{"id":457,"date":"2019-10-31T10:00:16","date_gmt":"2019-10-31T08:00:16","guid":{"rendered":"https:\/\/blogs.hanken.fi\/cers\/?p=457"},"modified":"2019-10-31T10:06:49","modified_gmt":"2019-10-31T08:06:49","slug":"innovate-or-die","status":"publish","type":"post","link":"https:\/\/blogs.hanken.fi\/cers\/2019\/10\/31\/innovate-or-die\/","title":{"rendered":"\u201cInnovate or die\u201d"},"content":{"rendered":"\n

Sometimes attributed to Peter Drucker<\/strong>, \u201cInnovate or die\u201d is a tagline embraced by media, managers and academics alike. But then again, what is innovation? In the simplest form, it boils down to introducing a change (i.e., something new). If you were to take an organisation\u2019s perspective then innovation is a new offering (e.g., a product or a service). Academic research distinguishes between radical and incremental innovation. While the former is an innovation that brings a fundamental change to the market and even to society (i.e., something truly new), the latter is an innovation that brings a smaller, less consequential change (i.e., something new, but still somewhat similar to what we already have and know). <\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

Let\u2019s take the telecommunications market as\nan example. Fifteen years ago, major players were competing on developing\nunique-looking mobile phones with all sorts of new features. Remember LG Prada,\nMotorola Razr or Nokia N-Gage? Each such new phone was an example of\nincremental innovation. And then Apple introduced the iPhone, which many argue\nis an example of radical innovation. I for one think that iTunes (the software\nplatform developed years before the iPhone that consumers were familiar with\nand that served as the application store for the device) was the real radical\ninnovation.<\/p>\n\n\n\n

In any case, the iPhone was not the first\nphone to be connected to the Internet, it was not the first phone with a\ntouchscreen and it was not the first phone to offer applications, but it was\nthe first phone to offer a true, seamless smartphone experience. The change\nthat the iPhone brought to the market was in shifting the focus from the\nphone\u2019s design and its features to what normal people could do with the software\nhoused within (that is, the applications that went far beyond calling, texting,\nlistening to music or playing games). All the iPhone iterations that came in\nthe next decade are examples of incremental innovation. Yes, they house\ntechnology that puts the original iPhone to shame and provide consumers with a\nbetter, faster and more fun experience, but the change they brought to the\nmarket was not as big as the original iPhone release.<\/p>\n\n\n\n

Can you become so exasperated with the change (that you didn\u2019t particularly ask for) that you will quit using the application altogether? <\/strong><\/p><\/blockquote>\n\n\n\n

So then \u201cInnovate or die\u201d boils down to, at\na minimum, introducing some incremental innovation to stay competitive and in\nthe best-case scenario introducing some radical innovation that will bring some\nserious competitive advantage. But, let\u2019s be realistic, radical innovation\nusually implies considerable R&D investment or a combination of\nentrepreneurial spirit and pure luck! Most organizations will not introduce any\nradical innovation, and most organisations who will attempt to introduce\nradical innovation will fail in the process\u2026 Hence, for most organizations,\nintroducing incremental innovation (i.e., somewhat new products and services or\nimproved versions of existing products and services) is the key strategy to stay\ncompetitive. <\/p>\n\n\n\n

But\nwhat about the consumers?<\/strong><\/p>\n\n\n\n

So, companies need to innovate to stay\ncompetitive and the most common form of innovation is incremental, but what\ndoes that mean for consumers? Again, it\u2019s a matter of change, or something new\nin how consumers use products or services. Let\u2019s take the example of digital\nservice providers. What is incremental innovation when it comes to e.g., a software\napplication? At the end of the day, the developer can change how the\napplication looks like (i.e., its design) and what you can do with it (i.e.,\nits features).<\/p>\n\n\n\n

