Making innovation work_in_new_times

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Nasscom overview

Nasscom overview

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  • 1. September 2009 Making Innovation Work in New Times NASSCOM 2009 INNOVATION AWARDS Management Consultants Where Innovation Operates
  • 2. Three Questions Why don’t companies develop strong, effective innovation? Why do companies find it so hard to sustain robust levels of innovation? How do leaders create meaningful levels of innovation? Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 2
  • 3. Innovation Originates with Business Strategy Innovation Business Operational Goals and Model Strategy Management Strategic Insight Blueprint Innovation Innovation Execution Strategy and Growth Goals How You Innovate Determines What You Innovate Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 3
  • 4. Insight Bridges Strategies and Goals Insight Customer Business Model Product/s Business Services Innovation Goals and Strategy and Strategy Regulations/ Goals Society Operations Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 4
  • 5. Strategies Must Align Business Goals and Strategy Insight Where Do We Focus Innovation Efforts? Innovation Strategy and How Much Innovation? Goals What Types of Innovation Do We Need? How You Innovate Determines What You Innovate Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 5
  • 6. Blueprint Translates Strategy Into Operations Strategic Blueprint New BREAKTHROUGH RADICAL Technology Change Close to INCREMENTAL BREAKTHROUGH existing Innovation Close to existing New Innovation Strategy and Business Model Change Operational Goals Business Model Model Technology Innovation Innovation Value Products/ Proposition Services Value Process Network Technologies Target Supporting Customer Technologies Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 6
  • 7. Innovation Portfolio Describes Innovation Goals How Much Innovation? Where Do We Focus Innovation Efforts? Change Drive the Growth Game New BREAKTHROUGH RADICAL Technology Change Close to existing INCREMENTAL BREAKTHROUGH Close to existing New Stay in Drive the Business Model Change Growth Game Making Innovation Work, Davila, Epstein, Shelton: Wharton School Publishing, 2006 Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 7
  • 8. Six Major Levers of Innovation What Types of Innovation Do We Need? Business Model Technology Innovation Innovation VALUE PRODUCTS/ PROPOSITION SERVICES VALUE PROCESS NETWORK TECHNOLOGIES TARGET SUPPORTING CUSTOMER TECHNOLOGIES Making Innovation Work, Davila, Epstein, Shelton: Wharton School Publishing, 2006 Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 8
  • 9. Six Major Levers of Innovation: Technology Technology Innovation What product or service should the company offer in the marketplace?  Performance PRODUCTS/ What features or offering should the company  Packaging Integral SERVICES develop? to Customer Value Can we reduce the cost of our current offering?  Manufacturing Can we improve the quality of existing products or PROCESS and Assembly services? TECHNOLOGIES  Service Delivery Can we improve the inventory or quality control?  Information How can we leverage the IT backbone to create a SUPPORTING Systems faster, better, cheaper product? TECHNOLOGIES  Logistics/ Inventory Making Innovation Work, Davila, Epstein, Shelton: Wharton School Publishing, 2006 Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 9
  • 10. Six Major Levers of Innovation: Business Model Business Model Innovation  Customer VALUE How do you define the customer experience? Experience PROPOSITION What value do customers want?  Brand Value “What” What is the solution?  Value Network/ VALUE How can you optimize the supply chain? Supply Chain NETWORK What part will you play in the ecosystem?  Ecosystem of Value Offerings “How” How do you shape the customer experience?  Buyers and Who are the targeted customers? Who is Influencers TARGET excluded and why? CUSTOMER  Marketing What do different segments want with regard to Methods “Who” the customer experience? Making Innovation Work, Davila, Epstein, Shelton: Wharton School Publishing, 2006 Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 10
  • 11. Companies Underutilize Business Model Levers Recent PRTM Client Example Products/ Value Innovation traditionally focused on product Services Proposition Business Model Innovation Technology Innovation Value Process Network Technologies Recent global supply chain transformation Target Supporting Customer Technologies Making Innovation Work, Davila, Epstein, Shelton: Wharton School Publishing, 2006 Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 11
  • 12. Design Operational Model to Fit Innovation Business Operational Goals and Model Strategy Management Strategic Insight Blueprint Innovation Strategy and Goals How You Innovate Determines What You Innovate Making Innovation Work, Davila, Epstein, Shelton: Wharton School Publishing, 2006 Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 12
  • 13. Partnerships Are a Core Competency of Leaders Innovation is a team sport Customers Customers Universities Competitors External Resources INNOVATION PLATFORM Universities Brainiacs Internal Resources Suppliers Suppliers Suppliers Suppliers Making Innovation Work, Davila, Epstein, Shelton: Wharton School Publishing, 2006 Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 13
