Costovation: Innovation That Gives Your Customers Exactly What They Want–And Nothing More
Stephen Wunker and Jennifer Luo Law
HarperCollins Leadership/An imprint of HarperCollins (August 2018)

How and why “innovation and cost-cutting can be a powerful duo, capable of shaping markets and creating long-term competitive advantages”

According to Stephen Wunker and Jennifer Luo Law, “costovation is a type of innovation that significantly compresses costs while still wowing customers. It’s about [begin italics] meeting [end italics or [begin italics] exceeding [end italics] customer expectations with [begin italics] less [end italics].”  I was convinced long ago that organizational efficiency — doing more with less, and doing it faster and better — is usually the single greatest contributor to profitability. For example, a focus on waste elimination has substantial bottom-line impact. How so? Reduce cycle time and increase first-pass yield. Improve on-time delivery performance. No capital investments are necessary. I also recommend generous bonuses to reward superior performance.

The costovation mindset has three defining characteristics: Breakthrough Perspective (“The more unique your perspective on the market, the more you can differentiate yourself”; Relentless focus (“What you concentrate on could vary [but] there is always a steadfast focus”); and Willingness to blur boundaries (Shake up your market by using “magnifying lenses” to reveal cost-reduction improvements of how your offering is made, delivered, and sold).

Wunker and Law carefully organize their material within four Parts. First, they explain what costovation is and why it matters; next, they examine the three aforementioned characteristics; then, they provide 20 strategies and tactics (“Costovation Strategy Playbook”); finally, they “put it all together” within context.

The title of one of Marshall Goldsmith’s recent books suggests that “what got you here won’t get you there.” My opinion is that what got you here won’t even let you remain here, however and wherever you define “here” and “there.”. The business world today really is more volatile, more uncertain, more complex, and more ambiguous than at any prior time that I can recall. Hence, in many (if not most) organizations, the need for both innovation and cost-cutting is greater now than ever before. I don’t much like the word “costovation” but highly recommend the concept.