Innovation mangement mao final

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Präsentationstitel – Zeile 1 Präsentationstitel – Zeile 2 Präsentationstitel – Zeile 3
Presented By:
Mohamed Abd Elmoneim Osman
Innovation Manager
mao.osman73@gmail.com
Innovation Management Concepts

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•At the end of this training, the attendance should have:
–Working understanding of innovation management concepts
–In-depth understanding of innovation processes and available models
–Knowledge of available tools, techniques, document templates and approaches to innovation management
Course Objectives:
“Innovation Management is about the pursuit of ‘NEXT’ practices…”
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Innovation Management

INTRODUCTION
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What is innovation?
Latin word Innovare meaning:
“ to make something new”
Introduction
Creativity
•is thinking up a new thing or an idea that is new to you
•Spending Money to Generate Ideas
Innovation
•is doing a new thing or the practical application of creative ideas
•Spending Ideas to Generate Money
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What is Creativity?
Creative Thinking
An innate talent that you were born with and a set of skills that can be learned, developed, and utilized in daily problem solving
Creative solutions are more than ideas - they must work in the real world. A creative solution has three attributes:
•It is new (otherwise it would not be creative).
•It is useful, in that it solves the problem (otherwise it would not be a solution).
•It is feasible, given the messy real world constraints like money and time.
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Are you Creative?
Age group % of creativity used
Kindergarten children 95 – 98 %
Junior school children 50 – 70 %
High school / University students 30 – 50 %
Mature Adults < 20 %
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Left Brain Or Right Brain
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Creative Thinking Skills
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Fluency
Flexibility
Elaboration
Originality
Creative thinking skills
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Workshop
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Brain writing – Method 635
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Description
Each participant receives a sheet of paper with a table with 3 rows and 6 columns. Each of the 6 participants has to write three ideas in the first row. With regard to the difficulty of the problem the paper gets passed on to the next person after 3 to 5 minutes. The next person should then try to pick up and develop further ideas (the idea has not to build on the predecessor – it can be just used as an inspiration).
Strengths
With little time effort (30 min) one can develop up to 108 ideas.
All members can participate without lose of time or have inhibitions.
The method can also be done via email.
No discussions or talking things to death.
Weaknesses
Not applicable for difficult problems.
Time pressure is sometimes difficult for particpants.
Participants developing ideas fast can get bored because they have to wait.
Application
For problems with low to medium complexity
As a second step after brainstorming in order to deepen the initial ideas.
If one wants to generate a lot of ideas in a short time with a moderate interaction of the participants.
Time needed
With 6 participants 30 mins (5 min. per round)
Adaptable for more or less participants.
4. Brainwriting – Methode 635
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Brain writing – Method 635
Idea 1
Idea 2
Idea 2
Participant 1
Participant 2
Participant 3
Participant 4
Participant 5
Participant 6
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Don’t Believe the Experts !
“That’s an amazing invention, but who would ever want to use one of them?” (US President Rutherford B. Hayes, after participating in a trial telephone conversation between Washington and Philadelphia in 1876).
“Television won’t be able to hold onto any market it captures after the first six months. People will soon get tired of staring into a box every night (Darryl F. Zanuck, Head of 20th Century Fox, 1946)
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Don’t Believe the Experts !
“The horse is here to stay, but the automobile is only a novelty, a fad” (President of Michigan Savings Bank, 1903, advising Henry Ford’s lawyer not to invest in the Ford Motor Company – disregarding the advice, he invested $ 5,000 in stock, which he sold several years later for $ 12,5 million).
“I think there is a world market for about five computers (Thomas J. Watson Sr., Chairman of IBM, 1943)
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The process of turning opportunity into new ideas and putting these into widely used practice.
“The real challenge in innovation was not invention- coming up with good ideas- but in making those inventions work technically and commercially”
Thomas Edison
What is Innovation?
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In general, innovation is interpreted as the creation, implementation, and commercialization of new ideas related to products, services, processes, distribution channels, promotional strategies, organizational structure, or measurement systems.
Innovation = Invention + Market Success
What is Innovation?
Innovation vs. Invention
“Invention is only the first step of a long process of bringing good ideas to widespread and effective use”
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Where Quality Management seeks “Best practices…”
Innovation Management seeks “Next practices…”
What Is Innovation Management?:
Innovation as a Source of Competitive Advantage.
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Simplified model of the Innovation process
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Innovation Process
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How innovation happens?
Process Success (?)
Innovation Process
Innovation Management 27

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Systems Innovation
How it really happens …..
Innovation Process
Innovation Management 28

