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Manging for Innovation

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The what, why and how of managing innovation in a business context

Published in: Business, Technology

Manging for Innovation

  1. 1. MANAGING 4 I N N O V A T I O N Greg Fisher
  2. 2. W H A T ? W H Y ? H O W ?
  3. 3. W H A T ?
  4. 4. What is innovation? <ul><li>Innovation is the process of turning opportunity into new ideas and putting those into widely used practice – Tidd, Bessant & Pravitt – Managing Innovation (2001) </li></ul><ul><li>Innovation is the means by which entrepreneurs exploit change as an opportunity for a different business or service – Peter Druker – Innovation and Entrepreneurship (1985) </li></ul><ul><li>Innovation is the successful exploitation of new ideas – UK DTI Innovation Unit </li></ul>
  5. 5. What is innovation? Opportunity Idea Exploitation = Innovation + +
  6. 6. Product Innovation <ul><li>Improving the features of a product or creating new products </li></ul>
  7. 7. Process Innovation <ul><li>Improving or changing the process by which a product or service is produced or delivered </li></ul>
  8. 8. Business Concept Innovation <ul><li>Radically reconceiving products and services, not just developing new products / services </li></ul><ul><li>Redefining market space </li></ul><ul><li>Redrawing industry boundaries </li></ul>
  9. 9. W H Y ?
  10. 10. Encyclopaedia Britannica’s 225 year track record of success was destroyed in: <ul><li>24 months </li></ul><ul><li>5 years </li></ul><ul><li>10 years </li></ul><ul><li>25 years </li></ul>
  11. 11. Encyclopaedia Britannica’s 225 year track record of success was destroyed in: <ul><li>24 months </li></ul><ul><li>5 years </li></ul><ul><li>10 years </li></ul><ul><li>25 years </li></ul>
  12. 12. What has more computing power? <ul><li>Dell 400 Mhz Pentium III desktop PC </li></ul><ul><li>Apollo 11 mission control computer </li></ul><ul><li>Sony Playstation </li></ul>
  13. 13. What has more computing power? <ul><li>Dell 400 Mhz Pentium III desktop PC </li></ul><ul><li>Apollo 11 mission control computer </li></ul><ul><li>Sony Playstation </li></ul>
  14. 14. It took the telephone 40 years to penetrate 10 million homes. How long did it take the Netscape browser? <ul><li>18 months </li></ul><ul><li>5 years </li></ul><ul><li>10 years </li></ul>
  15. 15. It took the telephone 40 years to penetrate 10 million homes. How long did it take the Netscape browser? <ul><li>18 months </li></ul><ul><li>5 years </li></ul><ul><li>10 years </li></ul>
  16. 16. How many people use the internet in China? <ul><li>50 million </li></ul><ul><li>200 million </li></ul><ul><li>300 million </li></ul>
  17. 17. How many people use the internet in China? <ul><li>50 million </li></ul><ul><li>200 million </li></ul><ul><li>300 million </li></ul>
  18. 18. Value of Yahoo!’s offer to buy Facebook.com from the 22 year old founder, Mark Zuckerberg <ul><li>$100 million </li></ul><ul><li>$1 billion </li></ul><ul><li>$500 million </li></ul>
  19. 19. Value of Yahoo!’s offer to buy Facebook.com from the 22 year old founder, Mark Zuckerberg <ul><li>$100 million </li></ul><ul><li>$1 billion </li></ul><ul><li>$500 million </li></ul>
  20. 20. 3 billion people live in Asia. What proportion of the population is < 25 years old? <ul><li>20% </li></ul><ul><li>35% </li></ul><ul><li>50% </li></ul>
  21. 21. 3 billion people live in Asia. What proportion of the population is < 25 years old? <ul><li>20% </li></ul><ul><li>35% </li></ul><ul><li>50% </li></ul>
  22. 22. The cost of hiring an English speaking PhD chemist in India is: <ul><li>R65,000 pa </li></ul><ul><li>R150,000 pa </li></ul><ul><li>R350,000 pa </li></ul>
  23. 23. The cost of hiring an English speaking PhD chemist in India is: <ul><li>R65,000 pa </li></ul><ul><li>R150,000 pa </li></ul><ul><li>R350,000 pa </li></ul>
  24. 24. The average consumer in the developed world is hit with how many marketing messages every day? <ul><li>500 </li></ul><ul><li>2500 </li></ul><ul><li>4500 </li></ul>
  25. 25. The average consumer in the developed world is hit with how many marketing messages every day? <ul><li>500 </li></ul><ul><li>2500 </li></ul><ul><li>4500 </li></ul>
  26. 26. General Motors makes more money from? <ul><li>Selling cars </li></ul><ul><li>Selling technology </li></ul><ul><li>Lending customers money to buy its cars </li></ul>
  27. 27. General Motors makes more money from? <ul><li>Selling cars </li></ul><ul><li>Selling technology </li></ul><ul><li>Lending customers money to buy its cars </li></ul>
  28. 28. Number of Apple iPods sold to date? <ul><li>10 million </li></ul><ul><li>35 million </li></ul><ul><li>100 million </li></ul>
  29. 29. Number of Apple iPods sold to date? <ul><li>10 million </li></ul><ul><li>35 million </li></ul><ul><li>100 million </li></ul>
  30. 30. Google’s value at IPO, 6 years after the business was founded? <ul><li>32 billion </li></ul><ul><li>20 billion </li></ul><ul><li>12 billion </li></ul>
  31. 31. Google’s value at IPO, 6 years after the business was founded? <ul><li>32 billion </li></ul><ul><li>20 billion </li></ul><ul><li>12 billion </li></ul>
