Innovation Can Be Scaled

In today's challenging economic climate, creating a process to scale up innovation offers each sales organization the opportunity to be a critical driver of competitive advantage, particularly in B2B markets. The trick is to find the innovations, select the ones that will make the greatest growth contribution, and rapidly scale those ideas across the organization.

Innovations can be either revolutionary (the iPod) or evolutionary (streamlined ordering processes); companies need both to remain competitive. The technology sector often focuses on revolutionary big bets, which are relatively rare, expensive to create, and extremely risky. Home-cooked evolutionary innovation -- capturing existing practices -- often has a greater chance of success and, if scaled, enormous payoffs.

These evolutionary innovations are likely sitting right under an organization's nose. Most companies have a multitude of good ideas embedded in existing practices that just need to be identified, tested, and scaled across the organization. These ideas have a tendency to sit idle within companies that look at innovation as a separate activity for a separate group of creative or strategic people, producing changes that are neither expected nor sought by the front-line sales force. This must change. Companies should employ a methodology to create a regular, executive-led process that can identify latent ideas that work; bring people from the front line to test, refine, and evangelize the ideas; and deploy those ideas.

The endgame is to make this innovation process a part of the company's DNA and to continuously be mainstreaming the ideas by involving the field early in the process and during the scaling phase. We refer to this process as the Scaling Sales Innovation (SSI) methodology. The approach consists of four distinct phases:

• Scan: Analyze distributions of performance across multiple dimensions (product, sales-rep achievement, geography, etc.) to identify significant variability. These analyses reveal pockets of opportunities to spotlight good ideas that are already in limited play. By doing this analysis with a statistical bent--and by looking at internal (not external) benchmarks -- companies can see where they are already doing disproportionately well and build on that.
  
• Shape: Create teams led by "Young Turks" from the field, with strong executive sponsorship. Use the most talented, energetic, and hungry people to quickly generate plans and get front-line support for the ideas. These plans must quantify the upside and define very specific initiatives to test the ideas for broad applicability.
  
• Test: Execute a set of pilots (led by the same "Young Turks") to prove and refine the ideas. Create and track short-term metrics to measure success and showcase results.
  
• Scale: Use initial success, secondary adopters, and institutional buy-in to build to the next order of magnitude. Ensure discipline regarding metrics and institutional infrastructure to support continuous scaling.

One advantage of this methodology is that you can actually achieve scale much faster. For one high-tech company, where projections for sales to the health-care industry called for roughly a 20 percent rise in bookings, within a year this approach led to more than 40 percent annual bookings growth.

Another benefit is that this approach can be replicated and staged through multiple innovation waves. A company can easily have one or more ideas in each phase at any given time, resulting in a constant stream of innovations to drive growth. The SSI methodology is also a terrific catalyst for changing the mindset of a field organization to one in which each front-line sales team proactively seeks revenue- and productivity-innovation opportunities. With this approach it is possible, even in difficult times, to grow revenues faster than the overall market and to beat market expectations.

In McKinsey & Co.'s High-Tech Sales and Marketing Practice, Lareina Yee (lareina_yee@mckinsey.com) is an associate principal and Tom Stephenson (tom_stephenson@mckinsey.com) is a principal. Scott Beardsley is a director and co-leader of the firm's Global Strategy Practice.

Related Articles

Data: A Flashlight to Sales Innovation

Analyzing performance companywide can uncover ideas that work.