Creative Modeling for Technology Visionaries Qualitative & Simplified Quantitative Modeling for Product Creation Module 8: Canonical Modeling David E. Goldberg University of Illinois at Urbana-Champaign Urbana, Illinois 61801 [email_address]

Qualitative Models in Words & Pictures 2 techniques with words: Socratic dialectic. Aristotelian data mining. A variety of techniques with pictures: Sketching. Diagramming. Surprise! Have been using such models all term. Review them & consider 2 canonical models of business.

2 techniques with words:

Socratic dialectic.

Aristotelian data mining.

A variety of techniques with pictures:

Sketching.

Diagramming.

Surprise! Have been using such models all term.

Review them & consider 2 canonical models of business.

This Module Consider canonical models in business and elsewhere. Analyze earlier models in course: Consider two canonical models in business: Porter’s five forces. Porter’s value chain. Subject all analyses to meta-analysis.

Consider canonical models in business and elsewhere.

Analyze earlier models in course:

Consider two canonical models in business:

Porter’s five forces.

Porter’s value chain.

Subject all analyses to meta-analysis.

Review of MTV Models Pink model of the conceptual age. Csikszenmihalyi’s model of creativity. Price, Griffin & Vojak model of TVs. Meta-analysis: What Socratic questions asked and answered? What data mined? What elements of qualitative model used and how integrated?

Pink model of the conceptual age.

Csikszenmihalyi’s model of creativity.

Price, Griffin & Vojak model of TVs.

Meta-analysis:

What Socratic questions asked and answered?

What data mined?

What elements of qualitative model used and how integrated?

Pink Model: A Whole New Mind Elements: 4 ages 3 A’s 6 senses 4 Ages: Agricultural age Industrial age Information age Conceptual age 3 A’s: Abundance Automation Asia 6 Senses: Design Story Symphony Empathy Play Meaning

Elements:

4 ages

3 A’s

6 senses

4 Ages:

Agricultural age

Industrial age

Information age

Conceptual age

3 A’s:

Abundance

Automation

Asia

6 Senses:

Design

Story

Symphony

Empathy

Play

Meaning

Meta-Analysis Socratic questions asked? Is our age different from times past? If so, what will ensure successful life of work in this new age? Data or other model influences: Florida’s Rise of the Creative Class. Data on rise in globalization. Rise in entrepreneurship. Broad array of scholarship in different areas.

Socratic questions asked?

Is our age different from times past?

If so, what will ensure successful life of work in this new age?

Data or other model influences:

Florida’s Rise of the Creative Class.

Data on rise in globalization.

Rise in entrepreneurship.

Broad array of scholarship in different areas.

Model Integration & Elements 4 ages model is historical argument (Hegelian in nature). 3 A’s model captures key characteristics of environment relevant to current age. 6 skills model captures skills necessary to be category creator. No visual elements (other than lists).

4 ages model is historical argument (Hegelian in nature).

3 A’s model captures key characteristics of environment relevant to current age.

6 skills model captures skills necessary to be category creator.

No visual elements (other than lists).

Csikszentmihalyi’s Model Elements: Systems model Definition Elements of creative person Dimensions of creativity complexity Systems model: Domain: symbolic rules and procedures. Field: individuals who are gatekeepers to the domain. Person: the creative one. Definition: Creativity is any act, idea, or product that changes an existing domain, or that transforms an existing domain into a new one. Creative person: Genetic predisposition doesn’t hurt. Curiosity, wonder, and interest. Access to a domain. Access to a field. Creative complexity. Creative complexity: Smart v. naïve Disciplined v. playful. Physical v. quiet Fantasy v. reality. Extrovert v. introvert. Humble and proud Masculine and feminine. Conservative and rebellious Objective and passionate. Suffering and enjoyment.

Elements:

Systems model

Definition

Elements of creative person

Dimensions of creativity complexity

Systems model:

Domain: symbolic rules and procedures.

Field: individuals who are gatekeepers to the domain.

Person: the creative one.

Definition: Creativity is any act, idea, or product that changes an existing domain, or that transforms an existing domain into a new one.

Creative person:

Genetic predisposition doesn’t hurt.

Curiosity, wonder, and interest.

Access to a domain.

Access to a field.

Creative complexity.

Creative complexity:

Smart v. naïve

Disciplined v. playful.

Physical v. quiet

Fantasy v. reality.

Extrovert v. introvert.

Humble and proud

Masculine and feminine.

Conservative and rebellious

Objective and passionate.

Suffering and enjoyment.

