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Guts, Grit and Glory: The Mindset of Great Innovation & New Product Development PRODUCT MANAGEMENT & INNOVATION 2016 September 15, 2016 - Philadelphia Tim McKnight – VP, Global Innovation @ Cigna

“You can not be remarkable by following someone else who’s remarkable.” - Seth Godin

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Continuous Improvement Incremental improvements in existing products, services, or processes

2

Invention The development of unique or new technologies, methods, or processes

3

Business Innovation The creation and capture of new value in new ways

“IF I HAD ASKED PEOPLE WHAT THEY WANTED THEY WOULD HAVE SAID: FASTER HORSES…” Henry Ford

“PEOPLE DON’T KNOW WHAT THEY WANT UNTIL YOU SHOW THEM. THAT’S WHY I NEVER RELY ON MARKETING RESEARCH.” Steve Jobs

Empathy is the ability to see the world as another person, to share and understand their perspective, emotions, needs, and daily challenges.

“Empathy is about standing in someone else’s shoes, feeling with his or her heart, seeing with his or her eyes. Not only is empathy hard to outsource and automate, but it makes the world a better place.” - Daniel H. Pink

“Empathy is intuitive, but also something you can work on intellectually.” - Tim Minchin

How might kitchen tools be made that are comfortable and a joy to use?

Get a handle on it.

2

1 Define the Broad Opportunity Map

Go Deep in Targeted Opportunity Areas

Helps to navigate the vast landscape of future business opportunities, focus on the most compelling ones and craft strategies for success by synthesizing information from the real world.

Builds a deep and comprehensive understanding of the defined space, explores a range of possibilities and yields testable prototypes or concepts that can assess the level of end-user interest and connection.

• Puts the company into context, not in the center. • Considers needs, not just solutions. • Displays both the island and the X. • Tells you where you are. • Gives a sense of the future and guides the roadmap.

• Transforms understanding into powerful insights. • Iterative in nature to explore and refine. • Focuses on building holistic concepts. • Targets and engages the end user. • Gives a sense for customer adoption and the size of opportunity.

Derisk with Strategically Phased Learning & Development Plans

Phase 3 Messaging and Effectiveness

Phase 1 App Download, Sign up and Notification Permissioning

$15K

+ -

Fail = -$15K

Phase 2 Location Accuracy

$150K $60K

+ -

Fail = -$75K

+ -

Fail = -$225K

Define use case(s), build integrated solution and pilot

Recap: Guiding Principles for Creating the Right Mindset  Adapt best practices, processes or other key approaches so they fit your culture  Define a common language across the organization  Become empathic  Get yourself a strategy  Learn to pause – you need to go slow to go fast

YESTERDAY

≠

TOMORROW

Design Thinking Creates The Framework for the Right Solution Inspiration

Inspiration: the problem or opportunity that motivates the search for solutions [this stage involves deep understanding, scenariobuilding and framework development]

Ideation

Ideation: the process of generating, developing, and testing ideas [this stage involves solutioning, building prototypes & exploring the balance between practical functionality and emotional appeal]

Implementation

Implementation: the path that leads from the project room to the market [this stage involves clearly communicating the idea and proving/showing that it will work]

A Solution The Right Solution

Winning Products and Services Are Driven by Great Insights

What’s Desirable? Stated and unstated, user-centered

People Needs, Wants And Desires

Business New Value, in New Ways for our Customers

What’s Viable?

Capabilities & Technologies Current, Needed, What’s Feasible? Internal or External Possible to implement based on range of existing / non-existing tech and process

Attractive as a short, mid or long term revenue driver

Great Insights Require Exploring the World Through Different Lenses

A multi-source, multi-method approach: • • •

Drives deeper customer understanding and provides unique perspectives Harnesses the power of broad-based, multidisciplinary team members Inspires new and innovative approaches for differentiated products and services

Voice of Customer Social Media

Transactional Surveys

Intercepts / Interviews

Journey Mapping

Qualitative Journaling

Competitive Analysis

Segmentation

Ethnographies

Secondary Advisory Boards

Market / Industry Analysis

Quantitative

Discussion Groups

Prototyping / Co-Create

Conjoint

Data Mining & Analytics Maximum Differential Analysis (Max Diff)

Discrete Choice

Pilot / Design-ofExperiments

Web

Data Analytics

Correlation & Regression Analysis

Overall Development Process – Front End to Back End

Front End

transition

Back End

DISCOVER

PIPELINE

DEVELOP & DELIVER

Define Opportunity

Create Concepts

Prototype & Demonstrate

Prioritize Approve Fund / Staff

Design & Validate

Prep & Build

IN MARKET

Launch

Realization

Cyclical, Repeatable Process

Understanding & Creation

POP

POC: Proof-Of-Concept

In-Market Validation

(Proof-Of-Principle)

What people Desirable expect and desire

Viable Business models that

are viable for success

Feasible

INNOVATION COE

Capabilities and partnerships that make execution feasible

INNOVATION PARTNERS

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Designed to Reduce Risk as Time and Investment Increase

Front End – DISCOVER

transition

DEVELOP & DELIVER – Back End

IN MARKET

Define Opportunity Create Concepts Prototype & Demonstrate

offline

online

Risk

Design & Validate Prep & Build

Launch

Understanding & Creation

POP

POC: Proof-Of-Concept

(Proof-Of-Principle)

Investment

In-Market Validation

Realization

The Importance of a Balanced Pipeline Portfolio

Existing markets we do not serve Existing markets we currently serve

KNOWLEDGE OF MARKET

WHERE TO PLAY

New market

Firms that excel at total innovation management simultaneously invest and balance initiatives at three levels of ambition: Core, Adjacent and Transformative.

Exploration into new markets

Transformative Developing breakthroughs and investments in markets that do not exist yet

Adjacent

Adjacent growth

Expanding from existing business into “new to the company” business

Core Optimizing existing products for current customers Improvements, extensions, variants and cost reductions

Next generation products

Existing technology that we currently use

Exploration with new technology

Existing technology that we do not use

KNOWLEDGE OF TECHNOLOGY HOW TO WIN

Source: Managing Your Innovation Portfolio by Bansi Nagji and Geoff Tuff, HBR May 2012

New technology

Detailed Process Steps – Front End Detail

Front End

transition

Back End

DISCOVER Define Opportunity

DEVELOP & DELIVER

Create Concepts

Assess & Plan

Define Opportunity

1

Define the Business Objective

2

Understand Needs

Prioritize Approve Fund / Staff

Design & Validate

Prep & Build

Create Concepts

3

Translate Understanding into Opportunities

4

Create Ideas

5

Iterate Ideas

IN MARKET

Launch

Realization

Prototype & Demonstrate

6

Develop Broad Concepts

7

Assess Concepts

8

Prioritize Strongest Concepts

9

Prepare & Execute Go Forward Plan

www.linkedin.com/in/trmcknight @tim_mcknight