The Process Innovation Checkup is a tool and part of the Ten-Types-Of-Innovation macro method (also described here). The fourth of the Ten Types Of Innovation describes process innovations, involving all activities that affect a company’s products.
Innovations in this area often require a dramatic shift away from business as usual. The company is empowered in the Process to function effectively, adapt quickly, and generate market-leading profit margins. Process innovation is one of the core competencies of modern business management. They include such important assets as patents and proprietary processes that guarantee a competitive advantage for years to come.
A well-known example of process innovation is lean production, where, for example, waste of material and working time is reduced. Process standardization, which reduces costs and complexity, and predictive analytics are also part of this. The latter analyzes procedures from the past and tries to predict future results to help the company offer a product in design and price in line with the market.
It is only a process innovation if a method differs substantially from or exceeds the established norm. Since lean production has already become the industry norm, your process innovation can only be counted as such if the method is distinctive or offers unmatched savings or efficiencies.
Successful process innovations in practice:
– ZARA: The retail chain accelerated the journey of a garment from the drawing board to sale to the end consumer. In just three weeks, a new design can be hanging in stores from Barcelona to Beirut. For this purpose, the store locations are placed in high-end locations to have direct contact with a fashion-savvy audience.
– Toyota: The car manufacturer is probably the outstanding example of lean production. Reduction of waste and further efficiency provide Toyota with stable market shares.
– Hindustan Unilever: Products that competitors traditionally offer in bulk packs, Unilever packaged in the smallest single-use sizes to the Indian population in regions where food can hardly be stored privately in a manner suitable for the product.
– IKEA: The Swedish furniture giant produces flat-packed furniture in a uniform design without any variation per country of sale. Likewise, the production and equipping with manufacturing machines are standardized in all countries, so that all internal processes are optimized.