Meta-Analysis Socratic questions asked? What is creative? What traits do creative people share in common? Data or other model influences: 91 videotaped interviews. Culture changers from different areas. Prior research on creativity.

Socratic questions asked?

What is creative?

What traits do creative people share in common?

Data or other model influences:

91 videotaped interviews.

Culture changers from different areas.

Prior research on creativity.

Model Integration & Elements Systems model explicates relationship of what creative person must do. Other models hierarchically identify aspects of creative person mined from interviews. Interlocking hierarchical dimensionalization of creative system. No visual elements (systems model easily drawn as block diagram).

Systems model explicates relationship of what creative person must do.

Other models hierarchically identify aspects of creative person mined from interviews.

Interlocking hierarchical dimensionalization of creative system.

No visual elements (systems model easily drawn as block diagram).

Tech Visionary Model Elements: Process Domains of innovation MP 5 Process Domains: Customer needs Organizational hurdles Technological feasibility Market acceptance MP 5 model Griffin, A. et al. (in press). Voices from the field: How exceptional electronic industrial innovators innovate. Journal of Product Innovation Management.

Elements:

Process

Domains of innovation

MP 5

Process

Domains:

Customer needs

Organizational hurdles

Technological feasibility

Market acceptance

MP 5 model

Meta-Analysis Socratic questions asked? Who creates new product value? How do they do it & what kind of people are they? Data or other model influences: Audiotaped interviews of technology value creators. Draws on earlier models of creativity and NPD.

Socratic questions asked?

Who creates new product value?

How do they do it & what kind of people are they?

Data or other model influences:

Audiotaped interviews of technology value creators.

Draws on earlier models of creativity and NPD.

Model Integration & Elements Process model follows flow of activities. MP5 model follows elements of what TVs do and who they are. Model is verbal and visual. Process style visual model hybrid with layers. Orbit & process visual model combined.

Process model follows flow of activities.

MP5 model follows elements of what TVs do and who they are.

Model is verbal and visual.

Process style visual model hybrid with layers.

Orbit & process visual model combined.

Michael Porter on Strategy Harvard Business School professor. http://www.isc.hbs.edu/ 2 important books on generic strategic concerns. Industries: Competitive Strategy (1980). Firms: Competitive Advantage (1985). Michael Porter (b. 1947)

Harvard Business School professor.

http://www.isc.hbs.edu/

2 important books on generic strategic concerns.

Industries: Competitive Strategy (1980).

Firms: Competitive Advantage (1985).

Canonical Modeling of Business View business strategy as canonical modeling. Outlines things that businesses have in common at highest levels. Largely ignores the details of specific industry, product, or market. Creative modeling requires attention to these details. Lessons of canonical modeling useful, however.

View business strategy as canonical modeling.

Outlines things that businesses have in common at highest levels.

Largely ignores the details of specific industry, product, or market.

Creative modeling requires attention to these details.

Lessons of canonical modeling useful, however.

Strategy: Industry Level General analytical techniques. The structural analysis of industries. Generic competitive strategies. A framework for competitor analysis. Market signals Competitive moves Strategy toward buyers and suppliers. Structural analysis within industries. Industry evolution. Generic industry environments Competitive strategy in fragmenting industries. Competitive strategy in emerging industries. The transition to industry maturity. Competitive strategy in declining industries. Competition in global industries. Trends affecting global competition. Strategy decisions The strategic analysis of vertical integration. Capacity expansion. Entry into new businesses

General analytical techniques.

The structural analysis of industries.

Generic competitive strategies.

A framework for competitor analysis.

Market signals

Competitive moves

Strategy toward buyers and suppliers.

Structural analysis within industries.

Industry evolution.

Generic industry environments

Competitive strategy in fragmenting industries.

Competitive strategy in emerging industries.

The transition to industry maturity.

Competitive strategy in declining industries.

Competition in global industries.

Trends affecting global competition.

Strategy decisions

The strategic analysis of vertical integration.

Capacity expansion.

Entry into new businesses

Structural Analysis of Industries Strategic attractiveness of an industry affected by five forces: Rivalry among existing firms. Threat of new entrants. Bargain power of suppliers. Bargaining power of customers. Threat of substitute products or services. High values of any of these can make industry unattractive strategically.

Strategic attractiveness of an industry affected by five forces:

Rivalry among existing firms.

Threat of new entrants.

Bargain power of suppliers.

Bargaining power of customers.

Threat of substitute products or services.

High values of any of these can make industry unattractive strategically.

