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8 steps to innovation: An introduction

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Slides presented by Prof. Rishikesha Krishnan at CIO Leadership Summit at Hotel Movenpick on April 26, 2013. It gives an overview of the book "8 steps to innovation: Going from jugaad to excellence" by Vinay Dabholkar and Rishikesha Krishnan.

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  1. 1. Rishikesha T. Krishnan & Vinay Dabholkar rishi@iimb.ernet.in; vinay@catalign.com 8 Steps to Innovation: Building a Systematic Innovation Capability April 26, 2013 1 Build a pipeline 3 Improve Batting Avg 2 Improve idea velocity
  2. 2. From Jugaad to Systematic Innovation:
  3. 3. Innovation by Firms Inputs People Funding Knowledge Infrastructure Capacity to Innovate Incentive to Innovate Benefits Competition Appropriability Rewards Social Environment Political Environment Economic Environment Technology Environment Government Policy International Environment 3
  4. 4. Innovation by Firms Inputs People Funding Knowledge Infrastructure Capacity to Innovate Incentive to Innovate Benefits Competition Appropriability Rewards Social Environment Political Environment Economic Environment Technology Environment Government Policy International Environment Improved since 1991 Remain areas of concern 4
  5. 5. INNOVATION STRATEGIES DEPEND ON YOUR SOURCE OF COMPETITIVE ADVANTAGE…. Look at the disciplines of market leaders…. 6
  6. 6. 1. Operational Excellence Provision of consistent quality at the best price through a standardized business system that minimizes the cost & difficulty faced by the customer in acquiring the product • Wal-Mart • Southwest Airlines Low-cost transaction processing systems Optimization of business processes 7
  7. 7. 2. Customer Responsiveness Emphasis on careful tailoring and adaptation of products & services to increasingly specific requirements • Merrill-Lynch • Nordstrom’s Microsegments Long-term relationships Empowerment 8
  8. 8. 3. Performance Superiority Continuous, fast-paced innovation that yields a steady flow of leading-edge products that consistently push the state-of-art •3M •Sony •Gillette Openness to new ideas Sensitive to latent needs Mobilize NPD teams 9
  9. 9. 8 Steps to Innovation: Building a Systematic Innovation Capability 1 Build a pipeline 3 Improve Batting Avg 2 Improve idea velocity
  10. 10. Build a Pipeline 1. Lay the Foundation 2. Create a Challenge Book 3. Build Participation 11
  11. 11. Improve the Idea Velocity 4. Experiment with Low Cost at High Speed 5. Go Fast from Prototyping to Incubation 6. Iterate on the Business Model 12
  12. 12. Increase the Batting Average 7. Build an Innovation Sandbox 8. Create a Margin of Safety 13
  13. 13. LAY THE FOUNDATION STEP 114 8 Steps to Innovation Excellence
  14. 14. Build a Pipeline 1. Lay the Foundation  Create Innovation Program  E.g. Jeff Immelt “Imagination Breakthroughs” - $1B potential  3 Key Processes  Idea Management  Buzz Creation  Training & Development 15
  15. 15. 3 Key Processes in an Innovation Program Idea Management Buzz Creation Training & Development (who submits? who selects? who funds?) (campaigns, communication, rewards, innovation day) (prototyping, TRIZ, design thinking, idea communication, leadership development)
  16. 16. Idea Box source scope stages technology selection funding Idea Management
  17. 17. Year No of Suggestions Participation Adoption suggestions per person Rate(%) Rate(%) 1951 789 0.1 8 23 1971 88,607 2.2 67 72 1986 2.6million 48 95 96 40 years, 20 million ideas
