Stefano Mizio, manager come corporate catalyst dell'innovazione

1. Innovation, business models and
manager’s role as ‘corporate
catalyst’
21 novembre 2013
Stefano Mizio – Management Board Innovits
MIP – Politecnico di Milano

2. About Innovits
• InnoVitamins (InnoVits) è un’iniziativa non profit fondata con
l’obiettivo di catalizzare lo sviluppo della cultura imprenditoriale
supportando idee di business innovative, fornendo strumenti
professionali e opportunità di business.
• InnoVits gestisce una gara di idee con l’obiettivo di selezionare,
fra tutte, la migliore idea innovativa di business.
• InnoVits è un percorso che accompagna e sostiene gli
imprenditori consentendogli di sviluppare e “vendere” la propria
idea di business in modo professionale, con il supporto di
professionisti di esperienza della community AlumniMIP.
• Innovits offre concrete opportunità di networking e, per le idee
migliori, l’opportunità di entrare in contatto con Business Angels
e Venture Capitalist in occasione della presentazione finale.

3. Agenda
We need
innovation
(Business Model
Innovation)
Lean
Startup/business
model
canvas/agile
methodologies
Large Corporation
are not always
too big to
innovate
Corporate
Catalyst
Stefano Mizio

4. Too big to produce gamechanging inventions?
innovate?
Stefano Mizio

5. Large companies:
Performance Engine
Performance engine strives to make every task, every process as
repeatable and predictable as possible .
Innovation is neither repeatable nor predictable; it’s exactly the
opposite: nonroutine and uncertain
Stefano Mizio

6. Today – digitally disruptive
economy
A computer;
An internet connection;
A programming language and SDK;
A friction-free digital platform for distributing
and making money from you innovation;
…in few years a 3D-printer
That’s all you need to bring your ideas to the
market!
BUT…
Stefano Mizio

7. Dozens of copycats
Increasing ease and decreasing cost of
innovation -> short-term pressure (startups)
Startup #1
Startup #1*
Startup #1**
Stefano Mizio

8. The new corporate garage?
Big companies have hard-to-replicate advantages
Stefano Mizio

9. The Challenge
Tim Kastelle Blog
Stefano Mizio

10. David versus Goliath
Search for a new business model…
Stefano Mizio

11. The rise and the fall of…
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12. Blockbuster
this is the end…
Don’t get Netflixed!
Stefano Mizio

13. Netflix, netflixed
Verb:
1.to cause disruption or turmoil to an existing
business model
2.To destroy a previously successful business
model
3.To displace the way value is currently created,
delivered, and captured
4.To be disrupeted, destroyed, or displaced by
new business model.
S. Kaplan
Stefano Mizio

14. The Challenge
You must reinvent a business model while the entire
organization is working hard pedaling the bicycle of
the current one.
Stefano Mizio

15. Even Netflix is in Danger of being
Netflixed…
Stefano Mizio

16. The Key Issue:
Business model innovation is a competency
that doesn’t exist in most companies, since it
never had to… …
The new normal is Amazon
Stefano Mizio

17. INNOVATOR’S PARADOX
and your current Business Model?
Scott D. Anthony
Stefano Mizio

18. Kodak acquired OFOTO in 2001
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19. Imagine if…
Kodak: “ our tagline is Share memories, share
lives”.
“Why don’t we let people simply share album
pictures?..we can create a feature that allows
people to share news items as well”.
Facebook in 2001??
But
Kodak didn’t take those steps….
Stefano Mizio

20. Kodak’magnete vs OFOTO: The
current business model
T&C:To maintain free storage, you need to meet the following minimum
purchase requirement within 90 days of first uploading images, and then
every 12 months thereafter ... If you do not purchase the required amount
as set forth above from us for a period of 12 months, we may delete the
images stored in your account.
Stefano Mizio

21. Your core business is a Magnet!
It can take the most power idea and turn it into something
that has been done before
Stefano Mizio

22. Car2Go business model
Take a look at Car2Go
Business Innovation Division
The Daimler Lab for new business
models
Company CEO Robert Henrichcan can be
credited with the founding of the services —
while working at Daimler in a division tasked
with exploring next-generation business
models, he developed and championed the
idea that grew into Car2Go.
Stefano Mizio

23. The Magnet didn’t work!
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24. Car2Go in Milan: 40,000 clients in
few months
Fiat, ENI,
Trenitalia
“coming soon”
Stefano Mizio

25. Leassons learned
• Run Experiment (Ulm Germany – internal
employees) – Frugal innovation.
• Alert to the early warning signs that a
business model is facing erosion (car
production for Daimler)
• Emerging trends : sharing economy +
sustainability/green economy.
•Organizational Model: Business Innovation
Division/ Strong Management Support.
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26. Stefano Mizio

