Most leaders are constantly bombarded with new ideas for products, services and business models but we often have trouble capturing the most promising ideas. An article in the Harvard Business Review, The Innovative Power of Criticism, shows how to judge and prioritize these ideas.

In my experience, you get great ideas from your team, your leadership, your customers and even friends. The problem is not enough ideas, it’s how to identify the ones you want to execute on. What most companies do is end up gravitating to the familiar ideas, whether or not they actually are the best.

Roberto Verganti, the author of the article, suggests a process rooted in the art of criticism.

The Art of Criticism

First, Verganti explains there are two types of innovation, improvements and new directions. Improvements are novel approaches that improve existing definitions of value. They address problems that you and your competitors have already identified.

New directions arise from reinterpreting the problems worth tackling. They redefine what customers consider important. Given that customers themselves do not know what WILL be important, they cannot generate this type of innovation.

A great example is the iPad. Customers who were happy with phones and laptops had no idea they would prefer to use a tablet. Apple would not have pursued the iPad if it relied on currently popular methods of innovation. Generating lots of ideas works well for improvements but it does not help to spot new directions. Companies tend to pick customers and other outsiders who back current directions and reject ideas that are untraditional.

Verganti writes, “to find and exploit the opportunities made possible by big changes in technology or society, we need to explicitly question existing assumptions about what is good or valuable and what is not—and then, through reflection, come up with a new lens to examine innovation ideas. Such questioning and reflection characterize the art of criticism.” Verganti has built a four step process to come up with new readings of customer issues and come up with innovative solutions.

1. Step 1: Individual reflection. The first step is to have members of your team reflect on how your company can solve an underlying issue (i.e. the aging of your customer base). One key to managing this step successfully is creating a heterogenous group to reflect on the position. It should include people of different seniority within the organization, different backgrounds, different departments, different approaches (analytic versus qualitative) and different personalities. Instruct the team members to consider, individually, how your company can create brand new concepts of value.The key here is to have the team members try to come up with their own ideas not asking customers, reflect alone rather than as a team and provide enough time to think ideas through thoroughly.
2. Step 2: Sparring partners. The second step entails each person having a trusted peer critique their vision. The colleague acts like a sparring partner, delivering a safe environment where the person can share a wild or half-baked hypothesis without fear of it being scorned.Verganti suggests you help team members find a sparring partner by using a near speed-dating methodology. After step one, in which individuals reflect independently on possible directions, invite them to a meeting and ask them to briefly illustrate their ideas, which can be posted on a wall. Then have each person choose another’s idea that he or she would like to explore. If more than one person chooses the same direction, ask them to indicate a second and, if necessary, a third choice.
3. Step 3: Radical Circles The third step is to gather a group of 10-20 people to discuss the ideas, which Verganti calls a radical circle. The group’s goal is not to decide which ideas are correct or wrong but how or why they are different, what underlying insights may have been missed and whether there may be a value proposition more formidable than all the hypothesizes.
4. Step 4: Outsiders The fourth step is to take the directions identified by the Radical Circle and subject it to criticism from outsiders. The outsiders’ goal is to challenge the ideas from the radical circle, not to create new ideas. By challenging the ideas, they will help strengthen them. This is also an area where analytics can help, as your data analytics team (or an external one or both) can assemble data to both support and oppose the hypothesizes and determine which results are more compelling.

Coming up with the strongest innovation

Verganti’s methodology allows you to build the strongest solutions to your key business problems. These solutions, moreover, can be truly innovative rather than incrementally improving your offering. The key is to focus your internal resources and then have multiple layers of criticism direct you to the strongest options.

Key takeaways

• You probably have a virtually unlimited list of ideas to improve your business. The key to success, though, is not generating millions of ideas but finding the best ones to deal to prepare you for the future
• To identify the best innovation opportunities, create a process that allows you to look internally for ideas then critically evaluate them.
• You first identify a diverse group of employees and have them come up with potential solutions, you then pair them up to critique these solutions, then form a group that looks at the ideas and sees if there are even better underlying options and finally subject the ideas to external evaluation.