Dale Stohr Innovation #1 HAUL 2009

Innovation Seminar #1 – HAUL Dale Stohr

A) What are innovation and creativity?

Innovation is a term for the implementation of a new or significantly improved product, process or method. There are different types of innovation including:

- Product innovation (eg. Apple’s iTunes)

- Process innovation (eg. PayPal payment system)

- Organisational innovation (eg. Paid parental leave)

- Marketing innovation (eg. Facebook social networking) (1)

Innovation leads to better products and services as well as new ways of living and working.

Creativity is the mental process of generating new ideas or concepts of originality. (2) Creativity is also the act of making something new, doing something that has never been done before or a process-of-elimination of many ideas to find the one right idea.

Creativity is the new idea while innovation is the application of that idea in business, design, science, education, marketing and other industries.

B) What conditions need to exist for innovation to occur?

Innovation can be brought about through a variety of conditions/situations such as:

- Needing to increase profits (3) (eg. Cadbury chocolate reducing milk content)

- Responding to customer needs (eg. New Toyota Hybrid car)

- Increasing market share (eg. ANZ to increase Business Banking share)

- Cost impacts (eg. Commodity price rises)

- Market changes (eg. Real Insurance ‘Pay As You Drive’ product)

- New technology (eg. Boeing 787 Dreamliner design technology)

- Government policy changes (eg. LPG car gas rebates)

- Globalisation (eg. China Construction Bank in Australia)

- Brand/organisation re-launch (eg. Country Road loyalty program)

‘Necessity is the mother of invention’ is an old adage that still applies today. So as a need arises, or is forced, then innovation is required to help deal with the situation. Lack of innovation can lead to business failure while some old products/services can continue to grow without innovation (eg. a simple hammer).

C) How is HAUL innovative?

HAUL is an innovative company for manufacturing consumer goods from recycled waste products and creating pieces of contemporary art. The product range at HAUL includes bags, wallets, laptop sleeves, backpacks and more that make HAUL customers feel special and exclusive. By using one-off vinyl advertising billboards to make limited runs of products, HAUL manufacturers goods that can not be replaced – each messenger bag is individual and rare. Other businesses have recycled waste to produce cardboard boxes, road materials, plastic pots, insulation and even cat litter. (4) But not many recycled products have become as street-credible as HAUL products. The reduction in landfill waste and ‘green’ credentials are a positive by-product of HAUL’s innovation. HAUL also use this method to innovate in other markets such as ‘Riveting’ for corporate clients and grow the business the further.

D) What did you learn from Scott Kilmartin’s approach to business that you can apply in your workplace? Why?

Scott’s ability to continue looking for ways to grow his business (recycling waste vinyl billboard and number plates) or meet the needs of his customers (urban designers, Mac fans, etc) is a real attribute that can be used in other businesses. Scott said he kept thinking about the business and the way it worked so that he could make it a better operation. The use of social media to communicate to his customers and receive feedback is another aspect of Scott’s approach that can be implemented elsewhere with some proper research – not all Facebook or Twitter users are the same. HAUL has a credibility that is seen in its product as well as its people that is not always easy to emulate. CentreCom (a Melbourne-based retail I.T. chain of stores) could certainly benefit from learning about HAUL and Scott’s experience in building the business and the tenacity required to grow a successful brand.

E) What will you do differently in your workplace, if anything? Give an example or explain why implementation cannot occur.

The successful marketing of HAUL through social media (like Twitter and Facebook) and the on-line retail presence of HAUL.com.au has the potential to be successful for other retailers in Australia. Communicating to potential customers in Australia and around the world can lead to great sales opportunities if implemented successfully – the goal is to easily give customers what they want. However, not all Australian retailers have the vision that Scott has to grow their business on-line like HAUL. Working with CentreCom, who have a bricks-and-mortar retail chain around Melbourne as well as an on-line store centrecom.com.au, I believe that further commitment would be required before social media would be seen as necessary for CentreCom. CentreCom’s directors and shareholders have a strong connection to the simple retailing concept of buying cheap and selling for a profit – the customer can take it or leave it. The small margins in the competitive consumer I.T. category mean staffing, time and investment is limited within CentreCom but the unseen opportunities to grow the brand and attract new loyal customers should not be ignored. Maybe, like a lot of companies, Australian retailers are waiting for somebody to do it right first before investing in social media. By then, CentreCom may be up against a competitor that has already taken its customers.

References:

(1) ‘Innovation in Australian Business’ 29/5/2009 www.inovation.gov.au

(2) ‘Creativity’ http://en.wikipedia.org/wiki/Creativity

(3) ‘Innovation in Australian Business’ 29/5/2009 www.innovation.gov.au

(4) ‘Environmental purchasing checklist’ 17/4/2007 www.environment.gov.au