More Related Content Similar to Session 02 opportunity development (20) Session 02 opportunity development1. New Product Development
Session 2: Opportunity Development
June 13, 2010
© 2010 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
2. Agenda
Overview
Opportunities from Experience
Opportunities from Market
Opportunities from Technology
Tools and Techniques
Summary
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
3. NPD Process
Conceptualize Develop Launch
Opportunity Product Pre-launch testing and
development Planning
System Architecting
Market Space Mapping Managing through Life-
Development process
Cycle
Positioning and Core
Project Management
Capabilities
Marketing
Business Model Design
Pricing New Product
Marketing Strategy
Sales and Channel
Total Business Case
Management
Development
Marketing Communication
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
4. Opportunity defined
Opportunity
When technological
possibilities are
matched with market Clear and consistent
needs and expected statement about
market demand “product”
and its “value” to
“target market”
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
5. NPD’s three legs
New Product
Opportunity
Technological Value to
possibilities Target Market
WHAT
HOW WHY
© 2009 Dr. Jay Jootar
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6. Different paths to opportunity
Market concept
complete
2. Market given
4. Market pull
Product concept
3. Technology push 1. Product given complete
© 2009 Dr. Jay Jootar
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7. Examples
1. Market pull: The oil price is increasing steadily. Need a
means for business professionals to conduct their meetings
effectively without having to meet face to face.
2. Technology push: Our technology can pump water at twice
the rate of the existing device. Need to find the market for
this technology.
3. Product given: Find the market for a given washing
machines with the specific features and functionalities
4. Market given: Find the products which help the construction
firm to move construction material from the truck to the
construction site easily
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
8. Examples
complete
Rice farming
Powered
Market concept by small
truck
battery
Agriculture
Rugged
model
Double power
water pump
complete
Product concept
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
9. Sources of ideas
Internal Sources:
Research & Engineering
Sales, Marketing & Planning
Production
Other company executives
External Sources:
Customers & prospects
Contract research organizations & consultants
Technical publications
Competitors
Universities
Inventors
Unsolicited sources
Source: Cooper, R. G.
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
10. Source of opportunities
EXPERIENCE MARKET TECHNOLOGY
1. Unexpected 1. Demographic 1. New knowledge
success changes 2. Converging
2. High-growth area technologies
2. Unexpected failure
3. Shift in consumer’s 3. Process weaknesses
3. Unexpected taste or perception 4. Underutilized
external event
4. Shift in supply chain resources
4. Competitor- or strategic 5. Expansion of scale of
triggered idea landscape current operation
5. Change in regulation
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
11. Agenda
Overview
Opportunities from Experience
Opportunities from Market
Opportunities from Technology
Tools and Techniques
Summary
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
12. 1. Unexpected Success
Do not think of unexpected success as
temporary event
There might be underlying factors that can be
exploited to gain even more success
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
13. Example: McDonald
Ray Kroc wondered why he
was selling so many
milkshake machine to
McDonald restaurant
He visited the restaurant
and finally bought franchise
before expanding its
success into the biggest
restaurant chain in the
world
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
14. Questions to ask
1. What unexpected product success have you had recently?
2. In which geographic areas have you had unexpected success
recently?
3. In which market/industry segments have you experienced
unexpected success recently?
4. What customer segments have provided unexpected success
recently?
5. What unexpected success have your suppliers had recently?
6. What unexpected success have your competitor had recently?
7. Which of your technologies has had unexpected success recently?
8. What unexpected customer/user groups have bought from you
recently?
9. What unexpected sources have asked to sample, distribute, or
represent your product recently?
10. ……. AND WHY?
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
15. 2. Unexpected Failure
Instead of spending time defending failure,
one should be asking “What caused this
failure, and how can we turn it into an
opportunity the next time?”
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
16. Example: Ford
Ford learned many lessons
Ford Edsel, the from the failure of launching
biggest failure in Edsel in 1950’s
history of automobile
One of the lessons was that
people bought car not just as
a transportation, but also as a
lifestyle
This led to the development
of Mustang, the first lifestyle
car that has been very
successful commercially
Mustang, the first
real lifestyle
automobile
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
17. Questions to ask
1. What unexpected product failures have you had recently?
2. In which geographic areas have you had unexpected failure
recently?
3. In which market/industry segments have you experienced
unexpected failures recently?
4. What customer segments have you provided unexpected failures
recently?
5. What unexpected failures have your suppliers had recently?
6. What unexpected failures have your competitors had recently?
7. Which of your technologies has had unexpected failures recently?
8. Which customer/user groups have had unexpected failures
recently?
9. Which distributors, dealers, and/or agents have had unexpected
failures recently?
