3 ways strong knowledge management can fuel innovation
Research from Deloitte suggests customer-centric companies are 60% more profitable than those not focused on the customer. So, it's no wonder most businesses are racing to reach this status.
But, a customer-centric company needs to do more than just offer a good experience. The best not only put their customers first, but they also work to truly understand their customer then design products and services to meet, and exceed, their needs.
Unsurprisingly knowledge is vital here because it enables businesses to anticipate and respond to their customers' evolving expectations and preferences.
Yet, research from Nielsen suggests 76% of FMCG product launches fail within a year. In other words, if a business launches four new products in a year, three of them would likely be taken off the market.
After assessing the products that achieved innovation success, Nielsen found that it wasn't just a matter of finding the right solution for brands, but also about testing products effectively, communicating their value correctly, and making the process a real team effort.
This is where a robust knowledge management strategy proves vital. A combination of cultural and technological changes can help improve innovation success rates, assisting companies to become more customer-centric in the process.
Table of Contents
Research has shown that when it comes to innovation, two brains are better than one. Effective collaboration is essential for generating successful innovative ideas, but one report found that a staggering 74% of CPG professionals feel that their company is ineffective in its collaboration efforts.
Yet, collaboration is arguably the most valuable asset of any organisation looking to get closer to their customers.
Internal processes must continuously evolve in line with changing customer needs, while a culture of innovation should be encouraged. In other words, everyone in the organisation must be inspired to share customer data, insights and information, no matter where they work in the organisation.
Reduce time inefficiencies
Too often, especially in large enterprises, finding and turning data into actionable insights sits with an overstretched consumer insights department. Their job is to provide colleagues – from marketers to product developers – with data they can use to build more informed campaigns and innovations.
Yet, thousands of employees relying on a small team to share company data is impractical and outdated. Plus, the lack of individual empowerment forces employees to put energy into low-value activities such as locating documents or answering unnecessary emails. This continuous quest for information can quickly spin a web of distraction, lowering productivity and thus negatively affecting business performance–simply because someone couldn't find the report they were looking for.
The companies that win here will be the ones ensuring teams are spending time analysing insights instead of acting like librarians trying to find them.
Abolish data graveyards
A data graveyard is precisely what it sounds like – a place where data and insights are buried. But, each comes at an incredible expense to the business which initially paid for it, as even the most game-changing customer data becomes worthless if no one can find or use it.
What's more, valuable customer research being lost in one or multiple data graveyards decreases the chances of incorporating all relevant insights into an organisation's product development cycle. Ultimately putting it at increased risk of innovation failure.
Small levels of friction can stall processes which lead to data graveyards. Removing the pain for employees in accessing data can be achieved through a combination of culture and technology.
The bottom line is
Making sure everyone in your organisation is empowered and able to find the right knowledge at the right time is key to developing successful innovations that consumers will love. As a result, organisations will become even more customer-centric in the process.