Kevin Parker of Manufacturing Business Technology explored innovation as not only a process (vs. a product) but also as something we tend to constantly be engaged in simply because of the constant upgrading of technology. Talking about products on the last gasps of their lifecycles he cited studies that said:
…further cost-reducing process innovations have relatively small effects on demand…Does that mean then, that product innovation, as opposed to process innovation, is always the key to success? Not necessarily, as the always helpful Wikipedia points out in its entry on “innovation”: process innovation can lead directly to increased shareholder value. Product innovation, on the other hand, risks costly R&D efforts that, if they fail, can erode shareholder value.
Kevin was trying to make a point that process innovation, spurred by technology, is endemic and possibly less risky than product innovation. Maybe so, but I believe that it is process innovation that can bring fantastic value that in some cases overshadows product innovation. And you don’t necessarily need technology to do it.
One of the roles of the best Project Management Offices (PMOs) is to do research on process innovation and bring the “best of the best” from inside and outside a company’s industry and country to the executive governance board for consideration. This is how the top companies drive innovation of their processes.
How do you fell about process innovation being valuable? Is it not valuable to your company because they do not conduct research for process innovations?
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