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INNOVATING BEYOND PRODUCT

While there is plenty of room for product innovation, wood industry leaders must get their heads into reinventing their processes to make it easier for customers to do business with the company. Websites, design tools, flexible products, simplified pricing, straightforward warranties, business hours aligned to the customers’ availability — all will improve the buying experience.

Further still, creating products as well as selling and installation services that trigger customer passion will create a clear competitive differential, making competitors irrelevant. Process innovation outside of the factory will drive the business, giving rise to new, effective and profitable business models. Innovation of business models will provide the framework for enterprise-wide business improvement.

LEADERSHIP REQUIREMENTS

Wood industry owners and leaders must recognize the essential requirements for success. First, you must know your customers — intimately. If you are not listening to them, you have no way to understand what they really want and expect. One thing you can count on: They don’t care about you; they care about themselves. They want what they want, and they want vendors to make their lives better. That expectation is our purpose for existence.

Second, based on what you know about your customers, innovate your business model first, then products. Start with the customer end of the process and work your way backward. Little process enhancements can pay big dividends with customers. Ask your customers what works, what doesn’t and what would be better; most times, they know.

Assume nothing. Just because we’ve been successful in the past, doesn’t mean our experience or knowledge remains relevant. As leaders, our challenge is to keep our own thinking fresh. We must have the courage to first challenge ourselves, then others around us. Reach out to other leaders.

Most importantly, even though resources may be tight, encourage creative thinking — in yourself and your employees. Innovation should not be constrained because of budgets. Challenge your staff to improve its performance for your customers without spending lots of money. Make sure the expectations and boundaries are clear.

Finally, we must all make sure our assumptions don’t take us off course. Innovation seldom comes in a flash of blinding inspiration. It comes from a deep understanding of customers, what’s happening in their worlds, the competitive landscape, and technology development. Innovation results when we see latent opportunities to deliver value to customers that competitors have not yet seen. It results when leaders say yes to creativity and imagination.

Ed. note: Strategy and business adviser to the wood industry, Don Shultz of J.E. Moran Associates (www.jemoran.com) collaborates with owners and executives to discover new customer and market possibilities, and to foster improved operational and financial outcomes. He can be reached at (608) 279-8089 or by e-mail at dshultz@jemoran.com.