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
BRIDGE PROGRAM OVERVIEW WHAT IS INNOVATION? WHAT DOES IT HAVE TO DO WITH DESIGNERS?
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
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
The majority of resources and effort are concentrated on the product offering CONTEXT: DOBLIN- INVESTMENT IN INNOVATION
The greatest return on innovation effort falls outside of the product offering. CONTEXT: DOBLIN ROI IN INNOVATION
BRIDGE PROGRAM OVERVIEW WHAT IS THE BUSINESS BRIDGE PROGRAM?
EXPANDING DESIGNER’S IMPACT ACROSS THE INNOVATION SPECTRUM DESIGNER DESIGN MBA BRIDGE Process Innovation Process Core Process Offering Product Performances Service System Customer Service Delivery Channel Brand Customer Experience Finance Business Model Value Network BUSINESS BUSINESS TRADITIONAL DESIGN INDUSTRIAL - FASHION - INTERIOR- ARCHITECTURE - GRAPHIC- ADVERTISING
Each module will run 9-2:30 hours a day for 2 weeks DELIVERY STRUCTURE-MODULES BRIDGE PROGRAM OVERVIEW Business Models VALUE Marketing + Management CUSTOMER Statistics + Operations DECISIONS Financial Management EVALUATION Project Based Learning
<ul><li>CONCEPTS EXPLORED AND PROBED: </li></ul><ul><li>OVERVIEW OF DESIGN PROCESS </li></ul><ul><li>CONCEPTUAL MAPPING OF BUSINESS MODELS </li></ul><ul><ul><ul><ul><li>CUSTOMER VALUE PROPOSITION </li></ul></ul></ul></ul><ul><ul><ul><ul><li>PROFITABILITY MODEL </li></ul></ul></ul></ul><ul><ul><ul><ul><li>RESOURCE REQUIREMENTS </li></ul></ul></ul></ul><ul><ul><ul><ul><li>KEY PROCESSES </li></ul></ul></ul></ul>SAMPLE COMPANIES OR OFFERINGS INVESTIGATED MODULE 1: VALUE Business Models VALUE
<ul><li>CONCEPTS EXPLORED AND PROBED: </li></ul><ul><ul><li>PRODUCT DEVELOPMENT + POSITIONING </li></ul></ul><ul><ul><li>PROMOTION </li></ul></ul><ul><ul><li>BRANDING </li></ul></ul><ul><ul><li>CUSTOMER BEHAVIOR </li></ul></ul><ul><ul><li>TARGET MARKETING </li></ul></ul><ul><ul><li>SOCIAL NETWORKING </li></ul></ul><ul><ul><li>MANAGEMENT STRUCTURE </li></ul></ul>SAMPLE COMPANIES OR OFFERINGS INVESTIGATED: MODULE 2: THE CUSTOMER Marketing + Management CUSTOMER
<ul><li>CONCEPTS EXPLORED AND PROBED: </li></ul><ul><ul><li>SURVEYS + SAMPLING </li></ul></ul><ul><ul><li>CORPORATE DECISION MAKING </li></ul></ul><ul><ul><li>SUPPLY CHAIN </li></ul></ul><ul><ul><li>STATISTICAL ANALYSIS </li></ul></ul><ul><ul><li>QUALITY CONTROL </li></ul></ul>SAMPLE COMPANIES OR OFFERINGS INVESTIGATED: MODULE 3: DATA IN DECISIONS Statistics + Operations DECISIONS
BRIDGE PROGRAM OVERVIEW WHAT IS INNOVATION? EXAMPLES OF DISRUPTIVE INNOVATION
THOMAS EDISION: THE LIGHTBULB IN CONTEXT DESIRABLE ILLUMINATION FEASIBLE INFRASTRUCTURE + DELIVERY VIABLE MONETIZATION OF SERVICE
DISRUPTION OF A COMMODITY PRODUCT DESIRABLE CONVENIENCE, SIMPLICITY, COFFEE ON DEMAND FEASIBLE PATENTED BREWING PROCESS VIABLE BUILT IN REOCCURRING REVENUE, HIGH SWITCHING COSTS
CONTEXT: APPLE’S DISRUPTIVE INNOVATION Itunes Store .aac high def support 1998 1999 2000 2001
BUSINESS MODEL= ENGINE FINANCIAL MODEL= FUEL OR ENERGY BUSINESS PLAN= ROAD OR TRIP PLAN BUSINESS MODELS: RELATED BUT OFTEN CONFUSED
BRIDGE PROGRAM OVERVIEW WHAT IS A BUSINESS MODEL? WHAT ARE WE GOING TO DO NOW?
BUSINESS MODEL BASICS Inspired by: Al ex Osterwalder Business Model Innovation Hub Offering OFFER Value Proposition: The Job Problem Solved + Need Satisfied Customer Relationships CUSTOMER-RELATIONSHIPS Reach, Treat, Communicate, Collaborate Customer Segments CUSTOMER-SEGMENTS Mass, Niche- Long Tail, Two Sided Distribution Channels CUSTOMER-CHANNELS Direct, Indirect INFRASTRUCTURE-PARTNERS Buyer-Supplier, Joint Venture, Co-Creation Key Activities INFRASTRUCTURE-ACTIVITIES Product, Platform, Problem Solving INFRASTRUTURE-RESOURCES Tangible- Capital Intensive, Intangible- Process, IP, Talent, Financial-Capital Cost Structure VALUE- COST Cost or Value Driven Fixed vs. Variable Revenue VALUE- REVENUE- RETURN Selling, Renting, Leasing, Fees, Other Measures