27. Large Companies
Resources Capabilities Exploration
Exploitation
Execution
New Business
Models
Search
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28. What kind of organization?
Spin out organization? Ambidexterity Organization? Partnership?
Stefano Mizio

29. Organizing an innovation initiative
Company
Performance Engine
Shared
Staff
Partenrship
Dedicated
Team
V. Govindarajan – C. Trimble : The other side od Innovation
Stefano Mizio

30. TELCO UNDER PRESSURE
Stefano Mizio

31. Whatsapp: founded in 2009
WhatsApp just surpassed 300 million users worldwide.
Telco senior management were worrying about the risk of cannibalizing
SMS revenue.
Always ask the question: “If I don’t do this, will an
existing or new competitor decide to?”
Stefano Mizio

32. In 2008 that was the reality
WALLED GARDEN WAS OVER!
High Rivalry among traditional
competitors – efficiency mature sector
Online players like Google have
become a driving force in the
industry.
Dumb pipe risk: operators just
building Freeways for
Californian cars.
http://flickr.com/photo_zoom.gne?id=321433870&size=l Darwin Bell
S. Mizio :VODAFONE ENTRY IN THE MOBILE INTERNET MARKET: COMPETITIVE ISSUES, INNOVATION AND CAPABILITIES - March 2010 - Final Thesis 3 EMBA MIP

33. Vodafone Internet Services
VF 360 platform
Trying to avoid being a Dumb Pipe
Stefano Mizio

34. Vodafone Internet Services
If you look for quick growth, you are forced to
Stefano Mizio
look to what exists

35. The organizational design seemed a good
fit for the innovation challenge…but
VIS relied too heavily on its Performance Engine to develop
VF360 infrastructure and APIs -> 1° Risk to overestimate
the capabilities of the Performance Engine.
“ One of the biggest problems is that the company still has a ‘handset & basestation’ mindset”. mobile industry review: vodafone_360_an_absolute_failure
Stefano Mizio

36. What kind of competencies
Acqui–Hiring and the
“organizational memory”
To expand a business the company must expand its inventory
skills…skills that you have never needed before.
Twitter 29 acquisitions since 2009 - 9 startups had received a seed
Stefano Mizio

37. Telco operators are organized to pursue
development effort of different duration
Develop and act as a venture backed startup with a great
“always beta” culture (Google) implied a different approach (
no waterfall ) -> 2° Risk : different Operating rhythm
…delivering reliable features every 6/8 months costing a lot o
money. That was unfit with Internet time/pace/philosophy
Stefano Mizio

38. Using existing processes
Little Performance Engines instead of Dedicated teams
Stefano Mizio

39. No custom organizational model in place
Ongoing Operation
Strategy
Organizing
&
Planning
Execution
Innovation
Committing to
an Innovative
Idea
?
“Great idea! Go
make it happen”
Something missing
Stage gate? Agile
approach? What kind of
relationships?
Making
Innovation
Happen
V. Govindarajan – C. Trimble : The other side od Innovation
Stefano Mizio

40. Fuji Film
Healthy Disengagement and Resource allocation
Fuji’s approach: investing in new advantages and
pulling resources from declining ones.
Stefano Mizio

41. The wave of transient advantage
What to do when you are in the Exploitation phase…
Healthy disengagement
R. Gunther McGrath: The End of Competiitve Advantage
Stefano Mizio

42. Kodak
Fuji: 25$ billion
2011 and 377th on
Fortune’s Global
500 list.
Kodak has gone
bankrupt.
Fuji didn’t get trapped by its
past.
Stefano Mizio

43. Are Accountants and CFOs Killing
Innovation?
The Accounting Conservatism
Stage Gate (uber alles) innovation process and the Net
Present Value perspective.
the Risk averse culture
Stefano Mizio

44. Is it Business Model innovation
really matters?
“Bad things can happen to
good technology. And
much of what can happen
is due to the business
model the company uses
to commercialize the
technology ”
H. Chesbrough
Stefano Mizio

45. Portfolio of Business Models
Impact Grid
Business Model
Level of
Promise
Risk level (detailed)
Interdependance
Technical Risk
Financial Risk
Risk
Level
(general)
B.M. 1
B.M. 2
B.M. 3
Low – Low/Medium – Medium/High – Medium - High
Source: Rethinking Business Model for Innovation
Stefano Mizio

46. Balancing Short Term and Long Term
Innovation
Source: Rethinking Business Model for Innovation
Stefano Mizio

47. Integrating different “Time – Horizonts”
Innovation Portfolio Management
Source:Managing Innovation Portfolios – Strategic Portfolio Management –R. Ohr and K. McFarthing
Stefano Mizio

48. Innovation initiatives are deliberate
departures from the past
Ongoing operation (90%
data, 10% unknowns):
central focus is to execute
the plan.
Innovation initiative (10%
data, 90% unknown): the
plan is a hypothesis.
Shifting attention from
data to assumptions
Stefano Mizio

