Editor’s Note: This article is excerpted from Executive Smarts, a collection of 25 concise chapters on management and leadership. For a limited time the e-version is free. The book’s co-authors, William Casey and Wendi Peck, teach and consult on the topics of organizational behavior management, organizational structure design, strategic communication, and strategic planning & execution. This material is copyrighted and reprinted on Flevy with permission.
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“Innovation sandbox” is a term coined by the late C.K. Prahalad. The gist: For a truly quantum innovation in either goods or services, (1) set a really high bar for what “good” looks like, (2) identify a small handful of aggressive constraints, and then, within that “sandbox” (3) begin a radical re-examination of your assumptions and self-imposed limits as you develop your breakthrough design. That combination forces you to, as Apple says, “think different.”
Prahalad’s many examples focus on impoverished markets, at the “base of the pyramid”(BOP), where the average person earns a couple of bucks a day. He describes innovations in cars, hotels, communications, and other areas that achieve world-class quality, yet remain affordable to society’s poorest – and they turn a great profit for the entrepreneurs providing them. Now, that’s sustainability! Seth Godin described BOP powerfully, as only he can.
One example Prahalad describes is absolutely world-class cardiac surgery costing $1500 (including profit) that is the equivalent of $45,000 surgery in the US. Oh, and he describes a companion product: innovative health insurance, also profitable, that enables entire villages in India to have access to the surgery, and other medical services, when needed. A high bar, aggressive constraints, and radical re-examination all spur dramatic innovation, again and again.
But Prahalad’s innovation sandbox isn’t just for wealthy entrepreneurs and multi-nationals serving vast third world markets. Actually, anyone can play in the sandbox. We were reminded of this recently in a conversation with our friend, Pamela Giusto-Sorrells, president Pamela’s Products, a producer of popular gluten-free foods.
Pam loves developing products, and she loves a good challenge. One new product she’s feeling good about is her single-serve, gluten-free brownie mix for kids, soon to be released on their Amazon store and retail outlets. Watch for the sandbox in this plucky lady’s own words:
“A lot of other bakers think that gluten-free products have to taste like sawdust, and I literally grew up in a health food industry that believed that. But it’s just plain wrong. I’ve spent a lot of time developing gluten-free recipes that taste really great. So here was my latest challenge: you raise your children on a gluten-free diet, and then you send them off to college and their buddies are doing something else, eating pizza, pretzels, cookies, and whatever else other teenagers eat. Unfortunately, a lot of their snacks will make the gluten-intolerant kid sick.
So my goal was to make something gluten-free that the wheat-eating college kid wants to eat. It’s got to be that good. So, first I asked myself, what does everybody like? Chocolate. What’s a great all-American food? Brownies. People love brownies. They’re a perfect late-night snack. But I had to work within constraints. For cooking, college kids probably have only a microwave; but I figured that they can get water from the bathroom, and they can keep a bottle of oil in their dorm rooms. It’s all about making really great food with limited resources.
So, how do I do it with limited resources? Take our brownie mix, package 100 grams, and mix in two tablespoons of oil and two tablespoons of water. Everybody’s got a spoon. Everybody’s got a bowl or a mug to mix it in. And everybody’s got 60 seconds – one minute to instant gratification. Because it’s so fast and easy, kids show it to other kids and – eh voila! – the wheat-eaters are eating the gluten-free kid’s snacks. Touchdown!”
Other sandboxes: Do you know someone who’s set a high bar, imposed tough constraints, and then radically re-examined assumptions, so they could serve a market that everybody else ignored?