Think about the many times each week your\nsmartphone, or computer asks you to install updates. Most of the times, you\ndon\u2019t notice any difference, so if there\u2019s a change it\u2019s in the background\n(e.g., the developer is fixing bugs). Every now and then though, an application\nthat you have installed and are using suddenly looks different and all sorts of\nnew things are trying to catch your attention.  Remember, the developers of those applications\nare on the one side trying to improve your experience with their incremental\ninnovation, while at the same time trying to maintain an edge over their\ncompetitors.<\/p>\n\n\n\n

But how do you, the consumer, feel? Do you\nhave to make efforts to figure out how to use the new version of the application?\nDo you feel like the new version is something that you would like to avoid or\nare you excited to try it out and figure out what is new? Can you become so\nexasperated with the change (that you didn\u2019t particularly ask for) that you\nwill quit using the application altogether? <\/p>\n\n\n\n

Together with my co-authors Dominik Mahr<\/strong>\nand Gaby Odekerken-Schr\u00f6der<\/strong> I\u2019ve tried to address these questions in a\nstudy that was recently published in the Journal of Business Research<\/em>.\nWe started from the idea that I have been presenting so far: Incremental\ninnovation introduces some change that is noticed by the consumer and if the\nconsumer wants to continue using the service then they must somehow deal with\nthat change. Then, we drew inspiration from studies in psychology that tell us\nthat when individuals are faced with a change they first try to understand if\nthe change is something threatening or something challenging and then they try\nto cope with the change.<\/p>\n\n\n\n

Our results show that the change introduced\nby incremental innovation takes away from the consumer experience. So, what are\norganisations supposed to do when the incremental innovations they introduce\nare potentially bad for the consumer experience? They can help consumers see\nthe incremental innovation as a potential gain, rather than as a potential\nloss. It might seem obvious that with each incremental innovation introduced\norganizations should explain why the change was necessary and how it is meant\nto improve the customer experience, but how many times does that happen?\nAnother way organizations can help consumers deal with the change is by\nencouraging them to explore what is new or by giving them the possibility to\nexpress their excitement or frustration about the change. The bottom line is\nthat instead of expecting that consumers will deal with the change on their\nown, our results show that it is key for organisations to help consumers in the\nprocess.<\/p>\n\n\n\n

Robert Ciuchita<\/a><\/em>
Assistant Professor<\/p>\n\n\n\n

<\/p>\n\n\n\n

Reference<\/strong>
Ciuchita, Robert, Dominik Mahr, and Gaby Odekerken-Schr\u00f6der. “\u201cDeal with it\u201d: How coping with e-service innovation affects the customer experience.”\u00a0Journal of Business Research<\/em>\u00a0103 (2019): 130-141. https:\/\/www.sciencedirect.com\/science\/article\/pii\/S0148296319303492<\/a> <\/p>\n\n\n\n

Photo: Jens Johnsson<\/p>\n","protected":false},"excerpt":{"rendered":"

Sometimes attributed to Peter Drucker, \u201cInnovate or die\u201d is a tagline embraced by media, managers and academics alike. But then again, what is innovation? In the simplest form, it boils […]<\/a><\/p>\n","protected":false},"author":12,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3,1],"tags":[],"class_list":["post-457","post","type-post","status-publish","format-standard","hentry","category-cers-blog","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/blogs.hanken.fi\/cers\/wp-json\/wp\/v2\/posts\/457","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.hanken.fi\/cers\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.hanken.fi\/cers\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.hanken.fi\/cers\/wp-json\/wp\/v2\/users\/12"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.hanken.fi\/cers\/wp-json\/wp\/v2\/comments?post=457"}],"version-history":[{"count":3,"href":"https:\/\/blogs.hanken.fi\/cers\/wp-json\/wp\/v2\/posts\/457\/revisions"}],"predecessor-version":[{"id":462,"href":"https:\/\/blogs.hanken.fi\/cers\/wp-json\/wp\/v2\/posts\/457\/revisions\/462"}],"wp:attachment":[{"href":"https:\/\/blogs.hanken.fi\/cers\/wp-json\/wp\/v2\/media?parent=457"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.hanken.fi\/cers\/wp-json\/wp\/v2\/categories?post=457"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.hanken.fi\/cers\/wp-json\/wp\/v2\/tags?post=457"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}