10. …….AND WHY?
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
18. 3. Unexpected External Events
• Unexpected external events can be from
competitors or some other unrelated events.
They can be internal or external to the firm.
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
19. Example
Aircraft hijacking in1960’s Metal detector is created by
applying existing technology used
for other industry
© 2009 Dr. Jay Jootar
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20. Example
AIDS
AIDS epidemic Condom has found another use
(besides contraception) to protect
transmission of the disease
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
21. Example
Availability of DVDs DVD players has been in such high
demands that many brands come out
with big marketing budget
© 2009 Dr. Jay Jootar
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22. Questions
• What unexpected external events have occurred
recently?
• What unexpected internal events have occurred recently?
• Have any expected external and internal events
combined in an unexpected way recently?
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
23. 4. Competitor-triggered ideas
Example
Apple 2
IBM PC tweaked its development
efforts and come out with similar
product
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
24. Know your competition
• Routinely survey your competition
• Periodically perform a complete review of competitive products,
particularly new ones. Determine how well the product is doing
in the market place
• Obtain a sample of your competitor’s product. Undertake a
thorough evaluation of the product from a technical standpoint
• Obtain copies of ad and literature, knowing what the competitor
emphasizes or how it positions the product can yield new
insights for your own new products
• Arrange an internal brainstorming session aimed at better your
competitor’s product and how to position against it
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
25. Agenda
Overview
Opportunities from Experience
Opportunities from Market
Opportunities from Technology
Tools and Techniques
Summary
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
26. 5. Demographic Changes
• Dimensions
– Income
– Age
– Education
– Mix
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
27. Quiz: Demographic Size
• Total population of Thailand
• Number of households
• Mobile phone penetration
• Number of cars, motorcycles, pick-up truck
• Number of students
• Number of tourists
• Number of Thais working overseas
• Number of computers
• Number of Internet users
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
29. Questions
• How is the age distribution of your customers and users
changing?
• How will the educational level of your customers and users
change in the next few years?
• How will the income distribution of your customers and users
change in the next few years?
• How will the geographic distribution of your customers and users
change in the years ahead?
• How might the buying habits of your customers and users change
in the year ahead?
• What are the customer demographics that might change over the
years ahead?
• How will the mix of your users and customers change in the next
few years?
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
30. 6. High-growth areas
• One should search for changes in the present
business or related businesses in which growth
is occurring faster than growth in gross domestic
product (GDP) or population growth.
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
31. Mobile download content
Wallpaper Music (Ringtone) Game
Source: Siam Turakit
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
32. Mobile download market is big and growing
Category of download content
Highlights
game
color
5% 46% of Thai teenagers
15%
use mobile download
music
basic
service1
basic
10%
color
game
6% use the service more
than 5 times a month1
music
70%
The majority of download
comes from Ringtone1
Source: Kasikorn Research Center, Industry sources, TIC
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
33. Questions
• What parts of the business are growing faster than
economic or population growth?
• What other businesses are growing faster than economic
or population growth?
• What potentially high-growth businesses related to yours
are dominated by only one or two companies?
• What parts of your competitors’ businesses are growing
faster than economic or population growth?
• What parts of your customers’ or suppliers’ businesses are
growing faster than economic or population growth?
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
34. 7. Shift in consumer’s taste or perception
• “What changes are happening in how our
customers perceive our products, and how can
we convert those changes into new
opportunities?”
• This is the area that can be consciously
manipulated. Creating new trend…
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
35. Example:
Hospital
Health consciousness
Fitness center
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
36. Questions
• What changes are occurring in how your products and services are
perceived?
• What changes are occurring in the values of your customers?
• What changes are occurring in the lifestyle, image, and status of
your customers?
• How will changes in perception affect your customers and
suppliers?
• For what new purposes have customers purchased your products
and services recently?
• What intangible reasons are customers developing to support your
products and services?
• What societal, peer, and normative pressures will affect your
products and services in the future?
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
37. 8. Shift in supply chain or strategic landscape
Component End
suppliers customers
Opportunities can occur anywhere in the supply
chain…You need to translate that to see the
implied opportunities where you are
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
38. Example: eBay
The popularity of eBay leads to
changes in distribution channel for
several kinds of goods
Now people with little or no capital
can make money by selling goods
on eBay and get a fair price
without being beaten down by
retailer
This lead to many products now
being sold primarily through eBay
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
39. Questions
• What major structural changes are occurring among your
customers?
• What major structural changes are occurring in your geographic
markets?
• What major structural changes are occurring within your
market/industry structure or in the conduct of your business?
• What major structural changes are occurring among your
competitors?
