Second half of full day workshop held at Temple University (Oct 16 - 2015)

1. Value Propositions to
Encouraging Adoption
© 2015 Robert McNamee & Andrew Maxwell
Dr. Robert McNamee
Managing Director,
Innovation & Entrepreneur Institute
Fox School of Business, Temple University
Dr. Andrew Maxwell
Director Bergeron Entrepreneurs in
Science & Technology,
Lassonde School of Engineering

2. Afternoon Agenda
Introduction to Innovation Science
Value Proposition to Adoption
• 12:45 Stakeholder & Barriers to Adoption
• 1.00 Stakeholder & Barriers to Adoption Exercise
• 2.00 Business Models & Enabling Adoption
• 2.15 Business Models & Enabling Adoption Exercise
• 3.00 Group Presentations on Barriers & Adoption
Wrap up:
• 3.30 Recap &Lessons Learned
• 4.00 Networking & Decompressing

3. Innovation science
• Technologists may believe better technology = market success
• However commercial success requires understanding:
– How will customers become aware of your solution?
– How will they know it works?
– What will motivate them to purchase?
– How can you overcome user inertia (address concerns)?
– How can you identify early adopters?
• Achieving commercial success requires understanding how
different factors affect people’s decisions and behaviours
Innovation science requires a better understanding of
people, not just technology and is a behavioral science

4. Steps in Canvas #2
(Phase II of TechConnect)
1. Identify multiple market segments for each application (value proposition)
2. Identify relevant stakeholders for each market segment
3. Identify barriers to adoption relevant to each stakeholder
4. Identify other constraints/barriers for that option
5. Synthesize new approaches/business models to overcome barriers

5. TechConnect is about
Divergence and Convergence
During Phase 1
• Challenge assumption about application for a novel technology
• Identify alternate jobs and value propositions
• Develop frameworks to identify most promising applications
During Phase 2
• Challenge assumptions about the market segment
• Focus on changing user/customers’ behavior
• Recognize barriers to adoption
• Synthesize alternate ways to overcome barriers
• Analyze context specific approaches to adoption

6. TechConnect Outcomes
Outcomes from the process
• Identify additional or adjacent market opportunities
• Inform technology Development
• Include a plan to overcoming adoption barriers into both
technology and development plan
• Alternate options preferred by different participants
– University technology transfer offices,
– Inventor
– Entrepreneur
– Corporation
– Economic development agency

7. TechConnect outcomes
vary for individuals
University Technology Transfer Offices look for:
• Licensing opportunities (revenues /reputation)
Inventors look for:
• Interesting applications for technology (uptake/ publications)
Entrepreneurs look for:
• Creating a viable and sustainable business (fundable/scalable)
Corporations look to:
• Enhance current offering and leverage existing resources
All participants benefit from a better understanding of the
technology commercialization process

8. Maxwell’s three laws of
innovation inertia
1. There is a natural tendency for organizations to keep
doing what they’re doing and resist changes. In the
absence of a force, they will continue to do what
they’ve always done.
2. Larger organizations require more force to change
what they are doing than smaller organizations.
3. For every force there is a reaction force that is equal
in size, but opposite in direction. When someone
exerts a force on an organization, he or she gets
pushed back in the opposite direction equally hard.
8

9. Motivation to adopt
2
• Perceived benefits can include…
– Saving money, increased utility or enjoyment
– Increase reliability, safety or environmental performance
– Reduces risks
• Perceived costs can include…
– Acquisition costs, switching costs,
– Uncertain outcomes/reputation
– Increased technology, financial or operational risk
• To motivate a change in behavior you can increase benefits
and reduce costs, and demonstrate this

10. 1. Where do you add value?
(Application / market segment)
Increased
efficiency for
internal
combustion
engine
After market
parts
OEM parts
supply
Direct deal
with fleet
operator
Instructions
• Start with understanding the
application
• Identify fundamentally different
market segments that might
see the value proposition
• May include segments you
need to to validate, or gather
more information on

11. 2. Who are stakeholders?
Automobile
owner
(individual or
fleet) Distributor /
Service
Centers
Manufacturer
of device
After market
parts
OEM parts
supply
NHTSA/EPA/C
ARB Fuel Supplier
(comple-
mentary)
Insurance
Agencies
Auto
media/Consu
mer reports
Auto-maker
manufacturing
Auto-maker
technical
team
(primary)
Auto-maker
Dealers
Auto-maker
management
and
marketing
Instructions
• Start with understanding each
market segment
• Identify fundamentally different
individuals in each segment who
see the value proposition
• This can include: users, economic
buyers, technology buyers and
influencers
• Each will have different
motivations and concerns when
adopting technology
• There may be some common
stakeholders between segments

