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Tuesday, September 02, 2014

Anne Nagro

Contributor to PCT Magazine

Features

[Top 100 Executive Summit] Return On Innovation

PCT Top 100

The future of your company depends on its ability to innovate. Here’s how to make it happen.

August 21, 2014

Editor’s note: David Burkus, assistant professor of management, Oral Roberts University, spoke at the Top 100 Awards Ceremony and Executive Summit about innovation. His presentation, “The Myths of Creativity: The Truth About How Innovative Companies and People Generate Great Ideas,” featured an approach designed to help leaders drive innovation and creativity. This article discusses how those in the pest management industry innovate in their businesses.
 

Want to grow your business to the next level or prevent being crushed by competitors? Innovate. A 2013 survey by Accenture found 93 percent of executives felt their company’s long-term success depended on its ability to innovate. Eighteen percent ranked innovation as their top strategic priority.

Firms on PCT’s Top 100 list are no exception. From tweaking existing processes to developing game-changing application approaches, innovation drives their success.

Even smaller organizations can — and should — dedicate resources to innovation, said Drew Marshall, principal of Princeton, N.J.-based Primed Associates, which helps companies develop innovation-capable cultures. Market advantages can disappear overnight for companies not thinking ahead, he said.
 

Funding It.

Marshall generally suggests 70 percent of a firm’s invested dollars be targeted for incrementally improving business processes; 20 percent on creating upgrades to existing services/products with new capabilities, functionality and value; and 10 percent to developing brand-new, transformational innovations.

Truly Nolen in Tucson spends more on the latter, said President Scott Nolen. The company has its own research and development workshop and full-time team, led by Alan Prevost.

The team works with employees and industry partners to develop better ways to place and apply product. It created a CO2-powered mister — the Bed Bug Tornado — to improve delivery of product to cracks and crevices to control bed bugs, and is exploring ways to improve insulation distribution in tight spots.

It’s even working with a company that makes spy equipment to develop devices like solar-powered LED attractors that use wavelengths to attract pests like mosquitoes. Unlike plug-in units, this new technology could be used on every street corner, said Nolen, who has a background in research and development.

Not every company can support an R&D team, but to ensure a culture of innovation thrives, and the necessary skills and knowledge survive, Marshall suggests a portion of an organization be focused on innovation 100 percent of the time.

 

Accenture Study: Innovation Efforts Falling Short Despite Increased Investment

Despite increased business investment in innovation, only 18 percent of executives say they believe their company’s innovation efforts deliver a competitive advantage, according to an Accenture study. (The study also revealed a risk averse approach to product and service development.)

The survey of 519 companies across more than 12 industry sectors in France, the U.K. and the U.S. showed 51 percent of participating companies reported increased funding for innovation. Ninety-three percent of surveyed executives said the long-term success of their organization’s strategy depends on their ability to innovate and 70 percent place innovation among their company’s top five priorities. Despite this commitment, the study found a decline in the satisfaction with innovation performance compared to the results of a similar Accenture study conducted in 2009.

The Accenture study shows those companies that institutionalized formal innovation management systems, compared to those that have not, are almost twice as likely to say they were “very satisfied” with their initial idea generation abilities (43 percent vs. 24 percent). Thirty-eight percent vs. 22 percent are “very satisfied” with the return on their innovation investments.

Accenture also found companies with a formal system in place are 75 percent more likely to define their innovation strategy as delivering a competitive advantage (21 percent vs. 12 percent), twice as likely to introduce a new business process or model (32 percent vs. 16 percent), and 35 percent more likely to say they are typically first to market with new products or services (50 percent vs. 38 percent).

Accenture is a global management consulting, technology services and outsourcing company, with 261,000 people serving clients in more than 120 countries. Accenture says it collaborates with clients to help them become high-performance businesses and governments. Learn more at www.accenture.com.

 



 

The Culture.

