3 Innovation Horizons

3 Innovation Horizons – the key to making idea schemes sustainable

Posted on February 23, 2012 by Michael Allen

Week in week out we are invited to visit organisations that have some kind of innovation or staff suggestion scheme, but almost without exception the feedback is that it isn’t performing as they had hoped.

That isn’t to say that the ideas systems don’t have ideas in there and aren’t delivering value, more that the Senior Executives seem disappointed with the results. One useful way of describing the mismatch between what Senior Executives what from an Innovation scheme and what the staff actually contribute is a concept called the 3 Innovation Horizons. This concept was developed by Christian Terwiesch and Karl T Ulrich in a book called Innovation Tournaments.

It uses the concept of horizons to describe the fact that if you are at the front line, your horizon is set on what you already do to support your existing customers with your existing capabilities and they can’t see the other horizons. This is Horizon 1 and perfectly describes the territory that traditional suggestion schemes occupy.

There is absolutely a business case for Horizon 1 ideas, but it needs to be expected that the vast majority of them are going to be incremental improvements, extensions, variants and costs reductions.

Horizon 2 describes ideas about new products and services that can be sold to your existing markets and adjacent markets that you can sell the existing products and services to. Staff can contribute insights to this Horizon, but the Authors argue that you need to include insights from your customers as well.

Horizon 3 describes ideas about brand new markets and brand new capabilities – it’s the stuff the Senior Executives are paid to worry about and again the authors would maintain that while the staff have insights that can serve Horizon 3, you need to engage a different groups of people, in a different way.

3_innovation_horizons

Innovation rarely happens without the commitment of Senior Managers – Innovation requires change so without their buy-in, that change won’t happen so it’s essential that they remain engaged.

The way we achieve this is to ensure that when we plan a programme of Innovation Challenges we do so to ensure that we are identifying Challenges that relate to all three Horizons.

You can learn more about the concept from the book or this link (from which I borrowed the diagram above), http://pwcinnovate.wordpress.com/2010/08/05/innovation-horizons/

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