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Reengineering in Innovation & Strategy

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Invited talk at Korea National Information Society Agency

Invited talk at Korea National Information Society Agency

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    Reengineering in Innovation & Strategy Reengineering in Innovation & Strategy Presentation Transcript

    • Reengineering in Innovation & Strategy Brown Bag Meeting Korea National Information Society Agency Jan. 30, 2007 GeunHo Lee geunhole@bu.edu
    • CONTENTS 1. New Trends in Innovation 2. New Trends in Strategy 3. Strategy Innovation
    • New Trends in Innovation Value Creation Chain Disruptive Innovation Open Innovation
    • Value Creation Chain Invention Innovation Diffusion
    • Disruptive Innovation The term disruptive innovation first appeared in the 1997 Harvard Business School professor Clayton Christensen’s best-seller The Innovator’s Dilemma. The book investigated innovations that were radical in nature compare to the conventional sustaining (incremental) innovation.
    • Disruptive Innovation Conventional Value Innovation Market’s Demand Disruptive Innovation Time continued
    • Contents of Disruptive Innovation Disruptive Technologies: technologies that have displaced other technologies to offer a whole new sphere of possibilities at lower prices. Disruptive Products: products or services that replace similar existing products or services based on their superior attributes or lower price.
    • Contents of Disruptive Innovation Disruptive Processes: processes that are of disruptive nature often outperform the traditional ways of working. Disruptive Business Models: Business Models that are disruptive do business in new and innovative ways in established or new areas. continued
    • Open Innovation Popularized by UC Berkeley Business School’s Professor Henry Chesbrough's book quot;Open Innovation,quot; this term refers to the broad concepts of leveraging external sources of innovation to drive internal growth. continued
    • Open Innovation Models In open innovation models, companies look inside-out and outside-in, across all aspects of the innovation delivery chain.
    • Open Innovation Models continued
    • Open Innovation Models Companies looking externally for sources of available technologies that can be used as a basis for internal development. continued
    • Open Innovation Models Established companies may acquire external innovations that offer the opportunity to develop new technology for scale-up. Companies may also spinout technologies that were internally developed but are determined to be better developed and commercialized by others. continued
    • Open Innovation Models Companies may spin out already commercialized technologies where more value can be realized, or acquire already commercialized innovation that can provide sources of new growth. continued
    • Best Practices: Nokia’s Venturing Nokia moved beyond quot;not invented herequot; and are embracing the best ideas whereever they are. Nokia's Venturing Organization is focused on corporate venturing activities that include identifying and developing new businesses. Nokia have a group called Innovent that directly supports innovators with the hope of growing future opportunities for Nokia.
    • New Trends in Strategy Strategies Hierachy Blue Ocean Strategy
    • Strategies Hierarchy
    • Blue Ocean Strategy Blue Ocean strategies, as described in the book “Blue Ocean Strategy” by W. Chan Kim and Renee Mauborgne at INSIED, found that most enterprises' business strategy relied primarily on competition which only results in a “Red Ocean,” where the costs of competition are very high and the rewards are relatively low.
    • Blue Ocean Strategy To maintain sustainable growth, the companies need to go beyond competition and create a new market- Blue Ocean. The Blue Ocean Strategy provides a framework and tool set for discovering new markets in traditionally filled spaces by changing the nature of competition away from the normal direction of the industry. continued
    • Blue Ocean Strategy The main idea of Blue Ocean Strategy is how to change the rules and lift the constraints through the value innovation. continued
    • A Good Blue Ocean Strategy Focus: a good strategy has a focus, and a company's strategic profile should clearly show it. Divergence: the value curve of blue ocean strategy always stand apart from the competitors. Compelling Tagline: a good strategy has a clear-cut and compelling tagline.
    • A Good Blue Ocean Strategy 10 9 8 Focus 7 6 5 Tagline 4 Divergence 3 2 1 0 s en t on nt ce ic e itie ct i me ie n Fu n Pr en ipm tru ron en Am Equ I ns vi nv En Co B.O. R.O. continued
    • Best Practices: Savi for RFID Business The RFID market is highly fragmented, and many players are competing on small niches. Up to now there was only small numbers of cases open a RFID blue ocean market. One example that open a RFID blue ocean market is the Savi technology which had a $425 million contract with the US Department of Defense in 2006.
    • Analysis of Savi’s Strategy Blue Ocean Attribute Description How the company and its products/services support specific Vertical Integration applications/industry? To what extent can the company's technology be complying Standard Compliances with different industry standards? This value measures the technological stability of the current Technological Stability firm, compared with its competitors. Price Model Measures a company's price competitiveness. To what extent is the technology offered can be integrated Consistency with legacy systems? Does the nature of the company's technology support Innovation Potential innovative use and further development? How do the company and its technologies provide end-user Right Offerings values across diverse needs?
    • Analysis of Savi’s Strategy 10 9 8 7 6 5 4 3 2 1 0 ) ) = M) =L ) = L) U=H ) =H U= H ) =H (MU U MU (MU l (M ( MU n s (M el ( y (M ncy ntia ti o nc e od i lit ngs gra pli a eM tab ist e ote f eri Int e Pric al S ons nP t Of cal Com ogi c C ov a tio Ri g h V erti nd ard nol I nn Sta T ech Savi R.O continued
    • Analysis of Savi’s Strategy Savi’s strategy canvas shows three characteristics of a good strategy usually found in Blue Ocean cases studies: 1. Focus on factors such as consistency with the legacy system and innovation potential by developing various platforms (multi-band, active and passive, sensor tags, wireless networks). 2. Divergence from conventional competition factors such as Gen2 standard compliances and low price devices development sacrificing the technological stability in operation. 3. Compelling Tagline in right offerings for end-user values across diverse needs. continued
    • Strategy Innovation Reengineering Strategy Innovation Issues
    • Reengineering Reengineering is the redesign of an organization's development & implementation processes for Innovation & Strategy. Reengineering in innovation & strategy is need to capture the paradigm shift such as disruptive innovation, open innovation, and blue ocean strategy.
    • Strategy Innovation Strategy innovation is an example of reengineering in innovation and strategy. Strategy innovation is a shifting in organization's business strategy in order to create new value for both the customer and the organization. Strategy innovation is a process of applying innovative thinking to the entire business model of a organization.
    • Strategy Innovation Strategy innovation is a change form the “Play the game better” to “Making my rule of the game”. Strategy innovation is Creative, Insights-driven, and Market-centric. continued
    • Issues What is the strategy innovation for the digital convergence? Is the uIT-839 a strategy innovation for the u-Korea vision? continued
    • Thank You!