  • 14. PRTM Model for Open Innovation Excellence Becoming Openly Innovative • Overcoming “Not Invented Here” mindsets • Finding and establishing relevant partners and networks • Establishing new organizational roles and responsibilities • Building the culture to become a partner of choice Opening Up Organization and Culture Opening Up Opening Up Practices and Strategy Capabilities Defining Open Innovation Executing Open Innovation • Choosing Open Innovation “paths to value” • Defining missing innovation assets • Clearly defining Open Innovation goals and • Establishing IP strategy and policies implications for the business • Building partner and ecosystem • Aligning Open Innovation goals and models management capabilities with business strategies • Establishing information exchange • Establishing a vision, metrics, and a path for (and control) capabilities change • Executing and demonstrating open innovation behaviors Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 14
  • 15. Open Innovation Has a High Return on Investment Venture Funds Returns Increased Tech Licensing Revenue Revenues New Market Access from “Open” New Products & Services Model Mergers & Acquisitions “Closed Model” Growth Our Our Market Market Revenue Revenue Net Income 0 Internal Development Internal Costs Development Savings from Open Innovation “Costs” Costs Leveraging Reduced & Avoided Costs External Development Closed Model Open Model Source: Adapted from Open Business Models, Henry Chesbrough © 2006, Harvard Business School Press
  • 16. Management Systems Bridge to Execution Management Governance Strategic Language and Processes Decision-Making Innovation Framework, Systems Innovation Operational Organization and Execution Model Culture Metrics and Motivators Customers Customers Making It Happen Universities Competitors External Resources Focus and Discipline INNOVATION PLATFORM Universities Brainiacs Internal Resources Suppliers Suppliers Suppliers Suppliers Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 16
  • 17. Management Systems Bridge to Execution Management Governance Strategic Language and Processes Decision-Making Innovation Framework, Systems Innovation Operational Organization and Execution Model Culture Metrics and Motivators Customers Customers Making It Happen Universities Competitors External Resources Focus and Discipline INNOVATION PLATFORM Universities Brainiacs Internal Resources Suppliers Suppliers Suppliers Suppliers Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 17
  • 18. Breakthrough Innovations Often Use Incubation Incubation Governance (IG)  Clearly-defined decision makers  Innovation coaches  Effective resource allocation Chair Strategy Finance PC Reps External Loop Reviews Structured  Mechanism through 1 2 3 Development which IG assesses value, provides direction, Process LOOP KEY  Roadmap for and manages scope QUESTION breakthrough / radical  Event and time based innovation development reviews Next  Guidelines steer  Business opportunity Loop development activities perspective  Tools and templates that  Collaborative team help teams quickly identify guidance and Loop innovative value empowerment Exit Development Teams  Small and cross-functional  External as well as internal resources  Intrapreneurial and nimble  Clear responsibility and authority for innovation development Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 18
  • 19. Management Systems Bridge to Execution Management Governance Strategic Language and Processes Decision-Making Innovation Framework, Systems Innovation Operational Organization and Execution Model Culture Metrics and Motivators Customers Customers Making It Happen Universities Competitors External Resources Focus and Discipline INNOVATION PLATFORM Universities Brainiacs Internal Resources Suppliers Suppliers Suppliers Suppliers Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 19
  • 20. Metrics and Motivators Help Create the Culture Organization Structure Leadership Metrics and Motivators Culture Learning Organization Making Innovation Work, Davila, Epstein, Shelton: Wharton School Publishing, 2006 Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 20
  • 21. Optimize Alignment to Drive Growth Innovation Business Operational Goals and Model Strategy Management Strategic Insight Blueprint Innovation Innovation Execution Growth Aspiration How You Innovate Determines What You Innovate Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 21
  • 22. Questions and Answers Why can’t companies develop strong, effective innovation? They are unwilling or unable to fix what is broken or underperforming Why do companies find it so hard to sustain robust levels of innovation? They use an outdated strategy or operational model for innovation How do leaders create meaningful levels of innovation? They manage innovation as if their future growth depends on it—because it does Making Innovation Work NASSCOM Awards— September 2009 | © 2009 PRTM Proprietary CONFIDENTIAL | 22
  • 23. PRTM Contacts ROBERT SHELTON MAHESHWAR SINGH Managing Director Director India Embassy Classic., 3rd Floor T +1 650 864 3517 444 Castro Street T +91 80 4010 0900 11, Vittal Mallya Road, M+1 650 218 3519 Suite 600 M+91 96 1195 5116 Bangalore 560001 Mountain View, CA 94041 India USA rshelton@prtm.com msingh@prtm.com www.prtm.com www.prtm.com