On a roll: innovation is driving the bottom line in the world of toilet tissue

The title of this blog is inspired from an article written by Alasdair Fotheringham in the Independent recently, concerning Tissue World, the global gathering of the elite in one of the few recession-proof industries.

Tissue World is the most important annual congress for the soft hygienic tissue paper business. In Tissue World, lavatory paper is mournfully described as a commodity product distinctly lacking in glamour.

But why be so bashful, when tissue paper provides a few gleams of light in Europe’s singularly gloomy economic tunnel? Take Spain, where tissue paper is one of a handful of industries beating the current recession, with sales up 2% in 2012. Or Portugal, where Renova has just come up with what they claim to be the sexiest toilet paper on Earth (to me it just looks black). All this in an industry with 4% annual global growth and an $80bn turnover.

People’s preferences for their nether regions’ cleansing accoutrements chime with clichés about national character. Germans, industry insiders say, like their lavatory paper strong and uncompromising; Italians have a weak spot for pretty paper designs and a softer texture, with plenty of niche products (in more senses than one) such as handbag-sized packets. Italy is also home to the archaeologist Silvio Fioravanti, who has the world’s largest pocket hanky collection – 11,972. But that’s another story.

We Brits, true to our reputation for being sensible, are far less fussy about style, size or texture – we just want to be 100% sure we are getting value for money each time we heave a 16-roll package into our supermarket trolleys. And as anybody fumbling hopefully in search of tissue in a public conveniences knows, thanks to government cuts, lavatory paper is becoming increasingly thin on the ground.

But the recession has had some positive knock-on effects for the industry. Even in a mature market that captures the interest of few consumers beyond that as a necessity, innovation is possible, as noted above – and check this out – Kimberly-Clark’s line of mini, wet-paper packs that was introduced last year has now cornered 5% of the Spanish market, thanks to the packets’ portable nature, not to mention the unforgettable name of Culitos Besables – Kissable Bottoms.

So, if the toilet tissue business can renew itself and put product innovation on its agenda, what can you do? How can you become an innovator in your industry? Is there a model of innovation to follow from successful innovators? How do organisations like Google, Facebook and Apple build innovation as a core competence?

Apple’s model is more visible in terms of its consistency and impact, but whilst we may regard them as disruptive innovators, they are in fact more subtle, and if they hope to continue to succeed they will keep it that way.

Apple has never been a ground breaker, rather have taken the ordinary, and made it into something extraordinary, gaining product leadership whilst at the same time making complex technology products simple in terms of their user interface and utility.

They haven’t invented anything crazy, but they have pushed the boundaries and improved on breakthroughs introduced by others. For example, the iPod was an extension of the MP3 player, the iPhone was an expansion of future expectations of the mobile phone, and the iPad improved on attempts at a tablet PC made by mainstream PC competitors.

This is what makes their innovation repeatable and scalable. Most admired innovators stumble upon a breakthrough once, maybe twice, and then their product development freezes after a couple of minor iterations on product features. Apple is different. They have started with the customer, and created devices and applications to meet potential demand by either improving, simplifying or stretching existing products in new ways that no one else could imagine.

Besides being more technology marketeers than technology pioneers, they take devices that we use every day and deftly turn them into devices that we can’t live without through subtle improvements over time in terms of user functionality, usability, reliability and in essence, more commercial.

This year Apple will spend $10 billion investing in its future. Underpinning their strategy is a clear set of innovation behaviours and guiding principles, which sets them apart as a business. John Webb, Marketing Director of Rackspace Hosting, published a blog on Innovation Excellence, which captured many of the innovation drivers, and I’ve summarised them below.

Have a thirst for knowledge Apple endlessly seeks knowledge and an understanding of product design, going to extreme lengths to gain insights and learnings that will facilitate a new innovation. Head of Design, Jonathan Ive visited Japan to meet a leading craftsman of samurai swords in order to garner understanding of the principles behind how they use metal. This knowledge consequently enabled him to design the world’s thinnest and most durable computers moulded from aluminium and titanium, rather than the traditional plastic.

Keep the focus Apple are disciplined in focusing on limiting the number of projects that they work on. This allows them the time, space and attention to re-visit products again and again, iterating and refining to reach higher degrees of innovation. To think that a multi-billion dollar company only has 30 major products is astounding.