  32. 32. H O W ?
  33. 33. 4 businesses 4 case studies 4 management philosophies 4 innovation models
  34. 36. Methodical Innovation Observe Brainstorm Implement Prototype
  35. 37. Observe IDEO’s cognitive psychologists, anthropologists, and sociologists team up with corporate clients to understand the consumer experience
  36. 38. Ideo
  37. 39. Brainstorm An intense, idea-generating session analyzing data gathered by observing people. Each lasts no more than an hour. Rules of brainstorming are strict and are stenciled on the walls.
  38. 40. Ideo
  39. 41. Prototype Mocking up working models helps everyone visualize possible solutions and speeds up decision-making and innovation .
  40. 42. Ideo
  41. 43. Implement Bring IDEO’s strong engineering, design, and social-science capabilities to bear when actually creating a product or service .
  42. 44. Methodical Innovation <ul><li>Process to drive innovation </li></ul><ul><li>Fun environment </li></ul><ul><li>Diverse teams </li></ul><ul><li>Encourage failure </li></ul>Application
  43. 46. Facts about P&G <ul><li>167-year-old business </li></ul><ul><li>$50 billion in sales </li></ul><ul><li>300 brands </li></ul><ul><li>160 Countries </li></ul><ul><li>13 brands in excess of $1 billion </li></ul>
  44. 47. P&G History of Innovations How do they keep this going?
  45. 48. <ul><li>R&D Spend – $1.6 billion </li></ul><ul><li>7,200-strong R&D staff </li></ul><ul><li>Over 1000 PhD’s </li></ul>P&G Response = R&D But still not getting the innovation they want?
  46. 49. Open Innovation R&D C&D [Connect & Develop] [Research & Development]
  47. 50. Source: P&G Connect and Develop Booklet: http://pg.t2h.yet2.com/t2h/page/homepage
  48. 51. Connection network Source: P&G Connect and Develop Booklet: http://pg.t2h.yet2.com/t2h/page/homepage
  49. 53. Our vision is simple. We want P&G to be known as the company that collaborates - inside and out - better than any other company in the world. I want us to be the absolute best at spotting, developing and leveraging relationships with best-in-class partners in every part of our business. In fact, I want P&G to be a magnet for the best-in-class. I have a ready-to-go product or technology to offer P&G I want to acquire a technology from P&G.
  50. 54. Ready-To-Go Products By acquiring the newly introduced SpinBrush, P&G was able to bring a superior oral care brand to market quickly, without undertaking the time and expense of developing an entirely new product. Ready-To-Go Packaging Consumer-preferred pump dispensers were originally developed by a European packaging products company. P&G led a collaborative improvement process to make the original pumps more effective prior to their launch in Olay’s North American markets. Open Innovation
  51. 55. Ready-To-Go Technologies P&G introduced Bounce, the world’s first dryer-added softener, after acquiring the product technology from the independent inventor who developed the innovative fabric-care solution. Open Innovation Commercial Partnerships P&G found the perfect complement to the Swiffer brand in a hand-held duster developed by a Japanese competitor. After purchasing the product, P&G leveraged elements of existing manufacturing processes and advertising components to launch Swiffer Duster within 18 months.
  52. 56. <ul><li>Know where to look </li></ul><ul><li>Leverage networks </li></ul><ul><li>Distribute and screen ideas </li></ul><ul><li>Promote openness to external ideas </li></ul>Open Innovation Application
  53. 58. MSA Vitality Discovery Life Discovery Card Destiny Health Discovery World 1994 2006 Innovation History
  54. 59. Driven Innovation &quot;We don't innovate for innovation's sake, but without a deadline that fine line between a great product and a mediocre product is seldom bridged.” Adrian Gore – CEO Discovery <ul><li>Set a deadline </li></ul><ul><li>Short planning cycles: 18 months to 3 years </li></ul><ul><li>Link product and process innovation </li></ul><ul><li>Combine intellect & emotion </li></ul>
  55. 61. Pet Project Innovation “ We call all of these projects Googlettes. Basically, they're baby Googles, startups within the startups. We really like the concept because it helps us keep that innovative startup feel and launch projects quickly.” Marissa Mayer - Director Consumer Web products at Google
  56. 62. Pet Project Innovation <ul><li>Free time </li></ul><ul><li>Access to upper managers </li></ul><ul><li>Top 100 priorities list </li></ul><ul><li>Small teams </li></ul>Application
  57. 63. Where will Google go next?
  58. 64. Open Innovation Driven Innovation Pet Project Innovation Methodical Innovation
  59. 65. Consistent Themes?
  60. 66. <ul><li>Leadership </li></ul><ul><li>Teamwork </li></ul><ul><li>Values </li></ul><ul><li>Stimulation </li></ul><ul><li>Recruitment </li></ul>Consistent Themes
  61. 67. Open Innovation Driven Innovation Pet Project Innovation Methodical Innovation
  62. 68. MANAGING 4 I N N O V A T I O N Greg Fisher www.fisherg.blogspot.com [email_address]

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