Friday, March 2, 2007

clinical innovations, Drucker, Readings on Innovation from The Daily Drucker (HarperBusiness, 2004)

Prologue: From time to time, I will reprint a daily entry from Peter Drucker’s book, The Daily Drucker. These entries may serve as an agenda item for physician entrepreneurs who seek to create a new company or introduce a new service. In his March 2 entry, Drucker makes this salient point about a successful innovation,, “Do customers want it and will they pay for it?” In tomorrow’s blog, I will give an example such an innovation.

Test of Innovation

2 March

Measure innovations by what they contribute to market and customer.

The test of an innovation is whether it creates value. Innovation means the creation of new value and new satisfaction for the customer. Yet, again and again, managements decide to innovate for no other reason than they were bored with doing the same thing or making the same product day in and day out. The test of an innovation, as well as the test of “quality” is not “Do we like it?” It is “Do customers want it and will they pay for it?”

Organizations measure innovations not by their scientific or technological importance but by what they contribute to market and customer. They consider social innovation to be as important as technological innovation. Installment selling may have had a greater impact on economics and markets than most of the great scientific advances in this century.

ACTION POINT: Identify innovations in your organization that are novelties versus those that are creating value. Did you launch the novelties because you were bored with doing the right thing? If so, make sure your next new product or service meets your customers’ needs.

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