Gig Overview

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Introduction to The Growth and Innovation Group (GIG).

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Gig Overview

  1. 1. The Growth and Innovation Group Discover, Shape and Launch New Growth Platforms
  2. 2. Our Mission <ul><li>We strive to greatly enhance the success of our client’s New Business Innovation and Growth efforts </li></ul><ul><ul><li>By providing Training & Implementation Services </li></ul></ul><ul><ul><ul><li>Grounded in demonstrated Principles </li></ul></ul></ul><ul><ul><ul><ul><li>Captured in effective tools and processes </li></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Yielding ongoing improved capabilities </li></ul></ul></ul></ul></ul><ul><li>to Discover, Shape, & Launch New Growth Platforms </li></ul>
  3. 3. We help Solve Growth Issues <ul><li>Our current opportunities are too small. </li></ul><ul><li>We lack clear direction or strategy for growth. </li></ul><ul><li>We have too many opportunities and are struggling to direct them. </li></ul><ul><li>We need to improve our overall capability for new business growth. </li></ul><ul><li>Our business development teams lack tools and processes. </li></ul><ul><li>Etc. … </li></ul>06/07/09 The Growth and Innovation Group Confidential
  4. 4. We are experienced practitioners & consultants <ul><li>in numerous Fields : </li></ul><ul><li>• solar energy • bio chemicals • renewable energy </li></ul><ul><li>• safety and security • renewable water • nano technology </li></ul><ul><li>• chemicals • plastics • printed electronics </li></ul><ul><li>• electronics • medical • photonics </li></ul><ul><li>• beverages • power • transportation </li></ul><ul><li>• construction • cleaning • adhesives </li></ul><ul><li>• coatings • oil& gas • packaging </li></ul><ul><li>• inks • personal care • fibers and non-wovens </li></ul><ul><li>• paper • cosmetics • analytical services </li></ul><ul><li>• batteries • insulation </li></ul><ul><li>for numerous clients : </li></ul><ul><li>Hoechst AG • WL Gore & Assoc. • McKinsey & Co. </li></ul><ul><li>Appleton Papers Inc. • Cargill Inc. • Equistar Chemical Co. </li></ul><ul><li>Dow Corning Corp. • Ferro Corp. • The Dow Chemical Co. </li></ul><ul><li>Guinness Beer • NewPage Paper • Valmet Corp. </li></ul><ul><li>Sawyer LLC • Fluoro -Seal Intl. L.P. • Materia Inc. </li></ul><ul><li>Genomatica Inc. • Allylix Inc. • Invista Inc. </li></ul>
  5. 5. Does your company need to go beyond the “incremental” and develop whole New Businesses? <ul><li>“ Some 70 percent of corporate leaders say innovation is among the top three priorities for driving growth.” </li></ul><ul><ul><li>“ How Companies Approach Innovation: A McKinsey Global Survey”, mackinseyquarterly.com, October 2007. </li></ul></ul>“ Breakthrough Innovations that are marketable matter the most.”
  6. 6. <ul><li>“… breakthrough innovation. Every executive we’ve spoken with in the past ten years wants it. The trouble is they don’t know how to make it happen.” </li></ul><ul><li> </li></ul>Although many desire growth through New Businesses – few are confident in their approach…. <ul><ul><li>“ Grabbing Lightning” Gina C. O’Connor et.al. 2008 John Wiley & Sons Inc. </li></ul></ul><ul><li> </li></ul>
  7. 7. The track record is not impressive…….. Copyright Hatfield Group LLC WinOvations Inc. Reference: G. Stevens and J. Burley, “3000 Raw Ideas = 1 Commercial Success!” Research • Technology Management, 40(3): 16-27, May-June, 1997.
