“The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man” George Bernard Shaw
Identification and targeting of key processes that have considerable impact on the organization’s ability to: Achieve its short, medium and long term Strategic Goals and ObjectivesIf improved, enable the organization to realize a high Return on the Investment (ROI) Identification of target processes for which complaints have been received from customers, trading partners or internal staff and which can result in productivity improvement Achieving initial success with BPM projects in one area of the organization, will create enthusiasm and buy-in from other groups.
Improving Performance: The ultimate reason for a firm to innovate is to improve its performance, for example by increasing demand or reducing costs. Market Advantage: A new product or process can be a source of market advantage for the firm. Productivity Enhancement: The firm gains a cost advantage over its competitors, allowing a higher mark-up at the prevailing market price or, depending on the elasticity of demand, the use of a combination of lower price and higher mark-up than its competitors to gain market share and increase profits. Product Innovation: the firm can gain a competitive advantage by introducing a new product, which allows it to increase demand and mark-ups.Product Differentiation: Firms can also increase demand through product differentiation, by targeting new markets and by influencing demand for existing products.Changes in Organizational Methods: Firms can improve the efficiency and quality of their operations, thereby increasing demand or reducing costs.Improving Production Processes: Innovation can also improve performance by increasing the firm’s ability to innovate. Improving the capabilities of production processes can make it possible to develop a new range of products, and new organisational practices can improve the firm’s ability to gain and create new knowledge that can be used to develop other innovations.
Recreated from Peter Skarzynski and Rowan Gibson,Building A Systemic Innovation Capability , Harvard Business Review, 2008. Fig 11.1
Ref. PaulTrott p. 97.
Innovate or die
Innovate to <br />succeed<br />Innovate to fail<br />Introduction to Foundations of Business Innovation September 8, 2011<br />It’s about balancing the risk of innovating against the risk of not innovating<br />
Why are we here?<br /><ul><li>Philosophical reasons: </li></ul>Take the course SCS 1724 Essential Western Philosophers<br /><ul><li>Meta-physical reasons:</li></ul>Read Stephen Hawking’s book “The Grand Design”<br /><ul><li>To identify ways we can increase the likelihood of innovation success in our organizations </li></ul> Take SCS 2539 Foundations of Business Innovation<br /><ul><li>Today we will provide an overview of the Business Innovation course by identifying:</li></ul>“The top ten causes of failure to innovate”<br />
Ten key causes of failure:<br />Confuse the role of innovation<br />Fail to clarify innovation goals<br />Don’t recognize innovation barriers<br />Fail to engage entire organization<br />Lack of recognition of importance of communication<br />Underestimate need for innovation resources<br />Unclear process for selecting innovation projects<br />Recognize the importance of change management<br />Failure to create an innovation culture<br />Recognize innovation is a journey not a destination<br />
1. Confuse the role of innovation<br />Innovation is:<br />Introduction of a new good, or a new quality of a good<br />Introduction of a new method of production (need not need include new technologies)<br />The opening of a new market <br />The securing of a new source of supply<br />The creation of a new organization <br />Joseph Schumpeter<br />
Identify Innovation Drivers<br />Internal drivers<br />Unexpected event<br />Contradiction<br />Change of work process<br />Change in industry structure <br />External Drivers<br />Socio-economic changes<br />Political changes<br />Technology changes<br />Drucker‘sInnovation<br />Framework<br />
Innovation not just technology development<br />Innovation includes:<br /><ul><li>Product Innovation
Business model Innovation……….. </li></ul>Greatest opportunities seen in business model innovation.<br />Can be applied to both private and public organizations<br />If your organization doesn’t innovate, someone else will..<br />
Understanding Process Innovation<br /><ul><li>A change in the way a product or service is manufactured, created, or distributed
Process innovation involves implementation ofnew or improved production or delivery method.
