Stanford Research Institute’s 5 disciplines of innovation

Discipline 1: Important customer and market needs

Discipline 2: Value creation

Discipline 3: Innovation champions

Discipline 4: Innovation teams

Discipline 5: Organizational alignments

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Discipline 1: Important customer and market needs

Identify important customer and market needs not just problems that are interesting. Create and share metrics for deciding what constitutes important needs within your team and enterprise, and seek important needs that are external, internal, incremental or transformational.

•Identify unmet important customer needs

•Find entry points to serve these customer needs

•Validate with your launch customer

•Market success is the only measure of innovation that counts

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Discipline 2: Value creation Create customer value and remember: only customers determine value, not you.

Continuous Value Creation results from meeting customer Need with and effective

Approach that provides superior Benefits per costs, compared to the Competition and

alternatives (NABC). Continuous iteration based on new input and data focuses

innovative development. Creating value is a continuous, compounding improvement

process.

Step 1: Value Proposition: write it down

- Need

- Approach

- Benefits per costs

- Competition

Step 2: Elevator Pitch – capture your project in a concise manner

Step 3: Value Creation Forums (aka watering holes). Continue the process through

regular focused reviews. In the reviews, the main roles are

- Green hat – positive feedback

- Red hat – areas of improvement

- Eyes of the customer – the customer’s view

- All play – all can contribute

Step 4: Innovation Plan

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STEP 1: VALUE PROPOSITION

• Write down NABC:

- Need

- Approach

- Benefits

- Competition

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STEP 2: ELEVATOR PITCH

• Capture your project in a concise manner

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•Attention-grabbing hook and purpose

OPENING

NEED: What’s the important, quantitative, customer and market need?

• Specific customer need

• Market size, growth, players and disruptions

• First market segment and beachhead customers

APPROACH: What’s the specific, quantitative approach to satisfying that need?

• Offering: product/service, quantitatively described

• Bring it to life: image, simulation or prototype

• Golden nugget: sustainable differentiation

• Positioning: place in the ecosystem

• Business model: how the initiative makes money

• Go to market: implementation plan

• Financials: investments and business projections

• Staffing: core leadership and staffing plan

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BENEFITS: What are the quantitative benefits per costs from that approach?

• For customers, including Value Factor Analysis

• For investors, staff and partners

COMPETITION: Who is the competitor and what are the alternatives now and in the future, and why are you benefits per costs superior?

• By name and specifications

• Defendable barriers to entry: e.g., IP

• Risk mitigation plan

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CLOSING

• Summary and explicit request for next steps

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STEP 3: VALUE CREATION FORUMS

• Iterate fast and often; be engaging, specific and quantitative

• Evaluation

- Green hat: positive feedback

- Red hat: areas for improvement

- Eyes of the customer: the customer’s view

- All play: all can contribute

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TEXT BOOK

Curtis R. Carlson & William W. Wilmot (2006). Innovation. The Five Disciplines for Creating What Customers Want, Crown Business, Random House, New York.

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