The Four-Step Innovation Process

It is easy to take a passive approach to innovation. After all, it seems like innovation should come naturally – someone in your organization has a great idea, that idea goes into action, and you have suddenly succeeded at innovating a new product or service. However, while it might seem as though that is how innovation should work, you will be sitting around and waiting for a long time if you expect it to occur organically. Instead, you should be putting into action a specific process that is designed to end in new innovations hitting the market. Not every innovation you generate will be a success, but those that do succeed will have the chance to change your organization forever.

The Four-Step Innovation Process

The Four-Step innovation process is straightforward and widely used. Of course, you will need to tweak this process to match up with the specific needs of your organization, as each business is slightly different in the way it needs to develop new ideas. This general outline is a great starting point, and offers an excellent way to drive consistent innovation within the company.

Step One – Observe Problems

You can learn a lot in business by watching your customers. What is it that gives your customers trouble? Is there something specific that you can see which is a significant problem for a majority of your target market? If so, solving that problem is an obvious opportunity for your company. One of the big points to keep in mind when innovating new ideas is the access that you have to a specific market. Rather than having to track down a new market to sell on your new product or service, it would be better to develop something new that can be sold to the same market. You already have the attention of that group of people, so why not return to them with another solution to a common problem?

Observe Problems

At this point, you are simply watching and learning. Think about what it is that is important to your current customers, and think about how you could make life easier for them through the development of a new offering. If possible, you may want to simply ask your customers through the use of a survey or other method to find out exactly what kinds of problems they are facing in relation to the products you already have on the market.

Step Two – Develop the Solutions

Now that you have a good idea of the problems that are being faced by your market, the next step is to actually find solutions to those problems. Of course, this is really where you have to get down to business, as it likely won’t be easy to solve problems that have not yet been solved by others.

Develop Solutions

It is important to not only find ways that you can solve the problems of your customers, but also that you can do so in a way which will be profitable down the line. If you have a solution to a problem that is never going to be able to turn a profit in the marketplace, there will be very little reason to actually take that idea any farther.

Step Three – Try It Out

Once you have a solution or solutions to the problem at hand, the next step is testing. Instead of trying to figure out the absolutely perfect solution to the problem before you develop a product, the better plan would be to put together a first version which can be tested out for you by a portion of the market.

Test Possible Solutions

It is almost impossible to perfectly master a product on the first try, so give up on that notion and simply get as close as you can initially. Through testing and refinement, you can move from an initial offering which is rough around the edges to something that is perfected by the time it is seen by the market as a whole.

At this stage, you are going to continue to learn from your customers. If you have tested the first version of the product by offering it to some of your loyal customer group on a trial basis, you can take their feedback and use it to move forward in the right direction. There is no information that you can receive which will be quite as beneficial as the feedback of actual users, so gather up as much of this kind of information as you can before moving forward to the final step.

Step Four – Implementation

With all of the homework and preparation done, it is time to hit the market and see how successful you have been in solving a problem. Of course, just because you have now implemented your concept and the product is on the market, you still don’t have to put a stop to your development process.

Implement Solutions

Every product in your line can always be improved, so there is no reason to ever stop taking feedback and ideas from your customers. The company that is willing to continually innovate even after a successful product is on the market is the company that can take a larger and larger share over time. Don’t get too comfortable just because you have done a good job of innovating this current product, as there will always be more problems to solve.

Rather than something that happens accidentally, innovation is a process that can be planned and strategically implemented. By using the four-step process which is highlighted above, you should be able to take innovative and exciting products to the market on a regular basis. You certainly don’t want to be a brand that is stale and out-of-date with customer needs, so stay focused on innovation even if you are currently leading the way in your industry. Markets are ever-changing, and only the organizations which are able to keep up with the pace will be able to remain profitable for years to come.

You can read more about the Four Step Innovation Process in our free eBook ‘Creative Thinking for Managers’. Download it now for your PC, Mac, laptop, tablet, Kindle, eBook reader or Smartphone.

Key Points

  • Innovation is a process that can be planned and strategically implemented using a four-step process based on observing your customer’s problems and developing solutions to them which you then test and refine.
  • The four-step process assumes that rather than having to break into a new market, it is usually easier to develop something new that can be sold to your existing market.
  • When considering which of their problems to try to solve it is important to do so in a way which will be profitable.
  • Through testing and refinement, you can move from an initial offering which is rough around the edges to something that is perfected by the time it is seen by the market as a whole.
  • Every product and service you offer can always be improved, and this process can lead to constant low-risk innovation within your existing market.

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