Innovation Funnels Fatally Flawed

The ‘innovation funnel’ is a widely used method of sifting wheat from chaff.

Here at The Strategy Distillery, controversially, we believe that innovation funnels don’t work. In fact, we believe that they stifle creativity and make innovation less likely to be successful.

It would seem the innovation funnel is only good at funnelling one thing – your marketing resources!

In a nutshell, innovation funnels have a tendency to encourage bureaucracy, negative thinking and conservatism, hindering the creativity they were designed to encourage.

Here’s the 4 reasons funnels don’t work:

1. Assumes good ideas are easy to come by.

Whenever an innovation funnel is drawn there are always loads of arrows coming in at the larger end representing ideas. As if it’s the easiest thing in the world to get ideas to fill a funnel with. The problem is that the funnel is utterly indiscriminate in its entry criteria for initial ideas. The issue is quality.

Anyone can come up with 100 ideas for innovating. Take for example, baby food – lets make it caviar flavour and not stain clothes. Formulation changes are easy and rarely revolutionary. But how easy is it to come up with the idea of putting it in a suckable pouch with a re-sealable lid so that the baby can safely feed themselves? Innovations such as this tackle consumer frustrations or create brand new needs consumers don’t yet know they have. This is the holy grail of innovation.

How about coming up with 25 ideas of that quality? Not so easy.

Generating legitimate and useful ideas is a low-status affair in the innovation funnel process, and so often, the key people capable of conceiving them are your senior stakeholders and consumers and they are sadly rarely involved until far later in the process.

2. Focus is on generating ideas instead of consumer problems to solve.

Problem solution text on a blackboardThe entire focus of the innovation funnel and stage-gate process is to ‘whittle down’ a large number of ideas to a smaller number by ‘killing off’ the weaker ones and ‘picking’ the winners.

The chances of picking genuine winners are determined by the starting point for ideation.

Businesses develop at worst, ‘opportunity platforms’ from which to ideate; e.g. “Capitalise on the energy drink trend”, and at best ‘insight platforms’; e.g. “Energy drinks tend to be overly macho”.

But these are very broad and rarely direct the creative thinking efforts towards ideas that will genuinely solve consumer problems or frustrations.

3. Too numbers focused; instead of ideas focused.

Numbers, graphs and charts image

As companies put more and more expectation on their innovation, they want it to be efficient, accountable and best in class, and therefore they feel the need to measure the hell out of it. At the front end of the innovation funnel, when ideas are so new and unformed, quantitative reads are at best a ‘stab in the dark’.

There are realms of research that suggest quant-led evaluation tends to favour the familiar. Concepts that are close to the existing product get scored higher than new, difficult, or extremely different ideas. This is probably where you will end up launching incremental ‘safe’ flavour line extensions for example.

4. Senior expertise is focused on evaluation, not creation and improvement.

Yes, no , maybe InterviewIn your last few innovation projects, when did the most senior and experienced marketing, operations or R&D people get involved or asked for their opinion? More than likely it was at an important ‘go/ no-go’ meeting. Their experience was only being called upon to spot the flaws. Which ideas won’t work, won’t go down the manufacturing line or won’t excite the retailer; which ideas contain hidden costs or unforeseen problems further in to their development. They are spotting the weaklings and weeding them out. This is no doubt a valuable task, but is this the best value these experienced people can bring to your project?

Would it not be better to focus the inputs of senior people into solving problems thrown up by new ideas such as: how can we get this to go down our line? What else do we have that could solve that consumer problem?

Innovation funnels don’t demand this kind of input. What they do demand is strict evaluation, flaw-spotting and the systematic weeding out of ideas with weak links. Essentially, innovation funnels are highly effective idea killing machines.

In our January issue, we will give you some pointers on how to avoid the frustration of more funnel-driven ‘hamster wheel’ innovation (where you keep going round the innovation loop but never actually launch anything truly successful).

In a nutshell, innovation funnels have a tendency to encourage bureaucracy, negative thinking and conservatism, hindering everything they were created to supposedly encourage.

Published 15th November 2014 by Shelly Greenway @ the Strategy Distillery