modern innovation perspectives
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Innovation Business Model PerspectivesTRANSCRIPT
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“innovation is the process of turning ideas into value and perspectives”
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Building New Innovation Capability to Identify Future Opportunities
- Identify New Growth Opportunities
- Define & Implement New Innovation Strategies
- Generate & Deliver Better Ideas
- Renew Organizatonal Capabilities
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different levels of innovation
business model innovation
product & service innovation
process innovation
technology innovation
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New Knowledge & Innovation…
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idea!
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Knowledge Creation as the Self-Transcending Process
Nonaka & Konno 1998
i : individual g : group o : organization
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It is estimated that aweek’s worth of The Times…
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Nonaka, Toyama, Konno 2000
Knowledge Leadership
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Knowledge Creation as the Self-Transcending Process
Nonaka & Konno 1998
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Financial Innovation…
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The Dow-Jones index of the largest companies traded on the U.S Stock…
market declined 22%, the worst week in the index's 118-year history
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Growth & Innovation…
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Growth is top of mind for business executives. Strong, value creating
revenue growth lies within reach of corporations that pursue best practice in
innovation, strategy, marketing, operations and organizations.
For companies aspiring to grow, where to compete is just as important as how. To
choose the right battlegrounds, they must match their distinctive capabilities with
sectors where profitability growth is likely to occur.
WHERE and HOW
to Grow?
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How to Grow?
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Service Innovation…
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Transformative Business Disciplines…
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Correlating Service Innovation Outcomes to The Ten Types of Innovation
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The Five Lessons of the (Service) Innovation Journey
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Open Innovation…
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Open Innovation means that valuable ideas can come from inside or outside the company (industry) and can go to market from inside or outside the company (industry) as well1.
This approach places external ideas and external path to market on the same level of importance as that reserved for internal ideas and paths to market during the Closed Innovation era2.
CLOSED & OPEN BUSINESS MODEL
OPEN INNOVATION!
1,2 H.Chesbrough, 2003
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Our current market
Our new market
Other firm´s market
Open innovation
External technology insourcing
Internal technology base
External technology base Henry Chesbrough, 2004
Internal/external venture handling
Licence, spin out, divest
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At any given point in time, firms must follow a certain trajectory or path of
competence development. This path not only defines what
choices are open to the firm today, but it also puts bounds
around what its internal repertoire is likely to be in the
future1.
STEP OUT OF THE BOX!!!
PATH DEPENDENCY
We had become stuck in our past and weren’t stretching far enough to innovate new ideas, to “step out of the box.”
David O. Swain, ex. CTO, Boeing
1Teece et al, 1997
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Learning & Diversity
Boeing VP Dick Paul & CTO David O. Swain went to P&G and asked how they were getting ideas and how they were thinking about R&D. After the visit they remarked, “P&G
had some great thoughts, which affected what we did; we went home and did a couple of things differently and that was an example of us beginning to open our eyes to the world
and trying to integrate that into our planning process
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Dynamic capabilities as the firm's ability to integrate, build, and reconfigure internal and external competences to address rapidly changing environments1.
Some dynamic capabilities integrate resources (product development; strategic decision making), others focus on reconfiguration of recourses (knowledge brokering) within firm and other dynamic capabilities are related to the gain and release of recourses (knowledge creation routines; alliance, acquisition and exit routines)2.
EXPLORATION & TRANSFORMATION
DYNAMIC CAPABILITIES
Roald Amundsen, Robert Scott, Umberto Nobile
1Teece et al 1997 2Eisenhardt and Martin 2000
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Developing Portfolio of Capabilities
Operational Capabilities
Technological Capabilities
TransformingSeizingSensing
Open Capabilities
Dynamic Capabilities
Learning
Innovation
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1995 1998 2000 2003 20052004 2006
?
Core Search Ads Monetization Communications Collaboration ?
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Microsoft® SyncMicrosoft® Sync
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Platform leaders (companies that drive industry wide innovation for an evolving system of separately developed pieces of technology) are
navigating challenges from wannabes (companies that want to be platform leaders) and complementors (companies that make ancillary
products that expand the platform’s market. Platform leadership is the ability of a company to drive innovation around a particular platform
technology at the broad industry level.
Cusumano and Gawer (2002)
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Outside-in Innovation…
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Space Innovation…
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EADS Space Plane from London to Sydney – 2,5 hours
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MEETING THE CHALLENGES OF
SPACE TOURISM
Space Tourists International Space Station (ISS) uus äri ning hotell?
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L-Commerce…
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LOCATION COMMUNITY
LOCATION COMMERCEE-Commerce
+ M-Commerce
=L-Commerce
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GPS-Enabled LBS Subscribers by Region, World Market: 2005 to 2011*
* ABI Research
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Social Communities
…
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Platforms & Innovation…
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PLATFORMS & Business Models
Google & Microsoft
Google Earth
Microsoft Virtual Earth
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Business Model
Innovation…
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GROWTH & OPEN
BUSINESS MODELThe business model provides a coherent framework that takes
technological characteristics and potentials as inputs, and
converts them through customers and markets into
economic outputs1.
A business model has two functions: 1.Value creation
2.Value capture
1Chesbrough, Roosenbloom 2002
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Traditional (product) Value Chain
vs.
Modern (business model) Value Chain
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20 senti
2 krooni
20 krooni
30 – 70 krooni
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The business model mediates between technical and economic domains
Over the years, entrepreneurs have been mostly known for technical innovations. And there are many great companies that have been built on top
of technical innovations like Intel, Cisco, Oracle, Apple, and arguably Microsoft. If you think of Federal Express, Google, Netflix, these companies
were built on business model innovations.
Business Model:
• market segment
• value proposition
• value chain
• c/profit mechanism
• value network
• competitive strategy
Business Model:
• market segment
• value proposition
• value chain
• c/profit mechanism
• value network
• competitive strategy
Economic Outputs:
e.g., value, price, profit
Technical Inputs:
e.g., feasibility,
performance
Measured in technical domain Measured in economic domain
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Focus in Business ModelA business model is a conceptual tool that contains a big set of elements and their
relationships and allows expressing the business logic of a specific firm. It is a description of the value a company offers to one or several segments of customers
and of the architecture of the firm and its network of partners for creating, marketing, and delivering this value and relationship capital, to generate
profitable and sustainable revenue streams. Osterwalder, Pigneur and Tucci (2005)
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... improve it
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Portfolio of Capabilities
& Business Model
Open Capabilities
Dynamic Capabilities
Operational Capabilities
Technology Capabilities
Portfolio
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how do you measure the success of a business model?
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Revenue Growth, Life Cycle & Innovation Dynamics
Business model innovation has captured the attention of executives tasked with achieving growth in the face of increasing competitive pressure. Business model innovation suggests
that if you took an existing product and repackaged how you sold it, you can hold off competitive pressures and even capture entirely new market segments.
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Business Model & Culture