  18. 18. The Power of Small Ideas “There is no genius in our company. We just do whatever we believe is right, trying every day to improve every little bit and piece. But when 70 years of very small improvements accumulate, they become a revolution” From Interview with Katsuaki Watanabe in HBR, July-Aug 2007 19
  19. 19. Build a Pipeline  Lay the Foundation  Create Innovation Program  E.g. Jeff Immelt “Imagination Breakthroughs” - $1B potential  3 Key Processes  Idea Management  Buzz Creation  Training & Development 20
  20. 20. Buzz Creation (creative campaigns) 21
  21. 21. Garib Rath (Heavier & longer) Axle load Heavier, faster and longer
  22. 22. Some Titan Innovation Campaigns  2004: “What is new?”  Identification and implementation of 5 new ideas by every supervisor on the shopfloor  2006: HOD Fund  Every head of department authorised to spend upto Rs. 1 lakh on an idea without any approvals  2008: “Simplify & Automate”  Most successful theme at Titan  2009: “Innovation School of Management”  Making every employee an innovator 24
  23. 23. Titan: The 3M of India? 25 Karatmeter resulted in transformation of jewellery business “Anyone can be an Innovator” Innovation School of Management Process innovations result in 100s of crores savings
  24. 24. Build a Pipeline  Lay the Foundation  Create Innovation Program  E.g. Jeff Immelt “Imagination Breakthroughs” - $1B potential  3 Key Processes  Idea Management  Buzz Creation  Training & Development 26
  25. 25. Training & Development  Titan Innovation School of Management  “Everybody an innovator by 2015” 27 Focus area Techniques Design thinking Immersive research, rapid prototyping, brainstorming Systems thinking TRIZ Systems archetypes Theory of constraints (TOC) Lateral thinking Edward de Bono’s six thinking hats
  26. 26. CREATE A CHALLENGE BOOK STEP 228 8 Steps to Innovation Excellence
  27. 27. Build a Pipeline 2. Create a Challenge Book  U & I Portal at HCL  Petition Box at Tihar Jail  Feel the Pain  Sense the Wave  See the Waste 29
  28. 28. The Bajaj Pulsar exploited a discontinuity.. 30
  29. 29. 7 Themes  Digital consumers  Emerging economies  Sustainable tomorrow  Smarter organizations  New commerce  Pervasive computing  Healthcare economy 31 http://jugaadtoinnovation.blogspot.in/2012/04/infosys-innovation-to-build-tomorrows.html
  30. 30. Disguster Delighter Annoyance Frills Negative Positive Low High Emotions Importance to customer A Relentless Focus on User Experience is Critical Source: H. Rao, Stanford GSB, 2007 32
  31. 31. Disguster Delays Missing Bags Delighter Upgrades Annoyance Pepsi instead of Coke Frills Inflight Magazine Negative Positive Low High Emotions Importance to customer A Relentless Focus on User Experience is Critical Examples from the Airline Industry Source: H. Rao, Stanford GSB, 2007 33
  32. 32. BUILD PARTICIPATION STEP 334 8 Steps to Innovation Excellence
  33. 33. Examples  Role model  Community of practice  Innovation catalyst  Rewards & recognition 35
  34. 34. Improve the Idea Velocity 4. Experiment with Low Cost at High Speed 5. Go Fast from Prototyping to Incubation 6. Iterate on the Business Model 36
  35. 35. EXPERIMENT WITH LOW COST AT HIGH SPEED STEP 437 8 Steps to Innovation Excellence
  36. 36. Improve the Idea Velocity 4. Experiment with Low Cost at High Speed 38
  37. 37. itch idea demo impact Feasibility Loop Viability Loop 2 months Sep 2003 Nov 2003 Feb 2004 3 months 2 months Apr 2004
  38. 38. Creating a Climate for Experimentation  Failure plays a critical role in innovation  Post-It Notes & failed adhesives  Nylon: a lab experiment that went wrong  TVS Spectra failed, but Victor succeeded  Time-to-market is important…but don’t forget the role of earlier innovations  Separate intelligent failure from unnecessary failure - in language and managerial response  Create infrastructure, give resources for expts  Have a high trial rate: fail fast, learn fast  Can you do the “last” experiment first? 40
