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APPLYING THE TEN TYPES OF INNOVATION | METHOD
Founded in San Francisco in 2000, Method was the brainchild of two
roommates-turned-entrepreneurs. Branding expert Eric Ryan teamed
up with former climate scientist Adam Lowry to create a non-toxic line of
natural home care products. The various offerings are now sold in more
than 40,000 retailers worldwide, including Target, Whole Foods, and
Kroger. In 2012, the company was bought by European eco-pioneer
Ecover to form what was described as “the world’s largest green
cleaning company.”
Method has also innovated its brand, building a company that stands for
much more than just tedious cleaning. As well as being eco-friendly,
packaging has been designed to be both colorful and countertop-friendly,
while the company not only has a wide following on leading home decor
and design blogs, but also hosts its own community site, known as
“People Against Dirty.”
Image Credit :
Method hand soap
courtesy of Method
THE BUILDING BLOCKS OF BREAKTHROUGHS
With a strong emphasis on sustainability and environmental sensitivity,
the vast majority of Method’s cleaning bottles are made from 100%
post-consumer recycled plastic while the company itself is a “Cradle to
Cradle” endorsed company; more than 60 of its products are certified
with the C2C stamp of environmentally friendly approval. Internally,
Method practices what it preaches: it offsets its carbon emissions,
works within a LEED-certified sustainable office, and it does not test
its products on animals.
Profit
Model
Network
Structure
Structure
Process
1
At the heart of any new discipline there often lies a simple,
organizing system—an underlying structure and order
governing what works and what fails. This is what the Ten Types
of Innovation® framework brings to innovation. Consciously
understanding it makes innovation easier and more effective.
Product
Product
Performance
CONFIGURATION
Product
System
Service
OFFERING
2
Channel
Brand
Customer
Engagement
EXPERIENCE
3
4
5
1
3
4
Method outsourced production to more than 50
separate subcontractors to develop a nimble and
flexible manufacturing process.
Method’s product not
only kills germs and
grime, it was developed
to avoid using toxic
chemicals or destructive
production practices. The
company adhered to “the
precautionary principle,”
meaning that if there was a
chance that an ingredient
wasn’t safe, it didn’t use it.
With its readily identifiable, bright, and colorful packaging
(originally created by industrial designer Karim Rashid),
Method built a big following in home décor and design blogs
and its bottles have prompted instant on-shelf recognition.
In a process the company calls “greensourcing,”
Method worked with suppliers and manufacturers
to track the environmental impact of making its
products. It also identified best practices to improve
the water, energy, and material efficiency of its
manufacturing processes.
WE DISCOVERED THE TEN TYPES OF INNOVATION IN 1998.
SINCE THEN WE HAVE LEARNED:
Innovation mostly fails. It doesn’t need to.
You shouldn’t let it.
FIVE TYPES OF INNOVATION
2
TEN TYPES OF
INNOVATION
5
Method created a community called “People Against Dirty”
that offered perks, deals, and early looks at new products for
customers. However, to broaden the brand’s appeal, they
opened the community beyond customers and invited anyone
interested in making the planet a cleaner place; a tactic
which advanced the company’s brand promise and extended
its reach to potential customers.
Innovation almost never fails due to a lack of creativity.
It’s almost always because of a lack of discipline.
The most certain way to fail is to focus only on products.
Successful innovators use many types of innovation.
Successful innovators analyze the patterns of innovation in their industry.
Then they make conscious, considered choices to innovate in different ways.
Innovations can be broken down and analyzed.
When you do so, you will learn why most fail and a few succeed.
Innovations can be built up systematically.
Doing so increases your odds of success exponentially.
ABOUT DOBLIN
Doblin, the innovation practice of Deloitte
Consulting LLP, brings together a wide
range of specific capabilities, tools, and
people to help our clients in their efforts
to solve their toughest challenges.
www.doblin.com
As used in this document, “Doblin” means the innovation practice of Monitor Deloitte within Deloitte Consulting
LLP, a subsidiary of Deloitte LLP. Please see www.deloitte.com/us/about for a detailed description of the legal
structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the
rules and regulations of public accounting.
This publication contains general information only, and none of the member firms of Deloitte Touche Tohmatsu
Limited or their related entities (collective, the “Deloitte Network”) is, by means of this publication, rendering
professional advice or services. Before making any decision or taking any action that may affect your business,
you should consult a qualified professional adviser. No entity in the Deloitte Network shall be responsible for
any loss whatsoever sustained by any person who relies on this publication.
