Presentation to GIBBS MBA class on Disruption and Innovation


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This is a talk I did a few weeks back to a GIBBS MBA class. It covers a nice wide range on digital disruption and how to try and innovate in a disruptive world. It does acknowledge sources in the slides but I would specifically like to acknowledge:
- Mary Meeker - KPCB (multiple presentations)
- Brynjolfsson & McAfee 2012 (Race against the machine)
- Govindarajan & Trimble 2010 (The other side of Innovation)
- Hobcraft 2012 (navigating-the-three-horizon-framework)

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  • Swords device = weaponised variant of the TALON bomb disposal robot
  • I-Robot RP-Vita just got FDA approval
  • The key message behind the Lego case study is that they had too much innovation and over diversification without looking carefully at how the market had changed around them. Only once they created a guided innovation programme did they pull out of their nose-dive. Lego also has an interesting innovation org chart.
  • Need to stimulate ideas (cross skilling and rotating people). Need to motivate people for improving processes and products via ideas boxes and monetary and other incentives.But this model doesn’t scale beyond a certain level if the innovation ideas are big.Execution challenge is reduced to a step-by-step process. But it is narrow and specialised and relies on new products being similar to existing products. It excludes radical or semi-radical innovation.Innovation requires a fearless leader to break all the rules. Its true that top management and CEO support is needed. But organizations are not designed for innovation. Organisations are designed for ongoing operations.Every innovation initiative requires a team with a custom organization model and a plan that is revised through a rigourous learning process.
  • To progress beyond Level 2, innovation management needs to be formalized to drive broader collaboration, knowledge sharing, and centralized focus and support. Lobby executive leaders to inject innovation into the strategy, culture, vocabulary and processes of the enterprise. Name an enterprise advocate and sponsor for innovation. Establish a permanent team to develop and coordinate the needed enterprise "shared services" for innovation management: common technologies, central support (moderation and facilitation) of collaboration and communities, and governance for the infrastructure and other shared services.
  • Presentation to GIBBS MBA class on Disruption and Innovation

