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What is Business Innovation Management? A Brief Introduction
- 1. What is InnovationManagement Christopher Michael Innovation Practitioner A brief introduction by:
- 2. Why invest ininnovation? The world has never changed this fast but will probably never change this slow again.
- 3. Averagelife length ofa company (inyears) 67 15 1920 Today Year 3
- 4. Basis of InnovationManagement Innovation management is based on some of the ideas put forth by the Austrian economist Joseph Schumpeter, working during the 1930s, who identified innovation as a significant factor in economic growth. 2017 Christopher Michael – Innovation Practitioner 4
- 5. S-CURVES for TWOHORIZONS Emergent Growth Mature Performance/Valueoffering Effort / Time Ongoing business (EXPLOITATIVE – INCREMENTAL) Business of the future (EXPLORATORY - RADICAL) The challenge for Innovators: to achieve a strategically balanced portfolio between exploitative (Incremental H1) and exploratory (Radical H2/H3) – based on a full recovery on its capabilities Source: Adopted from Tovstiga (2007) 2017 Copyright Innovation360 Group AB 5
- 6. What is InnovationManagement? Innovation management is a combination of the management of innovation processes, and change management. It refers both to product, business process, and organizational innovation. Innovation management is the subject of ISO 50500 series standards developed by ISO TC 279. Christopher Michael – Innovation Practitioner 6
- 7. “Either you innovateor you’re in commodity hell. If you do what everyone else does, you have a low-margin business.That’s not where you want to be.” Sam Palmisano, X-CEO IBM HYPER COMPETITION 2017 Copyright Innovation360 Group AB 7
- 8. Role of InnovationManagement Innovation, although not sufficient, is a necessary prerequisite for the continued survival and development of enterprises. The most direct way of business innovation is through technological innovation, disruptive innovation or social innovation. Management of innovation, however, plays a significant role in promoting technological and institutional innovation. Christopher Michael – Innovation Practitioner 8
- 9. 6 jun -18© Innovation360 Group AB 9 Why? The Strategic Questions The Strategic Questions Increase barriers to enter or copy Differentiation and neutralization of competitors Focus on competitive advantages Increase internal efficiency Cost savings Radical opportunities Market / Growth Profitand/or • Where is your business now? • Are you doing either one or both. • Have you strategically achieved it? • On what internal strengths have you based you next Innovation Plans?
- 10. Innovation Management Tools Innovationmanagement includes a set of tools that allow managers and engineers to cooperate with a common understanding of processes and goals. By utilizing innovation management tools, management can trigger and deploy the creative capabilities of the work force for the continuous development of a company. The process can be viewed as an evolutionary integration of organization, technology and market by iterating series of activities: search, select, implement and capture. Christopher Michael – Innovation Practitioner 10
- 11. The Innovation Framework StrategicQuestion • Profit? • Market? Type of Innovation Strategy • Incremental/Radical Innovation Strategy • Need seeker • Market reader • Technology driven Type of Innovation • Products • Processes • Organizational Structures • Management System • Production • Business Model • Services Leadership Style • Cauldron • Spiral Staircase • Fertile Field • PacMan • Explorer Personas • 10 Faces of Innovation Capabilities (66) Innovation Process • Ideation • Project Selection • Development • Commercialisation ME M E ME E PE P E PI PE P P I PI I MI M I MI M Value Proposit on (What) Plat orm Prod ucts Services CustomerInsights(Who)CustomerExperiences Custom erE ngagem ent ValueCapture Process(How) Organisaton LearningC apabilites Supply Channel(Where) Linkages O pen ness Brand 1 2 3 4 5 SalesInn ovaton innovaton360group.com innovaton360group.com MarketIn novaton Organisato n Innovaton The Wheel of Innovat on No003165554-0001 Of er Innov aton Source: Penker (2011, 2017) Why ? What ? How ? 2017 Copyright Innovation360 Group AB 11 An Innosurvey® will tell you the “now” of the Why? What? & How? The results of the Innosurvey® will guide you to the capabilities and Innovation Strategy needed for the future of Why? What? & How?
- 12. Why Innovate? Innovation managementallows the organization to respond to external or internal opportunities, and use its creativity to introduce new ideas, processes or products. 2017 Christopher Michael – Innovation Practitioner 12
- 13. About 50% oftoday’s jobs will be digitalised within the next 20 years. (e.g. the ”Industrie 4.0” initiative in Germany). Alongside this, we will see exponential growth in information-driven areas such as AI, Analytics, Media and Communication as well as pico-technology and possible free energy in the future. Historically low interest rates are driving technological investment and R&D. The EU offers innovation-checks, and additionally its Horizon 2020 programme has EUR 80 billion to invest to further strengthen R&D and Innovation in Europe. MOOCs (free massive online open courses provided through leading universities) help provide a larger range of qualified workers, also leading to an increased demand for goods and services. People for the first time can create value by only using their brand and an Internet connection. Globally increased transparency, information and knowledge-sharing. Increased demand and requirements drive the suppliers of goods from ”commodity providers” to ”niche players” 2017 Copyright Innovation360 Group AB 13 WHY (Innovate)? GLOBAL KEY DRIVERS
- 14. Innovation Team –Who does it involve? Innovation involves workers at every level in contributing creatively to a company's product development, manufacturing and marketing. 2017 Christopher Michael – Innovation Practitioner 14 A company is not only top management, nor is it only middle management. A company is everyone, from the top to a front line W. Chan Kim and Renée Mauborgne, professors at INSEAD and co-directors of the INSEAD Blue Ocean Strategy Institute.
