When you plan to make a new purchase, there are many things you will consider before making a decision and handing over your money. These considerations might include factors like quality, price, and/or popularity– but inevitably one of the most important things that you’ll think about is convenience and ease of use.
Convenience and usability depend largely on one core principle – how well will your new purchase integrate with your life and the products you already own and use.
If you’re looking to buy a new mobile phone for example, you’ll want to know how quickly and easily you can get it set up and in use without disrupting your routine. Will the new device connect easily to your computer for charging or syncing? Can you easily transfer all of the data and contact records stored in your old phone? Will your new device maintain information about the apps that you use to run your business, and your life, on a day-to-day basis?
If you could answer ‘yes’ to all of these questions, it’s likely that you would be buying your new phone from a company that has successfully implemented the concept of ‘product system innovation’. It’s a type of innovation that is based upon a simple idea: the creation of complementary products and services that are part of a single ecosystem.
There are two companies that will spring instantly to mind. Apple and Google (soon to be ‘Alphabet’). For me, it makes the most sense to consider their products and services as an ‘ecosystem’ where everything connects to fit together.
Think of what Apple have achieved with the iPod, the Mac, the iPhone, Apple TV, and now the Apple Watch – you can use all of these products together, linked by their iTunes service. The key here, however, is that attempting to introduce a non-apple device into the “eco system” is not easy and definitely not seamless. I experienced this first hand recently when I attempted to switch from the iPhone to Android – needless to say, I switched back to Apple once I realised I was not able to share my photos or my calendar with my family and was missing out on group messaging. Not only did I return to the iPhone, but I have recently included the Apple Watch into my own Apple ecosystem to further extend my integrated devices.
Apple is not the only company that has constructed an entire product ecosystem of its own. Technology businesses are great at creating brand exclusive ecosystems. Companies such as Microsoft, Google, Xero and Salesforce are just a few good examples. But product and service ecosystems should not be limited to tech companies – service companies, like financial advice businesses, can look to create ecosystems by extending their services too. Think about how you can add additional services or even products to your current core offering to formalise the ecosystem you have today in your practice.
How can you link together with other mutually complementary service providers, like accountants, lawyers, insurance providers, book keepers and mortgage brokers? How do you make it “convenient” and “easy” for a client to move from one service to another – so they stay within your ecosystem and you maintain the relationship? When done right, this type of innovation creates a lot of brand “stickiness”. Your clients will start to feel as though your company is a one stop shop for everything they need for their financial well-being.
For me, the concept of product system innovation or creating an ecosystem is the most exciting type of innovation and outside of the banks is not broadly available in financial services, but makes a lot of sense given the complex but complementary services that exist.
The first thing you should do before considering how you can implement product system innovation within your business is to prepare your innovation mindset and get your staff and colleagues involved in the process. Innovation of all types starts and ends with the culture of a business. Everyone has to be willing to try new ideas and to think in an innovative way – but once you have your entire team involved in the process you are sure to see your very own ecosystem begin to evolve and grow.
If you’re interested in learning more about innovation and how you can start making changes in your business, download my free eBook about how to innovate in a world of digital disruption.
