Making the Bleeding Edge Hurt Less: How to Innovate In the Right Ways
July 12, 2017 | Cody Sanger
It’s 2017 and we’re in the midst of a fast-moving technological revolution that shows no signs of slowing down. As a digital design agency, we often hear requests like “Can we use augmented reality to improve customer experience?” or “Is virtual reality really worth investing in?”
The short answer is: yes.
But Citizen doesn’t just create VR/AR experiences or build mobile apps and digital customer experiences. We uncover and solve complex problems deeply embedded in (or caused by) business strategies. This allows us to leapfrog basic technology iteration and envision truly innovative experiences that will positively transform our clients’ businesses.
In the process of doing so, we’ve adopted some basic principles of an innovation-oriented mindset. Here are three ways you can create your own lens of innovation:
1. Look to the bleeding edge.
Bleeding-edge technology describes technology that’s so new it’s considered a high-risk investment because the ROI is unknown. A technology is bleeding-edge if it fits one or both of these criteria:
- The technology lacks stability. It’s the first generation of the technology. So, just like your precious first-gen iPhone, it will have its share of bugs and issues.
- The technology lacks respect. Innovators are the only group really eyeing the technology. It hasn’t gained respect from industry leaders or the media, so it’s up to the innovators to keep pushing it forward and discovering use cases.
Companies shouldn’t invest in a bleeding-edge technology without a solid game plan, which includes questions like:
- What value could this bring to our end-users?
- Does exploring this technology really support our business strategy?
- How would this technology translate to something market-ready?
- Will it improve the overall customer experience?
A classic, though hardly recent, example of effectively using a bleeding-edge technology: eBay.
It’s 1995. It’s a time when most companies weren’t even using the Internet or email. However, a programmer by the name of Pierre Omidyar had a vision of creating a digital commerce center that would connect buyers, sellers, collectors and people from across the globe. So, he created a website called eBay. More than 20 years later, eBay is considered THE e-commerce pioneer and is valued at $36.6 billion.
And a not-so-good use of a bleeding-edge technology: Google Glass.
Admit it, Google Glass wasn’t exactly a cute look. And while wearable technology is a common accessory these days, wearables were considered a bleeding-edge technology when Google released Glass. In the end, Google Glass failed to take off because it lacked logical consumer use cases and came with a hefty price tag.
2. The second-mover advantage is your friend.
While early adopters of bleeding-edge technology do have the advantage of potentially gaining the industry edge, many innovators stand behind the second-mover advantage.
The second-mover advantage is derived from the idea that it’s advantageous to observe others’ use of bleeding-edge technologies and follow them to market. Here are a few of the benefits of this approach:
- It’s easier to enter the marketplace. The barrier to entry is lower because the cost of the bleeding-edge technology has likely decreased while the number of those using the technology is probably still relatively small.
- Take notes from your competitors. Simply put, there’s an advantage in having the opportunity to learn and grow from first-movers’ successes and mistakes.
- The technology is more stable. There’s an advantage in having access to the second generation of bleeding-edge technology because it’s been been retested, refined, and stabilized through R&D.
- You have a better understanding of your end-user. Second-movers have the luxury of getting to know their end-users better as well as how to effectively reach them.
A good example of a successful second-mover: Spotify.
Although Pandora Radio was the first major mobile streaming service, Spotify has established itself as the leading music-streaming service. Spotify was able to replicate Pandora’s ‘freemium’ business model, while at the same time creating a service that better met the needs of its target customers. Well played, Spotify.
And a not so good second-mover: Amazon Local.
Even successful companies that are considered to be innovative can sometimes fumble with the second-mover advantage. In early 2015, Amazon launched Amazon Local, a group-buying website that offered localized “daily deals.” Does this sound like services that other companies were already offering? Because it should — Amazon Local was created to directly compete with Groupon and LivingSocial.
However, Amazon made one crucial mistake. It failed to pay attention to the decaying state of the “daily deals” marketplace. It overlooked that both companies were experiencing layoffs and declining customer bases. So it didn’t really come as a surprise to anyone when it closed the doors on Amazon Local later that year.
3. Get stakeholders excited about the idea of innovation.
We’ve all heard the phrase “If it ain’t broke, don’t fix it.” But what if the people taking that approach are leading your company?
Institutional inertia is a phrase used to describe the pushback innovators face when company leaders are reluctant to change. Taking the “wait and see” approach to innovation in digital transformation era can put a company at risk for falling behind.
Here are three ways to combat institutional inertia:
- Make your ideas relatable. Convey your grand ideas in a way that allows internal leaders and influencers to see the real-life problems that the concept will provide solutions for.
- Educate those around you. Show company leaders how innovation will increase value for existing and/or potential customers.
- Communicate your amazing ideas. Share relevant news and success stories about second-movers and companies using bleeding-edge technology to achieve innovation.
Test. Observe. Learn. Repeat.
The common thread between these approaches is the drive to try new things and the spirit to learn. We can assume that Amazon learned a great deal from the failure of Amazon Local. And while they might not try another social-buying venture again, Amazon is even stronger and savvier for having tried it.
So our advice to you is: test out new ideas and technologies, see what others are doing around you, and always be learning. Don’t settle for the status quo; be the leader that sets the new status quo.