Successful Innovation Management

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Successful Innovation Management

  1. 1. vs. Successful Innovation Management The most powerful concepts and solutions of Innovation Management and Product Development to dramatically improve competitiveness 1S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  2. 2. Intro  Stefan Kutter  Dipl-Ing. (BA), MSc. Technology & Innovation Management  Founder & Head of consurge Innovationsmanagement (2005)  Own Ventures: – Innobest.net …inno-auditing & venture assentment online tools – Bestellshop-sw.de …local ERP/CRM for home order agencies & shops – Start-office.de …Berlin based incubator & shared office hub  Consulting projects & trainings mainly for SMEs in IT, service & manufacturing  Research in innovation- & start-up management 2S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  3. 3. Opening Questions  How do you experience innovation activities in Jordan?  Where do you see potential wasted?  What additional knowledge / approaches / skills / conditions could help you to innovate?  What are your expectations reg. this seminar? S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 3
  4. 4. Outline  Part 1 Challenges: understanding the immanent dangers to any business and why most approaches to innovate still fail so often (15 min)  Part 2 Success Factors: discussing the most important success factors of innovation management and its implications for improving the corporate ability to innovate focusing on idea management and the stage-gate process of new product development (25)  Part 3 Business Model Innovation: leveraging profits by designing and proving business models for each innovation to successfully implement it into the market (20)  Part 4 Questions & Answers 4S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  5. 5. Definition: What is an innovation? Anything, that is NEW & Successful S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 5 … to anyone (Company, Group of People, Area…) … not necessarily inventive! I claim: … in any way (economic, penetration/diffusion…)
  6. 6. 6 Stunning statistic on product innovation success Source: IAI, Bochum, Germany 100 33 13 6 0 20 40 60 80 100 started projects prototype development market introduction product success % percent Expon. (percent) S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  7. 7. !! There are more innovation projects actually killing the company rather than providing breakthrough success!! Stunning statistic on product innovation success 7 Ability to innovate is turning into an essential core competence Product Ideas Graph Sources: IAI Bochum & WU Wien in TR Innovation Projects Success Market S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  8. 8. Innovation Management Impact Competetive Advantage Time Today Innovation Management 8S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 Productivity Quality
  9. 9. Innovation Balance 9 ? ?
  10. 10. Innovation pressure Innovation abilities The Goal: sustainable profit Profitable growth create continious profitable revenue streams even under difficult market conditions 10S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  11. 11. Product Life Cycle under pressure 11 Source: Pahl/Beitz Sales Profit Sales / Profit Possible Relaunch Time S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  12. 12. Product Life Cycle Profit Sales Screening / BM Development Implementation Growth Mature Saturation Decline 1 Market cycle Development / T2M 12S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  13. 13. Source: Trommsdorff nach IMT Berlin , InWert-Vortragsreihe The PLC-Scissors 2 1 13 Average market cycles Average development time Years Time S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  14. 14. 2 Surviving the „Scissors-Effect“ higher success rates - Focusing on „Big Ideas“ - Business Model Design - Integrated Stage Gate Process / Portfolios - Customer Development / BM Innovation T 2 M - shorter Time to Market - pioneer margins - longer market circle - more profit sustainable, profitable growth Increasing corporate „Innobility“ 14S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  15. 15. Corporate Life Cycle by Adizes 15 Product Innovation Business Model Design/Innovation Process Innovation Organisation/ Service Innovation Business Model Innovation S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  16. 16. Macro-Economics & Innovation Management Kondratiev & Currency-Cycles Implications to corporate innovation strategy & crisis management 16S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  17. 17. Economic crisis? Dept crisis! 17S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 Macro-Economics & Innovation Management
  18. 18. 18S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 Macro-Economics & Innovation Management Kondratiev-Charts (Allianz Global Investors) (A. Nefiodow, Wikipedia)
  19. 19. Innovation Balance 19 ? ?
