Drug development is incremental innovation
Let’s not beat around the bush. The billions that pharmaceutical companies invest in developing a single drug is crucial for the health of the business, but it is incremental. Such investments leverage a company’s existing technical capabilities and business model to create products and services that contribute to its bottom line.
And to be clear: incremental innovation can be as complicated and expensive as architectural, radical or disruptive innovation.
Away with innovation mantras
Let’s forget about the mantra “It’s expensive and new, therefore it must be innovation”. Contrary to general belief, program costs aren’t directly related to how it’s innovativeness. Investing more money or development time doesn’t make something more innovative. So if you’re a healthcare and life science leader, it may be time to redefine what innovation really means to your business.
And therein lies a fundamental truth: innovation is a multi-faceted concept. It is vital that all different innovation types be discussed within your leadership team to determine the right future innovation strategy for your company. We’re here to help.
The Innovation Landscape
Our Innovation Landscape tool, which we adapted from Gary P. Pisano, enables you to identify which innovation initiatives are closest to your core business. It facilitates discussions on portfolio futureproofing, opportunity (and disruptor) spotting, and investment in technical capabilities.
The matrix is guided by two key criteria of innovative solutions:
- Business model:
The need to develop a new way of exchanging value between you, your customers, and other critical stakeholders. A revenue model is only one component of a business model.
The need to develop, invest in, acquire, or partner to build new technical capabilities that will allow for the creation of a transformational product or service.
Are you up for it? Map your innovation initiatives, discuss and reflect.
Here are some questions to get you going:
- How diverse and future-oriented is your innovation portfolio? What is intentionally incremental and what are the consequences of risk averseness?
- How have industry innovations – both in terms of business models and technical capabilities – created new competition or opportunities for your business?
- How do you set up your team for success when developing products which require new business models or technical capabilities?
Innovation Strategy Program
Use the healthcare and life science examples already plotted on the landscape to your advantage, as reference points for your organization’s understanding of innovation. And run an innovation stratetgy sprint to identify and demonstrate the value of innovation activities for your business – while eliminating those that hardly contribute, or not at all.