1950s comic book has lessons for business

Posted by Nick, account manager

The current exhibition at London’s Science Museum, “Dan Dare and the birth of hi-tech Britain”, brings to life a golden era of UK manufacturing.

The exhibition uses the popular comic strip as a backdrop for the plethora of British manufacturing success stories that defined Britain’s bid to re-invent itself as a high tech nation after the Second World War.

But tellingly the exhibition also highlights the factors which created so much pressure for companies in the UK and around the world. The sentence “In an age before globalisation, products from rockets to radios sprang from local roots” is heavy with nostalgia for a bygone age, but it also contains the reason why that era is indeed ‘bygone’.

As one of the first nations to industrialise, Britain’s ability to invent, design and innovate became inextricably linked to manufacture. The assumption was that the two went hand in hand. But as Britain moved in to the second half of the 20th century, flush with the success of its wartime ingenuity (radar, penicillin, the jet engine), it failed to spot the impact of advances in transport and communication that would deliver ‘globalisation’. The intrinsic value of its innovations should have been recognised, and they should not have been regarded as just ideas that might keep the country’s aging and increasingly expensive factories turning.

The display therefore contains two lessons for companies both in Britain and elsewhere. A salutary one in that the need to understand the wider context of design and innovation is vital. An inspirational one in that many of the products featured could be recognised as having made major contributions to modern life. Murphy, Cona and Russell Hobbs are just a few of the brands celebrated for creating a new home-life in post-war Britain.

The show leaves us with another double-edged message.

“...Britain retains an especially strong creative lead in conceptualisation, design and branding. Just as in the pages of Dan Dare, Britain remains the place where the future is imagined in to being.”

The challenge remains how to capitalise on conceptualisation and design as we can’t rely on using a manufacturing base to reap the dividends of great ideas. Imagination is always important, but it won’t pay the mortgage (or the budget deficit) by itself.

“Reverse innovation” : a cultural shift for business growth in the twenty-teens

Posted by Nick, account manager

We recently read an interesting article on the Harvard Business Review website on the shift in GE's culture from glocalisation towards adopting "reverse innovation" as a means of growth beyond its developed markets.

Glocalisation is the widely-used practice of developing one product for a company's key local market and distributing it globally with little change to accommodate local requirements. This means that local, especially developing, markets with different requirements are only skimmed. The impetus for change away from this practice is twofold: the global recession has encouraged multinationals to look to faster-growing developing ELDCs for sustained growth and recovery, and the rapid development of traditionally "third world" countries, often with large low-salaried populations, as competitors to market leaders on the world stage.

GE's solution was to adopt a mix of high-level R&D centres in more traditionally "advanced" nations, but to also create local R&D centres, and eventually local P&L-responsible teams, in India, China and other developing countries. The local teams have developed lower cost (selling prices that are, maybe, 15% of the company's higher-level products) items that meet the requirements of their locality. A prime example is the development of GE's portable ultrasound system. Working as an attachment to a laptop, the system met the demand for easy-to-use portable ultrasound devices that could be taken to patients who weren't able to travel to central clinics (which also couldn't fund large, expensive, fixed devices). The "reverse" part of this innovation was to then introduce the portable system back into the US and other core markets, but to segment the product offering and grow the market without cannibalising sales of higher-level products.

This is evidence enough that innovative companies operating in today's connected world have to think differently and react quickly in order to maintain a lead against both traditional competitors and newly-emerging competing fronts. As product development costs and time decrease, it is only through a combination of building brand and demonstrating real value that companies can truly see a "return on innovation".

The full article (subscription may be required) can be read at http://hbr.harvardbusiness.org/2009/10/how-ge-is-disrupting-itself/ar/1

Milan shows form and function can generate market interest.

Posted by Daisy, account exec

I’ve just returned from a trip to Milan where I visited Il salone di mobile - The International Furniture Fair. Having visited the last three editions, it was fascinating to see how different the atmosphere was at this year’s show. The credit crunch has definitely left its mark on this particular industry.

Whereas in previous years’ sheer luxury and opulence have been the overriding themes, the companies attracting the crowds and generating a buzz at last week’s event were those whose products were a genuine advance; designed to solve problems, deliver additional benefit and genuinely improve people’s lives.

Some companies had clearly invested time and money in developing technologies that enhanced their products’ performance. Some had taken the sustainability angle. Others had taken the rather radical approach of listening to customers and developing products that fulfilled their needs.

The vibe amongst the exhibitors was one of genuine excitement. People are looking to exploit the new market environment. It’s definitely not a case of simply struggling through the recession. As consumers’ priorities change, companies are looking to introduce more efficient, life improving products that will deliver value in any market rather just providing image and status when times are good.

But this excitement was also often tinged with a sense of frustration. I talked to several exhibitors who, having developed a breakthrough product (sometimes recognised by their peers in the industry with numerous awards) were still struggling to get a response from the market itself. There were many examples of firms failing to use communications effectively to close the gap between exciting design concept and profitable product. Those attending the exhibition might have enjoyed the luxury of a face to face explanation, but the consumers who make up the wider market would not have the same privilege.

The fair showcased many exciting innovations in lighting, materials, electronics and furniture. It would be a shame if the creativity and determination of these companies goes unrewarded because their advances remain unappreciated.

Welcome to Communicating Innovation

Posted by Andrew, partner

Welcome to the new FK3 website.

When we set up FK3, midway through 2005, we had a very clear vision for what our new agency should be. One that works in step with its clients and is clearly focused on their most important issues.

For us that meant developing a new way of working – faster, more cost effective; and orientating the agency around a key business imperative – innovation.

And so we established a very particular kind of agency, for which we decided we needed a very particular kind of website. But the fact that we’ve chosen until now to launch the definitive website for FK3 is due to more than just a healthy pre-occupation with our clients’ businesses rather than our own.

The very obvious truth is that the world is currently experiencing the hardest economic conditions for more than seven decades, and quite frankly we’ve been inspired to get our story across because the value of FK3’s offering has become more relevant than ever.

Budgets need to be stretched beyond breaking point and so clients need an agency that keeps its overheads low, its communications smooth and clear; and to be flexible – ready to adapt its messages to the most appropriate and cost effective channels available.

Market openings will be fleeting as desperate competitors scramble to slam those ‘windows of opportunity’ shut. Clients need their agencies to be especially fleet of foot and those that persist in peddling the time honoured tradition of trafficking briefs through their departmentalised production lines are unlikely to be of much help.

But above all, companies need to be seen to be delivering value. Consumers and business customers alike are being more careful than ever with their hard earned funds. And when all the potential suppliers have cut their prices to the bone, buyers become more discerning than ever as to who they should spend their money with.

People who are actually prepared to spend - expect more: more benefit, more value. Therefore companies have to innovate – develop ideas that convert into competitive advantage. And when companies do have genuinely differentiating features and benefits to offer, they have to be sure that potential customers understand clearly just what’s in it for them.

That’s FK3’s role. To ensure that companies maximise their ROI (Return On Innovation) and that prospects fully appreciate (and buy) the extra value built in to their products and services.

Currently there are some very mixed messages flying around. There are some reports of a slowing rate of decline, even a few areas of small improvement. There’s much debate as to whether we’ll be measuring this ‘downturn’ in terms of months or years. But it seems that there are always more pessimists than optimists.

However accurate the forecasts prove to be, most people buy into the belief that those organisations that equip themselves well for recession – and survive, are much more likely to thrive when conditions improve.

Let’s determine to turn this threat into an opportunity and emerge that much stronger when the sun starts to shine again.