Post-Launch Innovation: The Next Business Frontier

By Peter Skarzynski, ITC Business Group, 27-03-2014
Every organization focusing on innovation has a “front-end” process. And most of the organization’s innovation budget is allocated to front-end activities such as insight development, ideation, tech scouting and the like. In an unscientific poll at several recent innovation conferences we spoke, participants estimated 95-100% of total innovation investment is focused on pre-launch activities.

Ponder this: Why is so little of that talent and know-how focused on post-launch activities?
To software companies, innovating while in market is not a crazy idea. Its part of their business model. Think: Beta, V1, V2, V3. Of course this approach is relatively easy in a business in which the product can be rapidly adjusted and replaced with little cost or disruption. What about businesses that make products where engineering and design have to be finalized, production lines deployed, and channel arrangements locked down?
Challenging? Sure. Impossible? Hardly.
In fact, for those who build and master the discipline, post-launch innovation brings near term upside and offers the potential to impact your bottom line sooner rather than later. Though the size of the prize is tempting, you should not rush headlong into it. You will need to learn your way in and must realize that post-launch strategic innovation requires resources that are different from and additional to your current post-launch management processes and efforts.
As you do in front-end activities, you need to be thoughtful in choosing the in-market opportunities on which you focus. The good news is that many of the front-end techniques and approaches can be reapplied in a fit-for-purpose way, post-launch.
We believe post-launch innovation is the next practitioner’s frontier and see three general instances in which post-launch strategic innovation may be applied productively. You should consider post-launch innovation for products or services that:

• Produce unexpectedly good results relative to prelaunch forecast
• Underperform moderately relative to forecast but are in no way considered failures
• Are businesses of scale where even moderate improvements will add substantially to the bottom line

Learning from and acting on post-launch data and observations isn’t a new concept. The leading innovator and financial services company Capital One built their business around in-market experimentation, iterating on all aspects of their offerings. Rapid in-market iteration is already a mainstay of pure online retailers such as Amazon, where review cycles are conducted every few days and elements such as messaging, promotion and even pricing, can be adjusted quickly and easily. However, most firms outside of the software space still tend to go to market with relatively fixed launch plans that only get significant adjustments if and when a major problem emerges.
In our Innovators Field Guide, we share examples of post-launch innovation, including experiences from The Whirlpool Corporation. Whirlpool innovator Moises Norena characterizes well the mind-shift required to be successful as a shift from “launch and leave” to “Launch and Love.”
How to Get Started: Insights Post Launch
Gathering insights is central to post-launch innovation, just as it is with generating and developing new concepts. The key is maintaining a focus on new learning within the context of the launch. Even better,postlaunch learning opportunities are even broader than a software beta test. Let’s have a look:

Insight area	Typical learning
Your customer’s purchase process	Additional unmet needs to address? Adjustments to key points in the purchase process based on how customer interacts with POP or product?
Your customer’s usage and consumption	Opportunities to improve the experience? Extend to additional consumption occasions? Extend to a different customer? A
Channel insights	Within the purchase process, frustrations and pain points for the channel? Compromises  made that should not be necessary? What other new or different channel support will boost sales?
Traditional and non traditional competitor responses	What do competitor responses suggest about their view of your new concept? About customer or channel behavior?

Learn from Ries – Use Iterative and Rapid Experiments
The best way to get these types of insights is to make fit-for-purpose adjustments to some of your front-end insights techniques and apply post launch. Techniques such as experience mapping, ethnography, direct observations and netnography. In many cases you will be able to take actions without initiating a massive and impractical redesign of your product or platform. However, ideas for longer-term adjustments will likely emerge as well and should be captured for consideration. As with front-end ideation, it is helpful to identify larger sets of ideas. Grouping, sequencing, and prioritizing related ideas can lead to increased potential for market place traction.>>>