Pathways to growth: It’s time for firms to innovate
One of the hottest concepts in business these days is “disruption.” In fact, a KPMG survey found that three in four CEOs surveyed worldwide said their companies are striving to be market disrupters. In many sectors, effecting dramatic change in how business is done (disrupting) is a deliberate pursuit.
In public accounting, disruption through innovation is a do-or-die response to current traditional services — sluggish, predictable offerings with low margins and little creativity. If accounting firms don’t take note, they risk becoming irrelevant.
In part one of this series I wrote about thought leadership, the first step in the process of service-line or product innovation. Supported by solid thought leadership, the second step, and the subject of this article, is development and execution of the innovation itself.
Below I describe an approach to guide practitioners through developing or enhancing an offering.
As you move through the steps, you should simultaneously be seeking and engaging an early adopter — a client in need of what you’re creating who is willing to beta test your innovation.
Your offering need not, and in fact should not, be totally buttoned up before you bring in an early adopter. The point is to develop with a test client’s real-world situation and use the learnings to perfect the offering.
1. Identify your buyer group and persona. Your buyer group is a general category, such as physicians or manufacturers. Within that group, you need to identify a persona — a profile of your anticipated user.
Examples of personas are “members of a medical practice with 10 or fewer physicians” or “owners of a large, Midwest-based food manufacturing business.” Be specific. No matter how compelling your offering, the idea that anyone with a pulse and a wallet might want it is just not realistic.
2. Home in on the problem or need. Why does the marketplace want what you have to sell? Make sure your execution is grounded in an intimate understanding of what you’re doing, whom you’re doing it for and what it will look like.
Talk to everyone you can — industry leaders, prospects and clients — to learn about their needs and pain points. Think like a client by looking at the market from the outside in, rather than the inside out. Avoid YOWIII — “Your opinion, while interesting, is irrelevant.” No offense intended, but the market’s opinion always reigns supreme.
3. Structure your offering. I use a method called conceptual design to help clients translate an idea into a product or service. It is a simple, straightforward picture of the innovation concept.
An example I use to describe growth is a three-legged stool. Growth is the seat and it is supported by the functional areas of sales, marketing and product management. A conceptual design enables you to engage someone in a conversation about the concept of the innovation, a good starting point to educate and influence.
4. Determine market position. Where does your innovation fit in the marketplace? Assessing this requires a clear view of competitive offerings and of your market differentiators.
One of the most reliable resources is insight gleaned by interviewing your competitors. I know it sounds unusual, but you’re innovating and disrupting here. Without a deep understanding of the competition, how are you going to offer something competitively compelling? If your offering is the same as, or less strong than, other options, you’re not going to have much success.
5. Name your innovation. A name is basically word-based packaging. Like any effective packaging, it should be attractive, memorable and distinctive. Incorporate your early adopter’s experience to choose a name that reflects the value and purpose of your offering. Get creative. So instead of choosing “accounting outsourcing,” for example, reach for something a little more appealing, like “concierge accounting.”
Supported by strong thought leadership and thoughtfully executed, your innovation has only one way to go — up. Use this approach to propel your innovative, market-driven service up and away from the bloated fat-cat offerings into a sphere of its own.