  8. 8. And it is clear that new approaches are required…… <ul><li>“ Business and market needs and opportunities should be evaluated in concert with technological possibilities– and this needs to happen early, when strategies are first being developed.” </li></ul><ul><ul><li>Expanding the Innovation Horizon, The Global CEO Study 2006, IBM GLOBAL Business Services </li></ul></ul>
  9. 9. GIG’S Principles for reduced risk and enhanced returns <ul><li>Develop New Business opportunities by systematically identifying and reducing a defined set of uncertainties in 3 domains. </li></ul><ul><li>Develop New Business opportunities as New Business and Offering Platforms , i.e. groups of opportunities with real synergies that enable rapid market testing and can be developed in phases or steps over time. </li></ul><ul><li>Identify and develop new business opportunities that lie beneath a market discontinuity that can be addressed by company capabilities . </li></ul><ul><li>Minimize financial exposure of a new business opportunity by flexibly outsourcing or partnering capabilities that lie outside capabilities critical to competitive advantage. </li></ul><ul><li>Develop or adapt your existing Business Model and organizational design to new business development including: processes & tools, structure and staffing, competencies and capabilities, and culture. </li></ul>
  10. 10. Our principles for reduced risk and enhanced returns <ul><li>Develop New Business opportunities by systematically identifying and reducing a defined set of uncertainties in 3 domains. </li></ul>
  11. 11. Time Start-up Growth Maturity and Decline Growth and Renewal Cash Flow Higher Risk Hard To Identify, implement: New Business Development Lower risk Easier to identify Opportunities: Line Extensions Renewal
  12. 12. New Business Development has significant uncertainties, however they fall into predictable categories. Mark P. Rice F. W. Olin Graduate School of Business Babson College Olin Hall 242A Babson Park MA 02457 Gina Colarelli O’Connor* Rensselaer Polytechnic Institute Lally School of Management and Technology Pittsburgh Building #2214 110 Eighth Street Troy NY 12180 Richard Leifer Rensselaer Polytechnic Institute Lally School of Management and Technology Pittsburgh Building #2110 110 Eighth Street Troy NY 12180 A COMPREHENSIVE MODEL OF UNCERTAINTY ASSOCIATED WITH RADICAL INNOVATION
  13. 13. Multidimensional Study of Uncertainty <ul><li>“ The model incorporates the commonly used sources of uncertainty: technical and market uncertainty, but adds two others: organizational and resource uncertainty. Each of these four categories is further distinguished via two additional dimensions: criticality and latency. </li></ul>
  14. 14. GIG captures these uncertainties in a simple model: <ul><li>Market Uncertainties: </li></ul><ul><li>Is there a market opening? </li></ul><ul><li>Is there a market need? </li></ul><ul><li>Is there significant value? </li></ul><ul><li>Can that value be captured? </li></ul><ul><li>Offering Uncertainties : </li></ul><ul><li>Can we create offering? </li></ul><ul><li>Can we produce offering? </li></ul><ul><li>Do offerings uniquely satisfy market needs? </li></ul><ul><li>Do offerings have a sustainable competitive advantage? </li></ul><ul><li>Business Fit Uncertainties : </li></ul><ul><li>Does organization have needed capabilities? </li></ul><ul><li>Does organization have needed support? </li></ul><ul><li>Do projects match required returns, risk , and strategic intent boundaries? </li></ul>We look at each opportunity holistically and manage the critical uncertainties in steps… Business Opportunity
  15. 15. Uncertainty is systematically reduced through Hypothesis Directed Learning – an interdependent, iterative, and disciplined learning process, with useful tools <ul><li>A new business opportunity can be described by a finite and consistent set of hypotheses, using the uncertainty categories. We provide the categories and develop the content into hypotheses trees. </li></ul><ul><li>A level of validity can be assigned to each hypothesis based on our current level of knowledge and the source of this knowledge. We provide a level of validity model system proven over many projects. </li></ul><ul><li>A prioritized set of critical uncertainties can be defined based on the hypotheses with the highest impact on value and the lowest level of content resolution or validity. We provide simple tools to rapidly identify the most critical uncertainties. </li></ul><ul><li>Action items can be designed and implemented to address the critical uncertainties. </li></ul>
  16. 16. Three Tools for Hypothesis Directed Learning Copyright 2007 The Hatfield Group LLC GIG Confidential The Business Platform Map The Project Hypotheses The Hypotheses Tree Is this a valid New Business Platform? Understand and identify critical issues In key projects <ul><li>Prioritize critical issues across platform </li></ul><ul><li>Set action plan to resolve with milestones </li></ul><ul><li>Assign resources across the platform </li></ul><ul><li>Each key project is described by 12 hypotheses that cover business fit, opening and need, and advantaged offering </li></ul><ul><li>Each hypothesis is assigned a level of validity based on consistent criteria and impact on value </li></ul><ul><li>Hypotheses are prioritized within project s into critical issues based on validity and impact on value </li></ul>Each object Is a project Create Prioritized Action Plan across the platform
  17. 17. <ul><li>The Opportunity Hypothesis </li></ul><ul><li>The market discontinuity with S-Curves </li></ul><ul><li>Market Need </li></ul><ul><li>Market Opening </li></ul><ul><li>Competitive Advantage </li></ul><ul><li>Understanding of Functional requirements </li></ul><ul><li>Ability of Offering to satisfy Functional Requirements </li></ul><ul><li>Price </li></ul><ul><li>Volume </li></ul><ul><li>Manufacturing Cost </li></ul><ul><li>Non Manufacturing Cost </li></ul><ul><li>Timing to first $ 100K sales </li></ul>The New Business Platform Hypothesis The Project Hypotheses The Hypotheses Tree Is this a valid New Business Platform? Understand and Identify critical issues In each project Prioritize critical Issues and resources Across the platform Note: Each circle And square is a Project Hypothesis Directed Learning
  18. 18. These Principles and tools are captured in three processes that Discover, Shape, and Launch New Business Platforms Process Input Output Business Platform Discovery Broad and incomplete concepts of potential advantaged offerings, industries where they can be applied, business models that could be used Partially validated and highly robust Business Platforms due to multiple iterations with market opinion leaders and a broad range of capability experts Business Platform Shaping Partially validated and highly robust Business Platforms due to multiple iterations with market opinion leaders and a broad range of capability experts Validated Business Platforms across 11 hypotheses through multiple market interviews across the value chain and design experiments across critical offering and manufacturing hypotheses Business Platform Launch Validated Business Platforms across 11 hypotheses through multiple market interviews across the value chain and design experiments across critical offering and manufacturing hypotheses Initiated Business Platforms with key internal capabilities, critical partnerships, early stage customers, initial offerings, and development agreements in place.
