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Strategic Innovation: Coming to an Industry Near You
1.
Strategic Innovation: Coming
to an Industry Near You Brian Christian, President, The Inovo Group 2013 International Polyolefins Conference
2.
Three Topics
1. What ‘strategic innovation’ means 2. Why you should care about it 3. How you can do it 2 Copyright © 2013 The Inovo Group, LLC
3.
WHAT ‘STRATEGIC INNOVATION’ MEANS
3 Copyright © 2013 The Inovo Group, LLC
4.
What ‘Strategic Innovation’
Means The Strategic Innovation Zone Disruptive Wasted time, capital Too & resources pursuing Risky probable failures Newness to Significantly new offerings the World at risk levels that stretch but Zone do not break the company Probable success but won’t move the Sustaining growth needle Innovation Incremental Core Newness to Horizon the Company 4 Copyright © 2013 The Inovo Group, LLC
5.
What ‘Strategic Innovation’
Means Strategic Innovation Examples direct publishing Disruptive Too Risky Newness to the World Strategic Innovation Zone Sustaining Incremental Innovation Core Newness to Horizon the Company 5 Copyright © 2013 The Inovo Group, LLC
6.
WHY YOU SHOULD
CARE ABOUT IT 6 Copyright © 2013 The Inovo Group, LLC
7.
Why You Should
Care About It Coming to an Industry Near You! • Not just about growth…can be a matter of survival • Industries in flux are ripe for strategic innovation • Your industry is in flux 7 Copyright © 2013 The Inovo Group, LLC
8.
Why You Should
Care About It Corporate Turnover is Accelerating Notable Victims of Turbulence in Fortune 500 List Strategic Innovation in Last 5 Years Alone # of Companies Removed • Blockbuster • Borders Group • Tribune Company • Ziff Davis • AbitibiBowater 82 of Fortune 100 • Kodak disappeared • Vivitar • Silicon Graphics • Bethlehem Steel Year (1955–2011) • Global Crossing 8 Copyright © 2013 The Inovo Group, LLC
9.
Why You Should
Care About It Industries in Flux are Ripe for Strategic Innovation Industry Cause of Flux Resulting Innovation Rapid rise of cable and cellular Telecom Break-up of AT&T in 1984 voice & data as well as devices New wave of hybrid and electric Oil prices, global warming, Auto vehicle innovation starting in 1997 energy independence with the Toyota Prius Three generations of non-ozone HVAC Environmental restrictions on depleting, low global warming (et al) fluorinated hydrocarbons refrigerants and blowing agents Corporate Fall in cost of international Boom in business process Services communication in early 2000’s outsourcing (BPO) to India 9 Copyright © 2013 The Inovo Group, LLC
10.
Why You Should
Care About It Your Industry Is in Flux Design-Driven Flux 1. Designer Plastics: catalyst technology (metallocene, chain shuttling) driving transformation in polyolefin value chain 2. Shale Gas: upstream technology driving massive shift in cost and mix of C2-C3-C4 paraffin and olefin feedstocks Demand-Driven Flux 3. China/India: rapid growth and future potential driving transformation in polyolefin industry business models 4. Sustainability: regulatory incentives/constraints and consumer preference driving bioplastics, PVC replacement 10 Copyright © 2013 The Inovo Group, LLC
11.
Why You Should
Care About It Other Flux Forces on the Horizon Design-Driven Flux 1. 3D printing 2. Metal organic frameworks (MOFs) Demand-Driven Flux 3. Smart packaging 4. Africa 11 Copyright © 2013 The Inovo Group, LLC
12.
Why You Should
Care About It This Flux is Driving a Lot of Strategic Innovation Drivers of Strategic Innovation Strategic Innovation Design-Driven Demand-Driven Types Designer Shale China & Sustaina- Plastics Gas India bility New Products Molecule & New Services application design ‘On-purpose’ Biomass to New Processes C3/C4 olefins chemicals (butadiene) JVs and New Biz Models Specialty M&A 12 Copyright © 2013 The Inovo Group, LLC
13.
HOW YOU CAN
DO IT 13 Copyright © 2013 The Inovo Group, LLC
14.
How You Can
Do It Four Basic Requirements 1) Clearly define your starting point 2) Clearly define your end point 3) Develop a set of process design principles 4) Design a discovery process 14 Copyright © 2013 The Inovo Group, LLC
15.
How You Can
Do It Step 1: Clearly Define Your Starting Point Demand–Design Canvas Demand–Design Canvas Apple’s Canvas in 1999 ADJACENCY Branded Music WHITE Retail Business (design SPACE forward) (Apple Stores) (iTunes Store) Demand Demand Side Side ADJACENCY PC Consumer CORE (demand Electronics backward) (iMac) (iPod) Design Design Side Side Property of The Inovo Group, LLC 15 Copyright © 2013 The Inovo Group LLC
16.
How You Can
Do It Step 2: Clearly Define Your End Point Strategic Opportunity Model Illustrative Example Offering: iPod Develop: Partner with music industry; exclusive rights to Toshiba drive Develop Produce: Chinese contract manufacturers (e.g., Foxconn) Offering Deliver: Apple branded stores plus Apple website Produce Deliver Value: Consumers, Apple up; Value artists, distributors down Property of The Inovo Group, LLC 16 Copyright © 2013 The Inovo Group LLC
17.
How You Can
Do It Step 3: Develop a Set of Process Design Principles Inovo’s Discovery Process Design Principles 1 Be hypothesis-driven and needs-based 2 Employ concept of ‘iterative deepening’ 3 Ensure end-to-end business model focus 4 Reach outside for new knowledge 5 Incorporate the ‘wisdom of crowds’ 6 Separate ‘should do’ from ‘could do’ 17 Copyright © 2013 The Inovo Group LLC
18.
How You Can
Do It Step 4: Design a Discovery Process… Demand–Design Canvas 4 community engagement 1 STAGE 1 80-100 Opportunities 2 STAGE 2 15-20 3 STAGE 3 4-6 5 evaluation/selection tools 6 Property of The Inovo Group, LLC 18 Copyright © 2013 The Inovo Group LLC
19.
How You Can
Do It …Which Reflects These Principles Demand–Design Canvas 4 community engagement Reach outside for new knowledge 1 STAGE 1 80-100 Opportunities Be hypothesis-driven and needs-based 2 STAGE 2 15-20 Employ concept of ‘iterative deepening’ 3 4-6 Ensure end-to-end business model focus STAGE 3 5 evaluation/selection tools crowds’ Incorporate the ‘wisdom of 6 Separate ‘should do’ from ‘could do’ Property of The Inovo Group, LLC 19 Copyright © 2013 The Inovo Group LLC
20.
Thanks for Your
Attention Brian Christian President 35 Research Drive Suite 400 Ann Arbor, MI 48103 (269) 930-0574 Bchristian@TheInovoGroup.com 20 Copyright © 2013 The Inovo Group LLC