  20. 20. The Challenge: Handling Innovation Complexity  Innovation: necessary but often complex & risky  How high is innovation pressure?  Is my company’s ability to innovate sufficient?  Which IM concepts & methods fit best? ? 20
  21. 21. Ability to innovate: managing the innovation cycle S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 21 Proactive management of continuous innovation circle What? When ? For whom? Wich extend? Ideas & projects Processes Resources Market implementation
  22. 22. Factors of Innovation Success motivation Scenario analysis cooperation reference customers / lead users risk-management portfolio analysis promoters innovation- culture technology scouting innovation strategy foresight stage gate process open communication life cycle management intrapreneurship portfolio analysis idea management incentive system knowledge management core competence management market orientation resource planning innovation financing & controlling 22S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  23. 23. Ability to innovate Methodology Factors of Innovation Success – Core Elements 23S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 Resources & Relations Motivation Opportunities Motivation Opportunities Ressources & Relations Methods
  24. 24. Factors of Innovation Success: Dimensions 24S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  25. 25. Factors of Innovation Success 25S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  26. 26. Corporate Innovation Strategy S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 26 Pic: http://blog.bluesummit.net/strategy/mission-vs-vision/2007/ Vision (to identify) Goals (to achieve) Strategies (to guide) What? When ? Which extend? … to innovate For innovation strategy the core questions are: Products, Services, Business Model, Processes, Organisation, Markets Innovation leader, fast follower, late adopter Radical, semi radical, incremental, Imitation
  27. 27. Corporate Innovation Strategy  Examples: fast followers faster than inno-leaders – AltaVista -> Google – Napster -> iTunes – Netscape -> Internet Explorer – Apple Newton -> Palm Pilot -> Blackberry –> iPhone – IBM PC -> Compaq -> Dell – Double Click -> Google Ad Sense – Ofoto -> Flickr – Nintendo –> Xbox – Friendster –> Facebook S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 27
  28. 28. S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 • Corporate Culture • Core Competences • SWOT • Market Powers Current Situation • Technological Developments • Market / Megatrends • Scenario Analysis Trend Recognition & Forecasting • Vision / Mission • Strategic Goals • Strategy Options • Selection & Wording Strategy Development • Operative Goals • Criteria / Indicators • Scorecards Implementation- preperations Starting Point : Strategy (change) needed?! (routine assessment, new challenges etc.) !!! Fit of corporate and innovation strategy 28 Strategy development process
  29. 29. Internal Strength Weaknesses E x t e r n a l Chances ++ Strategies: Taking chances that fit the strenghts - + Strategies: Eliminate weaknesses to take on new chances Threads + - Strategies: Use strengths to fight/anticipate thread - - Strategies: Weakening the scope of Weaknesses & AVIOD thread / weakness combinations SWOT – related strategy Options 29S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 Corporate Innovation Strategy
  30. 30. S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 30 Potential Market Entries Suppliers Potential Substitutes Customers Negotiation Power Competition- Rivalry Porters Market Powers Negotiation Power Corporate Innovation Strategy Thees 5 powers are the strongest external drivers & sources of innovations, ideas etc. Others will be discussed in the „opportunity“ Block of Day 2
  31. 31. Innovation Culture  company culture portfolio S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 31 External orientation Internal orientation Hirarchical Cooperative Military Web Start up
  32. 32. Promoters  Innovation Champion (all in one?)  Power promoter  Know-How-Promoter (capabilities, skills)  Process Promotor  Relationship Promotor (force field) S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 32
  33. 33. Factors of Innovation Success 33S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  34. 34. Operational Management  Technology Management  Portfolio Management  Project Management  Risk Management  R&D Management – Stage Gate Process Management – Idea Management S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 34
  35. 35. Operational Management S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 35
  36. 36. Closed (Industrial) Innovation Model 36S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  37. 37. Open (Industrial) Innovation Model 37S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  38. 38. Stage Gate – the product innovation process model by Cooper  Quality enhancement of developing process  sharp focus and clear prioritizing  Parallel processes with higher pace  Cross-functional team  Including market orientation & assessment explicitly  Detailed information gains und forecasts in pre- development-stage  Create products with competitive advantage  Critic: does not include the service design component combined with product innovation S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 38