  39. 39. Avoid the “Failure Fallacy” 41
  40. 40. GO FAST FROM PROTOTYPE TO INCUBATION STEP 542 8 Steps to Innovation Excellence
  41. 41. Improve the Idea Velocity 5. Go Fast from Prototyping to Incubation 43
  42. 42. ITERATE ON THE BUSINESS MODEL STEP 644 8 Steps to Innovation Excellence
  43. 43. Improve the Idea Velocity 6. Iterate on the Business Model 45
  44. 44. Difficult to make money Holder of complementary resources makes Money (EMI, Coke) Inventor makes money Party with Innov .+ Compl. resources makes Money (Pixar vs Disney) Freely available or unimportant Tightly held and important Low High Complementary Assets Ease of Imitation Inimitability/Complementary Assets Framework Source: Afuah, 2004
  45. 45. BUILD AN INNOVATION SANDBOX STEP 747 8 Steps to Innovation Excellence
  46. 46. Increase the Batting Average 7. Build an Innovation Sandbox 48
  47. 47. The Power of Platforms 7 Themes  Digital consumers  Emerging economies  Sustainable tomorrow  Smarter organizations  New commerce  Pervasive computing  Healthcare economy 49 WalletEdge Platform Offering http://jugaadtoinnovation.blogspot.in/2012/04/infosys-innovation-to-build-tomorrows.html
  48. 48. Open Innovation 50 As one of the biggest players in the water purification market, Eureka Forbes is a natural partner for new technologies. EFL keeps itself open to new ideas from all over the world E.g. : Nanoceram technology developed by Argonide Corp. USA – takes care of viruses without chemicals
  49. 49. CREATE A MARGIN OF SAFETY STEP 851 8 Steps to Innovation Excellence
  50. 50. Increase the Batting Average 8. Create a Margin of Safety 52
  51. 51. THANK YOU 53 rishi@iimb.ernet.in http://jugaadtoinnovation.blogspot.in

Descripción

Slides presented by Prof. Rishikesha Krishnan at CIO Leadership Summit at Hotel Movenpick on April 26, 2013. It gives an overview of the book "8 steps to innovation: Going from jugaad to excellence" by Vinay Dabholkar and Rishikesha Krishnan.

Transcripción

  1. 1. Rishikesha T. Krishnan & Vinay Dabholkar rishi@iimb.ernet.in; vinay@catalign.com 8 Steps to Innovation: Building a Systematic Innovation Capability April 26, 2013 1 Build a pipeline 3 Improve Batting Avg 2 Improve idea velocity
  2. 2. From Jugaad to Systematic Innovation:
  3. 3. Innovation by Firms Inputs People Funding Knowledge Infrastructure Capacity to Innovate Incentive to Innovate Benefits Competition Appropriability Rewards Social Environment Political Environment Economic Environment Technology Environment Government Policy International Environment 3
  4. 4. Innovation by Firms Inputs People Funding Knowledge Infrastructure Capacity to Innovate Incentive to Innovate Benefits Competition Appropriability Rewards Social Environment Political Environment Economic Environment Technology Environment Government Policy International Environment Improved since 1991 Remain areas of concern 4
  5. 5. INNOVATION STRATEGIES DEPEND ON YOUR SOURCE OF COMPETITIVE ADVANTAGE…. Look at the disciplines of market leaders…. 6
  6. 6. 1. Operational Excellence Provision of consistent quality at the best price through a standardized business system that minimizes the cost & difficulty faced by the customer in acquiring the product • Wal-Mart • Southwest Airlines Low-cost transaction processing systems Optimization of business processes 7
  7. 7. 2. Customer Responsiveness Emphasis on careful tailoring and adaptation of products & services to increasingly specific requirements • Merrill-Lynch • Nordstrom’s Microsegments Long-term relationships Empowerment 8
