Companies are now using 3D printing for everything from human tissue to food to heavy machinery. 3D printing is a highly-disruptive technology in some markets. For example, an aerospace company had a 20-year-old division that manufactured custom-machined aircraft engine parts. The division enjoyed 60 percent market share. It was recently outflanked and put out of business by a 3D printing company that created the customized parts onsite. Key patents expired on one of the three 3D-printing technologies a few years ago and exploitation of the technology skyrocketed. Other important patents will expire in February of 2014. Expect 3D printing to change your industry if it has not already. Measuring 3D customer needs and your ability to innovate around them will put you ahead of the wave instead of underneath it.
Open innovation means sourcing innovation from wherever in the world you can get it, and then incorporating these innovations into winning new products. Unfortunately, there is more talk about open innovation than there is observable success. It is one thing to see the potential of open innovation and another thing to turn it into winning new products. One of the keys to measuring the success of open innovation is developing targeted metrics for crowdsourcing.
Measuring customer needs is the key metric that separates the successful innovators from the also-rans. Innovative companies are able to focus on what is most attractive to customers and translate those characteristics into innovations. For example, in the early days, Apple waded into the shark-infested waters of personal computing where the other vendors were competing on storage capacity and CPU speed. The prevailing wisdom said that “more is better.” Instead, Apple emphasized ease of use, attractiveness and entertaining features that delighted customers. They revolutionized the market by understanding the customer’s latent needs and translating those needs into innovative designs.
More companies are striving to do a better job of choosing high risk/high reward products for their portfolio and investing accordingly. There are three pillars of portfolio management. The first is to understand the customer need that will drive who buys the product. The second is investment intensity. This means distinguishing when a large investment is required to make a reliable decision about a proposed product and when a small investment will suffice to produce a similar result. The third pillar of portfolio management is aligning products with corporate strategy. There is a metrics dimension to each of these three. Companies that focus on all three pillars of portfolio management, rather than only on projected payback, do a much better job of investing in R&D and getting a superior return.
Companies are building communities of lead users and prospective customers proactively. They are harnessing the power of existing social media for the purposes of crowd-sourcing and testing innovations. Companies are struggling to gauge the success of these initiatives. Some useful metrics around social media use include: