The document discusses how to innovate in the 21st century. It covers the following key points:
1. Exponential technologies like IoT, big data, and AI are driving disruption through dematerialization, demonetization, and democratization. This will transform industries and business models.
2. To innovate successfully, companies need an innovation strategy that addresses how innovation will create customer value and how the company will capture that value. They also need an organizational structure with core, incubator, and transformation teams.
3. Practical innovation methods include using constraints to drive creativity, focusing on growth mindsets, leveraging key motivators like curiosity and significance, and setting up team collabor
2. Agenda
How to Innovate in the 21st Century
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Introduction & Innovation Strategy
Organization and Transformation
Practical Innovation Methods
3. 120 Years of Innovation and the Future
Exponential Disruptive Innovation
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Internet of Things +
Big Data +
Exponential AI
Autonomous
entities
First generation of
adults that grew up
with IoT and AI
Internet
2.0
Internet
1.0
4. What is Changing in the 21st Century?
The 5 Mega Trends
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THE 5 MEGA TRENDS
1. The age of urbanization
2. Accelerating technological change
3. Challenges of an aging world
4. Greater global connections
5. Climate Change
6. Key Impacts of Exponential Technologies
Exponential growth of new technologies has enormous potential to transform the way we do business
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1. Dematerialization: Physical Product become digitized and are
distributed as bits
• Consumer electronics product categories (Audio, camera, video,
GPS,… ) have been almost eliminated by Smart Phones.
• Transportation : Not owning a car and instead use UBER for cars as the
total life time cost of owning a car is higher
• Books : From material books to online books (bits), from DVD to on
line streaming
• Miniaturization of products will have great impact in the
environmental sustainability!
7. Key Impacts of Exponential Technologies
Exponential growth of new technologies has enormous potential to transform the way we do business
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2. Demonetization: Reduces the value of a market segment
(especially services but not only) by introducing a new
Business Model
• Skype > Long Distance calls
• iTunes > Record stores
• Amazon > Book Stores
• AirBnB > Hotel Chains and travel platforms
• Craigslist > Classified Ads
• Uber > Taxi Fleets and more…..
8. Key Impacts of Exponential Technologies
Exponential growth of new technologies has enormous potential to transform the way we do business
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3. Democratization: Availability of key technologies/
applications to almost everybody.
Smartphones become the platform to access everything.
• Unlimited computing power (Cloud computing)
• Cheaper energy (Solar, 5 generations away to cover all earth needs)
• Artificial Intelligence (Virtual assistants, healthcare)
• Unlimited competences/cost competitive resources (Crowd Sourcing, Crowd Funding)
• Unlimited education (Free or low cost > on line universities)
• Free Communication (Smartphones, Internet, WhatsApp, Skype) and Mobile Phones
changed Africa by supporting cheap/easy communication and economic growth.
9. Key Impacts of Exponential Technologies
Exponential growth of new technologies has enormous potential to transform the way we do business
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4. Industry and market boundaries are fading
• Re-definition of Markets, from ‘Product specific’ to ‘Customer need’ centric:
• ‘Car market’ becomes ‘Mobility Market’
• The definition of an Industry is changing dramatically with boundaries between
Industries fading as digital technologies penetrate industries and companies,
creating businesses across those industries (e.g. Google, Apple, … )
10. Mark Andreessen - Predictions
Founder of Netscape and Andreesen-Horowitz
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11. The New World
Exponential Disruptive Innovation
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What do…Exponentially accelerating computer power, mobile internet
connectivity and Artificial Intelligence….
Urbanization, Aging population….
New Business models that demonetize, dematerialize and democratize…..
Connected crowds that finance, create, solve and soon, everything else.…
all have in common?
12. The New World
Exponential Disruptive Innovation
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They are the preconditions for a ‘perfect storm’
Will your company ‘survive’
the disruptive innovation that
the storm will bring?
Are you ready to embrace the opportunities?
Do you know what to do?
13. Innovation Strategy
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Innovation Strategy should be fully aligned with Business Strategy and
should answer 3 main questions:
1. How will Innovation create value for potential customers?
2. How will the company capture value from the innovations it generates?
3. What types of innovations will allow the company to create
and capture value and what resources should each type receive?
There are 4 types of Innovation based on Business model
(old, new) and Technology (old, new) .