Obsess about the details Jonathan Ive’s design mantra is a devotion to detail. He will obsess on solving a tiny issue, unwilling to compromise in his quest to create a more fundamental product. This is what sets Apple’s products apart, including the packaging. Perfection, and striving for it, is as much in their culture as innovation.

Look to be wrong Apple is about being adventurous and curious, making a big deal of inquisitiveness and an interest in being wrong as Ive puts it. One of the hallmarks of Apple is this sense of looking to be wrong. It’s the inquisitiveness, the sense of exploration. It’s about being excited to be wrong, because then you’ve discovered something new. Apple works by a process of evolution, iteration and retrospectives, it’s an attitude to try out and explore new ideas without the fear of failure, a powerful combination of curiousness and optimism.

Be Better, not different The prevailing wisdom is that you have to differentiate to create and sustain competitive advantage. But in today’s markets, being different is no longer enough – it’s about being better. Better by nature dictates that the consumer is central to the development process. For something to be better, the consumer has to see, feel and believe that it is in fact better.

Successful growth companies have a deep understanding of their customers’ problems. Many are embracing tools such as the customer empathy map to uncover new opportunities to create value. This customer insight is the foundation for their lean approach to product innovation: rapid prototyping, design partnerships with lead users, advocates generate the viral buss, and the company then pivots to improve their product and business model.

As an aside, I’m constantly amazed at how few companies invest the time to get out of the office and interact with customers outside of sales situations. During the turnaround of IBM, Lou Gerstner launched Operation Bear Hug to get the company back in touch with its customers – IBM’s top 50 executives had to visit five customers per week and deliver a write-up to Gerstner. In the digital age, Apple’s equivalent is the frequent product launches, trailed by the social media frenzy ahead of the release, which highlights features and benefits of new products.

10 to 3 to 1 Apple designers expect to design 10 different mock-ups of any new feature under consideration, and these are not just basic mock-ups, they all represent different, but really good implementations that are faithful to the product specifications.

Apple’s innovation is subtle and focused as previously stated – Iterate and reduce – simplicity is an intense focus on usability and application for the consumer, making the device easier for people to use. This is the essence of Apple’s innovation methodology, creating repeated models and prototypes of the same product to see if they can improve each element again and again, re-working tiny details and solving tiny problems until they achieve the overall end solution.

Then, by using specified criteria, they narrow these 10 ideas down to three options, which they further develop until they finally narrow down to the one final concept that truly represents their best work for production.

This approach is intended to offer enormous latitude for creativity that breaks past restrictions, but it also means they inherently plan to throw away 90% of the work they do. I don’t know many organizations for which this would be an acceptable ratio. Your accountant would probably declare All I see is money going down the drain.

Leadership: You need a leader who prioritises new product innovation. The CEO needs to be someone who looks out to the horizon and consistently sets a vision of innovation for the organisation that he or she is willing to support completely with people, funds, and time. Further, that leader needs to be fluent in the language of your customer and the markets in which you compete, with a storyline for your products and services. That storyline needs to state decisively what is in bounds and what is out-of-bounds over an 18-month to 3-year period.

This storyline or strategic vision needs to be revised according to market changes and the evolution of your new product pipeline, but fundamentally search for uncontested market space and make competition irrelevant using Blue Ocean Strategy and the Business Model Canvas principles.

Steve Jobs set the benchmark for this when he launched his successful Think Different campaign, commissioning The Crazy Ones, a video that featured Einstein, Edison, Gandhi, Muhammad Ali, Hitchcock, Richard Branson, and other ‘trouble-makers’ who changed the world. Every employee understood Job’s views on risk-taking and innovation, and set it as part of the brand to attract a certain type of customer.

So, next time you contemplate your product innovation strategy, reflect on the extremes of tissue paper to Apple, and that your business probably rests somewhere between these two extremes in terms of product attractiveness.

Nothing is stronger than habit, and as Einstein said, If you always do what you always did, you will always get what you always got, we cannot solve a problem by using the same kind of thinking we used when we created them. So don’t just sit there contemplating, get up and do it!

Ultimately for a business, innovation is the ability to convert ideas into invoices, and thus it’s not how many ideas you have, it’s how many you make happen.

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