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LEAD Innovation Blog

Read our latest articles on innovation management and innovation in a wide range of industries.

Date: 29-May-2019
Posted by: Michael PUTZ
Category: Innovation methods

Why you have to deal with trends in your industry yourself

 

Think tanks and futurologists are trying to track down new developments. This may generate a gain in knowledge for the consumer market. Relevant mechanical engineering trends, plant engineering trends, medical technology trends, textile industry trends and trends in the automotive industry cannot be found in this way. Read in this blog post how you can define the term trend yourself, why it is important to deal with it yourself and how an external service provider can help you.

Does it concern or threaten me and - can I use it and if so how? We ask ourselves these questions as soon as we hear the word "trend". The term never goes out of fashion, because it always describes a change and thus something new. The term innovation also has to do with both, and by definition must always correspond to a trend. Because only market success turns a new invention into innovation. The term "trend" is therefore inseparably linked to the word "innovation".

Paper Create Trend Universe

 

Trend researchers help only to a limited extent

There are companies that are concerned with discovering and interpreting trends from a wide variety of fields. The Zukunftsinstitut, for example, sees itself as a think tank for trend and future research and provides strategic knowledge for tomorrow's economy. The trend consultant Trend One promises something similar. Both companies offer analyses and forecasts on far-reaching and long-term changes such as urbanization, individualization, globalization or connectivity. For companies that operate in the B2C market and also serve a clearly defined area, the content inputs of such future consultants can be quite valuable. However, these companies are less concerned with very specific changes, mechanical engineering trends, plant engineering trends, medical technology trends, textile industry trends and trends in the automotive industry. But even the smallest niche is subject to megatrends, which only unfold their effect there. A company in this sector must be familiar with the content of these trends - because there is little to be expected from an external consultant here. External service providers are a valuable support when it comes to choosing and applying the right methods to identify and exploit trends. A prerequisite for this, however, is that the word "trend", charged with many meanings and emotions, is precisely defined.
 

What is actually a trend?

A trend is a general development in a certain direction. A development always means a change. To illustrate this better, here is an example: Price pressure in an industry is only a trend if it has not existed before. If the price pressure has been noticeable for about 10 years, then it is a constant and no longer a trend. Trends always have a temporal and a geographical, sector-specific or thematic component. For example, in the case of engines that run on fossil fuels, the drop in consumption relative to strength is a trend.

 

Trends follow round and square curves

The course of trends can be depicted on a diagram that relates the factors of time and distribution to each other:

  • Such a development can be linear.
    An example of this is the already mentioned thirst of combustion engines, which decreases in relation to power.
  • Exhaust emission regulations, on the other hand, require a step-by-step development: within the EU, a new standard comes into force every five years. Since September 2014, Euro 6 has applied to all newly typified passenger cars; one year later, the regulation came into force for all newly registered passenger cars. Legal regulations are often the reason why trends are gradual. They can also trigger a completely different trend that takes a different course. Stricter exhaust regulations have certainly helped to trigger the trend towards electro mobility. A development, by the way, that many established industry leaders have overslept.
  • The Gaussian bell curve shows a further, quite typical trend: At the beginning there is only little change, then the majority slowly jumps onto the trend, only to lose interest in it again after some time. An example: Already in the 90s there were some SUV models to buy from European car dealers. However, the number of new registrations did not rise sharply until the turn of the millennium and reached a peak at the end of the 10s. Sales of SUVs will then fall as soon as buyers lose interest in turning to a different car class or choosing alternative forms of mobility at all.

 

What distinguishes megatrends from trends, fashions and hypes?

Time plays an important role in innovation management. It is therefore very common to distinguish trends in terms of their duration: a megatrend describes a development that will last for more than 20 years. Urbanization would be such a megatrend. A classic trend lasts between one and 20 years. A hype is a development that arises within a year and disappears again. Modes are special forms of trends: These are developments that come again and again at more or less regular intervals. The length of women's skirts is undoubtedly subject to a fashion, such as the design of cars: round shapes are replaced by angular ones and then replaced by round ones.

 

Trend categories

For innovation management it is practical to divide developments into several - but at least two - categories - namely market and technology. Using the web as a decision-making aid for purchasing cars or buying them online is a clear market trend. In order to do justice to this development, sales innovations are in demand, because the buyers look for alternatives apart from the classical car dealer. Using alternative fuels for combustion engines is clearly a technology trend: car designers must therefore design their engines to work with bioethanol, for example.

 

A company must know the content of relevant trends

Every company must be aware of the content of the trends that move its own business and industry or could influence them in the future. If this knowledge is missing, the basis for a professional management is automatically missing. In order to grow, a company needs a sound picture of the future. This is especially true for marketing, product management and the research and development department. In order to get such a picture, an external service provider can help. Without this service provider knowing trends from the specific industry itself. Together with the company itself, the service provider implements a process to identify, analyze and evaluate trends. In order to discover trends in the first place, there is a myriad of sources - such as trade fairs, databases or specialist media. It is up to the company itself to make use of these sources. When analyzing and evaluating the various developments, however, it is advisable to incorporate the perspective of external parties. Here, too, a service provider can help because he has an appropriate network at his disposal.

 

Trend universe paves the way to roadmap and search fields

The collection of trends, which leads to an individual trend universe, forms the basis for innovation management. This is followed by the analysis and evaluation of trends. This is the case when the trend universe is linked to a timeline and its innovation past. The result is the roadmap, which literally serves as a road map to innovation success. Concrete search fields can be derived from the roadmap. The research and development department thus knows exactly where to look for something new. However, a search field must always be associated with at least one trend - otherwise it does not deserve the designation "search field" and will not lead to any innovation.

 

Conclusion: Why you have to deal with trends in your industry yourself

There are numerous tasks in innovation management that can be outsourced to external service providers. But certain core areas must be covered by each company itself. In the B2B area in particular, this means dealing with new developments in terms of content. Mechanical engineering trends, plant engineering trends, medical technology trends, textile industry trends, trends in the automotive industry and developments in many other industries are too specific for futurologists who tend to focus on broader topics. You cannot outsource the discovery, analysis and evaluation of trends. A service provider can only support you in choosing and applying the right method for this task. In the best case, this service provider also has a network of external experts at his disposal and prevents you from stewing in your own juice.

Create Trend Universe

Michael PUTZ

Born in the Salzkammergut. After working for Shell and Porsche, he concentrated on innovation management as a study assistant at the Innovation Department of the Vienna University of Economics and Business Administration. In 2003 he founded LEAD Innovation and manages the company as Managing Partner. Lectures at MIT, in front of companies like Google or NASA.

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