PB&J Approach to Growth

If you’ve been following my facebook, you probably participated in a poll on peanutbutter storage post-jar-opening. While doing some light research to support my (minority) position that it belongs in the fridge, I found this article on the J.M. Smucker company, owner of (obviously) jellies and (less obviously) the Jif peanut butter brand. The article explains how a CPG company like Smucker’s managed to make it to #2 (beating out Apple) on this year’s Barron’s 500 list of the top publicly traded companies based on growth metrics.

What caught my attention was the short paragraph on this view of product innovation: Co nsumers don’t buy products; they hire products to do a specific job. The article doesn’t really go into the detail on this philosophy that it really deserves, but as old as this concept is (and believe me, it’s old), it’s surprising how many companies view their product from this lens. The companies that do view their product innovations this way usually have higher success rates on their new product lines.

iPods are not music players, they are tools hired to fight off boredom, stay entertained, or immerse yourself in music in any surrounding. In grad school I read a study about McDonald’s effort to improve their milkshakes, when they surprisingly found out that 40% of milkshakes were purchased in the morning by workers embarking on long commutes. These particular milkshake customers didn’t want a milkshake, they were hiring something quick, not messy, that they could consume with one hand on a long, boring commute. It’s probably not a coincidence that shortly after this research McDonald’s also came out with a line of smoothies (for those who want to hire the same type of product, but healthier). Harvard professor Theodore Levitt (who was surprisingly not quoted in this article out of HBR!) has the perfect way to sum this up: “People don’t want to buy a quarter-inch drill. They want a quarter-inch hole.”

P.S. – Jif’s official position on the storage of peanutbutter is that peanutbutter consumed in under 3 months is fine in the cabinet. If it’s kept longer than 3 months, it needs to go in the fridge. My peanutbutter’s chief “job” is to complement the jelly, and as a result I store it in the same place as my jelly – the fridge!

My next office/facebook debate? Creamy vs. Crunchy.

Great Article about Incremental Innovation

Still working on my personal mission statement, but wanted to share this mashable article on innovation.

One of my first posts (What do IV Bags and Reeboks Have in Common?) was about taking something already in existence and combining it with something else existing, completely unrelated, to make the first thing better. This post on mashable articulates why that’s so successful: it isn’t driven by market demand, it drives market demand.

I’m actually surprised they used the Ford assembly line as an example without referencing this famous Henry Ford quote: “If I’d asked customers what they wanted, they would have said ‘a faster horse.'” This quote really hits the nail on the head. The best innovations don’t just make the way we currently live better, they completely change the way we live. Love ’em or hate ’em, it’s hard to dispute Apple’s reputation for innovation. Apple didn’t make a better portable CD player, they made an iPod. Then an iPhone. Then an iPad. What next?

Check out the article here: Why the Best Innovations Are About Relevance, Not Invention

What do IV Bags and Reeboks Have in Common?

Remember when Reebok came out with Pump basketball shoes? If you’re my age, this was the coolest thing to hit your elementary school since LA Gear’s lightup sneakers or British Knights! You could inflate your shoes by continuously pressing on the little basketball in the tongue of your shoe for a better fit. I never actually knew back then that the pump had a functional purpose, I just thought it was fun. When Reebok was struggling to compete with Nike’s Air, they needed a game changer. The concept for the Pump came from several team members at an “innovation brokerage” firm who had worked on medical supplies in a previous project. One had designed splints and recognized the potential for splints to provide ankle support in a shoe, while another had worked on IV bags (which eventually became the technology that inflated to become the splint), while yet another had worked with pumps. Three unassuming, fairly dissimilar medical devices came together to develop a component for a basketball shoe that would yield $1 billion in revenue in its first year.

Have you ever had an “aha!” moment about something in your life while doing something completely unrelated? Ever notice how Dr. House always realizes what’s wrong with his patient at the end of an episode because someone says something completely off topic that sparks his brain? Convenient fictional example, I know, but that’s what defines innovation: taking something existing and making it better with something else existing. For another example, take the quartz watch. A commonly found rock solved the problem of inaccurate portable timepieces by vibrating at a constant frequency. The quartz technology was originally developed to be used to detect enemy submarines by transmitting sound underwater (sonar) during World War I. Later used to solve radio frequency problems, it was eventually identified as the perfect constant frequency regulator that could drive accuracy in clocks and watches. No one looked at a rock in the ground and said “Maybe we can use this rock to make our clocks accurate” or even “I bet this thing can tell me where submarines are.” Each discovery came from seemingly unrelated discoveries that built and built into the modern innovations we know them as today.

My takeaway from these examples and my own “aha!” moments is that the best way to be innovative is to cast a wide net of knowledge. Continuously learning is critical, and not just about the things that are immediately related to your job or your interests. Following only your interests means, at best, you’re going to adhere to the best practices in your field. But to create a true game changer, you’ve got to look in unexpected places. I’m going to sneak Disney into this post and suggest this exercise written by Disney Imagineer and Principal Engineer for Ride Mechanical Systems from The Imagineering Workout:

Combining ideas develops new ones and strengthens concepts, stories, or creative solutions. It can be very effective in brainstorming when unrelated ideas are put together. The following method is a fast way to combine seemingly different ideas into new ones.

On one sheet of paper, list in a single column all your ideas of interest…Make a copy of the list. Place each list side by side and then slide them up and down with respect to one another until interesting, plausible, or useful combinations start popping up. Once you select a combination, start exploring the relationship between the two elements. What might they have in common? Why are they so popular? Why would they never get along?

The method can be automated, of course, but it is much more fun when you slide the sheets of paper by hand.”

Happy innovating!