A range of orthodoxies is making it harder to develop breakthrough products in the consumer goods industry. It urgently needs a reformation.
- For years, consumer goods companies have excelled at product innovation.
- Recently, however, their tried-and-true processes for choosing ideas, selecting business models, and making investment decisions have become orthodoxies that hinder the adoption of novel, tailored, and flexible ideas.
- Four orthodoxies are particularly ingrained in the consumer goods industry: innovation starts with existing business models and categories, focus groups are at the heart of efforts to generate insights, it's best to rely first on internal resources, and companies should "let a thousand flowers bloom."
- Companies must free themselves from these orthodoxies—a tricky task for large, complex, and global organizations, but one that will pay off in spades.
- Exhibit 1: New-product launches have proliferated in recent years but without substantial innovation.
- Exhibit 2: Breakthrough innovation generates the largest returns.
- Exhibit 3: In the consumer-packaged-goods industry, innovation is overwhelmingly generated outside of the top companies.
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