12. 3. What are barriers to adoption?
(Benefits vs costs)
Perceptions
of costs vs
benefits
(major)
Reliability,
maintenance
costs
Ease of
installation/
compatibility
Technical risk
Uncertainty
about long
term effects
on other parts
of car Performance
over time
Not invented
here
Liability
concerns
Instructions
• Start with understanding each
stakeholder
• Identify how they perceive cost
and benefits
• Consider five types of barriers:
– Economic
– Technical/operational
– Personal risk
– Market/Financial risk
– Reputational risk
– Behavioral
After market
parts
OEM parts
supply

13. 4. Other constraints?
(Internal: organization, resource)
(External: market, environement)
(Contextual: building awareness)
Safety testing
(time/cost)
Warranty
issues
Product
liability
insurance
costs
Environmenta
l and
performance
regulations
Competitive
environment
CAFÉ fleet
regulations
Instructions
• Identify internal, external and
contextual factors that might
influence perception:
– Internal constraints include
existing business strategy, current
organization and resources
– External constraints include
technology, market,
competition, legislation,
shareholder
– Contextual factors include
challenges in building awareness
and overcoming liability of
newness
After market
parts
OEM parts
supply

14. 5. Identify how you can modify
business, revenue and innovation
factors to overcome barriers
Addressing barriers to adoption,
consider
• Can you increase the perceived
benefits or reduce the perceived
costs?
• Can you change the business model
(i.e. form factor, channel partner)
• Can you change the revenue model
(reduce initial cost or financial risk)
• Can you embed features in the
technology or revenue model
(increase observability, trialability,
compatibility)

15. 5a. Strategic options to stimulate
innovation adoption
Embed
capability to
record fuel
savings
• Relative Advantage – better
than the alternatives it will
replace
• Compatibility – easy for user to
assimilate innovation
• Complexity – easy for user to
learn to use the innovation
• Trialability –easy for a user try
out the innovation
• Observability – how readily can
a user see the results /
• Brainstorm alternate ways in
which you can modify the
technology, business model etc.
After market
parts
OEM parts
supply

16. 5b. Business model options to
stimulate adoption
Embed
capability to
record fuel
savings
• Integrate into existing offering
• Embed compatibility with current
practice
• Integrate into existing supply chain
• Reduce installation/integration
complexity
• Change form factor for market niche
• Focus on one performance dimension
• Integrate into partners offering
• Make it easy to measure performance
• Brainstorm alternate ways in which
you can modify the technology,
business model, etc.
Design device
as a clamp on
system,
enabling end
users to
install
After market
parts
OEM parts
supply

17. 5c. Revenue model options to
stimulate adoption?
Embed
capability to
record fuel
savings
• Offer for free (trial) before you
have to purchase
• Turn a capital purchase into a
service agreement
• Charge per use or for savings made
• Steeped charges for increasing use
• Offer basic service for free, with
premium options
• Integrate with other product or
service offerings
• Brainstorm alternate ways in which
you can modify the technology,
business model, etc.
After market
parts
OEM parts
supply
Design device
as a clamp on
system,
enabling end
users to
install Have a fuel
supplier offer
for free as
part of a fuel
supply
contract

18. Licensing vs. venture creation as
commercilization alternates
Factors that favour new venture creation
• Technology is sold as a complete solution
• Market for technology is growing, lacks standards and is not
dominated by major player
• Technology and business development costs are not excessive
• Technology likely to disrupt the market
• Required technical and management expertise and resources
available locally (and not controlled by competitors)
• Inventor wishes to play critical role
• Time to product launch is less than 12 months
• Identified early adopters
• Risk capital readily available

19. Closing Thoughts
• TechConnect process deconstructs the technology
commercialization process into a series of divergent
and convergent stages
• Highlights importance of proprietary technology
• Embeds market facing questions into each process
(speeds up time to market or fails fast)
• Helps inventor identify and choose options
• Asks important questions to ask at each stage
• Helps participants better understand technology
commercialization process (technological/behavioral)

20. Thank you to our partners