Why Commercial Innovation in a Corporation?
Business is going well. Profits are growing. The stock price is increasing. Why innovate now? There are many books written about this. Here is my experience with the value of innovation and different “corporate innovation engines”.
Innovative Pharma companies’ growth is fueled by R&D. As patents in practice only last for about a decade, the researchers must invent and develop major new medicines frequently. Or the company dissapears.
There is a very appealing case for commercial innovation in addition to the R&D invention. Let’s start with the core business: “the pill”. One example: even the best medicines are not being used by everyone who needs them.
- Informing millions of doctors around the globe through medical representatives only is no longer realistic: innovative engagement with doctors is needed (AI? VR?)
- In many countries, patients cannot access medicines as they may not be available. If pharmacists don’t exist or don’t stock some medicines, innovative ways need to be found to get medicines to patients (Drones? 3D printing?).
- If patients cannot afford the new medicines, innovative solutions must be found (Micro financing? Pay for performance?)
Another area of innovation opportunity is “around the pill”. One example: medicines are only one part of the treatment solution. The large majority of patients do not take their medicines appropriately.
- If patients forget to take their medicine as prescribed, innovative reminders may be needed (Alexa? Prompting pillboxes?)
- If patients don’t understand why they should take their medicine, innovative education tools can help (QR code scanning? Gamification?)
- If patients stop to take their medication because of side effects, innovative engagement models with health care providers can help (Apps? Telemedicine?)
- If patients have to make life style changes in addition to taking medicine, innovative support may be needed (Websites? AR?)
Going a step further, “beyond the pill”. An example is creating new, tangential businesses, employing core capabilities.
- The business of a Pharma company can be positively influenced by companies in other industries who may be developing innovative solutions, such as ways to lower overall healthcare costs or increase healthcare efficiencies. These companies can benefit from the Pharma employees’ expertise (regulatory, customer understanding) through partnerships.
- Start ups may be developing potentially disruptive healthcare solutions, like diagnostic tests. They can exchange (extract and create) value with Pharma (resources, medical expertise). If they become successful, they may even become part of the Pharma company.
A few learnings. Connecting these engines for innovation across the company generates cross fertilizing value, even if organized informally. Engaging flexible platform builders early can maximize impact and efficiencies in scaling of innovations across all engines.
As William Pollard said:
”Learning and innovation go hand in hand. The arrogance of success is to think that what you did yesterday will be sufficient for tomorrow.”
So, as Innovation Leader, I made sure to focus on my direct area of responsibility (the pill, around the pill) and to stay closely connected to the beyond the pill teams. My goal was always to give and take and learn.
More reading: Innovate or die: The stark message for big business
Any other experiences or thoughts? Please discuss below!