Issue 14: Different strokes for different innovative folks

July 12, 2019

This week, we're deep-diving into innovation archetypes and exploring how, and where, companies innovate. We'll look at in-house innovation, hackathons and more to understand how companies find and nurture new ideas.

Then, we'll look at beauty and personal care company Shiseido's $92-a-month personalized beauty device that's debuting in Japan, explore how businesses can integrate AI into their decision-making and goal-setting and take a look at how AI is changing product development processes.


Focus: Build or Buy to Innovate?

In academia, the saying is "publish or die." For companies, it may as well be "innovate or die." There are myriad ways to innovate: for some flavors of innovation that various companies are using, take a look at what's happening in the meat alternatives space, finance, established corporations and more.

D.I.Y. INNOVATION

HBR suggests that innovation may be best done in-house. Many institutional investors worry that companies don't get credit for long-term R&D investments; and they're probably right. Nonetheless, this piece argues that companies, investors and the larger environment are all better off when companies make long-term R&D investments.

For companies that believe this is the case, there are three main archetypes for their innovation infrastructures: 1) horizontally integrated across departments, 2) vertically integrated as a separate department and 3) as in-house innovation lab.

HORIZONTAL INTEGRATION

For technology companies looking to innovate in-house, many case studies prove that tight horizontal integration across their digital service architecture stacks allows them to innovate across their product.

VERTICAL INTEGRATION

After exiting its early investment in Beyond Meat through its investment arm, Tyson Ventures, Tyson Foods its own meat substitutes, to be rolled out this summer. These venture investments helped Tyson Foods develop its own products, which were created in-house by Tyson's chefs and consumer specialists. Innovation aside, if you have questions about meatless meat, here are answers to nine questions you may have, but are too embarrassed to ask.

IN-HOUSE INNOVATION LAB

In a pair of reports, CB Insights dives into 37 corporate innovation labs in finance and 75 corporate innovation labs that are helping major companies stay relevant in the face of disruption.

INNOVATION BY ACQUISITION

For companies that don't innovate in-house, innovation by acquisition can be a viable alternative to the DIY approach. Business Insider describes the business case for innovation by acquisition. This approach can work in technology (e.g.,Salesforce's acquisition of Tableau), the food industry (e.g., Nestlé's purchase of Sweet Earth to get into the plant-based meat business) and even government. However, there are downsides to this approach, as well.

HACKATHONS/COMPETITION

Hackathons — once exclusively the realm of tech geeks in hoodies — have become a way for companies across industries to effectively crowd-source solutions to some of their business problems and create buzz around their innovation-related activities to targeted communities and participants.

British Airways in-flight hackathon tackles problems between Silicon Valley and London

Emirates Hackathon

BCG Digital Ventures DV Hacks NYC 2019 (Applications are open until August 30, if you're interested!)


Extended Reading

Shisedo's Beauty App Promises Perfect Skin -- at $92 a month

Japanese skincare giant Shiseido is launching an at-home customized skincare machine, Optune, in Japan. The device works with an iPhone app that takes photos of the user's face to detect skin conditions and enables Optune to dispense a personalized formula twice a day. The machine can dispense 80,000 possible formulations of product. Thus, Shiseido has finally struck upon the solution for women (and men) who are always wondering, "am I doing this right?" while slathering their multi-step skincare on each day.

What AI-Driven Decision Making Looks Like

Although many companies have adapted data-driven approaches to operational decision-making, this HBR article suggests that there's more they can do to embrace technology as a management and decision-making tool. For companies to fully leverage data's value, they need to go a step further to bring AI into workflows and enable AI-driven, versus merely data-driven, decision making  Ultimately, the companies that most effectively integrate AI into their workflows will reap advantage that'll allow them to come out on top.

Product development gets a makeover — with virtual reality

Thanks to VR, product development and design-to-value (DTV) capabilities have massively improved across industries. By helping break the constraints of the physical world, VR is helping designers, engineers and developers work across geographies to innovate and collaborate. It can even help teams interact with their projects in ways that'd be impossible without VR (for example, tearing down component parts virtually in ways that wouldn't be possible in actuality).

d2e77584-c0d3-4110-ab3e-3062bc10fe3d.png

Strategy For and With AI

David Kiron and Michael Schrage argue that AI can help companies determine which outcomes to measure, how to measure them and how to prioritize them. In the machine learning era, using AI to determine, measure and optimize KPIs can help make organizations more effective and competitive.

ef5e6375-db25-4ec0-bae8-3d8caa3e351f.png