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Innovation Process
Generic phases of the innovation process:
Idea Stage - Searching & Scanning in (the internal & external environments)
Design ,Development Stage - Filtering & Selecting potential opportunities (Acquiring the technical, financial & market resources)
Implementing Stage (Commercialisation)
Evaluation stage (Reviewing & Learning from experience)
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Discover
Develop
Deliver
Discover
Your Idea Customer Need Your competitors
The Concept
Your Business Plan
Your Solution prototype
The Opportunity
Your Strengths, Weaknesses
Innovation process
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Discover
Develop
Deliver
Discover
Innovation process
evaluate ideas, initial acceptance (offline)
Brainstorming session to challenge idea (with domain/industry experts)
Evaluate pilot + assign full team
+ resource allocation
Final Evaluation + Lesson Learned
Role of Innovation Team
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Innovation Management Process Models
Foundational Innovation Management Process Map:
Innovation process
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Innovation Management Timeline Model:
Timeline
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Exploring different aspects of innovation
Degree of novelty:
Incremental → doing what we do better
Radical → new to the world
Level of innovation: → Components or Systems (Architecture)?
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Timing: the innovation life cycle.
Exploring different aspects of innovation
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Dimensions of ‘innovation space’
The 4Ps of innovation :
Product – changes in the things (products/services) which an organization offers,
Process – changes in the ways in which they are created and delivered
Position – changes in the context in which the products/services are introduced
Paradigm – changes in the underlying mental & business models which frame what the organization does
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Types of Innovation
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R & P Ltd company working in garden machinery
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Technology excellence may not be enough…..
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Discontinuous innovation
– what happens when the game changes?

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Types of Innovation
Mechanism
Advantage
Examples
Novelty in product or service offering
Offering something no one else can
•Walkman
•Dishwasher
•Telephone bank
•On-line retailer
Novelty in Process
Offering it in ways others cannot match (faster, lower cost, more customized, etc.)
•Bessemer’s steel process
•Internet banking,
•On-line bookselling
Timing
1.First mover advantage
2.Fast Follower advantage
1.Amazon.com
2.Samsung (Apple’s)
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MP3 changed the business model radically
•New sales channels (“iTunes”, “musicload”)
•Fits in all products (mobile phones, cameras …)
•New workplaces and work processes
•New communication forms: podcasts Economic success in Germany
•9.200 workplaces directly linked to MP3
•350 Mio. € sales with MP3-ringtones
•2008 Forecast: 7 billion € sales of MP3-players
Example for innovation:
Technology application: Example MP3 (since 1987)
Innovation: Example
Spath, Dieter: Technologiemanagement, Lecture 2008/09.
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The first mobile phone on the market …
•Motorola DynaTAC 8000xFits in all products
•Weight: 794 gramme
•Height: 33 cm (mobile phones, cameras …)
•Price: 3395 US $
•First prototype 1973, market launch 10 years later due to necessary permissions, infrastructure etc.
Example for innovation:
The first mobile phone 30 years ago!
Rudy Krolopp, 73
former chief designer of Motorola
The first mobile phone in Germany: 500g, 3000 DM (~ 1500 Euro)
The competition catches up: AEG 1989
Mobile phones today
Innovation: Example
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Those products disappeared from the market. An invention does not guarantee a commercial success.
Innovation Introduction: Example
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Can we manage Innovation?
This is the big question
The innovation for sure is important, but :
–It’s complex, uncertain, risky and costly.
So at first glance it might appear that it is impossible to manage something like this.
 The problems is of partial views of innovation
 Management is equal to Routines
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Routines & Innovation
 The problem with routines are they have to learned, and learning is difficult, it take (Time & Money)
 The routines can’t copy from other firm
 And There are some abilities the firm must have to create a routine and managing the innovation
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Innovative Organization
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Leadership, shared vision & climate:
innovation leadership, not senior management
broad vision, not detailed strategy
organizational climate - ‘the way we do things around here’
“Innovation has nothing to do with how many R&D dollars you have… it’s not about many. It’s about the people you have, how you’re led, and how much you get it.”
Steve Jobs
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Leadership, shared vision & climate
Changing Mindset (PARADIGM)
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Characteristics of an innovative climate:
Trust & Openness
Challenge & Involvement
Freedom & Autonomy
Support & Space for ideas
Conflict & Debate
Risk-taking
Freedom (Playfulness & humour)
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SPOT framework
Sweet SPOT framework for assessing innovation:
Strategy (Developing an innovation strategy)
Processes (Innovation process, systematic PM, C.I, Q. A)
Organization (Building the innovation organization)
Tools & Technology (QFD, Taguchi, Common Software)
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Developing an innovation strategy
Notions of corporate strategy first emerged in the 1960s

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“If You Don't Know Where You're Going, Any Road Will Get You There.”
The Cheshire Cat from Alice In Wonderland

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Discrepancy
Current State
• Lack of useful ideas
• Lack of skills or support for creative and strategic breakthroughs
• Perhaps, other challenges and problems
Desired Future
Need
Innovation
Champion
Strategy on how
to get there
Gap

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Innovation Strategy
Four factors have a major influence on the ability of a firm to develop and create value through innovation:
1.The national system of innovation (which defines how dealing with opportunities and threats)
2.Its power and market position.
3.The capability and processes of the firm, including (R&D, production, marketing, etc.)
4.Its ability to identify and exploit external sources of innovation, especially international networks.