    1. 1. Innovation and Digital Disruption Brian Pinnock Product Strategy and Innovation 25 October 2013
    2. 2. Cutters, Makers, Refrigerators
    3. 3. AGENDA Dark side of Disruption Disrupting Business Models Guided Innovation
    4. 4. Moore’s Law 5
    5. 5. Transistors per Die 1010 Moore’s Law Intuitive linear view 1960 2010
    6. 6. No Moore’s Law for Software?
    7. 7. Artificial Intelligence
    8. 8. Dark Side of Disruption 25 October 2013
    9. 9. Exponential Growth 10
    10. 10. Race against the Machine Productivity Employment Source: Brynjolfsson & McAfee 2012
    11. 11. Index of US Growth GDP vs. Income GDP per capita has grown faster than real median household income Source: Brynjolfsson & McAfee 2012
    12. 12. US Job Growth by Decade Deep structural issues not just a consequence of the recession Source: Brynjolfsson & McAfee 2012
    13. 13. Race against the Machine Source: Brynjolfsson & McAfee 2012
    14. 14. Disrupting Lawyers Then Now Source: NY Times
    15. 15. Disrupting Pharmacists Then Now Source: Fast Company
    16. 16. Live Translation Then Now Source: NY Times
    17. 17. Disrupting Industrial Robots Then Now Source: Wired
    18. 18. Disrupting Driving Then Now Source: KPCB
    19. 19. Disrupting Business 25 October 2013
    20. 20. Evaluating Disruptions Is it easy to use? User Experience Does it enable people to connect in new ways? Is it useful? Business Model Ecosystem Value Does it tap new revenue streams? Is it done at a lower cost? Does it change the flow of value? Does it shift power from one player to another? How much of the old value proposition was just lettuce?
    21. 21. Disrupting Books and Publishing Then Now Source: KPCB
    22. 22. Disrupting Music Then Now Source: KPCB
    23. 23. Disrupting Print Media Then Now Source: KPCB
    24. 24. Disrupting Computing Devices Then Now Source: KPCB
    25. 25. Disrupting Photography Then Now Source: Bain
    26. 26. Disrupting Video Then Now Source: KPCB
    27. 27. Disrupting Retail Then Now Source: Tesco
    28. 28. Disrupting Point of Sale Then Now Source: KPCB
    29. 29. Disrupting Insurance Then Now Source: Scientific American
    30. 30. Disrupting Money Then Now Source: Bitcoin P2P
    31. 31. Disrupting Government 25 October 2013
    32. 32. Disrupting War Then Now Source: Strange Horizons
    33. 33. Disrupting Healthcare Access Then Now Source: KPCB
    34. 34. Disrupting Early Education Then Now Source: Economist – World in 2050
    35. 35. Disrupting Higher Education Then Now Source: Economist – World in 2050
    36. 36. Guided Innovation in a Disruptive World 25 October 2013
    37. 37. Innovation Myth An Aladdin's cave full of innovation treasure is available to anyone that has the secret password.
    38. 38. Innovation Innovation is a Smurf word
    39. 39. High Semi-Radical Process Innovation Radical Innovation Incremental Innovation Semi-Radical Technology Innovation Low Change in Business Process Types of Innovation High Low Change in Technology Source: Davila et al 2006
    40. 40. A Recipe for Innovation? Exert strong leadership on the strategy and portfolio Integrate innovation into the business mentality Integrate innovation into the business structures Align innovation with strategy Manage creativity and value capture Neutralize organizational antibodies Establish networks Use metrics and incentives Source: Davila et al 2006
    41. 41. Types of Innovators Need Seekers Market Readers Technology Drivers Engage customers directly to generate new ideas. Develop new products and services based on superior end-user understanding. Seek out both articulated and unarticulated needs. First to market. Eg. Apple, Procter & Gamble Closely monitor their markets, customers, and competitors, focusing largely on creating value through incremental innovations to their products. A more cautious approach. Depends on being a “fast follower” E.g. Hyundai and Caterpillar Depend heavily on their internal technological capabilities to develop new products and services. Leverage R&D investments to drive both breakthrough innovation and incremental change, in hopes of meeting the known and unknown needs of their customers via new technology. E.g.Google and Bosch Need Seeker strategy offers highest potential of superior performance (Booz & Company’s annual study of R&D spending – 2012)
    42. 42. Cautionary Tale: Too much Innovation Too much innovation and over diversification without taking cognizance of market structure changes.
    43. 43. Misguided Innovation Ideas Innovation = Ideas + motivation “Innovation and ongoing operations are always and inevitably in conflict. But ongoing operations pays for innovation.” Innovation = ideas + process Innovation = ideas + leader Innovation = ideas + leader + team + plan + structure Source: Govindarajan & Trimble 2010
    44. 44. You don’t shuffle your way from one S-curve to another. You have to jump. Gary Hamel
    45. 45. Degree of Strategic Fit Happens across 3 time horizons Horizon 3 Dominant force Zone of greatest uncertainty Emerging change Horizon 2 Horizon 1 Weak signal Time (years) Source: Baghai et al 1999
    46. 46. Each has a different point of focus Horizon 3 Create viable options Value Horizon 2 Build emerging businesses Horizon 1 Extend and defend the core Time (years) Source: Baghai et al 1999
    47. 47. It depends on the types of projects
    48. 48. Different skills & Different Measurement Horizon 1 Horizon 2 Horizon 3 The current way of doing business is dominating Exploring ways to develop but mostly built from the core Exploring completely new ways of doing things Annual Operating Plan Business Building Strategies Place to Explore & Experiment Specific Campaigns & Plans Emerging Concepts & Models Aspiration & Future Promise Incremental Innovation Disruptive, more Collaborative Radical Innovation Pure Market Research Needs related Social Trending & Narratives Dominant System New Related Need to explore Game changing nature in Industry Current Business Emerging Business Desirable State Viable options, plenty of unknowns Invent, Develop, Deploy Research, Demonstrate, Disrupt & Discover Envision, Explore & Embody Leveraging Existing Capabilities Emerging & Existing Capabilities Exploring Radical New Capabilities Metrics: Existing, Harder, Based on Profitable growth Metrics: Ring-fence areas of possible disruption Metrics: more on exploring, built on emerging themes Source: Hobcraft 2012
    49. 49. Hype Curve Matches 3 Horizons Years to mainstream adoption: Less than 2 years Peak of Inflated Expectations 2 to 5 years 5 to 10 years More than 10 years Visibility Obsolete before plateau Plateau of Productivity Slope of Enlightenment Technology Trigger Trough of Disillusionment Time Horizon 3 Horizon 2 Horizon 1 Source: Fenn & Raskino 2008
    50. 50. Effort & Involvement H3 Teams H2 Teams H1Teams Immature Technology Stage Technology Peak of inflated Trigger Expectations Trough of Disillusionment Market Ready Slope of Enlightenment Plateau of Productivity
    51. 51. Maturity Models
    52. 52. Individual organisms don’t evolve. Only the species evolves. Clayton Christensen
    53. 53. Discussion 25 October 2013
    54. 54.