14. Innovation Strategy
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1.1 Innovation Types
Based on different business models (BM) and different
Technologies we can have the following 4 types:
1. Sustaining or Routine( same BM and Technology): Intel
microprocessors, Microsoft operating systems and Apple iPhone
product extensions
2. Disruptive (new BM and same Technology): IoS versus Android
3. Radical (new Technology and same BM): Genetic engineering
disrupted the Pharmaceuticals
4. Architectural (new Technology and new BM): Digital Imaging
16. Innovation Strategy Questions
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Conclusion/call for action:
1. Where are you, or your company is thinking linearly?
2. What exponential technologies can you use to create a competitive
advantage?
3. Which products or services are going to dematerialize or
demonetize first in your industry?
4. Which exponential technologies are going to disrupt your business?
5. What will become Free in your industry in the future?
Are you prepared for the Era of Exponential and Disruptive Innovation?
17. Agenda
How to Innovate in the 21st Century
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Introduction & Innovation Strategy
Organization and Transformation
Practical Innovation Methods
18. Organizational Support for Innovation
Exponential Disruptive Innovation
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What organizational structure established companies need to transform
and innovate successfully?
An Incumbent to become successful in a disruptive business environment like now in the
21st century, needs to have a structure with the following 3 parts that support the future:
1. The core businesses that are focusing to maintain or grow and generate profit
2. Incubator group to develop new disruptive businesses
3. Transformation group to focus in one of the very promising businesses coming out of
the incubator or acquired to become part of the future core business
19. Transform and Succeed
Exponential Disruptive Innovation
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How can established companies transform and succeed in the 21st century
disruptive business environment?
1. Create a Transformative Purpose, Embrace Autonomy and Speed
2. Create Outward looking Innovation Culture
3. Search actively for new business models
4. Incubate or acquire new disruptive businesses
5. Monitor technology breakthroughs and major customer behaviour changes
20. Agenda
How to Innovate in the 21st Century
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Introduction & Innovation Strategy
Organization and Transformation
Practical Innovation Methods
21. Practical Innovation Methods (1)
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Exponential Disruptive Innovation
3.1.1 Benefits of Constraints/Clear Targets
• When we give a big constraint with clear targets to a TEAM the creativity
skyrockets The result is innovative solutions with less resources within less time.
• We need clear targets because “whatever is measured is getting done”. This is
what is happening with Incentive competitions ( e.g. crowd sourcing
competitions)
• Moreover if the team is setup in an isolated location (away from the mainstream
business ) the chance of coming with more innovative concepts is higher.
22. Practical Innovation Methods (2)
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Exponential Disruptive Innovation
3.1.2 Mindset
If you work on the mind set of your employees with the values/beliefs of the company the results
can be spectacular :
• If it was easy it would have been done versus Everything is easy with the right tools and processes
• If anything can go wrong it will go wrong versus If anything can go wrong fix it !
• We cannot predict the future versus we cannot predict the future so we will create it !
• We cannot improve versus measure it to improve it
• If you thing something is impossible then it is versus Everything is possible
• No means No versus No means maybe and find a different way to get Yes
• Failure is Failure versus Failure is Learning
23. Practical Innovation Methods (3)
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Exponential Disruptive Innovation
3.1.3 Key motivators
There a few key motivators: Curiosity, Fear, Wealth, Significance. What are the key motivators
for you, your employees, your customers?
• Curiosity is the weakest motivator for Innovation.
• Fear creates incremental innovation. People do not want to fail (Reputation, Time, Money).
• Wealth Creation is a powerful motivator for innovation.
• Significance is the most powerful motivator. It Is similar of having a powerful mission or
purpose in the company.
24. Practical Innovation Methods (4)
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Exponential Disruptive Innovation
3.1.4 Create Team Collaborations and Competitions:
Team characteristics:
• small (5-8 people)
• Youthful (mindset): Younger people attempt the impossible
• Diverse in knowledge/experience/culture/sex/…
• Risk taking/Failure is ok
• Clear targets, clear rewards, limited budget
Multiple teams:
• e.g. 5-5-5-5 : 5 teams of 5 people, 5 weeks, 5 ideas
• Limited budget and let them innovate
• Rules are: (1) Failure is ok, (2) Best idea wins, (3) If 1 team succeeds
then all succeed (to enforce collaboration)
Or use competition among the teams and mix and match the best
teams in later competition stages. This is an approach that Intuit is using.