• What major structural changes are happening in your customers’
businesses?
• What major structural changes are occurring within your
regulatory environment?
• What major structural changes are occurring in your supplier
relationships?
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
40. 9. Regulation Changes
• Watch for important regulation changes
that can create a whole new industry
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
41. Example: VoIP
In 2006, NTC
granted
permission to ISPs
to provide voice
over IP service,
thus opening a
new range of voice
services to be
delivered to users
by this new Softphone IP Phone Mobile Phone
technology (on PC) With WiFi
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
42. Agenda
Overview
Opportunities from Experience
Opportunities from Market
Opportunities from Technology
Tools and Techniques
Summary
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
43. 10. New Knowledge (Fundamental Research)
• Provide more focus to research to deliver new knowledge or
a capability that may spawn new products or processes
• Use relevant criteria to judge technology development
projects
– Degree of strategic fit and strategic importance to the
corporation
– Ability to achieve strategic leverage (e.g. platform for growth,
impact on multiple business units
– Potential for reward (value to the company, if successful)
– Likelihood of technical feasibility
– Likelihood of commercial success (for example, competitive
advantage, existence of in-house competencies)
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
44. Example: Wi-Fi
Original solution - Use wire to
Hi-speed internet
connect broadband at home
or office
hi-speed internet
Wi-Fi access point
Wi-Fi equipped notebook
Use WiFi (Wireless LAN) to
connect to
broadband at home or office
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
45. WiFi access point
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
46. WiFi-equipped Notebook
Wi-Fi built in Wi-Fi PC card insertion
“Intel Centrino”
Microprocessor embedded with Wi-Fi
© 2009 Dr. Jay Jootar
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47. Source of ideas for new knowledge
• Trade shows
• Trade publications
• Patents
• Suppliers
• Universities
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
48. Questions
• What new knowledge has recently become known about
your business?
• What combinations of knowledge have created new
insights into your business?
• What new sources of information about your business
have recently been tapped?
• What new patents or discoveries have been announced
relating to your business?
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
49. 11. Converging Technologies
• Two or more technologies that perhaps singly do
not represent opportunity but that, when taken
together, represent substantial opportunity for
those willing to look for it.
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
50. Example: Digital camera
Optical
+
Digital imaging
+
Storage
technology
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
51. Questions
• What technologies in your businesses are converging or
merging?
• Which of your technologies is now being joined to outside
technologies?
• Which of your technologies can be more effective if
deliberately converged?
• What would be the ideal convergence of technologies in
your business?
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
52. 12. Process Weaknesses
• All organizations are composed of various
processes, procedures, or systems.
• We should ask ourselves “What
bottlenecks, weak links, or missing links
are there in these processes and how can
we eliminate them?”
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
53. Example: Federal Express
Leverage weakness in USPS
process to deliver parcels and
packages to provide more efficient
service targeting at premium
prices
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
54. Questions
• What self-contained processes exist in the organization?
• What process weaknesses exist in our customers’
organization?
• What weakness or “missing link” prevents better process
performance?
• Why do some processes perform better at some times
than at others?
• What bottlenecks do each of these processes have?
• What process weaknesses among our competitors might
we be able to improve on?
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
55. 13. Underutilized Resources
• Look for way to utilize utilized resources
into something that is valuable, scarce, or
expensive
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
56. Example: Bio-fuel
Gasohol Bio-diesel
Ethanol
Tapioca Sugar Cane Oil Palm
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
57. 14. Scale Expansion for Existing Business
• Look for way to capture more market by
expanding scale of existing “successful”
business. Create a new business model
along the way.
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
58. Example: Dell Computer
1984 Founded company as PC’s Limited based in his dorm
room
1985 Built 1st PC “Turbo PC”
Began selling direct to consumers (instead of selling
through distribution channel)