- 15. “The Eight Shadesof Innovation” 6 jun -18 © Innovation360 Group AB 15 Driving Market Driving Profit Driving Internal Transformation Driving External Transformation Offer Innovation Sales Innovation Organizational Innovation Marketing Innovation ME M E ME E PE P E PI PE P P I PI I MI M I MI M Value Proposit on (What) Plat orm Prod ucts Services CustomerInsights(Who)CustomerExperiences Custom erE ngagement ValueCapture Process(How) Organisaton Learning C apabilites Supply Channel(Where) Linkages Open ness Brand 1 2 3 4 5 SalesInn ovaton innovaton360group.com innovaton360group.com M arketIn novat on Organisaton Innovaton The Wheel of Innovat on No003165554-0001 Of er Innov aton ME M E ME E PE PE PI PE P P I PI I MI M I MI M Value Proposit on (What) Plat orm Prod ucts Services CustomerInsights(Who)CustomerExperiences CustomerE ngagement ValueCapture Process(How) Organisaton Learning C apabilites Supply Channel(Where) Linkages Open ness Brand 1 2 3 4 5 SalesInn ovaton innovaton360group.com innovaton360group.com M arketIn novat on Organisato n Innovaton The Wheel of Innovat on No003165554-0001 Of er Innov aton ME M E ME E PE P E PIPE P P I PI I MI M I MI M ValuePropositon(What) Platorm Prod ucts Services CustomerInsights(Who)CustomerExperiences Custom erE ngagement ValueCapture Process(How) Organisaton LearningC apabilit es Supply Channel (Where) Linkages Ope n ness Brand 1 2 3 4 5 SalesInn ovaton innovaton360group.com innovat on360group.com M arket In novaton Organisato n Innovaton TheWheelofInnovaton No003165554-0001 OferInnov aton ME M E ME E PE P E PIPE P P I PI I MI M I MI M ValuePropositon(What) Platorm Prod ucts Services CustomerInsights(Who)CustomerExperiences Custom erE ngagement ValueCapture Process(How) Organisaton LearningC apabilit es Supply Channel (Where) Linkages Ope n ness Brand 1 2 3 4 5 SalesInn ovaton innovaton360group.com innovat on360group.com M arket In novaton Organisato n Innovaton TheWheelofInnovaton No003165554-0001 OferInnov aton ME M E ME E PE P E PI PE P P I PI I MI M I MI M Value Proposit on (What) Plat orm Prod ucts Services CustomerInsights(Who)CustomerExperiences CustomerE ngagement ValueCapture Process(How) Organisaton Learning C apabilites Supply Channel(Where) Linkages Open ness Brand 1 2 3 4 5 SalesInn ovaton innovaton360group.com innovaton360group.com M arketIn novaton Organisaton Innovaton The Wheel of Innovat on No003165554-0001 Of er Innov aton ME M E ME E PE P E PI PE P P I PI I MI M I MI M Value Proposit on (What) Plat orm Prod ucts Services CustomerInsights(Who)CustomerExperiences CustomerE ngagement ValueCapture Process(How) Organisaton Learning C apabilites Supply Channel(Where) Linkages Open ness Brand 1 2 3 4 5 SalesInn ovaton innovaton360group.com innovaton360group.com M arketIn novaton Organisato n Innovaton The Wheel of Innovat on No003165554-0001 Ofer Innov aton ME M E ME E PE P E PI PE P P I PI I MI M I MI M Value Proposit on (What) Plat orm Prod ucts Services CustomerInsights(Who)CustomerExperiences CustomerE ngagem ent ValueCapture Process(How) Organisaton Learning C apabilites Supply Channel(Where) Linkages Open ness Brand 1 2 3 4 5 SalesInn ovaton innovaton360group.com innovaton360group.com M arketIn novaton Organisato n Innovaton The Wheel of Innovat on No003165554-0001 Ofer Innov aton ME M E ME E PE P E PI PE P P I PI I MI M I MI M Value Proposit on (What) Plat orm Prod ucts Services CustomerInsights(Who)CustomerExperiences CustomerE ngagem ent ValueCapture Process(How) Organisaton Learning C apabilites Supply Channel(Where) Linkages Open ness Br and 1 2 3 4 5 SalesInn ovaton innovaton360group.com innovaton360group.com M arketIn novaton Organisato n Innovaton The Wheel of Innovat on No003165554-0001 Ofer Innov aton ”Eight Shadows” thinking enables an initial, rapid analysis of possible capability gaps! • Where are you innovating? • Why are you innovating there? • What resources are you using? • How will you do it? • What does the BMC comparison tell you?