  39. 39. Stage Gate – the innovation process model by Cooper 39S. Kutter, Successful Innovation Management, SRTD-Project, Amman,
  40. 40. Stage Gate – the innovation process Gate 1 Idea Screen Stage 1 Scoping Gate 2 Second Screen Stage 2 Build Business Case Gate 3 Go to Development Stage 3 Development Gate 4 Go to Testing Stage 4 Testing & Validation Gate 5 Go to Launch Stage 5 LaunchDiscovery Stage Post-Launch Review $!? Idea management Project management Market preparation & implementation 40S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 erspecti Concept Drafts Construction Detailing
  41. 41. Stage Gate Process Implementation S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 41
  42. 42. Source: Perspective: The Stage-Gate Idea-to-Launch Process – Update, What’s New and NexGen Systems Dr. Robert G. Cooper
  43. 43. Gate Review Template S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 43
  44. 44. Three components of creativity Expertise Motivation Creative Thinking Skills Creativity Teresa Amabile HBR Sept ‘98 S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  45. 45. Creativity techniques S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 45  Problem: unflexible thinking due to (sussess-)Patterns  Not enjoying change/ uncertainty  Weakness to discover and accept opportunities off the common and well known
  46. 46. De Bono lateral & parallel thinking  Edward de Bono (19 May 1933, Malta )  Physician, author, inventor and consultant  The originator of the term lateral thinking  Best selling book: “Six Thinking Hats” Source: http://en.wikipedia.org/wiki/Edward_de_Bono 46S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  47. 47. Human thinking is based on:  Facts and Information  Emotions and Feelings  Cautious and Careful  Positive  Creative Thinking  Control of Thinking  White Hat  Red Hat  Black Hat  Yellow Hat  Green Hat  Blue Hat 47S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  48. 48. Systematic Innovation (TRIZ)  TRIZ: The theory of inventor's problem solving  TRIZ provides tools and methods for: 1. Problem Formulation 2. System Analysis 3. Patterns of System Evolution 4. Much more S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 48 Based on the analysis of 400,000 inventive solutions (more than 1.5 mln patents studied by today) Source: http://en.wikipedia.org/wiki/TRIZ Genrich Altshuller (1926-1998)
  49. 49. Contradictions: Service Innovation http://problemsolvingfire.files.wordpress.com/2008/06/good-cheap-fast3.jpg 49S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  50. 50. 50
  51. 51.  Wow can we make sure that problems play out & that potentials stay wasted? Guided Brainstorming S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 51
  52. 52. Ideenmanagement - Pipelinemodell S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 52 monitor/ screening collect / capture generate purchase assess select projects improvements clear, strategy related criteria Assessment & selection routines processes and routines Creativity techniques
  53. 53. External Sources of Ideas S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 53 5 5 5 5 5 5 10 1010 10 10 10 1015 15 15 15 15 15 15 20 20 20 20 20 20 20 5 20 suppliers competitors customers consultants literature laws research Trade fair shows All SMEs SMEs up to 2,5 Mio. € sales External sources of impulses for innovations (mentions in %) KfW-Study in SMEs 80 100
  54. 54. Idea Management S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 54 Involvement in Idea management Proper reasons if rejected Sufficient Bonus Aktive support Realising many suggestions/ ideas Feedback when realised 36% 17% 5% 15% 2% 19% Fast realisasion source: Uni Graz 2001 Motivation: Influence-Factors on employee involvement
  55. 55. From suggestion systems (QM) to Idea Management S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 55 Classic Improovement: •collect many ideas, pic few •centralized assessment •Bonus reward •adminitration-like handling Ideen-Management •Decisions whether to implement are taken from employee and direct supervisor •small improovements/ changes are welcome •High share of ideas realized •immaterial rewards (appreciation) Source: Kammer 2004
  56. 56. Integration des Ideenmanagements S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 56  Interfaces and Interactions Strategies / Goal-system  Criteria CRM Idea management QM Knowledge management Innovation cultur, Reward Systems HRM (multi) Project management
  57. 57. Goals in Portfolio Management  Value Maximization  Cost control  Strategic fit of projects/ products  Balancing projects/ products – Sequence & timing – Quantity & pipeline alternatives – Resource demands Source: New Problems, New Solutions: Making Portfolio Management More Effective By: Dr. Robert G. Cooper Dr. Scott J. Edgett
