Innovation and Business Models

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This is a quick overview of innovation, design thinking, and business models

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  • FINANCE Business Model-Dell prepaid, no inventory Networking and Value Chain- partnerships to share core competencies: Coke doesn ’t make coke, Amazon offers infrastructure and Development, Ebay PROCESS Enabling Process-Starbucks charges more, pays educated employees more for a different customer experience Core Process- Walmart advances profitability through process innovations such as real time inventory, systems that allow store managers to identify and react to changes in consumer behavior OFFERING Product Performance- Intel Processors are used universally with little competition because the performance is unmatched Product System- Microsoft office bundles a suite of complimentary offerings: word, powerpoint, excel, web browser, etc Service- Fed Ex has outstanding customer service, package tracking DELIVERY Channel- how you connect your customers to your offering. IKEA is not only a store, it is an experience Brand-how you communicate your value. Businessweek consistently names Coke the most valuable brand in the world Customer Experience- the integrated experience offered by Apple from the store where geniuses can solve your problems, to the design and user interface that delight
  • This is rarely understood. Apple was not the first MP3. The Rio came first, Napster came next. Napster was the file sharing program that shut down digital content as the music industry was bleeding. Apple worked with the music industry to develop a standard of copyright protection for digital music. Then Apple created a market place (itunes) for purchase and organization of music. This is when the rapid growth of units and offerings began
  • Innovation and Business Models

    1. 1. MICROLECTURE INNOVATION + BUSINESS MODELS
    2. 2. DISRUPTIVE INNOVATORS Label Musician Entrepreneur Talk Show Host Inventor Areas of Innovation Notable in Business Fast Company: Most Creative Person in Business Creative Consultant - Polaroid Time Magazine Person of the Year World ’s Youngest Billionaire Barron ’s: World’s Best CEO Forbes: CEO of the Decade CNN, Time, Life Magazines: Most Influential Woman in the World Music Marketing Business Model Fashion Theater Activism Technology Social Media Business Model Media Branding Business Model Philanthropy Technology Branding Business Model Experience Design Lady Gaga Mark Zuckerberg Oprah Winfrey Steve Jobs
    3. 3. CONTEXT: IDEO WAYS TO GROW MATRIX NEW STUFF TO SAME OLD PEOPLE TWEAK PRODUCT, SERVICE OR BRAND SELL OLD STUFF TO NEW PEOPLE SELL NEW STUFF TO NEW PEOPLE
    4. 4. CONTEXT: DOBLIN 10 TYPES OF INNOVATION Enabling Process assembled capabilities you buy from others Core Process proprietary process that add value Service how you serve your customers Channel how you connect customers to offering Customer Experience how you create an integrated experience for customers Brand how you express your offering ’s benefits & values to customers FINANCE Business Model Networking PROCESS Enabling Process Core Process OFFERING Product Perform Product System Service DELIVERY Channel Brand Customer Experience Business Model how the enterprise makes money Networking enterprise structure, value chain & partnering Product Performance basic features-performance & function Product System extended system around the offering
    5. 5. The majority of resources and effort are concentrated on the product offering CONTEXT: DOBLIN- INVESTMENT IN INNOVATION
    6. 6. The greatest return on innovation effort falls outside of the product offering. CONTEXT: DOBLIN ROI IN INNOVATION
    7. 7. WHAT IS INNOVATION? EXAMPLES OF DISRUPTIVE INNOVATION
    8. 8. AGE OLD EXAMPLE IN A NEW LIGHT DESIRABLE ILLUMINATION VIABLE INFRASTRUCTURE + DELIVERY VALUABLE MONETIZATION OF SERVICE
    9. 9. JUST A CUP OF JOE? DESIRABLE CONVENIENCE, SIMPLICITY, COFFEE ON DEMAND VIABLE PATENTED BREWING PROCESS VALUABLE BUILT IN REOCCURRING REVENUE, HIGH SWITCHING COSTS
    10. 10. WHAT IS REALLY INNOVATIVE ABOUT THE IPOD? THE PRODUCT? 1998 1999 2000 2001
    11. 11. LIFECYCLE OF A DISRUPTIVE PRODUCT INNOVATION 2006 2007 2008 2009 2010 2011 Flip Video Launched May 2006 HD Flip Video Launched
    12. 12. WHAT EXACTLY IS A BUSINESS MODEL?
    13. 13. BUSINESS MODEL= ENGINE FINANCIAL MODEL= FUEL OR ENERGY BUSINESS PLAN= ROAD OR TRIP PLAN BUSINESS MODELS: RELATED BUT OFTEN CONFUSED
    14. 14. (C) Al ex Osterwalder Business Model Innovation Hub THE FOUR COMPONENTS OF THE BUSINESS MODEL CUSTOMERS CUSTOMER SEGMENTS CUSTOMER RELATIONSHIPS DISTRIBUTION CHANNELS INFRASTRUCTURE KEY PARTNERSHIPS KEY ACTIVITIES KEY RELATIONSHIPS VALUE PROPOSITION PROFIT EQUATION REVENUE STREAMS COST STRUCTURE
    15. 15. INNOVATION IS NOT JUST ABOUT PRODUCTS DISRUPTIVE INNOVATION IS DESIRABLE, VIABLE, AND VALUABLE SPEED OF INNOVATION CYCLES ARE RAPIDLY INCREASING START WITH THE USER IN MIND SOME KEY TAKE AWAYS

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