C O PY RIGHT © 2 014 D ELOIT TE D E V ELO PMENT L LC | AL L RIGHT S RE SERV ED
THE TEN TYPES OF
INNOVATION
STRENGTH IN NUMBERS
Simple innovations use one or two types of innovation and every
company needs to pursue them. Failure to consistently, relentlessly
improve the known is one of the surest routes to failure.
Unfortunately, too many firms do only simple innovation. In today’s
contested markets, simple innovations alone are never enough for
long-term success. They can build a lead on competitors, but they
don’t create the firms, brands, or platforms that thrill us.
AN OVERVIEW
The Ten Types framework is simple and intuitive. It
is a useful tool you can use both to diagnose and
enrich an innovation you’re working on, or to analyze
existing competition. It makes it especially easy to
spot errors of omission — missing dimensions that
will make a concept stronger.
Profit
Model
Network
Structure
The Ten Types framework is structured into three
color-coded categories. The types on the left side of
the framework are the most internally focused and
distant from customers; as you move toward the
right side, the types become increasingly apparent
and obvious to end users. To use a theatrical
metaphor, the left of the framework is backstage;
the right is onstage.
Process
CONFIGURATION
Product
Performance
Product
System
When a market grows up and gets complicated, it demands more
sophisticated innovation, which uses many types of innovation
combined elegantly and orchestrated with care. Under the covers,
inside your firm, these require working across internal boundaries
and silos — challenges that bring additional complexity. You can
cut through this with multi-disciplinary teams to bring in the
necessary talent and knowledge, and with systems in place to tell
everyone how they can tackle tough challenges with curiosity,
confidence, and courage.
Service
Channel
OFFERING
Brand
Customer
Engagement
EXPERIENCE
Naturally, sophisticated innovations are more difficult to pull off,
not least because they have longer development horizons than simple
innovations. But consider the flip side: once you launch them, they
are likely both to delight customers and confound competitors. Often
you will be able to succeed with them for years before challengers can
catch up. Almost all of the enterprises that we identify as leading
innovators routinely use multiple types of innovation — and handily
outperform the average firms that innovate more naïvely.
SIX PRINCIPLES FOR USING THE TEN TYPES
EFFECTIVELY
1
PROFIT MODEL
STRUCTURE
PRODUCT PERFORMANCE
SERVICE
BRAND
The way in which you make money
Alignment of your talent and assets
Distinguishing features and functionality
Support and enhancements that surround
your offerings
Representation of your offerings and
business
For example, how Netflix turned the video
rental industry on its head by implementing a
subscription model
For example, how Whole Foods has built a
robust feedback system for internal teams
For example, how OXO Good Grips cost
a premium but its “universal design” has a
loyal following
For example, how “Deliver WOW through
service” is Zappos’ #1 internal core value
For example, how Virgin extends its
brand into sectors ranging from soft drinks
to space travel
UNDERSTAND ALL TEN TYPES
Virtually all projects can improve just by knowing and deeply
understanding the value and subtleties of each of the types.
2
NETWORK
PROCESS
PRODUCT SYSTEM
CHANNEL
CUSTOMER ENGAGEMENT
Connections with others to create value
Signature or superior methods for doing
your work
Complementary products and services
How your offerings are delivered to
customers and users
Distinctive interactions you foster
For example, how Zara’s “fast fashion“
strategy moves its clothing from sketch to
shelf in record time
For example, how Nike+ parlayed shoes,
sensors, apps and devices into a sport
lifestyle suite
For example, how Nespresso locks in
customers with its useful members
only club
For example, how Wii’s experience draws
more from the interactions in the room
than on-screen
For example, how Target works with renowned
external designers to differentiate itself
DE-EMPHASIZE RELIANCE ON PRODUCTS AND TECHNOLOGY
These are the easiest capabilities for competitors to copy.
3
THINK ABOUT CATEGORIES AS WELL AS TYPES
Consciously try to imagine new ways to configure assets, build
platforms, and foster fresh experiences.
4
USE THE TYPES THAT MATTER MOST
Use diagnostics to understand which types you and others
in your industry tend to overlook.
5
UNDERSTAND WHAT YOUR USERS REALLY NEED
User research can help you know what is relevant to customers and
what surprises other types might help to deliver.
6
LEARN MORE ABOUT THE TEN TYPES OF INNOVATION
Doblin’s new book to help you innovate your
way to meaningful and sustainable growth.
www.doblin.com/tentypes/
C O PY RIGHT © 2 014 D ELOIT TE D E V ELO PMENT L LC | AL L RIGHT S RE SERV ED
USE ENOUGH OF THE TYPES TO MAKE A SPLASH
Using five or more types, integrated with care, is nearly always enough
to reinvent a category and become newsworthy.
