels.
  • A strongly watched brand message.
  • And the strong use and control of the channels retail (Apple Store) as well as retail help to further deepen the case.
iPhone / iTunes - Innovationsbreite und -tiefe

iPhone / iTunes – innovation width and depth

You could go on with other cases for hours, which is actually a good exercise. Even if in hindsight it all seems easy.

So this was a short detour to the tools topic – one could write books about it. And indeed, they exist: Doblin themselves have written one and Vijay Kumar’s also uses TTOI in his book “101 Design Methods”. Google delivers some several million hits on the topic. And of course: You can also talk to us about TTOI  :-)



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