Why small and large firms depend on each other in their innovation process?

1. Innovation – What, Why, How… Why small and large firms depend on each other in their innovation process? Anand Subramaniam

2. 2 “Without tradition, art is a flock of sheep without a shepherd. Without innovation, it is a corpse.” - Winston Churchill

3. 3 Highlights Innovation Overview Innovation Metrics / Measures

4. Innovative Companies 2010 4 Source – Business Week

5. Innovation Overview

6. Innovation – Open vs. Closed 6

7. Innovation and Customer Need 7 Target Audience Objective Mechanism Target Audience Objective Mechanism Target Audience Objective Mechanism Target Audience Objective Mechanism

8. Innovation - Drivers Increased demand for accountability Stricter regulation Technologies coupled with a need to exceed the competition in these technologies Rising customer expectations regarding service and quality Changing economy Drivers Increased competition Demographic, social and maket changes Industry & community needs for sustainable development Shorter product life cycles 8

9. Innovation Types 9 Incremental Innovations Focused on making small but significant improvements to existing products or services (when industry is mature) Breakthrough Innovations Introduces an existing technology into a new market, a new technology into an existing market or changes the way the offering is delivered Disruptive Innovations Game Changers who disrupt an existing market or create a whole new market

10. Innovation - Sustaining vs. Disruptive 10 Sustaining Focused on demanding customers; both incremental and radical. Incumbents have resources and motivation Disruptive Introduce products and services not as advanced as existing ones, but offering other advantages (simpler, cheaper, more user friendly, ...) and focus on new or less demanding customers.

11. Innovation - Enablers 11 Climate for Creativity Working environment where inspiration thrive & creativity flourishes Idea Generation Secure a continuous source of creativity and flow of new ideas Incubation Structures Support the development and growth of ideas from innovation to delivery Metrics & Incentives Measure outcomes from creative processes and recognise talent at the organisation and individual levels Role of Collaboration & Partnering Work externally and internally with organisations and specialists who have the strongest capabilities for innovation Integration of Business & Technology Integrate technological capabilities with business insight to achieve innovation

13. venture finance,

14. exit opportunites,

15. knowledge (production, markets and R&D)

17. as suppliers of new knowledge (which they cannot develop themselves),

18. organisational renewal, for experimentation with busienss models,

20. Market acceptance

22. Founders = Mgt Team

23. Minimal Revenue

24. Slow Growth

25. High Growth

26. Head Count

27. Multiple Cycles

28. Bright Idea

29. Experimental

30. Research

31. Business Plan

33. Administration

34. Marketing

35. Revenue GrowthSeed Idea / Concept Time

37. Business Development

38. Market Access

39. Financial

40. Training

41. PR / Marketing

42. Networking

44. Prototype

45. Project Management

46. Business Premises

47. Management Training

48. International support

49. Market Access

50. Recruitment

51. Training and Incentives

52. Diversification strategies and support Start-Up Seed Idea / Concept Time

53. Metrics & Measures

54. Innovation – Product / Service Measures Growth rate in share of key customers’ purchases Time to market for new products / services Growth rate in number of customers Number of patents % age of revenue / sales / gross margins from new products / services Customer satisfaction with product / service features Product / Service Measures ROI for new products / services % of new products / services achieved initial business objectives Time to profitability for new products / services % age of products / services making up the 80% of sales volume 16

55. Innovation – Business Model Measures Number of sales channels used Number of channel partners / alliances appointed / created Revenue growth Profit growth Number of new sales channels created during the year Business Model Measures % age business components or processes outsourced Number of joint ventures created during the year Average time to act on identified business opportunities 17

56. Innovation – Operation Measures Warranty expenses as a % age of sales Cost of goods sold as a % age of sales On time delivery Cost reduction Customer retention Operation Measures Perfect order fulfilment Full time equivalents Customer satisfaction from order taking to delivery Order fulfilment cycle time Inventory turnover rate 18

57. 19 “No one asks you to throw Mozart out of the window. Keep Mozart. Cherish him. Keep Moses too, and Buddha and Lao Tzu and Christ. Keep them in your heart. But make room for the others, the coming ones, the ones who are already scratching on the window-panes.” - Henry Miller

58. 20 Good Luck http://www.linkedin.com/in/anandsubramaniam