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Rational strategy approach
This approach is intended to help the firm to:
1.Prepare for a changing future.
2.Be conscious of trends in the competitive environment.
3.Focused on longer term
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Innovation Strategy

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•Incremental strategy approach (Trial and error)
In this approach the most efficient procedure is to:
1.Make deliberate steps (changes) towards the stated objective.
2.Measure and evaluate the effects of steps (changes)
3.Adjust (if necessary) the objective and decide on the next step (change)
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Innovation Strategy

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Innovation Strategy
Rational/Planning
Resource/Capabilities based
top-down
bottom-up
outside-in
inside-out
choice
variation & selection
ahistorical
Cumulative
static
dynamic/learning

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Innovation Leadership Vs. Followership
According to Porter, Firms must also decide between two market strategies:
Leadership
Where the firms aim at being first to market (this requires a strong corporate commitment to creativity and risk taking)
Followership
Where the firms aim at being late to market, based on imitating from leaders (this requires a strong commitment to competitor analysis and intelligence, to reverse engineering) (East Asian “dragon” countries.

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Examples of successful Leader strategies.
Leader
Follower
Spath, Diether: Lecture Technology Management, Stuttgart, 2008/9.
Entrepreneurial Strategy: Generating and Exploiting New Entries

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Leader
Follower
Examples of successful Follower strategies.
Spath, Diether: Lecture Technology Management, Stuttgart, 2008/9.

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Innovation Strategy
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Advantages of being first to market
Disadvantages of being first to market
•Reputation as a pioneer
•Capture market share
•Early benefits to learning curve.
•Definition of standards
•Establish entry barriers e.g. patents
•Dominate supply & distribution chains
•Earn ‘monopoly’ profits
•pioneering costs, educating buyers, regulatory approval
•demand uncertainty
•changing buyer needs
•low-cost imitation
•followers ‘leapfrog’ technology

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Strategic Management: Porter U-Shape
Limits of Rational Planning
Market Share
ROI
Cost Leadership
Differentiation Concentration
between the chairs
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So, Innovation: Response or strategy?
“. . . chance favours only the prepared mind”,
L. Pasteur, 1854
“...the more I practice, the luckier I get…”,
Gary Player (champion golfer)

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Innovation = 3 % Inspiration and 97 % Transpiration.
Thomas Edison

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1.Market (Pull/Demand/Need) (The necessity is the mother of innovation)
2.Technology push (Radar, Mobile, Microwave, hovercraft, Antibiotics)
3.Regulation
4.Recombination
5.Futures and forecasting
6.Accidents
7.Search tools & methods
•Internal sources – (climate & creativity, Inspiration(
•External sources – open innovation (Users, Watching others, Competitors, partners, etc.)
Where do Ideas coms from?

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Bullinger, Hans-Joerg: Fraunhofer-Gesellschaft, Best Innovator, 13.11.2008
leisure
nature
at home: TV, eating, leisure activity
business travels, on the way to the office
company break
boring meetings
interesting meetings
workplace
somewhere else
travel
in the company outside the company
Where are ideas generated?

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Technology Push approaches suggest that innovation proceeds linearly:
Scientific discovery  invention  manufacturing  marketing
Demand Pull approaches argued that innovation originates with unmet customer need:
Customer suggestions  invention  manufacturing
Most current research argues that innovation is not so simple, and may originate from a variety of sources and follow a variety of paths.
Hadia, Hamdy: Product & Innovation Process, Lecture Winter Semester 2008/09.
Research and Development by Firms
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Sources of Innovation

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Accelerating Ideas to Market – The AIM process
•The stage-gate system

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Strategies for idea/concept generation:
Research & analysis
Imitate or adapt
Seek inspiration
Consult ‘creative’ types
Apply systematic creativity methods & tools

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Some Tools of creativity:
Mind maps - make assumption explicit
Lateral thinking - reverse logic, intermediates
Brainstorming - non-evaluative idea generation
Creative Problem solving
TRIZ
De-Bono’s ‘six thinking hats’
 Etc.,
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On average, it takes about 3,000 raw ideas to lead to
a commercially successful product or process
0
500
1000
1500
2000
2500
3000
Projects
Ideas
Stevens & Burley, 1997
Initial Experiments
ideas
New
product

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Building the innovation case

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Developing the business plan
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1.Details of the product or service
2.Assessment of the market opportunity
3.Identification of target customers
4.Barriers to entry and competitor analysis
5.Experience, expertise and commitment of the management team
6.Strategy for pricing, distribution and sales
7.Identification and planning for key risks
8.Cash-Flow calculation, including breakeven points and sensitivity
9.Financial and other resource requirements of the business.

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Portfolio management of process innovation
It used simple categories:
1.Incremental: essentially continuous improvement projects
2.Radical: using the same basic technology but with more advanced implementation.
3.Fundamental: using different technology (e.g laser cutting instead of mechanical)

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Creating new products and services

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Popular Innovation Management Models:
DeSai Group Innovation Funnel™ Model:
The DeSai Group – http://www.desai.com

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Stage-gate process for new product development
1.Idea generation
2.Concept generation
3.Project assessment and selection
4.Product development
5.Product commercialization

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Stage-gate process for new product development

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Key factors influencing the success of new product development

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