  58. 58. Portfolio Management
  59. 59. Portfolio Management – Chance/Value
  60. 60. Force Field Analysis S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 60 V. Bräutigam, Uni Speyer, 2010 High influence Low influence Veto-Player Close relation Weak relation Dominated relation Alliances & cooperation Tensions, conflicts, opposings interests Broken relation Unclear relation Relations Actors
  61. 61. Factors of Innovation Success 61S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  62. 62. Risk Management  Definition: Risk – unclear – The probable frequency and probable magnitude of future loss – in risk management: probability of hazardous impacts gain <-> loss S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 62
  63. 63. Risk Management 63S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 ISO 31000 from http://www.enhancesolutions.com.au/web/articles.php?category_id=1
  64. 64. Risk Management  Assessment dimensions: – How severe? • Damage/ magnitude caused/ expected – How far? • Scope • Range • Areas – How often? • Repeatable / self triggering • Several independent occurence – How probable?  Risk Formula: Damage x Scope x Times x Probability S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 64
  65. 65. Technological Hype Cycle 65
  66. 66. 21.10.2006 66S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  67. 67. Szenario Analysis 67S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  68. 68. Scenario Development S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 68
  69. 69. Business Model Innovation 69S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 Source: IMB
  70. 70. Business Model Innovation Understanding Business Models „ […] we define a business model as a representation of a firm’s underlying core logic and strategic choices for creating and capturing value within a value network.“ (Shafer, S. M./ Smith, H. J./ Linder, J. C. (2005)) … sharp definition - but does it really help? 70S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  71. 71. Business Model Innovation Understanding Business Models Business Model ≠ Business Process Model Business Model ≠ Enterprise Model Business Model ≠ Business Plan No business plan survives the first customer contact!? 71S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  72. 72. Business Model Innovation 72S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  73. 73. Business Model Canvas by Dr. Osterwalder 73S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  74. 74. Business Model Canvas by Dr. Osterwalder Core Questions: •Who is the customer? •What does the customer value? •What is the underlying economic logic? •How do we make money in this business? http://www.youtube.com/watch?v=dtfNsuP2AQQ 74S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  75. 75. Business Model Canvas by Dr. Osterwalder 75S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  76. 76. BM Design Dr. Osterwalder Validate, Prototype & Test it! 76S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  77. 77. BM Design Dr. Osterwalder Linking Customer Development to stage-gate 77S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  78. 78. Mass Prototyping Campaign Sales Automation Online Campaigns PR SEO Social Media Adverts Videos Pitches Newsletter specified Communication Mix Attraction Offer „Heating up steps“ Sale 78S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010
  79. 79. S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 79 Communi- cation Problem Stress Demand Pricing & Revenues € Cost Structure € Potential Competences / Resources Inhouse Partner Sales- Channels & Pipelines Solution Relief Job Target GroupsOffers  x  y  z x  y  z
  80. 80. SME Multi Level Audit Approach 80S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 •Pre-research •Key Values
  81. 81. Multi Level Audit approach 81S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 0 1 2 3 4 5 Strategy corporate culture Innovation driver Innovation processes Idea management Portfolio management Knowledge / Qualification Kooperations Financing external Orientation Risk Management Marketing Innovation Profile sample- comp Benchmark Inno- ability Inno- pressure Innovation Balance
  82. 82. Results & Perspective S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 82 Outside Perception Interview Results Key Values Inno-Profile Inno-BalanceMarket Trends Feedback: -Customers -Partners -Staff Analysis Evaluation Alternatives of action Roadmap Coaching Implementation Rapid increasement of competitiveness Sustainable safeguarding of future returns & market position
  83. 83. S. Kutter, Successful Innovation Management, SRTD-Project, Amman, 2010 83 skutter@consurge.net +49 (0)30 692068930 vs. Successful Innovation Management The most powerful concepts and solutions of Innovation Management and Product Development to dramatically improve competitiveness

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