Can the “customer orientation” ending innovation?
It is clear that the “customer orientation”, making our organization will always be near him and put it metaphorically at the pinnacle of our organization is a prerequisite for success. This is even more important in technology companies, where the culture and strategy are often more influenced by what technology can do (technology-push) than what the market wants (market-pull).
The influence of customer orientation innovation should be absolutely positive, that can detect customer needs and effectively develop new products that meet. This has been confirmed in many studies, which identify the incorporation of the customer’s voice as one of the main factors of success of new products and, conversely, cited poor market analysis as one of the most common factors of failure (e.g. “Winning at New Products” by Robert Cooper).
However, in recent years is common to hear opinions to the effect that too much emphasis on customers can lead to a trivial innovation. This is because customers are generally “short-sighted” and only express desires for products that currently exist and needs more or less obvious and already articulated. Most of them lack a vision with respect to new products and are unable to express latent needs. Not free itself from the “tyranny of the market that is being served” is basically incremental innovations and products which are extensions of existing ones, not to discover emerging markets. If you want to create new markets is best (according to some authors) do not pay attention to our clients.
In fact, some are beginning to distinguish between the classical approach to customer orientation and a new “market orientation”, which goes beyond mere customer orientation in understanding and satisfying latent needs. This debate is most relevant in the case of discontinuous innovation (breakthrough), that require major changes in product and conduct of its users. There are two main types of discontinuous innovations (technology and market), although it is usual that a particular innovation drink both. These two basic types differ mainly in that:
- In an innovative technology is based on applying new and advanced technologies to existing markets.
- In a market-based innovation is to apply existing technologies to new or emerging market.
The study “The Effects of Strategic Orientations on Technology-and Market-Based Breakthrough Innovations” by K. Zhou, C. Yim and D. Tse, the authors try to answer the question about what effect the strategic direction of these two types of discontinuous innovation. The result confirms that
- Market orientation has a positive effect on innovations in technology, this is because market-oriented firms seek to identify and articulate latent needs of customers more demanding (e.g., Lead users) in the markets existing and mobilize the necessary resources to meet those needs through technological advancements.
- Market orientation has a negative effect on market innovation, as these companies focus too heavily on customers, competitors and current market and are unable to identify the opportunities provided by emerging markets and launching products that are desired by customers under new preferences and value systems.
In short, market orientation can to prevent businesses innovate outside of their current value. What can be done with this dilemma? Should we dispense with the market orientation?
The answer is probably a new type of market orientation, a bifocal orientation, combining different elements:
- A focus on consumers in existing markets but also in non-consumers and consumers of alternative and substitute products.
- A present needs but also the needs expressed and no future.
- An emphasis on the competitors but also in non-traditional competitors and alternative markets.
- Do not focus solely on the value of existing systems but to try to open up new market spaces.
- Reforming the business model and make improvements in value for customers.
In this way the companies escape the tyranny of the markets they currently serve and create value not only present in its markets but also in emerging markets and even create new markets. And all thanks not only to monitoring the environment, but an active participation in the evolution and changing environment.
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