CHAPTER TEN MANAGING THE FRONT END OF INNOVATION (FEI): GOING BEYOND PROCESS
Jelena Spanjol1 and Lisa Welzenbach
10.1 What Is the Front End of Innovation (FEI) and Why Is It Important?
In the 2019 PwC annual global CEO survey, 62% of CEOs reported pursuing new product development as a key instrument to drive revenue growth (PwC 2019). Yet, 55% of those same CEOs indicated they were extremely concerned with their ability to innovate effectively – a clear disconnect between what is needed and what is possible. Indeed, business leaders have been consistently reporting innovation both as a strategic priority and a critical challenge in their organizations.
One central challenge to innovating effectively is populating the innovation portfolio with the right mix of breakthrough and incremental innovation. A study of over 22,000 new product introductions over almost 20 years in the consumer packaged goods sector (Sorescu and Spanjol 2008) demonstrates that breakthrough innovation (i.e., products with new to the world consumer benefits) delivers organizational growth, while incremental innovation (i.e., products that include variations of existing benefits) merely ensures a company’s survival. What firms ultimately introduce into the market is determined early in the innovation process (i.e., during the front end of innovation), not at the launch stage. As a result, comprehensively and ...
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