The document discusses various aspects of service innovation including: 1) Service innovation involves developing new services or modifying existing services to create added value for customers through new technologies or competencies. 2) Companies must learn to tap into service innovation by addressing higher customer expectations, the rise of mobile internet, big data, and the internet of things. 3) Successful service innovation focuses on relieving what customers do not like, enabling what they cannot do without the service, and making it easier for customers to get what they need.

1. Service Innovation

2.  Service innovation as any new services developed
during innovation processes which are valuable for customers
 Changes in service concepts or service delivery processes driven by
by new technologies or organizational competences that create
added value
 It implies developing a new service or renewal, modification of
existing services
 It is the innovations that an organization makes in processes to
replace or improve its existing goods and services
 Such as new knowledge or technologies that companies
incorporate into their service offerings, which results in value for
both customers and businesses

3. A service innovation changes the way
customers are served to create value for
customers and revenue for the company
 Companies must learn to tap the potential for service innovation
made possible by four evolving trends:
 Higher customer expectations,
 the rise of the mobile Internet,
 Big data and advanced analytics,
 the Internet of Things

4. Begin by asking the following questions:
 How can we relieve customers from activities they do not like
to perform?
 How can we enable customers to perform activities they
cannot do without our service?
 How can we make it easier for customers to do what they
need or want to do?

5.  Customers will often not pay more for attributes that do not bring them
benefits, as from the customers’ perspective this would not be of value.
 The formula for customer value can be written as:
(Total Customer Benefits – Total Customer Costs) = Customer Value, or (B – C
= CV)
To Increase Customer Value: Evaluate your customer experience, Focus on
on more than price, Collect customer data, Target your most loyal customers,
Segment your customer base.

6.  Psychographics are all about understanding customers’
lifestyles, values, beliefs, and optimizing marketing to
demonstrate to customers how the company can fulfil these
psychographic variables by providing the benefits sought thus
providing customers value.

7. The Customer Star framework created by Stefan Michel helps executives
and entrepreneurs align their decisions and actions around what
customers really want.
 Customer Segments. Which current and future
segments can we identify in our market? Which of
these segments are we interested in? How do we
serve different segments differently?
 Positioning. What does our brand stand for?
 People. What are the employee skills required? What
is the leadership style and how doe it shape the
culture in the organization?
 Information/IT. How do we use the Internet and
other IT systems for gathering, storing, and
disseminating data?
 Products. How do we innovate, manufacture, and
distribute our products?
 Operations. How do we design and manage our
processes in all phases of the customer relationship?
Partners. In addition to suppliers and distributors, which
partners are essential to serve your customers?
Profit Model. What are our major revenue drivers, and
what are our major cost drivers?

8. DESIGN LED INNOVATION
Design Led Innovation is a user-centered design methodology that radically rethinks the meaning of your
products, services, systems and processes for your customer. This leads to dramatically new forms of value
that supports your organisation’s growth and sustains its long-term success

9. Design led innovation:
 Design led innovation describes a managerial approach to culturally
embed design within a business and to enable strategic and radical
innovation.
 It is this difference that affords design led innovation a unique
opportunity for radical innovation in business value propositions by
using the designer’s sensibility and methods to match people’s needs
with what is technologically feasible and what a viable business strategy
can convert into customer value and market opportunity
 In order to create and foster strategic innovation designers continuously
toggle back and forth between analysis and synthesis and operate both
in the concrete and abstract world also known as prototyping

10.  Design-led innovation facilitates business model innovation by conceiving novel
business model ‘propositions’ implying ‘meanings’ for the customers and thus
linking it with the various dimensions of a business model
 It facilitates business model innovation through the creation of new business
prototypes both in the real and the abstract world, to make both the novel
business model and the process of business modelling more tangible
 It facilitates and accelerates the process of prototyping and the exploration of
‘disruptive’ business models by engaging in ‘deep’ abstraction
 facilitates business model innovation by engaging with customers and
stakeholders and conceiving future value co-creation options
 facilitates business model innovation with a new design capability and new
functional roles of designers

11. Concept of Improvisation
 Improvisation is defined as an action taken in real time situations where it involves
a high degree of spontaneity, creativity and intuitive insight by individuals, groups
or the whole organisation
 It can be considered a tool to developing strategy that helps executives identify
key decisions that are needed to create more shareholder value
 Improvisation may appear to be spontaneous and intuitive to actually call for the
improvement of planned procedures and competencies.
 Businesses operating in dynamic, fast-paced, and noticeably modern task-based
environments must expand competencies to create surroundings with a view to
decorate a business group’s improvisation process.

12. IMPROVISATION AS A SPONTANEOUS
CREATIVE PROCESS
 Improvisation, can boost innovation in companies, but not in all of them. There are
certain conditions you need to have in place to get the creative boost you’re
looking for.
 The concept of improvisation is promising mechanism and design principle for an
organization's capacity for learning, adaptability and innovation
 The study demonstrates that the success of the improvisation process relies on
both internal and external factors conducive to innovation
 Practical implications are drawn for team managers and entrepreneurs intending to
cultivate a willingness to improvise in teams and nurture collaborative relationships
with external partners for innovation

13. Start-ups:
 By definition, a start-up company is an entrepreneurial
venture that is typically a newly emerged business that
aims to provide an innovative product, process or service
to the market and hopes to scale to a big company. On the
other hand, a big corporation is a larger, more stable, and
profit making enterprise that has certain social and
economic impacts
 Huge risks with huge returns
 More than just a job
 Small team
 Always pivoting
 Offering innovation
 Low cash flow

14. Big Corporations
 Emphasis on profits over risks
 Regular Jobs
 Huge Team
 Doing similar things
 Huge Pools of Funds
 It is also a possibility that the two can work together. Startups
are constantly being acquired by big corporations for their
talents and unique value proposition. Facebook acquired
Instagram, WhatsApp, and Oculus because it felt connected to
what they were doing. Big corporations often treat startups as
little R&D centres where innovation is created by constant
failures and talented people.

15. Co-Creation
 Co-creation is a shared process by which customers, suppliers,
retailers, designers and other relevant third-parties work together
with the company to generate ideas towards a mutually valued
endpoint
 Executed as a simple process of gathering around a table for a
discussion with a group of internal and external experts, including
customers, who have an opinion on the product or product need
being discussed
 Each party represents their unique perspective in the product
relationship ranging from buyer to developer and, via the process, is
encouraged to communicate their thoughts around things that work,
things that don’t, areas of need, opportunities for improvement and
more.
 Co-creation can be as elaborate and encourages its customers to engage
and develop new designs such as Canon, Heineken, Lays, McDonald’s
and Lego.

16. Open Innovation
 It is a corporate mind-set that embraces external thinking and
recognizes that great ideas are not exclusively generated
internally within the company
 Open innovation is the use of purposive inflows and outflows
of knowledge to accelerate internal innovations
 Similarly to co-creation, open innovation as a process can be
applied at any and throughout all phases of product
development.
 Corporations with successful product track records, such as
Siemens, Apple®, GE, P&G and so many others, apply open
innovation daily, in every aspect of product development

17.  Both co-creation and open innovation can be and are routinely used
interchangeably.
 Co-creation offers a combination of market research, brand loyalty, product
champions, insights on demand and a host of other benefits that provide
value at every step of the way along the product development process. As
such, co-creation may have great relevance and appeal to a wide swath of
business functions.
 Open innovation, on the other hand, may be a better solution for
addressing deficiencies in in-house expertise, addressing supply chain
problems and the like.
 Co-creation and open innovation each have their own benefits, risks and
numerous examples of successes as well as failures