UFI Open Seminar in Europe 2010 - Budapest - Juan Rigall

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New business ideas – how to change your business?
by: Dr. Juan Rigall, Managing Partner, Santiago Advisors, Willich, Germany

Published in: Business
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UFI Open Seminar in Europe 2010 - Budapest - Juan Rigall

  1. 1. NEW BUSINESS IDEAS - H O W TO C H A N G E YO U R B U S I N E S S UFI Open Seminar in Europe Budapest, June 23nd 2010 1
  2. 2. UFI Open Seminar Europe 100623_UFI Open Seminar final 1 2
  3. 3. Agenda Innovation in times of crisis - a vital case? What is innovation? Major trends in innovation management? How to change your business sustainably? UFI Open Seminar Europe 100623_UFI Open Seminar final 2 3
  4. 4. How to capitalize on globally recovering markets Perceived development What makes the difference? (Western hemisphere) Our performance is dependant on Scenario 3  the (macro-)economic development Scenario 2  individual best-in-class operational performance Scenario 1  active driving of consolidation and cooperation  our individual growth performance on top of all that 2008 2009 2012 What generates the highest growth in profitability? UFI Open Seminar Europe 100623_UFI Open Seminar final 3 4
  5. 5. Recent global studies reiterate on the importance of innovation Handelsblatt Management Forum Main outcome 1. Restructuring the own economy Americas 2. Re-invent yourself - innovative business models 1. Innovation, innovation, innovation Europe 2. Penetrate upcoming regions South America,Africa 1. Encounter growth potentials in Worldwide leading business schools home region Asia predict and evaluate future trends 2. Innovate and conquer techno- logy leading position Innovation is main focus to generate growth in developed markets UFI Open Seminar Europe 100623_UFI Open Seminar final 4 5
  6. 6. Innovation - a simple definition new Regions, New formats Customers, New customers etc New regions old old new Formats (shows, conferences, etc.) Innovation - a new business generating overproportional profits UFI Open Seminar Europe 100623_UFI Open Seminar final 5 6
  7. 7. Trade fair industry‘s executives focus on hurdles for innovation Typical statements towards innovation Conceptual cornerstones „95% of the market is set nowadays.We are only growing through Strategic ambition acquisition of new formats and that means crowding out, not growing.“ „I have not seen a real innovation in the last 10 years.“ Business model „Do not knock on my door with a new business idea of less than Structures 4.000 sqm.“ „ Motivation is the problem - uncertain long-term success vs. current sqm Motivation sold is an unfair comparison.“ „I am always preaching in favor of new business but my people are not Qualification creative enough.“ „I do not know what we spent for the new business development but Steering perceived outcome is low.“ UFI Open Seminar Europe 100623_UFI Open Seminar final 6 7
  8. 8. To generate new business ideas you need a conceptual grid Holistic approach Concept Stra- Beyond barriers strategy development tegy Business model Business model lab Structures Flexible structures Motivation Internal awards Qualification Creativity & entrepreneurship Steering KPI & monitoring Interdependent cascade of requirements UFI Open Seminar Europe 100623_UFI Open Seminar final 7 8
  9. 9. Give guidance towards role and importance of new businesses State-of-the-art concept Potential implications trade fair industry  The relation between traditional and new business must be clear as well as “the rules of the game” (internal competition, expected business impact etc.)  A quantified strategic ambition has to be communi- cated personally to give guidance to the whole organization Strategic ambition  Regular updates on strategic development safeguard  Define vision of your business in 5 years time focus and momentum through continuous reiteration  Position business in the future growth grid  Ascribe the potential value contribution of new Industry examples businesses to the overall company performance  Translate your strategic ambition concerning innovation into a strategic plan  Automotive industry UFI Open Seminar Europe 100623_UFI Open Seminar final 8 9