49. Run disciplined exp.
Companies need to
be learningfocused and failure
tolerant.
Building a culture
of
experimentation
Or better … disciplined experimentation
Innovations as experiments
Stefano Mizio

50. Run Disciplined Experiment
Learning :
the process
of turning
speculative
predictions
into reliable
predictions
V. Govindarajan –C. Trimble – The other side of innovation
Stefano Mizio

51. Modern Day (management)
Neologisms
CORPORATE ENTREPRENURSHIP
ENTREPRENEURIAL ORIENTATION
INTRAPRENEURSHIP
LEAN ENTERPRISE
INTERNAL CORPORATE VENTURING
Stefano Mizio

52. Intrapreneurship/Corporate
Entrepreneuship
Intrapreneurship can be defined as
using entrepreneurial skills without
taking on the risks or accountability
associated with starting your own
business. Instead, intrapreneurs are
employees in larger organizations,
who act as entrepreneurs while
having the resources and
capabilities of the larger firm to
draw upon
Corporate Entrepreneurship: is the
process by which individuals inside
organizations pursue opportunities
without regard to the resources they
currently control (Stevenson)
Stefano Mizio

53. Why startup???
Search for a business model… sound interesting if
you are an established company!
Steve Blank – Customer Development Manifesto
Stefano Mizio

54. Startup and established company
Steve Blank
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55. key activities
value
proposition
customer
relationships
key
partners
customer
segments
Product/Market fit
cost
structure
key
resources
revenue
streams
channels
Business Model Canvas
55
Stefano Mizio JAM
images by

56. B Model structure
IBM’ s global CEO report 2006: business model innovation matters
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57. 9 Guesses
Guess
Guess
Guess
Guess
Guess
Guess
Guess
Guess
Guess
Stefano Mizio

58. Customer Development Model
or How we search for the business Model
Search
Execution
Pivot
Learning and Discovering
Design experiments, start
listening
testing your hypotheses outside the building
Steve Blank – Customer Development Manifesto
Stefano Mizio

59. Holistic Focus on three things
Agile Coaching Blog – David Bland
Stefano Mizio

60. Medical Device Manufacturer
Heart disease is the number one killer in India, accounting for a quarter of
deaths among those aged 25 to 69. Millions are dying due to lack of access to
treatments.
Stefano Mizio

61. Healthy Hearth model
Innovation commitment
External
Partner:
Ashoka (to back
social
entrepreneurs and
support and
finance plan for
pacemakers)
Internal
partners
Bring
pacemakerk
tech. to
Indians who
desperately
need it
Patient
education
activities
through local
events, text
messaging and
social media.
Hospitals
People who
are unable to
obtain
pacemakers
and other
cardiac
products
Stefano Mizio

62. Do you believe B. Model is a
tool for startups?
Entrepreneurial
approach/method
Unique capabilities
Experimentation/ get out of the
building : diagnostic camps to
identify potential patients.
Strong Brand Reputation: local
doctors/ Regulatory approval/…
Business Model Validation
Open minded
Observation
( Aravind Eye Care System)
Humility
Partner relationships
“Last mile” distribution
channels
Process and internal resources:
design, staffing and execute
pilots and expanding programs
Recombining existing
capabilities
Stefano Mizio

63. Managing the Partnership
You need the Performance Engine!
Performance
Engine
Dedicated
Team
Conflicts must be anticipated, mitigated or neutralized
Stefano Mizio

64. Innovation and Corporation in Italy
what managers say about innovation
WOBI (World of Business Ideas) indagine presentata al World Business Forum di Milano (56 novembre) – 3500 dirigenti di azienda intervistati: WBF L'Italia chiede più innovazione
• la scarsa propensione all’innovazione dimostrata dai manager (40,48%).
• il 49,6% degli intervistati ritiene prioritario per stimolare l’innovazione il giusto approccio
dei manager.
• Solo il 9,9% dei manager pensa che le aziende con una lunga storia siano le più
disposte a innovarsi
Stefano Mizio

65. Complacency and Fear
In 2001 Nokia engineers about iPod: “ It’s just a hard drive built on
older technology in a fancy case.”
Stefano Mizio

66. A new Breed of manager
Organizations need a structure and a corresponding culture where
accelerated change is the new normal. It requires an environment, a
strategy in which experimentation and pioneering is the most common
thing to do in order to be able to innovate.
Stefano Mizio

67. It’s a matter of Perpective
Curiosity + Diversity + Method
Stefano Mizio

68. The key Point
The limits to innovation in large organization
have nothing to do with creativity and nothing
to do with technology.
They have everything to do with management
capability.
Ray Stata – founder and chairman of Analog Devices
Stefano Mizio