  19. 19. GIG’S Principles for reduced risk and enhanced returns <ul><li>Develop New Business opportunities by systematically identifying and reducing a defined set of uncertainties. </li></ul><ul><li>Develop New Business opportunities as New Business and Offering Platforms, i.e. groups of opportunities with real synergies that enable rapid market testing and can be developed in phases or steps over time. </li></ul>
  20. 20. New Business Platforms Allow: <ul><li>Synergistic development of Offerings </li></ul><ul><li>Robustness: Multiple Projects, Offerings </li></ul><ul><li>Significant Value: Typically value comes in long term projects </li></ul><ul><li>Timely Value: Short term projects linked to long term projects </li></ul><ul><li>Net Result: Greater Value, Lower Risk </li></ul>
  21. 21. GIG’s New Business Platform Map Tool: <ul><li>Allows for multiple projects within an offering platform including relative value or attractiveness and time and multiple offerings </li></ul><ul><li>Captures the level of uncertainty or validity of each Project </li></ul><ul><li>Describes the level of resourcing within the Platform </li></ul>Each Project must address all uncertainties!
  22. 22. GIG’S Principles for reduced risk and enhanced returns <ul><li>Develop New Business opportunities by systematically identifying and reducing a defined set of uncertainties. </li></ul><ul><li>Develop New Business opportunities as New Business and Offering Platforms, i.e. groups of opportunities with real synergies that enable rapid market testing and can be developed in phases or steps over time. </li></ul><ul><li>Identify and develop new business opportunities that lie beneath a market discontinuity that can be addressed by company capabilities </li></ul>
  23. 23. Industry Discontinuities: A Pre-requisite to Successful Business Platforms <ul><li>Business Platforms aligned to Market </li></ul><ul><li>Discontinuities are: </li></ul><ul><li>Significant in Value : Underneath Market Discontinuities multiple market openings and unmet needs are present </li></ul><ul><li>Robust: Open space for both Offering development and protection </li></ul><ul><li>Timely and lower cost for entry: New entrants are “pulled into” the market versus fighting incumbents. </li></ul>
  24. 24. GIG utilizes S-Curves as a tool to identify and describe Discontinuities across value chains
  25. 25. The high level flow of how GIG consistently discovers robust new Business Platforms: Search for market discontinuities where advantaged offerings can potentially fit…….. Underneath the Discontinuities lie multiple openings and needs. Flexibly shape advantaged offerings to meet openings and needs and create projects…. Projects are then linked for synergistic development into Business and Offering Platforms for Validation and Implementation
  26. 26. GIG’S Principles for reduced risk and enhanced returns <ul><li>Develop New Business opportunities by systematically identifying and reducing a defined set of uncertainties. </li></ul><ul><li>Develop New Business opportunities as New Business and Offering Platforms, i.e. groups of opportunities with real synergies that enable rapid market testing and can be developed in phases or steps over time. </li></ul><ul><li>Identify and develop new business opportunities that lie beneath a market discontinuity that can be addressed by company capabilities. </li></ul><ul><li>Minimize financial exposure of a new business opportunity by flexibly outsourcing or partnering capabilities that lie outside capabilities critical to competitive advantage. </li></ul>
  27. 27. Competencies and Capabilities <ul><li>We can work with management and program teams to identify current capabilities and core competencies. </li></ul><ul><li>We hypothesize new capabilities and competencies that maybe required based on strategic direction and project/portfolio content. Then address each on a case-by-case basis. </li></ul>
  28. 28. GIG’S Principles for reduced risk and enhanced returns <ul><li>Develop New Business opportunities by systematically identifying and reducing a defined set of uncertainties in 3 domains. </li></ul><ul><li>Develop New Business opportunities as New Business and Offering Platforms, i.e. groups of opportunities with real synergies that enable rapid market testing and can be developed in phases or steps over time. </li></ul><ul><li>Identify and develop new business opportunities that lie beneath a market discontinuity that can be addressed by company capabilities. </li></ul><ul><li>Minimize financial exposure of a new business opportunity by flexibly outsourcing or partnering capabilities that lie outside capabilities critical to competitive advantage. </li></ul><ul><li>Develop or adapt your existing Business Model and organizational design to new business development including: processes & tools, structure and staffing, competencies and capabilities, and culture . </li></ul>
