Innovation and the Small Business Challenge

This month Inc. Magazine challenged A.G. Lafley (CEO of Procter & Gamble) and Ram Charan (strategy execution guru) to apply the lessons from their new book The Game-Changer: How You Can Drive Revenue and Profit Growth with Innovation to a much smaller company - one with only $4 million in revenue and 30 employees.

Lafley and Charan took on the challenge and came up with a seven-step routine for innovation.

The steps include:

1. Select the Strategy (Look for an underserved market)
2. Connect to Customers (Use social networks as an idea collector)
3. Generate Ideas (Brainstorm the right way)
4. Select an Idea (Separate the good ideas from the great)
5. Prototype and Test (Bring on the customers)
6. Go to Market (Even half-baked product ideas can work)
7. Adjust for Growth (Devote resources to innovation)