8 steps to innovation: An introduction

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Slides presented by Prof. Rishikesha Krishnan at CIO Leadership Summit at Hotel Movenpick on April 26, 2013. It gives an overview of the book "8 steps to innovation: Going from jugaad to excellence" by Vinay Dabholkar and Rishikesha Krishnan.

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8 steps to innovation: An introduction

  1. 1. Rishikesha T. Krishnan & Vinay Dabholkarrishi@iimb.ernet.in; vinay@catalign.com8 Steps to Innovation:Building a Systematic Innovation CapabilityApril 26, 20131Build apipeline3 ImproveBatting Avg2 Improve idea velocity
  2. 2. From Jugaad to Systematic Innovation:
  3. 3. Innovation byFirmsInputsPeopleFundingKnowledgeInfrastructureCapacity to InnovateIncentive toInnovateBenefitsCompetitionAppropriabilityRewardsSocialEnvironmentPoliticalEnvironmentEconomicEnvironmentTechnologyEnvironmentGovernment PolicyInternationalEnvironment3
  4. 4. Innovation byFirmsInputsPeopleFundingKnowledgeInfrastructureCapacity to InnovateIncentive toInnovateBenefitsCompetitionAppropriabilityRewardsSocialEnvironmentPoliticalEnvironmentEconomicEnvironmentTechnologyEnvironmentGovernment PolicyInternationalEnvironmentImproved since1991Remain areasof concern4
  5. 5. INNOVATION STRATEGIESDEPEND ON YOUR SOURCE OFCOMPETITIVE ADVANTAGE….Look at thedisciplines of market leaders….6
  6. 6. 1. Operational ExcellenceProvision of consistent quality at the best pricethrough a standardized business systemthat minimizes the cost & difficulty facedby the customer in acquiring the product• Wal-Mart• Southwest AirlinesLow-cost transactionprocessing systemsOptimization ofbusiness processes7
  7. 7. 2. Customer ResponsivenessEmphasis on careful tailoring and adaptationof products & services to increasinglyspecific requirements• Merrill-Lynch• Nordstrom’sMicrosegmentsLong-term relationshipsEmpowerment8
  8. 8. 3. Performance SuperiorityContinuous, fast-paced innovation that yieldsa steady flow of leading-edge products thatconsistently push the state-of-art•3M•Sony•GilletteOpenness to new ideasSensitive to latent needsMobilize NPD teams9
  9. 9. 8 Steps to Innovation:Building a Systematic Innovation Capability1Build apipeline3 ImproveBatting Avg2 Improve idea velocity
  10. 10. Build a Pipeline1. Lay the Foundation2. Create a Challenge Book3. Build Participation11
  11. 11. Improve the Idea Velocity4. Experiment with Low Cost at High Speed5. Go Fast from Prototyping to Incubation6. Iterate on the Business Model12
  12. 12. Increase the Batting Average7. Build an Innovation Sandbox8. Create a Margin of Safety13
  13. 13. LAY THE FOUNDATIONSTEP 1148 Steps to Innovation Excellence
  14. 14. Build a Pipeline1. Lay the Foundation Create Innovation Program E.g. Jeff Immelt “Imagination Breakthroughs” - $1B potential 3 Key Processes Idea Management Buzz Creation Training & Development15
  15. 15. 3 Key Processesin an Innovation ProgramIdeaManagementBuzzCreationTraining &Development(who submits?who selects?who funds?)(campaigns,communication,rewards,innovation day)(prototyping,TRIZ,design thinking,idea communication,leadership development)
  16. 16. Idea Boxsource scope stagestechnology selection fundingIdea Management
  17. 17. Year No of Suggestions Participation Adoptionsuggestions per person Rate(%) Rate(%)1951 789 0.1 8 231971 88,607 2.2 67 721986 2.6million 48 95 9640 years, 20 million ideas
  18. 18. The Power of Small Ideas“There is no genius in our company. Wejust do whatever we believe is right, tryingevery day to improve every little bit andpiece. But when 70 years of very smallimprovements accumulate, they become arevolution”From Interview with Katsuaki Watanabein HBR, July-Aug 200719
  19. 19. Build a Pipeline Lay the Foundation Create Innovation Program E.g. Jeff Immelt “Imagination Breakthroughs” - $1B potential 3 Key Processes Idea Management Buzz Creation Training & Development20
  20. 20. Buzz Creation (creative campaigns)21
  21. 21. Garib Rath(Heavier & longer)Axle loadHeavier, faster and longer
  22. 22. Some Titan Innovation Campaigns 2004: “What is new?” Identification and implementation of 5 new ideas byevery supervisor on the shopfloor 2006: HOD Fund Every head of department authorised to spend upto Rs. 1lakh on an idea without any approvals 2008: “Simplify & Automate” Most successful theme at Titan 2009: “Innovation School of Management” Making every employee an innovator24