  29. 29. These Principles and tools are captured in three processes that Discover, Shape, and Launch New Business Platforms Process Input Output Business Platform Discovery Broad and incomplete concepts of potential advantaged offerings, industries where they can be applied, business models that could be used Partially validated and highly robust Business Platforms due to multiple iterations with market opinion leaders and a broad range of capability experts Business Platform Shaping Partially validated and highly robust Business Platforms due to multiple iterations with market opinion leaders and a broad range of capability experts Validated Business Platforms across 11 hypotheses through multiple market interviews across the value chain and design experiments across critical offering and manufacturing hypotheses Business Platform Launch Validated Business Platforms across 11 hypotheses through multiple market interviews across the value chain and design experiments across critical offering and manufacturing hypotheses Initiated Business Platforms with key internal capabilities, critical partnerships, early stage customers, initial offerings, and development agreements in place.
  30. 30. Yet the literature tells us more is needed beyond Process to succeed……. “ Emphasis must shift: from ideas to execution and from leadership excellence to organizational excellence.” Building Breakthrough Businesses Within Established Organizations, by and Vijay Govindarajan and Chris Trimble Harvard Business Review May 2005
  31. 31. GIG: A Holistic Approach to New Business Development Four Elements for Effective Organizational Design Integrated at three levels of the Organization
  32. 32. GIG provides tools to optimize Organizational Design Design Element Issues Addressed Tools Growth Strategy <ul><li>Types of Growth Desired </li></ul><ul><li>Goals: Size, Value, Timing </li></ul><ul><li>Capabilities to be Leveraged </li></ul><ul><li>Markets to be addressed </li></ul><ul><li>Business Fit Boundaries </li></ul><ul><li>A believable vision of how it all fits together </li></ul>Workshop format at desired level of organization Organizational Structure <ul><li>Best Practices Organizational structure at each level of organization </li></ul><ul><li>Desired linkages between levels and between current and new business development organizations </li></ul>Seminar and workshop format with key leadership at desired organizational level Job Design <ul><li>New roles required for successful new business development </li></ul><ul><li>Skill and Competency profiles </li></ul><ul><li>Training requirements </li></ul>Generic Job descriptions, skill, and competency profiles for new roles provided and customized to companies specific HR practices. Training courses provided. Business Culture <ul><li>Identifying measurable behaviors required for New Business Development </li></ul><ul><li>Benchmarking organization </li></ul><ul><li>Culture transformation activities </li></ul><ul><li>Seminar on effective behaviors and supporting research </li></ul><ul><li>Benchmark surveys </li></ul>
  33. 33. Portfolio View: Risk vs Return Model Portfolio Size = NPV in MMUSD $7.4 MM $42.8 MM $5.4 MM $24.4 MM $6.5 MM $21.4 MM $3.7 MM - 5.0 10.0 15.0 20.0 - 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0 Value Risk NPV/Current Burn Platform 1 Platform 6 Platform 7 Platform 2 Platform 4 Platform 3 Platform 5
  34. 34. <ul><li>GIG is capable of augmenting your organization’s capabilities by doing content work….. </li></ul><ul><li>OR </li></ul><ul><li>Building these processes into your organization by teaching the processes while doing projects with your people </li></ul>Getting Started: Implementation Options
  35. 35. Getting Started: Some options <ul><li>Choose a project you want done </li></ul><ul><li>Choose a process you want to try: Discovery or Shaping </li></ul><ul><li>Align a current portfolio and check the critical uncertainties. </li></ul><ul><li>Pick an Organizational Design issue you want to fix </li></ul><ul><li>Do some diagnostics </li></ul><ul><ul><li>Informal driven by a few leaders </li></ul></ul><ul><ul><li>Formal with cross functional leadership teams </li></ul></ul>
  36. 36. Getting started <ul><li>Contact us: </li></ul><ul><ul><li>Dave Cornelius: [email_address] or 843-290-6020 </li></ul></ul><ul><ul><li>Dave Hatfield: [email_address] or 989-631-3332 </li></ul></ul>06/07/09 The Growth and Innovation Group Confidential

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