The right culture makes all the difference, reports a study by the Massachusetts Institute of Technology. Company values, employee engagement and having the support to take risks set the tone for innovation. Creativity is another requirement, experts say. Leaders “have to recognize that failure is a part of the process,” said Marshall. He asks clients, “If you’re seeking breakthrough innovation, what are you prepared to break?”

Nolen laughingly admitted to being “really good at making mistakes,” but if there is one person who should take the gamble to innovate, “it’s me.”

Innovation can be disruptive and messy. But it’s also inspirational, said Nolen. “People like knowing that we’re cutting edge and it really helps motivate people,” he said. Though some employees resist change, being innovative is “more energizing than it is fatiguing,” Nolen explained.

Innovation is one of eight core values at Arrow Exterminators in Atlanta, said Chief Marketing Officer Cindy Mannes. Its Project Innovation encourages employees to share new ideas through the company intranet and suggestion-box-like “innovation stations” at every service center.

“We want everyone to feel empowered,” said Mannes. This is one of the ways “we can give a voice to every person in our company.” Front-line employees are the best source of ideas; innovation isn’t going to come from senior executives sitting in a strategic planning session, she said.
 

Ask Questions…and Listen.

Organizations most effective at innovation are the ones that “tie themselves most closely to the customer or user experience,” said Marshall. “The closer you can get to an empathetic understanding of why somebody would use your services or a competitor’s services and recognize the value of meeting their needs before they recognize they have needs, the better off you will be in the long term,” he said.

The larger a company gets, the “more you tend to generalize who your customers are,” Marshall said. “You start looking at markets and market segmentation, rather than customers and customer profiles.” For large companies swimming in big data, “the customer gets lost in the numbers,” he cautioned.

Marshall urged leaders to “flip the ride-along on its head.” Instead of managers evaluating how technicians perform service, explore the customer experience. What are the sticking points of doing business with the company? Where are we saying no to the customer where we might be saying yes? Where are we not providing a service that customers want because we’re not in a position to provide it? What challenges do customers face when your service may or may not provide a solution?

This type of thinking led Abell Pest Control in Etobicoke, Ontario, to develop a custom software platform, said Brett MacKillop, regional vice president. The constantly evolving software differentiates Abell from competitors and has improved close rates while addressing client needs, he explained. For example, sales representatives can view real-time routes to schedule and sell service calls while on the phone with clients. Having to call clients back “is not good enough for us,” he said.

Marshall suggested documenting the entire customer experience, from the moment customers realize they have a pest issue through billing and follow up. This framework will help you tackle sticking points, he said. “By making your thinking visible, you give your company the opportunity to explore a range of options and test your thinking in partnership with your customers at a low cost,” said Marshall.

He also recommended adopting a common language for innovation, such as customer-focused design thinking, which is based on customer observations and the insights that come from those observations. Design thinking, developed by the company IDEO, focuses on six key steps: define the challenge, observe people, form insights, frame opportunities, brainstorm ideas and try experiments, he said.

The service design tools at www.servicedesigntools.org can be immediately put to use, he said.
 

Prepare for Change.

Truly Nolen is one of the industry’s most inventive companies. Still, Nolen is not satisfied. “I think we need to quadruple the budget,” he said. Without innovating, “you can’t learn,” and that’s helped the company be successful in 57 countries, he said.

Nolen urged PMPs to “share their innovation.” Sure, some may steal your ideas, but you’ll gain new and better ideas to move ahead; the industry has much room for improvement, he said.

Customer needs are changing. So are pests: Bed bugs and tawny crazy ants have become major problems, Chagas disease-carrying kissing bugs are in southern Arizona, pack rats have been linked to hantavirus, new termites constantly enter Florida, he said. “You can’t serve the customer of the future doing what we did yesterday,” cautioned Nolen.

 


Email the author at anagro@giemedia.com.


Enter to Win!
For a chance to win one of three copies of David Burkus’ book “The Myths of Creativity,” visit www.pctonline.com/mythbook.aspx. The book provides practical tips on how companies and individuals can innovate and generate great ideas.