How to Gain an Unfair Innovation Advantage

Not every company can imitate Google’s practice of giving employees 20% of their work time to pursue passion projects, but there are other ways to foster a culture of innovation.

May 5, 2015

6 Min Read
How to Gain an Unfair Innovation Advantage

Not every company can imitate Google’s practice of giving employees 20% of their work time to pursue passion projects, but there are other ways to foster a culture of innovation. 

Steve McPhilliamy

Today, the medtech industry is more dynamic than ever, with companies facing a growing number of competitive forces, including emerging technologies that impact core products, new user experiences that draw customers away from current offerings, and new startups that will change the competitive landscape. All of these threats have one thing in common: They are driven by innovation.

To be in sync with emerging and evolving market needs and stay ahead of the competition, medtech companies can no longer rely on a single innovation method. To create an “unfair” competitive advantage, companies must adopt multiple, concurrent innovation approaches. These approaches can vary from organization to organization, but strong innovation consistently comes from a healthy mix of technology vetting and derisking, combined with a solid corporate innovative culture, user-centered initiatives, and strategic partnerships. These elements provide the foundation to maintain market share and sustain long-term innovation.

Weaving Innovation into Corporate Culture

Innovation starts with the right mindset, and that mindset needs support from the top of the organization. Corporate cultures that highly value innovation and collaboration have set a vision that becomes part of the company’s DNA. By leveraging the insights and inspirations of everyone a company employs—from brand managers and business unit leaders to support staff—a repository of new ideas is never far away, and the seeds of innovation have the chance to organically and continuously grow. The trick to leveraging this approach is to not only support the notion of idea-sharing within the company but provide methods to grow “intrapreneurs” that can take the ideas and build them into tangible, viable solutions.

While not every company has the luxury of 3M’s structure and no-holds-barred Open Innovation process or the resources that enable Google’s practice of giving all 26,000 of its employees 20% of their work time to pursue passion projects, there are other ways to foster a culture of innovation. From communicating the value a company places on new ideas during employee orientation, to creating an internal Intranet-based idea-sharing portal, to defining methods that identify and support “intrapreneurs”, promoting internal ideation doesn’t have to be cost prohibitive to fuel a constantly evolving pipeline of new ideas that can be turned into new product, service, and customer experience solutions.

Research-Informed, User-Centered Design

User-centered design is another approach at the heart of identifying valuable opportunities. Investigating a user’s experience with a product or a service through field research can bring ideas to light for a range of near- to long-term innovation opportunities aligned to multiple stakeholders and company goals. Understanding an interaction with a product, service, or workflow through a user’s eyes can help companies define clear innovation goals for solutions that are based in real needs.

Clear value for this approach can be found in the Mayo Clinic Center for Innovation, which employs a live onsite research team to directly observe Mayo Clinic patients and design solutions that creatively address their needs. Another example of the value this approach offers can be found in Olympus Medical’s Diego ENT microdebrider platform. Our team observed live nasal surgeries to uncover leading user needs and discovered unnecessary repetitive actions to activate the existing tool’s surgical blade. This finding ultimately fueled our development of a far more efficient next-generation device that saves surgeons valuable time.

Technology Scouting

Interest and investment in technology scouting as an approach to innovation has grown over the past five years as corporations increasingly look for ways to gain better exposure to the emerging technologies of startup companies in the medical space. While new concepts once came primarily from companies’ internal R&D efforts, an ever-growing base of new technologies is emerging from a growing ecosystem of startup companies.

Startups are at the edge of new technologies’ potential. They are exploring full-system immersive experiences and tapping into on-target trends like consumer-managed health and personalized healthcare. These startup companies can impact people’s lives and create meaningful change in a space that needs new ideas around reduced cost, increased care, and better outcomes.

The companies that find a way to tap into this will grow their innovation pipelines and inspire more change at a faster rate. Companies like Johnson & Johnson have opened innovation centers across the world to tap into and support these growing startup companies. Over the past three years alone, J&J has opened centers for innovation and startup incubators in Cambridge, San Francisco, London, and Shanghai. With 80% of all startup exits coming through acquisitions in the medical field, companies that have aligned with startup talent have positioned themselves at the forefront of innovative opportunities.

The popularity of startup innovation programs that help facilitate technology scouting by companies can be seen in present day productions of Qualcomm’s Xprize and our own Chicago HealthTECH Summit, both of which incentivize startups to competitively pitch juries while doubling as acquisition and investment scouts. A recent example of technology scouting’s importance among major corporations to feed the innovation pipeline is Samsung’s announcement of its partnership with startup PhysIQ to employ its predictive analytics platform technology that continuously monitors patients with chronic diseases and enables proactive treatment by clinicians.

Strategic Partnerships

Partnerships can be a valuable approach for multiple reasons. They can provide opportunities for new distribution channels, expand a company’s reach, and open the door to entirely new markets and solutions. Through an in-depth understanding of market trends and user needs, companies can frame what technologies augment their current solutions and position themselves well for future offerings. In many cases, it requires knowing that it cannot be achieved effectively on your own and identifying when to collaborate with other groups.

One of the best strategic collaborations of late in medtech resulted in an iPad-based wellness service for the elderly in Japan. IBM, Apple, and Japan Post, a government-owned holding company that runs a postal service in Japan, leveraged the partnership approach to innovation to both expand its reach and bring a new solution to market. The new monitoring service was engineered to check up on elderly people in their homes, coordinate activities that are central to their well being, and report their well-being status back to their families. Run on Apple’s iPads through a suite of quality-of-life apps developed by IBM and deployed by Japan Post workers that visit elderly people's homes, the solution helps schedule medical appointments for the elderly, coordinate their travel, hire home maintenance professionals, and coordinate volunteers. Together, this collaboration effectively pairs complementary resources, capabilities, and perspectives to enable an entirely new service that serves a clear market need.

With this combination of concurrent innovation approaches in place, companies can begin to develop a rhythm of creating new concepts, products, and experiences and effectively compete in today’s dynamic medtech industry.

Steve McPhilliamy is partner at Insight Product Development and executive director of Insight’s Accelerator Labs in Chicago. Reach him at [email protected].


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