1989 Set up its 1st on-site-service program to compensate for
the lack of local retailers
Michael Dell
1996 Started selling PC via web site
1999 Becomes the largest seller of PC in U.S.A.
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
59. Agenda
Overview
Opportunities from Experience
Opportunities from Market
Opportunities from Technology
Tools and Techniques
Summary
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
60. Idea generating system
1. Establish a “focal point” for ideas
– Assign one person the responsibility of stimulating,
generating, and receiving new product ideas, moves the idea
to the next step and get feedback to idea submitter
– Make a list of possible sources of ideas
– Establish a flow lines or mechanisms to solicit ideas from
each source
1. Set up an idea bank
– Not all product ideas get acted upon
– Set up an “idea bank” a holding tank for inactive ideas
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
61. © 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
63. Voice-of-Customer Research
• Camping out, a.k.a. “Fly-on-the-wall”, “Day-in-the-life-of”
• In-depth on-site interviews and visits with customers can often
point to unmet, unarticulated, needs that yield your next new
product breakthrough
• For B2B, focus on the entire workflow of customers
• Product Value Analysis – experiential method where customers
have interactions with facets of your product and then express
their views, concerns, and difficulties
• Customer surveys or focus groups
• Convene a group of experts to discuss the problem and possible
breakthrough solutions
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
64. Lead users
• Many commercially important products are initially
thought of and prototyped by lead users –
companies, organizations, or individuals that are
well ahead of market trends and have needs that
go far beyond the average user
• If we can find the lead users and get ideas from
them, we get the idea that are well ahead of the
market
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
65. Lead-user process
• Identify the target market and company goals for
innovations in this market
• Determining the trends: Talk to people in the field who
have a broad view of emerging technologies and leading-
edge applications
• Identify lead users: Use a networking process in which
project team members explain their quest to people with
apparent expertise on the subject, then ask for a referral
to someone with even more relevant knowledge
• Developing the breakthroughs: Host a workshop with
lead users and key in-house technical and marketing
people
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
66. Scenario Planning
• What is the best future scenario?
• What is the worst possible scenario of the future?
• How do you characterize these scenarios?
• Identify the primary decisions managers face
• Identify markers or signals of each scenario to spot which
way the world is moving
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
67. Business Plan Workshop
• Off-site company event designed to produce or
scope out at least several future revenue
streams
• Key is to harness the creative energy of the
entire group of senior and middle management
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
68. Example of Workshop Plan
• Day 1 & 2
– Opening speech
– Break-out session “Identify major trends, shifts, changing
customer needs, and potential disruptions that are taking
place in our market place”
– Break-out session “Identify the major technology shifts in your
and your customers’ industry that will impact the market and
change the way you do business”
– “Assessment if internal company strengths and core
competencies that might be leveraged to advantage and
shifts in the industry and value chain structure”
– Key challenge “What opportunities do these changes
suggest to you”
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
69. Example of Workshop Plan
– Opportunity mapping – Have the team map out some of the
opportunities that their assessments have suggested
Clustering of new opportunity suggestions around major
opportunity themes
• Day 3
– Cluster and collapse these many opportunity themes into
manageable subset of major opportunities Convert into
drawings, sketches, prototype brochures and display on
posters around the conference room
– Have attendees walk to the posters of product idea they
would like to work on
– Each opportunity team fleshes the opportunity out further,
starts to shape the product, product family, or solution and
begins to think about the path forward
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
70. Immersion
• Select a product area where the company currently
has no presence but that it wants to attack. Select
based on strategic assessment.
• Assemble a dedicated cross-functional team to
immerse themselves in this area for the next eight to
twelve months.
• Harvest many ideas uncovered during this period and
sit down with others in the company, develop a list of
product opportunities
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
71. Broaden scope
• A project manager come up with a product idea
• He/she invite people from other business units and pose a
key challenge “What could this idea become if all the
business units in the room worked on it?
• Key is to put together a group of creative people, give
them a product idea, and ask how it can be amplified and
grown by employing the strengths of each of their business
units
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
72. In-house suggestion scheme
• Focus the scheme strictly on new product ideas
• Publicize the scheme widely; use in-company promotion
• Offer some guidance; provide a pamphlet or web page that
defines what a good idea is and what areas are in bounds
and out of bounds, and create an idea submission sheet or
template
• Provide fast and fair feedback to submitters
• Provide recognition or rewards for successful submitters
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
73. Provide Scouting Time
• A handful of progressive firms encourage select
groups of employees to be creative by providing
free time – “scouting time” – and some financial
helps on personal projects
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
74. Agenda
Overview
Opportunities from Experience
Opportunities from Market
Opportunities from Technology
Tools and Techniques
Summary
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
75. Summary
• A well-developed new opportunity need to have clear
definition on both market and technology dimensions
• Leverage experience both good and bad to find a new
opportunity
• Look at the market, both customers and supply chain level
to identify new opportunity
• Exploit new technology, process to create a truly
innovative new business
• Use various tools to brainstorm and consolidate new
business ideas
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
76. Ending Notes
Think of the market as a “non-flat” world
Look on the other side to find new
source of wealth and opportunities
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com
77. Reference
1. Cooper, R. G. Winning at New Products, Basic Books,
2001
2. Drucker, P. F. Innovation and Entrepreneurship: Practice
and Principles, Harper & Row, 1985
3. Robert, M. Product Innovation Strategy, McGraw-Hill,
1995
© 2009 Dr. Jay Jootar
Slides downloadable from www.vcthailand.com