2. What is it?
…concerned with the new or the novel.
Is innovation technology based? Many of the more
significant innovations of the 20th century are
organizational rather than technology based.

3. Different types of Innovation give greater
profitability at different points in the life cycle of
a product family
New product
invention, tailoring,
Profitability
and development
Process Marketing
Application Business
Innovation Innovation
Innovation Model
Innovation Structural
Disruptive Product Innovation
Innovation Innovation
Time

6. The anatomy of a product

7. Product quality dimensions

8.  1.Product Line Based:
A)New-to-the –world Products
B)Line Extensions
C)Me-too products
D)Products Modifications

9. Continuous Innovation
Dynamically
Continuous Innovation
Discontinuous
Innovation

10.  Genuine uncertainty
› It’s not going to happen – certainly not now
 Cannibalization
› It will compete with our current products
 Shifts in the customer base
› Our current customers don’t want it
 Margin erosion
› It will make less money

11.  Time horizons & Incentives
 Fear of (individual) cannibalization
 Overload
 Competency Traps

12. Who buys a technology
when it is first
introduced?
Performance
New technologies sell to:
- New customers
- With new needs
- Often at lower margins
Time

13. Complementary
Uniqueness Assets
Maturity
Takeoff
Ferment

15. effectiven
efficiency cutting
 e ess
different copying enhancin
g
impossibl
e

16.  Dynamically continuous innovation:
A pronounced modification to an
existing product
› Requires a *moderate* amount of learning or
behavior change
› Convergence:
The coming together of two or more
technologies to create a new system with
greater benefits than its parts

18. “ Disruptive innovation theory points to situations
in which new organizations can use relatively
simple, convenient, low-cost innovations to
create growth and triumph over powerful
incumbents.”
 Sustaining versus Disruptive Innovation

19.  Markets that don’t exist can’t be analyzed
 The experts, including you, will be wrong
 Don’t invest all your resources on the first effort
— beta release
 Discovery, not implementation, based planning

20.  Markets that don’t exist can’t be analyzed
 The experts, including you, will be wrong
 Don’t invest all your resources on the first effort
— beta release
 Discovery, not implementation, based planning

21.  Bring a difference value proposition to the
market
 Initially under perform established products in
mainstream market
 But, the products improve at a rapid rate
 Superior in ways that are not valued by the
established market — more reliable, easier to
use, or cheaper

22. Performance
Time

23. Performance
Overshot
Customers
Undershot
Customers
Time

24. Automated Electronic
Paper Library
Collections Paper Library Library
Bib Control Paper Collections Paper Collections Digital
Bib Control Electronic Bib Control Digital
1965-1995 1995-date

25. Automated Electronic
Paper Library
Collections Paper Library Library
Bib Control Paper Collections Paper Collections Digital
Bib Control Electronic Bib Control Digital
1965-1995 1995-date
Sustaining Many
Innovations Disruptive
Innovations

26.  Browsing versus Search
 Britannica versus Wikipedia
 Journals versus Repositories

27.  Browsing — requires prior arrangement, you
are putting things (usually books) in order on a
shelf
 Problems
› Mind reading — guess what the user is thinking
› Fortune telling — make predictions about the future

28.  Searching —
› “the only group that can categorize everything is
everybody”
› “One reason Google was adopted so quickly when it
came along is that Google understood there is no
shelf… Google can decide what goes with what after
hearing form the user.”

29. “The Web has an editor, it’s everybody. In a
world where publishing is expensive, the act of
publishing is also a statement of quality — the
filter comes before publication. In a world
where publishing is cheap, putting something
out there says nothing about quality. It’s what
happens after it gets published that matters. If
people don’t point to it, other people won’t read
it.”

30.  Google versus traditional bibliographic control
 Open Archives/Repositories versus journals
(and soon monographs?)
 Google Book Project, Open Content Alliance
versus library collections
 Reference librarians versus Yahoo/Google
Answers

31.  Product variation
 Customization
 Modular Designs

32.  New Technology
 Hybrid Technology

33. 33

38. New Product Development Process
Evaluate at each
Opportunity Identification stage to determine
Go/No Go whether to proceed.
Design
Go/No Go Key is to manage
Testing risk of introducing a
Go/No Go failure or not
Introduction introducing a
Go/No Go success.
Life-cycle Management
Proactive vs. Reactive

39. Success Rate Entirely New Products
3000 raw 125 beginning
300 submitted
ideas projects
ideas
.03% .8%
.3%
1.7 launches 4 major 9 large
60% developments developments
25% 11%
1 commercial
success

40. It’s a great little product,
but we’re still working on
packaging and handling

42. New, familiar New , unfamiliar
Decreasing knowledge of the market
Familiar
Familiar New , familiar New , unfamiliar
Decreasing knowledge of the technology

43. Decreasing knowledge of the market
Market Business New Business
Expansion Expansion Model
Market Business Business
Extension Extension Expansion
Market Product Product
Penetration Extension Expansion
Decreasing knowledge of the technology

44. Probability of
Success
Market Business New Business
New Product with Expansion Expansion Model
unrelated technology in
existing market: 50%
Market Business Business
Extension Extension Expansion
Market Product Product
Penetration Extension Expansion

45. Market Business New Business
Expansion Expansion Model
Probability of Market Business Business
Success Extension Extension Expansion
Existing product in a new
Market Product Product
market: 15% Penetration Extension Expansion

46. Improved product in Market Business New Business
existing market: 75% Expansion Expansion Model
Market Business Business
Extension Extension Expansion
Market Product Product
Penetration Extension Expansion

47. Market Business New Business
Expansion Expansion Model
Market Business Business
Extension Extension Expansion
Probability of
Success
Market Product Product
Penetration Extension Expansion
New Product in a New
Market: 5%

49. A company cannot rest on its laurels; many
product class winners have fallen victim to
their success
US Steel (steel)
ICI (chemicals)
Kodak (photography)
Goodyear (tires)
Polaroid (instant photography)
Zenith (TVs)
IBM (PCs)
Smith-Corona (typewriters)

50.  The right product is one that becomes available at
the right time (i.e., when the market needs it), and
is better and/or less expensive that its competition.
 To have the right product, therefore, one must:
 Predict a market need
 Envisage a product whose performance and
capability will meet that need
 Develop the product to the appropriate time
scale and produce it.
 Sell the product at the right price

51.  There are, unfortunately, many examples of potentially
innovative space products being developed at the
wrong time, at the wrong price point, or due to poor
market predictions:
 TV-SAT and TDF-SAT: Performance wrong (few high power
transponders when many medium/low power were needed)
 OLYMPUS: Too soon (large busses only started to become
needed some years later)
 IRIDIUM and GLOBALSTAR: Wrong market and/or too late
(development of GSM took away most of the market)
 AIRPHONE: Too expensive
CONCLUSION? Introduce only Productive Innovation

55. OTHER POSSIBILITIES???
Battery Powered Battery Charger?
Braille TV Guide?
Fireproof Matches?
Solar Powered Flashlight?
Sugar coated Insulin btablet?
.....

57. › Innovation can be productive or wasteful. The
secret to success is being able to spot the
difference in advance and encourage the former.
This should be your goal!!