- 16. Innovation Processes Innovation processescan either be pushed or pulled through development. A pushed process is based on existing or newly invented technology, that the organization has access to, and tries to find profitable applications for. A pulled process is based on finding areas where customers needs are not met, and then find solutions to those needs. To succeed with either method, an understanding of both the market and the technical problems are needed. By creating multi-functional development teams, containing both engineers and marketers, both dimensions can be solved. 2017 Christopher Michael – Innovation Practitioner 16
- 17. 2017 Copyright Innovation360Group AB 17 How? Leadership Styles and the Three Innovation Horizons Horizon 1 Horizon 2 Horizon 3 Scope Core Business Growth business Future business Strategic Focus Exploit and optimize existing business, incremental innovation Expanding existing and building new business, adjacent innovation Explore options, place small bets on emerging opportunities, radical innovation Innovation Strategy Market Reader, Technology Drivers (incremental) Technology Drivers (partly radical) and Need Seeker Technology Drivers (Radical) and Need Seeker Leadership Style Spiral Staircase Cauldron, Fertile Field, Pacman Explorer Capabilities with strong correlation to strategy and leadership Clear Vision, Goal-Oriented Leadership, Core Focus, Market Insights Platform and Design thinking, Prototyping, Speed to market, Project Selection, Ideation External knowledge sharing, Co-Creation, Open Innovation, Anthropology, Technology Watch Competencies Fully assembled To be acquired or developed Requirements uncertain Metrics Return On Investment Net Present Value based on prototyping and hypothesis Strategic Option Value based on scenarios Source: Penker (2016). Based on the work of Ralph-Christian Ohr and Kevin McFarthing. 1 Based on Jaruzelski & Dehoff (2010). 2 Based on Loewe, Williamson, Chapman Wood (2001). All data is collected and analyzed in InnoSurveyTM (2016).
- 18. Innovation & ProductLifecycle The product lifecycle of products is getting shorter because of increased competition. This forces companies to reduce the time to market. Innovation managers must therefore decrease development time, without sacrificing quality or meeting the needs of the market. 2017 Christopher Michael – Innovation Practitioner 18 Scope Strategic Focus Innovation Strategy Leadership Style Capabilities with strong correlation to strategy and leadership Competencies Metrics
- 19. The Home ofInnovation Creating a consistent innovation engine DESIGN&CHANGE Howdoyouenablethe organisation toinnovate long-term? STRATEGY Whereareyouheaded&howdo youdesigntheorganisation toimplementstrategy? INSIGHT Whatareyourinnovation capabilitiesandlevelof readiness? Profit Growth • InnovationAssessment: • Measurereadinesstoinnovate • Benchmarkwithtopinnovators • Identifygrowthgaps&gain insighton strengths/weaknessestoenable change • Quant+qual(data+in-field work) • SetStrategicDirection • Define&prioritizestrategic initiativesina3-horizonportfolio • Setrequirementsoncapabilities &competencies • Defineprinciplesfor organizationalsetup • Implement organizational design • Governance,process&change • InnovationToolsforsupport • InnovationBoardandTaskforce Coaching: • Hypothesis-based approach • Exploration anddecision makingthat supportsstrategy • Createcommonlanguage&build capabilities Destination & ambition with your innovation efforts? 2017 Copyright Innovation360 Group AB 19 Do an Innosurvey to know What areyourinnovation capabilities and level of readiness? Contact: Christopher Michael at Christopher@eclecticinnovationsindia.com WhatsApp - +919872981425
- 20. Goal of InnovationManagement The goal of innovation management within a company is to cultivate a suitable environment to encourage innovation. The suitable environment would help the firms get more cooperation projects, even ‘the take-off platform for business ventures’. Senior management's support is crucial to successful innovation; clear direction, endorsement, and support are essential to innovation pursuits. 2017 Christopher Michael – Innovation Practitioner 20
- 21. Good news Next step It is possible to assess and measure leadership, strategy and capabilities for innovation It is possible to strengthen leadership and capabilities for innovation It is possible to link strategy and innovation execution It is possible to mitigate risks with a balanced portfolio Design, implement, and run an innovation system will allow your company to stay ahead of its competitors Innovation360 and Eclectic Innovations can help you move ahead in Innovation Management Christopher Michael - Innovation Practitioner Contact: Christopher@eclecticinnovationsindia.com. WhatsApp - +919872981425 The journey starts now!