Innovation by Subtraction - Article Review
Article Review 26/07/11
“Innovation by Subtraction”
Innovation has always been a lifeline to the development of new products, services and better standards of living. According to Management expert Peter Drucker “if an established organization, which in this age necessitating Innovation, is not able to innovate, it faces decline and extinction.” Innovation is a development process and translation of an idea into an application, solving present or unknown problems and implementing changes and perception of how the problem or obstacle can be perceived or utilized.
Paul Sloane in his article “Innovation by Subtraction” talks of how there is a tendency to think that the best way to innovate is to add new features to our existing products and services, and that this is not always the best viable solution. If you add too much to an existing product a customer could become puzzled, fatigued and overloaded with features, not to mention associated costs. That sometimes the better solution lies in subtraction.
He uses Ryanairs business model as his main example, based on Southwest Airlines existing concept Michael O’Leary used innovative subtraction to eliminate all the frills from air travel which enabled Ryan Air to offer cheaper flights than its competitors.
O’Leary subtracted amongst other things the middlemen (travel agents), and ticketing saving on paper, postal costs staffing, and also got rid of the expense of complimentary airline meals, if you would like something there is the option to purchase.
Ryanair used its innovative ideas to subtract instead of adding to create a whole new business model which saved on cost and simplified how it operated. It enabled it to compete, up market and is some cases displace its competitors.
Innovation by subtraction as seen with Ryan Air can lead to a new business model and create an entirely new market. This new model could also be labelled as disruptive innovation. A concept coined by Clayton
“Innovation by Subtraction”
Innovation has always been a lifeline to the development of new products, services and better standards of living. According to Management expert Peter Drucker “if an established organization, which in this age necessitating Innovation, is not able to innovate, it faces decline and extinction.” Innovation is a development process and translation of an idea into an application, solving present or unknown problems and implementing changes and perception of how the problem or obstacle can be perceived or utilized.
Paul Sloane in his article “Innovation by Subtraction” talks of how there is a tendency to think that the best way to innovate is to add new features to our existing products and services, and that this is not always the best viable solution. If you add too much to an existing product a customer could become puzzled, fatigued and overloaded with features, not to mention associated costs. That sometimes the better solution lies in subtraction.
He uses Ryanairs business model as his main example, based on Southwest Airlines existing concept Michael O’Leary used innovative subtraction to eliminate all the frills from air travel which enabled Ryan Air to offer cheaper flights than its competitors.
O’Leary subtracted amongst other things the middlemen (travel agents), and ticketing saving on paper, postal costs staffing, and also got rid of the expense of complimentary airline meals, if you would like something there is the option to purchase.
Ryanair used its innovative ideas to subtract instead of adding to create a whole new business model which saved on cost and simplified how it operated. It enabled it to compete, up market and is some cases displace its competitors.
Innovation by subtraction as seen with Ryan Air can lead to a new business model and create an entirely new market. This new model could also be labelled as disruptive innovation. A concept coined by Clayton
References: http://www.irishtimes.com/newspaper/opinion/2011/0602/1224298259216.html http://innovationzen.com/blog/2006/10/04/disruptive-innovation/ http://www.healthguidance.org/entry/11388/1/What-Is-Disruptive-Innovation.html http://realinnovation.com http://www.referenceforbusiness.com/encylopedia/inc-int/innovation http://paggu.com http://www.innovationtools.com http://www.destination-innovation.com/ http://www.innovationtools.com/Articles/EnterpriseDetails.asp?a=346