  8. 8. 3. Performance Superiority Continuous, fast-paced innovation that yields a steady flow of leading-edge products that consistently push the state-of-art •3M •Sony •Gillette Openness to new ideas Sensitive to latent needs Mobilize NPD teams 9
  9. 9. 8 Steps to Innovation: Building a Systematic Innovation Capability 1 Build a pipeline 3 Improve Batting Avg 2 Improve idea velocity
  10. 10. Build a Pipeline 1. Lay the Foundation 2. Create a Challenge Book 3. Build Participation 11
  11. 11. Improve the Idea Velocity 4. Experiment with Low Cost at High Speed 5. Go Fast from Prototyping to Incubation 6. Iterate on the Business Model 12
  12. 12. Increase the Batting Average 7. Build an Innovation Sandbox 8. Create a Margin of Safety 13
  13. 13. LAY THE FOUNDATION STEP 114 8 Steps to Innovation Excellence
  14. 14. Build a Pipeline 1. Lay the Foundation  Create Innovation Program  E.g. Jeff Immelt “Imagination Breakthroughs” - $1B potential  3 Key Processes  Idea Management  Buzz Creation  Training & Development 15
  15. 15. 3 Key Processes in an Innovation Program Idea Management Buzz Creation Training & Development (who submits? who selects? who funds?) (campaigns, communication, rewards, innovation day) (prototyping, TRIZ, design thinking, idea communication, leadership development)
  16. 16. Idea Box source scope stages technology selection funding Idea Management
  17. 17. Year No of Suggestions Participation Adoption suggestions per person Rate(%) Rate(%) 1951 789 0.1 8 23 1971 88,607 2.2 67 72 1986 2.6million 48 95 96 40 years, 20 million ideas
  18. 18. The Power of Small Ideas “There is no genius in our company. We just do whatever we believe is right, trying every day to improve every little bit and piece. But when 70 years of very small improvements accumulate, they become a revolution” From Interview with Katsuaki Watanabe in HBR, July-Aug 2007 19
  19. 19. Build a Pipeline  Lay the Foundation  Create Innovation Program  E.g. Jeff Immelt “Imagination Breakthroughs” - $1B potential  3 Key Processes  Idea Management  Buzz Creation  Training & Development 20
  20. 20. Buzz Creation (creative campaigns) 21
  21. 21. Garib Rath (Heavier & longer) Axle load Heavier, faster and longer
  22. 22. Some Titan Innovation Campaigns  2004: “What is new?”  Identification and implementation of 5 new ideas by every supervisor on the shopfloor  2006: HOD Fund  Every head of department authorised to spend upto Rs. 1 lakh on an idea without any approvals  2008: “Simplify & Automate”  Most successful theme at Titan  2009: “Innovation School of Management”  Making every employee an innovator 24
  23. 23. Titan: The 3M of India? 25 Karatmeter resulted in transformation of jewellery business “Anyone can be an Innovator” Innovation School of Management Process innovations result in 100s of crores savings
  24. 24. Build a Pipeline  Lay the Foundation  Create Innovation Program  E.g. Jeff Immelt “Imagination Breakthroughs” - $1B potential  3 Key Processes  Idea Management  Buzz Creation  Training & Development 26
  25. 25. Training & Development  Titan Innovation School of Management  “Everybody an innovator by 2015” 27 Focus area Techniques Design thinking Immersive research, rapid prototyping, brainstorming Systems thinking TRIZ Systems archetypes Theory of constraints (TOC) Lateral thinking Edward de Bono’s six thinking hats
  26. 26. CREATE A CHALLENGE BOOK STEP 228 8 Steps to Innovation Excellence
  27. 27. Build a Pipeline 2. Create a Challenge Book  U & I Portal at HCL  Petition Box at Tihar Jail  Feel the Pain  Sense the Wave  See the Waste 29
