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TRANSCRIPT
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Unleashing INNOVATION across the
VALUE CHAIN
Presenters:
Tarun Gupta, IIM Ranchi
Jubin Goyal, IIM Ranchi
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INNOVATION
What
Context
LG Fridge/Washing Machine
FlipKart
SarvaJalShaadi.com
Innovation isnt about great
ideas. Innovation is a chain
that requires strength at every
link to succeed.
Incremental Improvement:
Net Books
Radical Breakthroughs :
Toyota Battery powered Prius
Creative Destruction
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Is Innovation Growth ?
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Gains of Innovation
Source: NISTADS February12 Bulletin
Product Outcome Process Outcome Other Outcome
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Innovations are mostly adoption of the market trend in terms of product quality, machine
etc. Himachal Pradesh scores better in every aspect of innovation mainly due to the presence
ofpharmaceutical and electric goods industryand also due to the presence ofPSUs.
Source:NISTADS February12 Bulletin
Scope of Innovation
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Culture of Innovation
Leadership Lays the Foundation: Senior Managements Priority
Build Innovation Into the Organization: Clear system of approving & Funding,Innovation built into the annual review process
Hire the Right People: PHD Graduates
Celebrate Innovators: Weekly slack time of 5 hours is provided for personal projectsUse Social Media to Tap ideas:A social network called IdeaMax, lets people submit idea,
where other people can comment or vote for it.
Discovery of Microbe that helps plants grow in saline soil.
The use of Super computer for drug discovery Eka mKrishi, a database on 5 crops to provide information to farmers about when
and which seeds to sow.
Case Study: Tata Group Innovation Forum (TGIF)
Products out of TGIF:
TCS Chief Technology Officer Ananth Krishnan, coins that 10% of revenues of TCS are directly traceable to innovation activity.
Source: Bloomberg Business Week
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Weaving Innovation in day-to-day activities
Problem: Shortage of Power supply
Case Study: North Delhi Power Ltd. (NDPL)
I want power when I need it the most.
Source: http://www.tata.com/innovation/articles
Induced Demand side Management
to reduce Peak-hour demand.
Supply of2 MW to Delhi Jal Board was
shifted to Off-peak hours, thereby
reducing peak hour demand.
A first of its kind initiative in India,
where electricity board and water
board have joined hands.
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Managers rolein Creating a Learning
Organization
- Stability: Consistent commitment tochange, innovation.
- Reduce power distance: Flattenedorganizations, cross- functional teams
- Celebrate Effort: rewarding successes &failures both, it helps in fostering trust.
- Judicious Slack of resources: allows roomfor innovation.
- Organic Organization: flexibility,value external knowledge
P&G (Wrinkle free Shirts)
- Disagreement is good: teachpeople to give up having to be in agreement with
everything.
Source: Harvard Business School Publications
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Top-down VsBottom-Up
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TakeawaysImpact of Organizational environment on creativity:
Source: Prof. Teresa Amabile, HBS; creativity & innovation in organizations.
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Measuring InnovationPercentage of
Respondents
Revenue
realized from
offerings
launched in the
past 3 years
Projected Vs
Actual
performance
Total funds
invested in
growth
projects.
Allocation of
investments
across
projects.
Average
development
time of each
project
Number of
projects that
meet the
planned
targets.
Number of
projects killed
or tabled at
each milestone
Percentage of
ideas funded
Cannibalization
of existing
product sales
by new
offerings.
Source: BCG Senior Management Innovation Metrics Survey
a) Only 35% of the Senior Executivesare satisfied with their companys
innovation measurement practices.
b) 43% of the Senior Executives feel
that the innovation initiatives are
not held to the same level of rigor
as companys core businesses.
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Improving company measurement practices
Innovation effectiveness:
1. Only 20% companies consistently tie incentives to innovations.
2. Tie medium or long-term compensation to innovation metrics .
All components of the Cash Curve should be measured :
Source: James P. Andrew & Harold L. Sirkin, Payback: Reaping the rewards of Innovation (Boston: Harvard Business School press.)
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Sources of process & product innovation by firms in India:
Source: ASCI Journal of Management
Role ofEducational Institutions
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Role ofEducational Institutions
Annual Graduate Production:
Source: ASCI Journal of Management
Total size ofIndias R&D talent pool is three times smaller than that of China. PhDs account for less than 2 per cent of post graduates in India .
India produces three times as many postgraduates as the UK, but the
UK produces 1.5 times more PhDs than India.
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Role ofEducational Institutions
Access
Concepts
CreationApplication
Services
Source: http://knowledgecommission.gov.in/
http://knowledgecommission.gov.in/http://knowledgecommission.gov.in/ -
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Words of Wisdom
There is a way to do it better, find it.
Thomas Edison
Thank you
We are open to questions now