Treat Your Innovation Pipeline Just Like Your Sales Pipeline

Treat Your Innovation Pipeline Just Like Your Sales Pipeline

Paul Sloane 01/01/2024
Treat Your Innovation Pipeline Just Like Your Sales Pipeline

Managing the sales pipeline is a well-developed executive skill in any company selling large ticket items to business customers.

Each salesperson has to gather data and input their reports and forecasts. Some of the key actions in managing the pipeline include:

  • Qualification questions have to be answered. Does the customer need our product? Do they have a budget? Are we in contact with the decision maker? Who is the competition?  Etc.

  • What is the dollar value of each item in the pipeline? What is the likelihood of closing the deal? What is the timescale? Estimates for each of these questions enable a total sales forecast to be assembled and reviewed.

  • What are the barriers to each sale?  What are the key actions planned?  What additional resources are needed to win the deal?

  • We look back at the history of the pipeline.  What are the conversion rates from prospects to sales? Why did we lose the deals we lost?  What is the sales velocity i.e. how long does it take to convert prospects into sales?  What could we have done better?

  • Every member of the executive team is involved and aware of the key issues. They contribute ideas and resources to help close sales.

The pipeline is regularly reviewed at executive level. It is an essential tool in running the business. Lessons are learned, and changes are made to constantly improve the sales process.

The pipeline of innovation projects for new and improved products and services is also strategically vital for the business but typically it is not treated with the same attention or importance.   Let’s use a similar approach to the one above.

  • Qualify. Is there a customer need for each innovation? Will they pay for it? Are we in touch with customers who can evaluate the prototype and give us feedback?  What will this innovation compete with? Will customers like it? Can we crack the technology?

  • For each item in the pipeline we need an estimate of its cost to develop and projected payback. This is reasonably straightforward for incremental innovations but particularly hard for radical innovations. Nonetheless estimates are essential.  We can then evaluate the total projected impact of our innovation pipeline.

  • What are the barriers for each project? What are the key actions planned?  What additional resources are needed to bring this initiative to completion? What technology challenges do we face? Do we need external help?

  • Again, we look back at the history of the pipeline.  What are the conversion rates from promising ideas to implemented innovations? Why did so many projects not make it to market?  What is the innovation velocity i.e. how long does it take to convert an approved initial idea into a new product or service? What is the failure rate at each stage in the gating process?  What could we have done better?

  • Every member of the executive team should be involved and aware of the key issues. But often they are not – they leave it to the Chief Innovation Officer or equivalent responsible person.

The innovation pipeline should be regularly reviewed at executive level but how often does this happen?  Because the revenue impacts are hard to assess and the technical barriers are tricky the innovation pipeline review tends to slip down the priority list.  We need to appraise it with the same rigour that we apply to the sales pipeline.  We can then use the insights gained to constantly improve and speed up our development programmes.

Share this article

Leave your comments

Post comment as a guest

0
terms and condition.
  • No comments found

Share this article

Paul Sloane

Innovation Expert

Paul is a professional keynote conference speaker and expert facilitator on innovation and lateral thinking. He helps companies improve idea generation and creative leadership. His workshops transform innovation leadership skills and generate great ideas for business issues. His recent clients include Airbus, Microsoft, Unilever, Nike, Novartis and Swarovski. He has published 30 books on lateral thinking puzzles, innovation, leadership and problem solving (with over 2 million copies sold). He also acts as link presenter at conferences and facilitator at high level meetings such as a corporate advisory board. He has acted as host or MC at Awards Dinners. Previously, he was CEO of Monactive, VP International of MathSoft and UK MD of Ashton-Tate. He recently launched a series of podcast interviews entitled Insights from Successful People.

   
Save
Cookies user prefences
We use cookies to ensure you to get the best experience on our website. If you decline the use of cookies, this website may not function as expected.
Accept all
Decline all
Read more
Analytics
Tools used to analyze the data to measure the effectiveness of a website and to understand how it works.
Google Analytics
Accept
Decline