  28. 28. The Bajaj Pulsar exploited a discontinuity.. 30
  29. 29. 7 Themes  Digital consumers  Emerging economies  Sustainable tomorrow  Smarter organizations  New commerce  Pervasive computing  Healthcare economy 31 http://jugaadtoinnovation.blogspot.in/2012/04/infosys-innovation-to-build-tomorrows.html
  30. 30. Disguster Delighter Annoyance Frills Negative Positive Low High Emotions Importance to customer A Relentless Focus on User Experience is Critical Source: H. Rao, Stanford GSB, 2007 32
  31. 31. Disguster Delays Missing Bags Delighter Upgrades Annoyance Pepsi instead of Coke Frills Inflight Magazine Negative Positive Low High Emotions Importance to customer A Relentless Focus on User Experience is Critical Examples from the Airline Industry Source: H. Rao, Stanford GSB, 2007 33
  32. 32. BUILD PARTICIPATION STEP 334 8 Steps to Innovation Excellence
  33. 33. Examples  Role model  Community of practice  Innovation catalyst  Rewards & recognition 35
  34. 34. Improve the Idea Velocity 4. Experiment with Low Cost at High Speed 5. Go Fast from Prototyping to Incubation 6. Iterate on the Business Model 36
  35. 35. EXPERIMENT WITH LOW COST AT HIGH SPEED STEP 437 8 Steps to Innovation Excellence
  36. 36. Improve the Idea Velocity 4. Experiment with Low Cost at High Speed 38
  37. 37. itch idea demo impact Feasibility Loop Viability Loop 2 months Sep 2003 Nov 2003 Feb 2004 3 months 2 months Apr 2004
  38. 38. Creating a Climate for Experimentation  Failure plays a critical role in innovation  Post-It Notes & failed adhesives  Nylon: a lab experiment that went wrong  TVS Spectra failed, but Victor succeeded  Time-to-market is important…but don’t forget the role of earlier innovations  Separate intelligent failure from unnecessary failure - in language and managerial response  Create infrastructure, give resources for expts  Have a high trial rate: fail fast, learn fast  Can you do the “last” experiment first? 40
  39. 39. Avoid the “Failure Fallacy” 41
  40. 40. GO FAST FROM PROTOTYPE TO INCUBATION STEP 542 8 Steps to Innovation Excellence
  41. 41. Improve the Idea Velocity 5. Go Fast from Prototyping to Incubation 43
  42. 42. ITERATE ON THE BUSINESS MODEL STEP 644 8 Steps to Innovation Excellence
  43. 43. Improve the Idea Velocity 6. Iterate on the Business Model 45
  44. 44. Difficult to make money Holder of complementary resources makes Money (EMI, Coke) Inventor makes money Party with Innov .+ Compl. resources makes Money (Pixar vs Disney) Freely available or unimportant Tightly held and important Low High Complementary Assets Ease of Imitation Inimitability/Complementary Assets Framework Source: Afuah, 2004
  45. 45. BUILD AN INNOVATION SANDBOX STEP 747 8 Steps to Innovation Excellence
  46. 46. Increase the Batting Average 7. Build an Innovation Sandbox 48
  47. 47. The Power of Platforms 7 Themes  Digital consumers  Emerging economies  Sustainable tomorrow  Smarter organizations  New commerce  Pervasive computing  Healthcare economy 49 WalletEdge Platform Offering http://jugaadtoinnovation.blogspot.in/2012/04/infosys-innovation-to-build-tomorrows.html
  48. 48. Open Innovation 50 As one of the biggest players in the water purification market, Eureka Forbes is a natural partner for new technologies. EFL keeps itself open to new ideas from all over the world E.g. : Nanoceram technology developed by Argonide Corp. USA – takes care of viruses without chemicals
  49. 49. CREATE A MARGIN OF SAFETY STEP 851 8 Steps to Innovation Excellence
  50. 50. Increase the Batting Average 8. Create a Margin of Safety 52
  51. 51. THANK YOU 53 rishi@iimb.ernet.in http://jugaadtoinnovation.blogspot.in

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