5 Forces Diagram http://www.berg-marketing.dk/GIF/five_forces.gif

Generic Strategies 3 generic strategies: Overall cost leadership Differentiation Focus Can be plotted as function of Strategic target Strategic advantage

3 generic strategies:

Overall cost leadership

Differentiation

Focus

Can be plotted as function of

Strategic target

Strategic advantage

Generic Strategy Quadrants http://tatler.typepad.com/images/strategy.jpg

Stuck in the Middle

Meta-Analysis Socratic questions asked? What industries attractive in long term & why? Data or other model influences: Comparisons of industry data. Prior work in industrial strategy. Model integration & elements: Qualitative categories work hierarchically. Use of system/process diagrams to illustrate relationships. Use of quadrant charts to show key variations. Qualitative sketch of functional relationship to help understand consequences of poor strategy.

Socratic questions asked?

What industries attractive in long term & why?

Data or other model influences:

Comparisons of industry data.

Prior work in industrial strategy.

Model integration & elements:

Qualitative categories work hierarchically.

Use of system/process diagrams to illustrate relationships.

Use of quadrant charts to show key variations.

Qualitative sketch of functional relationship to help understand consequences of poor strategy.

Strategy: Firm Level Competitive strategy: The core concepts. The value chain and competitive advantage. Cost advantage. Differentiation Technology and competitive advantage. Competitor selection. Industry segmentation and competitive advantage. Substitution. Interrelationships among business units. Horizontal strategy. Achieving interrelationships. Complementary products and competitive advantage. Industry scenarios and competitive strategy under uncertainty. Defensive strategy. Attacking an industry leader.

Competitive strategy: The core concepts.

The value chain and competitive advantage.

Cost advantage.

Differentiation

Technology and competitive advantage.

Competitor selection.

Industry segmentation and competitive advantage.

Substitution.

Interrelationships among business units.

Horizontal strategy.

Achieving interrelationships.

Complementary products and competitive advantage.

Industry scenarios and competitive strategy under uncertainty.

Defensive strategy.

Attacking an industry leader.

Value Chain Analysis Take process/systems view of the firm. Imagine generic elements as opportunities for differentiation or other strategic advantage. Imagine linkages between activities as opportunity for competitive advantage. Consider primary and support activities. Recall this is 1985: Aftermath of Japanese quality revolution.

Take process/systems view of the firm.

Imagine generic elements as opportunities for differentiation or other strategic advantage.

Imagine linkages between activities as opportunity for competitive advantage.

Consider primary and support activities.

Recall this is 1985: Aftermath of Japanese quality revolution.

Primary Activities 5 primary activities: Inbound logistics. Operations (manufacturing). Outbound logistics. Marketing and sales. After sales service. Where’s product development? Assumption in the 80s was category enhancement mentality.

5 primary activities:

Inbound logistics.

Operations (manufacturing).

Outbound logistics.

Marketing and sales.

After sales service.

Where’s product development?

Assumption in the 80s was category enhancement mentality.

Support Activities 4 “support” activities: Firm infrastructure Human resource management Technology development Procurement

4 “support” activities:

Firm infrastructure

Human resource management

Technology development

Procurement

Value Chain Diagram

Meta-Analysis Socratic questions asked? What gives a firm a sustainable competitive advantage? Data or other model influences: Prior work in industrial org. & strategy. Line & staff orientation. Extant categories bias. Model integration & elements: Qualitative categories work hierarchically. Use of system/process diagrams to illustrate relationships. Diagram showing process flow and bus-characteristics of “staff” functions.

Socratic questions asked?

What gives a firm a sustainable competitive advantage?

Data or other model influences:

Prior work in industrial org. & strategy.

Line & staff orientation.

Extant categories bias.

Model integration & elements:

Qualitative categories work hierarchically.

Use of system/process diagrams to illustrate relationships.

Diagram showing process flow and bus-characteristics of “staff” functions.

Bottom Line Review of other course models: Pink’s, A Whole New Mind. Csikszentmihalyi’s, Creativity. Price, Vojak & Griffin, Tech Visionaries. Porter’s canonical industry & firm models: Five forces of industry structure. Value chain of competitive advantage. Lessons & meta-lessons important. Need to build creative models that help in product development, launch, and sustenance.

Review of other course models:

Pink’s, A Whole New Mind.

Csikszentmihalyi’s, Creativity.

Price, Vojak & Griffin, Tech Visionaries.

Porter’s canonical industry & firm models:

Five forces of industry structure.

Value chain of competitive advantage.

Lessons & meta-lessons important.

Need to build creative models that help in product development, launch, and sustenance.