The 4 phases of innovation
The phases of an innovation, ie an innovation process, can be divided into four main steps:
- Idea: collection of innovation potentials, derivation of ideas, evaluation and release of ideas.
- Concept: Extensive analysis and derivation of concepts for the solution, implementation and marketing.
- Solution: Development and testing of the solutions to the finished product.
- Market: Arouse and fulfill a customer's needs by implementing in procurement, production and logistics as well as marketing and sales.
Each phase has its own characteristics. If the front phases are more creative and less structured, the phases of implementation and marketing are very process-oriented and focused.
The development of the individual phases depends very much on the individual requirements of a company. For example, larger companies have a more intensive assessment with several decision-making stages in the idea phase. Or technology-intensive organizations with complex products will have a more comprehensive production implementation. And service providers have different requirements.
Phase 1: Ideas
An innovation process always starts with the search for and finding innovative potentials and the derivation of ideas, which are subsequently evaluated.
An innovation potential is a newly discovered opportunity for innovation. This can be:
- An unfulfilled customer requirement
- A problem with the customer
- A possible new market
- A new technical solution.
There are countless possibilities for tracking down innovation potentials. There are essentially two different approaches:
- Targeted search: The search for potentials is based on the innovation strategy and the derived search fields. Various methods are used to collect ideas internally and externally (open innovation), e.g. creativity workshops, lead user workshops, idea competitions.
- Random Finding: One encounters randomly discovering impulses for potentials. For example, one finds a new technology in searches. However, employees can also generate impetus via the company's suggestion or on the basis of customer feedback.
An idea emerges from the potential for innovation, a thought-like construct, such as the new solution in the sense of a new product or a new service. In practice, it can merge into a one-pager with a description and sketch. In the case of a first description of the ideas, the reason why the idea is relevant to the company, the potential and the usefulness of the idea is important.
The conclusion of the first phase makes the idea assessment. On the basis of defined criteria, the potential benefits and the feasibility of the company are evaluated. Based on this, the idea is given a priority and the release for the next phase is decided where the objectives and expectations are also concretized.
Phase 2: Concept
From Phase 1 comes a concrete and released idea with goals and expectations. This is followed by an intensive analysis phase in order to gather as much information as possible about the idea and its further processing:
- Market and customer requirements
- Market potential, e.g. Market size, market attractiveness
- Chances, e.g. Differentiation possibilities for the competition
- Risks and feasibility, e.g. Technical feasibility, market entry barriers
- Framework conditions, e.g. Laws, standards, patents
The most intensive and important analysis is that of the customer requirements, for example:
- What are the needs of customers?
- Are there any unfulfilled or unconscious customer needs?
- Which customer problems are there and should be resolved?
- What is the importance of needs?
Here, a systematic approach with professional methods such as customer interviews, focus groups, lead user workshops or customer observations is recommended in order to gain the greatest possible insight. Especially Lead Users are a very valuable source, because they have many experiences and many own ideas and solutions as advanced users.
On the basis of the analyzes, first concepts are developed with regard to the
The solution first includes the requirements for the new product, the specification. Furthermore, there are first solution concepts in the form of descriptions, sketches or models.
For a successful and feasible implementation, first thoughts have to be gathered for an implementation concept. It covers procurement, production and logistics.
Marketing is also very important. The best solution is not successful if it is not marketed well. This includes the product strategy, which defines the positioning, the USP, target markets, possible sales channels, the pricing strategy, etc. This strategy is the basis for marketing and distribution throughout the product life cycle.
The business model Canvas by Alexander Osterwalder and Yves Pigneur is the perfect tool for conceptualization.
In order to release the idea or concept for the next phase, a concept evaluation is necessary. It analyzes the requirements for solution, implementation and marketing thoroughly. Particular attention is paid to the solution concept, which is best evaluated with future customers and users.
The optimal approach is iterative, where initial raw concepts are evaluated and continuously developed in continuous feedback loops until a coherent, first-class concept is established.
Depending on the scope of the concept phase, an innovation project can already be started here in order to work with the tools of the project management.
Phase 3: Solution
The aim of Phase 3 is to develop a ready-to-use solution that can be brought to the market. Solutions are being developed, prototypes built and tests carried out. In addition to concept and lab tests, the tests also include market tests under real conditions in order to gain comprehensive feedback.
Once the solution has reached maturity, it will be released for implementation and marketing. At the same time, the concepts for implementation and marketing are further developed and adapted.
Outputs of this phase are usually technical specifications, CADs and know-how for application and production.
Phase 4: Market
The last phase is about bringing the product to the potential customers. On the one hand, this requires the physical availability of the product. These include procurement, production and logistics based on defined concepts.
On the other hand, the customer is aroused and then fulfilled. All marketing and sales channels are activated. As a basis, internal sales must be convinced and trained in order to bring the products to the customers in the main step. All these activities can be summarized as innovation marketing.
At the end of the innovation phases, the new product is transferred to product lifecycle management in the responsibility of product management. On the basis of the continuous evaluation and analysis of the product on the market by, for example, customer feedback or quantitative market analyzes, measures are taken to increase sales, margins and customer satisfaction. Among other things, the famous 4P tools of marketing are used.
Various process models are available for the management of the innovation phases. The most popular in practice are the
Regardless of the chosen process model, the content and sequence of the phases are always the same. Only the structure and type of settlement are different.
Conclusion: 4 phases of innovation
Innovative processes after phases are indispensable. This is because they create structure and systematicity to avoid mistakes and to increase the innovative performance. This ensures that all important steps are completed in a timely and correct manner. If there were no processes and phases, one would orientate without orientation constantly back and forth rather than focused on the goal.