An innovation is commonly thought of as a brand new, revolutionary concept – but it doesn’t have to be.
Recognising that the way someone else does something in one industry can be transferred to another is innovative in itself. In fact, organisations that are able to innovate by looking outside their immediate industry are a step ahead.
Why? They have a working ‘prototype’ or proof-of-concept that they can use as a starting point from which to innovate. To be clear; we are talking about innovation, not imitation. This is where some organisations fail in their attempts to learn from others.
The challenge is: How can I make cross-industry innovation work for me?
It requires an organisation that is not just open to the idea, but also capable of making the right connections, forming transferrable insights, and implementing real change. Learning from others requires an ability to understand the underlying principles of what is being done, why it is being done and the desired outcomes.
Three examples of cross-industry innovation
As a consulting firm that works across many industries, we see methods, practices and systems that work well in one industry that can be, or have been, successfully applied to others.
Here, we will share some examples and provide some other insights that may inspire you to look in a different way for your next innovation.
1. When setting KPIs isn’t enough
A large open-cut coal miner needed to ensure efficient removal of overburden (the dirt and rock on top of the coal) to ensure monthly production targets could be met. To achieve this, it had been determined that a key production KPI, ‘Saturation’ (available trucks versus the required loading rate) had to be at 85%.
Similarly, a Contact Centre setting a Grade-of-Service (GOS) KPI of 80/30. Translation: 80% of calls answered in 30 secs.
Both businesses consistently met their KPI targets, but continually failed to achieve their desired outcomes.
If you’re using a standalone metric to measure success, you risk masking or increasing other operational inefficiencies if the focus becomes “moving the metric”.
On closer inspection and a visit to the mine, we identified that trucks were regularly queuing to dump their loads, and diggers were regularly waiting for trucks to fill. Similarly, the Contact Centre was achieving its GOS target but had agents doing so at the expense of service and quality – ultimately undermining the purpose of the Centre.
Once these other deficiencies were identified, the mine was able to:
- Apply a balance of complementary Service, Quality and Efficiency metrics; and
- Develop the requisite tools and practices to manage these multiple levers to achieve the required customer, quality and efficiency outcomes.
The result? A focus on managing not just how many trucks were available, but when they were available, and the routing (dump and dig locations) that minimised the amount of non-productive time.
For the Contact Centre, their focus became on answering every call to the service, quality and consistency expectations that reflected the organisation’s commitment to their customers, not the speed of the call.
2. A gain for your customer is a gain for you
Our Banking and Financial Services industry has recently been criticised around the world, and in the Australian Banking Royal Commission, for the way it has treated its customers. This criticism was primarily due to putting profits and personal gain ahead of operating in the customer’s best interest.
Our recent work within the Community Housing sector highlights what is meant by putting your customer first.
In Community Housing, the customer is the resident – individuals or families that find themselves in challenging circumstances. If a Community Housing provider doesn’t have the residents’ best interests at heart, some of the neediest people in our communities will end up homeless. In these transactions the stakes are high!
While making a profit isn’t the objective of Community Housing, making the most of every dollar is. The Quality, Service and Efficiency objectives therefore are no less important in the Not-for-Profit sector, and you could easily argue the consequences of getting it wrong are much greater for their customers (residents).
Our work in Community Housing has concentrated on framing the day-to-day management of a community housing portfolio from the perspective of the resident.
Issues like rent arrears, maintenance, anti-social behaviour and mental health are front and centre, and need to be optimised with the objective of sustaining the tenancy. Therefore, a tenant behind in their rent, is not ‘in arrears’ but ‘at risk of losing their home’.
The approach is not ‘rent recovery’, but how to help them get back on track, improve their financial skills, or help them find and apply for eligible programs for financial assistance. The outcome of this approach was a 10% improvement in rental arrears within just 8 weeks and a 40% improvement in turnaround times for vacant properties. Both these outcomes help not only residents but also improves the financial position for the Housing provider, a true win/win scenario.
3. Making good practice a habit
A 1% increase in rate was worth approximately $6 million in annualised revenue to a Frontline Sales business, but their phone sales team were struggling with conversion rates.
Closer analysis revealed variable conversion performance across teams. Data showed that the dedicated ‘fish tank’ (new hires team) had a significant and consistently higher rate of performance compared to the more established teams.
A deeper dive showed the company had excellent sales materials and training, and the training and coaching technique in the fish-tank environment was very good at getting the new-hires up to the required competency level.
The challenge was how to maintain and improve on the skills and competencies learned in the fish tank, and extend it to the regular teams.
Now consider the safety measures in Heavy Industry.
It is commonplace in heavy industry and other high-risk environments to conduct daily safety shares, tool-box meetings, and Job Safety Analysis; routine daily and intra-daily short sharp interactions to reinforce the focus and importance of safety.
These interactions aren’t general ‘be safe’ messages. They are planned and very specific in the message they deliver. In addition, everyone is empowered to ‘call-out’ situations that present a risk of an incident. Safety becomes a habit.
To improve conversation rates, the Frontline Sales team needed to make good sales practices a habit. So, they adapted the safety techniques from heavy industry:
- Sales Tool Box talks;
- Real-time coaching and reviews; and
- Peer-to-peer coaching and assessments.
This helped to regularly reinforce the company’s sales training program, and empowered team members to provide positive and coaching feedback to their peers. The results saw more consistent and sustained and higher conversion rates across all teams, resulting in a 3.2% improvement in conversion rates and a >$18 million uplift in annualised revenue.
Copying to innovate
So, what is it about these three examples that can be applied to your organisation?
To innovate in your organisation doesn’t necessarily mean finding or creating a new technology or solution. It could simply mean applying a method or a practice from another industry with similar underlying principles as your own.
In each example these innovations weren’t an investment in a new tech solution or some other bright and shiny silver bullet. They were a combination of new methods, tools or ways of doing the work – a change in management practices and behaviours.
These organisations were prepared to look outside – and understand. They were able to ask others for help, either directly or via a trusted advisor, to facilitate the cross-pollination of ideas. From this external view, you can learn to:
- Be less insular;
- Be on the lookout for how others do things; and
- Seek out people with broad expertise.
Innovation requires an openness to take a different approach and to move away from the introspection of the past. By recognising that no matter the type of work – be it digging massive holes, selling products and services, or providing sustainable housing for those most vulnerable in our community – we can all learn from the way others meet their customers’ needs.