  23. 23. Titan: The 3M of India?25Karatmeter resulted in transformation of jewellerybusiness“Anyone can be an Innovator”Innovation School of ManagementProcess innovations result in 100s of crores savings
  24. 24. Build a Pipeline Lay the Foundation Create Innovation Program E.g. Jeff Immelt “Imagination Breakthroughs” - $1B potential 3 Key Processes Idea Management Buzz Creation Training & Development26
  25. 25. Training & Development Titan Innovation School of Management “Everybody an innovator by 2015”27Focus area TechniquesDesign thinking Immersive research, rapidprototyping, brainstormingSystems thinking TRIZSystems archetypesTheory of constraints (TOC)Lateral thinking Edward de Bono’s six thinkinghats
  26. 26. CREATE A CHALLENGE BOOKSTEP 2288 Steps to Innovation Excellence
  27. 27. Build a Pipeline2. Create a Challenge Book U & I Portal at HCL Petition Box at Tihar Jail Feel the Pain Sense the Wave See the Waste29
  28. 28. The Bajaj Pulsar exploited a discontinuity..30
  29. 29. 7 Themes Digital consumers Emerging economies Sustainable tomorrow Smarter organizations New commerce Pervasive computing Healthcare economy31http://jugaadtoinnovation.blogspot.in/2012/04/infosys-innovation-to-build-tomorrows.html
  30. 30. Disguster DelighterAnnoyance FrillsNegative PositiveLowHighEmotionsImportancetocustomerA Relentless Focuson User Experience is CriticalSource: H. Rao, Stanford GSB, 200732
  31. 31. DisgusterDelaysMissing BagsDelighterUpgradesAnnoyancePepsi insteadof CokeFrillsInflightMagazineNegative PositiveLowHighEmotionsImportancetocustomerA Relentless Focuson User Experience is CriticalExamples from the Airline IndustrySource: H. Rao, Stanford GSB, 200733
  32. 32. BUILD PARTICIPATIONSTEP 3348 Steps to Innovation Excellence
  33. 33. Examples Role model Community of practice Innovation catalyst Rewards & recognition35
  34. 34. Improve the Idea Velocity4. Experiment with Low Cost at High Speed5. Go Fast from Prototyping to Incubation6. Iterate on the Business Model36
  35. 35. EXPERIMENT WITH LOW COSTAT HIGH SPEEDSTEP 4378 Steps to Innovation Excellence
  36. 36. Improve the Idea Velocity4. Experiment with Low Cost at High Speed38
  37. 37. itchideademoimpactFeasibility Loop Viability Loop2 monthsSep2003Nov2003Feb 20043 months 2 monthsApr 2004
  38. 38. Creating a Climate for Experimentation Failure plays a critical role in innovation Post-It Notes & failed adhesives Nylon: a lab experiment that went wrong TVS Spectra failed, but Victor succeeded Time-to-market is important…but don’t forget the roleof earlier innovations Separate intelligent failure from unnecessary failure -in language and managerial response Create infrastructure, give resources for expts Have a high trial rate: fail fast, learn fast Can you do the “last” experiment first?40
  39. 39. Avoid the “Failure Fallacy”41
  40. 40. GO FAST FROM PROTOTYPETO INCUBATIONSTEP 5428 Steps to Innovation Excellence
  41. 41. Improve the Idea Velocity5. Go Fast from Prototyping to Incubation43
  42. 42. ITERATE ON THEBUSINESS MODELSTEP 6448 Steps to Innovation Excellence
  43. 43. Improve the Idea Velocity6. Iterate on the Business Model45
  44. 44. Difficult tomake moneyHolder ofcomplementaryresources makesMoney(EMI, Coke)InventormakesmoneyParty withInnov .+ Compl.resources makesMoney(Pixar vs Disney)Freely availableor unimportantTightly heldand importantLowHighComplementary AssetsEase of ImitationInimitability/Complementary Assets FrameworkSource: Afuah, 2004
  45. 45. BUILD ANINNOVATION SANDBOXSTEP 7478 Steps to Innovation Excellence
  46. 46. Increase the Batting Average7. Build an Innovation Sandbox48
  47. 47. The Power of Platforms7 Themes Digital consumers Emerging economies Sustainable tomorrow Smarter organizations New commerce Pervasive computing Healthcare economy49WalletEdgePlatform Offeringhttp://jugaadtoinnovation.blogspot.in/2012/04/infosys-innovation-to-build-tomorrows.html
  48. 48. Open Innovation50As one of the biggest playersin the water purification market,Eureka Forbes is a naturalpartner for new technologies.EFL keeps itself open to newideas from all over the worldE.g. : Nanoceram technologydeveloped by Argonide Corp.USA – takes care of viruseswithout chemicals
  49. 49. CREATE AMARGIN OF SAFETYSTEP 8518 Steps to Innovation Excellence
  50. 50. Increase the Batting Average8. Create a Margin of Safety52
  51. 51. THANK YOU53rishi@iimb.ernet.inhttp://jugaadtoinnovation.blogspot.in

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