Process innovations can be intended to decrease unit costs of production or delivery, to increase quality, or to produce or deliver new or significantly improved products. </li></li></ul><li>Understanding Service Innovation<br /><ul><li>Majority of individuals in Canada (and US) work in service industry
Even where people work in manufacturing, many of these individuals providesupport services
Service innovation isbiggest opportunity to increase competitiveness
Improvements in service innovation can be measured in terms of increases productivity and value added </li></li></ul><li>Opportunities for Service Innovation<br /><ul><li>Contributes to competitive advantage
Most significant possibilities in financial and medical services</li></li></ul><li>Understanding Business Model Innovation <br /><ul><li>New ways of doing business can also increase competitiveness and productivity by:
Improve shareholder/stakeholder perceived value </li></ul>"Would you tell me, please, which way I ought to go from here?""That depends a good deal on where you want to get to," said the Cat."I don’t much care where--" said Alice."Then it doesn’t matter which way you go," said the Cat."--so long as I get SOMEWHERE," Alice added as an explanation."Oh, you’re sure to do that," said the Cat, "if you only walk long enough." Lewis Carroll<br />
Create a feedback loop that updates status of innovation projects and encourages accountability</li></ul>“The greatest barrier to communication is believing that it has occurred” Oscar Wilde<br />
6. Lack of commitment to innovation resources<br /><ul><li>Greatest single barrier to stimulating innovation ideas, is the lack of action around previous innovation suggestions
Many ideas are not implemented without clarity or feedback as to why not
Implemented ideas are not successful because of:
Insufficient clarity of outcomes and expectations
Lack of required resource commitment (money, people, time)
Assumption that resources appropriate for one activity can be used in another</li></li></ul><li>7. Unclear innovation process<br /><ul><li>Innovation is a management process the requires specific tools, techniques and discipline
Innovation involves thedevelopment of organizational processes and procedures for generating, considering and acting on innovative ideas
Without an innovation process, the likelihood of innovative projects being pursued is minimal</li></li></ul><li><ul><li>Identify innovation imperative and establish objectives
Ideation<br />Evaluation<br />Realization<br />Implement process in organization’s context<br />Innovation Outputs<br />Resources<br />Strategy<br />Innovation<br />Inputs<br />Product Innovation<br />Service Innovation<br />Process Innovation<br />Business Model Innovation<br />Employees<br />Suppliers & Partners<br />Customers<br />Competitors<br />Processes<br />Culture<br />Creating the environment and processes to support innovation<br />
8. Recognize the importance of change management<br />Change through Leadership<br />Create a Shared Need<br />Shape a Vision<br />Mobilize Commitment<br />Make Change Last<br />Monitor Progress<br />Change Systems and Structures<br />Change Culture from Control to Trust<br />Communicate<br />Incentivize <br />”If you always do what you always did, you will always get what you always got” Albert Einstein<br />
9. Create an innovation culture<br /><ul><li>Use mentoring / coaching approach to management
Encourage / incent team rather than individual performance
Build trust rather than controls, and accountability rather than monitoring</li></li></ul><li>Innovative organizations:<br /><ul><li>Embraces a culture of risk, reward success and learn from failure
Develop a project and portfolio managementapproach to innovation
Create opendecision-making processes and focus on timely implementation
Develop cross functional teams to embrace innovation across organization
Focus on communications and engagement</li></li></ul><li>Creating an Innovation Capability<br />
Common Causes of Innovation Failure <br />Organizational Causes <br />Process Causes <br />Poor leadership<br />Poor organization<br />Poor communication <br />Lack of empowerment of stakeholders <br />Poor knowledge management<br />Resource limitations<br />Poor goal definition<br />Poor alignments of goals and actions<br />Poor team effort<br />Poor monitoring of results<br />Poor communication and access to information<br />Inappropriate decision making<br />
10. Innovation is a journey not a destination<br /><ul><li>Re-evaluate corporate strategy to examine innovation opportunities
Monitor innovation projects and review perfromance
Review innovation process and identify opportunities for improvement
Learn from failures</li></li></ul><li>Innovation for success<br />Three choices:<br />Innovate your organization,<br />Partner with an innovative organization or<br />Wait for innovation to happen………..<br />“In this road to the future, there are drivers, passengers or road kill”<br />Competing for the future: Hamel & Prahalad, 1994<br />
See You in SCS 2539 Foundations of Business Innovation <br />Starts Monday 19th in Mississauga and Tuesday 20th in Toronto<br />http://innovationcentre.ca/learning-centre/education-partners/<br />“Well, in our country," said Alice, still panting a little, "you'd generally get to somewhere else — if you run very fast for a long time, as we've been doing.” “A slow sort of country!" said the Queen. "Now, here, you see, it takes all the running you can do, to keep in the same place. If you want to get somewhere else, you must run at least twice as fast as that!” Lewis Carroll<br />
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