  10. 10. Simulate new business ideas intensively State-of-the-art concept Potential implications trade fair industry  Own insecurity about new business models and their value generation does not save management to ignore potentials of other businesses (merchandising, event management, etc.)  Apply open minded teams with good mix between fact- driven and out-of-the-box to assess business potential Business model lab  Define evaluation grid beforehand without perpetuating  Simulate impact of new business models in the existing business and success requirements “laboratories” to avoid costly failures  Train your teams on new markets requirements and focus competitive and customer added-value Industry examples  Capitalize on newest methods and other industries’ experiences (e.g. hightec, IT, pharmaceutical, auto- motive industry)  IT industry UFI Open Seminar Europe 100623_UFI Open Seminar final 9 10
  11. 11. The more innovative the more separate State-of-the-art concept Potential implications trade fair industry Organizer  Internal cannibalism is most frequent reason for failure New business of new businesses development  New businesses must deliver significant returns long- New Infra- Inter- term. Otherwise, internal balance at risk Fairs Fairs Admin. ventures structure national  Success stories must be communicated intensively. Flexible structures Internal migration from traditional to new businesses and vice versa should be allowed  If new businesses promote new business models or are perceived as internal competition, structural separation is key  Organization must allow for other external parties Industry examples (investors, universities, etc.) to adhere easily (open innovation)  Consumer goods UFI Open Seminar Europe 100623_UFI Open Seminar final 10 11
  12. 12. Internal awarding mobilizes the entire organization State-of-the-art concept Potential implications trade fair industry  Innovation goes beyond a certain department or just the management team  Emphasis on new business idea generation is laid upon the organization across all functions  Joint team work as well as being allowed to think out- of-the-box motivates people Internal innovation awards  Keeping an eye on profit generation potential should  Utilize the innovative power of your whole not imply any limitation towards size, scope, etc. organization  Go beyond the New Business department Industry examples  Build-up mixed teams that work-out selected ideas  Make strategic rationale and business case sketch mandatory  Pharmaceutical industry  Reward winning teams and communicate intensively UFI Open Seminar Europe 100623_UFI Open Seminar final 11 12
  13. 13. Invest in your people State-of-the-art concept Potential implications trade fair industry  Creativity can not be imposed but creativity techniques can be trained  Existing contact base to various industries main sounding board to discuss creative new approaches  Decentral entrepreneurship has to be fostered to Creativity and entrepreneurship generate sustainable development of new businesses  Help your organization to question current proceedings and ways of making business  Train them to listen and derive business opportunities from multitude of contacts Industry examples  Show them variety of potential business models  Pharmaceutical industry UFI Open Seminar Europe 100623_UFI Open Seminar final 12 13
  14. 14. Measure closely to provide transparency on innovative performance State-of-the-art concept Potential implications trade fair industry  Key ratios like sales contribution of young formats (less than 3 years) to be defined  Margin and volume contribution to be closely monitored  Clear break-up rules if new ventures do not meet expectations KPIs & monitoring  Integrate KPIs into your reporting system to provide  Define the main metrics to measure new business decision making capabilities “at your fingertips” success  Make them integral part of target agreement process Industry examples  Monitor the impact on single KPIs closely and define measures  Communicate the importance of KPIs and the way  Semiconductor technology they work UFI Open Seminar Europe 100623_UFI Open Seminar final 13 14
  15. 15. Summary Cornerstones Findings trade fair industry Beyond barriers “You have to create room for innovative thinking and strategy development give strategic guidance” “You have to breed new business with a strong profit Business model lab focus” “You have to separate embryonic businesses from Flexible structures mainstream” “You have to campaign for innovative behavior Internal awards internally” Creativity & “You have to train people on creativity and entrepreneurship entrepreneurship” “You have to closely balance investment and KPI & monitoring respective outcome” UFI Open Seminar Europe 100623_UFI Open Seminar final 14 15
  16. 16. UFI Open Seminar Europe 100623_UFI Open Seminar final 15 16

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