APPLYING THE TEN TYPES OF INNOVATION | METHOD
Founded in San Francisco in 2000, Method was the brainchild of two
roommates-turned-entrepreneurs. Branding expert Eric Ryan teamed
up with former climate scientist Adam Lowry to create a non-toxic line of
natural home care products. The various offerings are now sold in more
than 40,000 retailers worldwide, including Target, Whole Foods, and
Kroger. In 2012, the company was bought by European eco-pioneer
Ecover to form what was described as “the world’s largest green
cleaning company.”
Method has also innovated its brand, building a company that stands for
much more than just tedious cleaning. As well as being eco-friendly,
packaging has been designed to be both colorful and countertop-friendly,
while the company not only has a wide following on leading home decor
and design blogs, but also hosts its own community site, known as
“People Against Dirty.”
Image Credit :
Method hand soap
courtesy of Method
THE BUILDING BLOCKS OF BREAKTHROUGHS
With a strong emphasis on sustainability and environmental sensitivity,
the vast majority of Method’s cleaning bottles are made from 100%
post-consumer recycled plastic while the company itself is a “Cradle to
Cradle” endorsed company; more than 60 of its products are certified
with the C2C stamp of environmentally friendly approval. Internally,
Method practices what it preaches: it offsets its carbon emissions,
works within a LEED-certified sustainable office, and it does not test
its products on animals.
Profit
Model
Network
Structure
Structure
Process
1
At the heart of any new discipline there often lies a simple,
organizing system—an underlying structure and order
governing what works and what fails. This is what the Ten Types
of Innovation® framework brings to innovation. Consciously
understanding it makes innovation easier and more effective.
Product
Product
Performance
CONFIGURATION
Product
System
Service
OFFERING
2
Channel
Brand
Customer
Engagement
EXPERIENCE
3
4
5
1
3
4
Method outsourced production to more than 50
separate subcontractors to develop a nimble and
flexible manufacturing process.
Method’s product not
only kills germs and
grime, it was developed
to avoid using toxic
chemicals or destructive
production practices. The
company adhered to “the
precautionary principle,”
meaning that if there was a
chance that an ingredient
wasn’t safe, it didn’t use it.
With its readily identifiable, bright, and colorful packaging
(originally created by industrial designer Karim Rashid),
Method built a big following in home décor and design blogs
and its bottles have prompted instant on-shelf recognition.
In a process the company calls “greensourcing,”
Method worked with suppliers and manufacturers
to track the environmental impact of making its
products. It also identified best practices to improve
the water, energy, and material efficiency of its
manufacturing processes.
WE DISCOVERED THE TEN TYPES OF INNOVATION IN 1998.
SINCE THEN WE HAVE LEARNED:
Innovation mostly fails. It doesn’t need to.
You shouldn’t let it.
FIVE TYPES OF INNOVATION
2
TEN TYPES OF
INNOVATION
5
Method created a community called “People Against Dirty”
that offered perks, deals, and early looks at new products for
customers. However, to broaden the brand’s appeal, they
opened the community beyond customers and invited anyone
interested in making the planet a cleaner place; a tactic
which advanced the company’s brand promise and extended
its reach to potential customers.
Innovation almost never fails due to a lack of creativity.
It’s almost always because of a lack of discipline.
The most certain way to fail is to focus only on products.
Successful innovators use many types of innovation.
Successful innovators analyze the patterns of innovation in their industry.
Then they make conscious, considered choices to innovate in different ways.
Innovations can be broken down and analyzed.
When you do so, you will learn why most fail and a few succeed.
Innovations can be built up systematically.
Doing so increases your odds of success exponentially.
ABOUT DOBLIN
Doblin, the innovation practice of Deloitte
Consulting LLP, brings together a wide
range of specific capabilities, tools, and
people to help our clients in their efforts
to solve their toughest challenges.
www.doblin.com
As used in this document, “Doblin” means the innovation practice of Monitor Deloitte within Deloitte Consulting
LLP, a subsidiary of Deloitte LLP. Please see www.deloitte.com/us/about for a detailed description of the legal
structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the
rules and regulations of public accounting.
This publication contains general information only, and none of the member firms of Deloitte Touche Tohmatsu
Limited or their related entities (collective, the “Deloitte Network”) is, by means of this publication, rendering
professional advice or services. Before making any decision or taking any action that may affect your business,
you should consult a qualified professional adviser. No entity in the Deloitte Network shall be responsible for
any loss whatsoever sustained by any person who relies on this publication.
C O PY RIGHT © 2 014 D ELOIT TE D E V ELO PMENT L LC | AL L RIGHT S RE SERV ED