In our previous blog post, Innovation is not a Buzzword, we made the argument that innovation is a necessary endeavour for an organization or company’s continued relevance and success. Over the coming weeks, we have 5 planned posts that will delve deeper into why you should be innovating.
This post makes the argument that if you can frame the conversation around tech and service innovation in your favour, you will be have an advantage in the market place. To a great extent, innovation is an important communications and branding asset.
This blog post includes the following:
Part 1: Amazon, Apple and the power of visionary thinkers on the marketplace
Part 2: Two ways hackathons help you predict and plan for future developments
Part 3: How one company organized an internal hackathon to respond to changes in the financial industry
In 2011, Amazon CEO Jeff Bezos felt the need to write a piece for Business Insider explaining why Amazon had posted lower than expected earnings, which was primarily a result of a $3 billion increase in expenses. Mr. Bezos wrote:
“Technology infuses all of our teams, all of our processes, our decision-making, and our approach to innovation in each of our businesses. It is deeply integrated into everything we do. […] Invention is in our DNA and technology is the fundamental tool we wield to evolve and improve every aspect of the experience we provide our customers.”
Innovation is what differentiates an active company from a passive one. Organizations with a strategic approach to innovation increase their likelihood of shaping the market in ways that fit their needs.
Over a little more than two decades, Amazon has run roughshod over numerous competitors by out-investing them in developing the future of commerce and retail. They started off as a simple online bookseller after all, and over time began selling other products, producing consumer electronics (The Kindle, Fire TV), and becoming the biggest supplier of cloud infrastructure services in the world. Jeff Bezos then bought The Washington Post in 2013, which provides him the ability to better understand a struggling industry while using it as a laboratory to explore the intersection of integrated content and commerce. Now that Amazon has surpassed Walmart as the world’s most valuable retailer in the United States by market capitalization, it is clear that Jeff Bezos was right to invest heavily in changing the market in his favour.
Apple’s current competitive advantage over Microsoft is based on the same visionary principles. Steve Jobs’ user-centric focus revolutionized the way personal computers were marketed and sold to consumers. Central to that experience was his focus on design, usability, and intuitive products and interfaces. This approach helped Steve Jobs and Apple develop whole new industries and impose their vision of the future on the rest of the world.
At their respective peaks, Amazon and Apple controlled the market, forced competitors to adapt to their technological innovations, processes and products, and permanently altered their respective industries.
Steve Jobs once quoted Wayne Gretzky:
“I skate to where the puck is going to be, not where it has been.”
Knowing this, how can a hackathon help you best predict where the puck is going to be?
Here are two ways a hackathon will help you evaluate the direction your company should take:
Tapping into different communities
Every type of hackathon allows you to crowdsource insights and solutions from a community of your choosing. By mingling software developers, product managers, designers, curious citizens, and professionals with diverse backgrounds, you ensure the ideas that result from the hackathon are dreamed up by a wide array of makers, users, and customers with different perspectives.
Hackathons are an opportunity for “talent engagement;” means of entering a conversation with idea generators that could help open new growth possibilities. Hackathons are a great way to keep your finger on the pulse of what is happening culturally, technologically, and even politically.
Predicting and understanding the future is best accomplished by understanding people, their concerns, anxieties, ambitions, and dreams. In order to frame and manipulate a market or industry in your favour, you need to understand your consumers. Hackathons provide crowdsourced answers that help you accomplish that while engaging with people at the same time.
Development of Intellectual Property
IP is a tricky subject to manage when it comes to hackathons. The volunteer-driven and collaborative nature of hackathons generally means you need to be sensitive about not giving the impression you are using crowdsourcing as free labour. Therefore, when it comes to determining who owns the IP that is developed during a hackathon, it is important you consider the repercussions of your choice on the matter. Make sure that the rules regarding IP are clearly articulated. That being said, it is remarkable how successful well-organized hackathons are at delivering creative solutions and insights. In the right context, participant submissions may open up additional markets, customer bases, and spawn new product lines or entire companies.
One of our clients (who prefers to remain anonymous) was proactive in responding to the changes in the financial industry. Part of their strategic blueprint was an internal hackathon with the objective of re-imagining the way their customers experienced their services using new emerging technologies. They were concerned about the threat of disruptive technologies in their industry and wanted to prepare for the changes.
Beyond organizing the actual hackathon, Hackworks helped them coordinate pre-hackathon workshops in order to brief the participants on the challenges affecting the financial industry and introduce them to new technologies. The workshops provided the participants with ample time to become acquainted with the technologies and brainstorm on the potential impacts they may have on their own lives, that of their customers, and their industry as a whole. Participants were also encouraged to play and experiment with other tools and technologies that might be disruptive.
From a pool of over 4000 employees, a group of 150 were selected as participants and provided new tools, an opportunity to work with colleagues from other departments and a unique learning experience. Even with less than 5% of its workforce participating, the benefits of such an activity for the company are enormous. Each of those participants returned to their teams with ideas and knowledge to share.
The ultimate focus of the hackathon was on finding solutions that would enhance digital customer experiences. By doing so, the company created an engaging platform for their employees to do something unique and share their own ideas with company leaders and executives. The participants felt empowered and included in decision-making they don’t normally get involved in. The company was able to crowdsource ideas from employees working in a variety of different departments and mine the expertise of employees that connect with customers on a daily basis.
Processes were put in place in order for the ideas generated during the hackathon to be immediately evaluated. Work began right away on weaving together the ideas, insights, and technologies that surfaced into the company’s innovation roadmap. With the solutions and insights developed during the event, the client was able to better prepare for future and avoid reactionary innovation.
It is not always the best innovation that succeeds, it is the one that manages to achieve a successful market-fit, because ultimately, an innovation is more than an invention or discovery, which increases knowledge but doesn’t necessarily impact the market. By continuously exploring possible product and process innovations, you increase the likelihood your solutions gain traction, answer market needs, and create new revenue streams. Involving employees and outsiders from different backgrounds when assessing future developments is a simple but effective way of covering your bases.