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Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
Haydnpresentationtransforminginnovation 120612061439-phpapp02
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Haydnpresentationtransforminginnovation 120612061439-phpapp02

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  1. HYPE User Forum 14/15th June 2012 Haydn Shaughnessy
  2. Agenda
  3. Global 2000 companies 2012, Up Up 8% 8% Up Up 12% 12% Up Up 11% 11% Source: Forbes $149 trillion assets $149 trillion assets $36 trillion revenues $36 trillion revenues $2.6 trillion $2.6 trillion profit profit WE UNDERESTIMATE THE ACHIEVEMENTS OF THE ENTERPRISE – HUGELY SUCESSFUL WAY OF CREATING WEALTH.
  4. BUT IT HAS HIT A LIMIT Shareholder returns of larger firms were 70% below those of smaller firms over a 10-year period in USA Source Gregory V. Milano, “Too Big to Succeed?” CFO Magazine, April 29, 2011 THE OVERHEAD GROWS FASTER THAN THE BOTTOM LINE
  5. Changes in the economy that bring pressures to innovate 1.The opportunity of the new globally connected middle class 2. The global innovation race 3. Digital – physical convergence (ordematerialization) 4. Disruption in the value chain 5. The loss of oligopoly power
  6. The new middle class The new global middle class creates massively differentiated needs, and low cost, good enough goods 900 million – 2 billion people by 2030 = x 3 or x 7 The future is mass differentiation
  7. Growth x8 in 2012 Fastest growing social network, 13 employees 10,000 x Library of Congress photo library by 11.2011 – 14 billion images Low overhead high scale businesses ON THE OTHER HAND WE SEEM TO HAVE INVENTED A NEW FORM OF ORGANIZATION TOO
  8. The new enterprise operating model
  9. A simple ecosystem model of business Information market A new hardware layer Apps market Developer network Platform 50,000 Android 48 member open handset alliance 88,000 articles on pebble watch in 48 hours Strong background in self management
  10. ELEMENTS OF THE PLATFORM 1. A software platform has rules of the road 2. A developer or production community signing up to T&Cs not contracts – low friction scaling – with strong background in selfmanagement 3. (Semi-) automated ingest to a platform 4. Seamless highly scaled transaction management 5. Information ecosystem New leadership role? ATTRACTION, attracting resources 6. Possibly the reinvention of product around connectivity 7. EXTRAORDINARY SCALE
  11. ECOSYSTEM 1 The Forbes’ Story Feb 2011 to Feb 2012 Tapped into 800 ecosystems Opens potential for hundreds of new revenue streams Acquisition of True/Slant MONTHLY UNIQUE VISITORS
  12. ECOSYSTEM 2 Other examples American Express Google Apple The Guardian Expedia 3,600 API partners $137 million revenues in 12 months $2 billion in sales.
  13. Physical product ecosystems
  14. Competing ecosystem models multiple supplier and licensee partners in fragmented markets vs highly disciplined continuum from hardware to software in standardized environment
  15. Today’s ecosystems 1. Ecosystems are closely related to mass differentiation 2. They gather around a platform – like iTunes, Android, quirky 3. Represent highly scaled interactions 4. Take place in OPEN environments among peers 5. Power dynamics are totally different from the large firm
  16. AND MASS DIFFERENTATION IS? The ability of large firms to serve many micro markets with relatively increases in overhead cost, usually through multiple ecosystem partners, providing exceptional strategic options management.
  17. Why aren’t more companies adopting this model? 1990-92 2000-03 Services Services Employees Employees INTERNALITIES Transition point 2004-06 2007 - 10 The CEO The CEO Risk Risk EXTERNALITIES Transition point A Semantic Analysis of 20 years of business writing in The Harvard Business Review, source Haydn Shaughnessy
  18. The Three Worlds
  19. CLOSE UP Lab-based, driven by oligopolies that shape new markets Attempts to interpret and adapt to the service economy Ignores the rules and uses multiple strategies to invade new markets. Innovation comes from multiple, scaled partnerships
  20. Most New Innovation Techniques Arise in Externalities Reverse innovation, new forms of    incubation, open innovation, social media, scouting, corporate venturing, design thinking, service innovation, consumerized innovation, data and analytics, Challenge Driven Innovation, business model . © 2011 Haydn Shaughnessy
  21. Managing an extended knowledge pool innovation architecture Creating an that encapsulates all elements of innovation Strategic options building, as companies develop for what might happen as well as what they know will happen
  22. THE INNOVATION ARCHITECTURE
  23. Innovation pioneers are arriving at somewhat the same point as platform and ecosystem companies THE STRATEGIC OPTIONS PORTFOLIO DO MORE, PLAN FOR WHAT MIGHT NOT HAPPEN
  24. STRATEGIC OPTIONS MANAGEMENT Nokia Siemens Networks We need to find a way to disrupt ourselves – in other words ways to transform.
  25. Apple’s Strategic options 2010 iPad Launched, iPhone 4, iTouch 4G, iPod Nano, 6G iPod Shuffle 4G, iPad iOS 4.0, iPad iOS 3.2 support, iBook App and iBookstore introduced, Ping social network added, AirPlay added, Wi-Fi printing support, iTunes Versions 9.0.3 thru 10.1.1 released. Apple TV, MacAir solid state 2011 iPhone 4s, iPad 2, iOS 4.3 and iOS 5 support, Siri voice recognition, Apple TV 2G support, Mac App Store launched, iTunes in the Cloud launched, Wi-Fi Syncing, iCloud services launched, iTunes Match introduced, iTunes Versions 10.1.2 thru 10.5.2 released
  26. In a period of change disruptive cultures are needed Periodically the complexity paradigm wins out
  27. Hack thyself Facebok algorithms are highly adaptive, combining human and machine networks; the business model is opportunistic Generative Non-discretionaryy Discretionary Normative RIM left itself with no concurrent options – all its options were stuck in the planning phase.
  28. What gives you discretionary generative power Is it the product Is it market position Is it ideation Is it the platform?
  29. IT IS HUMAN CAPABILITY The business model and the human resource element is ready for complexity – in IT dependent sectors
  30. WHAT SUPPORTS THIS CAPABILITY? 1. The Platform – innovators have this in platforms like HYPE 2. Ecosystems – still difficult for large companies to trust the external environment 3. Strategic options management – being able to serve differentiated markets and products 4. Belief in a new form of scale
  31. Conclusions The future lies with ecosystems supported by increasingly scaled and sophisticated platforms These platforms enable companies to serve globally differentiated markets in an elastic fashion, holding overhead down during growth
  32. THE END HAYDN SHAUGHNESSY Fellow Centre for Digital Transformation, UCI Irvine Blogs/forbes.com/haydnshaughnessy haydn@cogenuity.com

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