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The challenge of innovation
Paris March 20th 2012 Dr. Michael Ohler, Principal BMGI Europe Anthony Shingleton, Principal BMGI Europe [email protected] [email protected] http://www.bmgi.com
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Content
One shared understanding of innovation?
Failure to innovate versus ... Failure to stay with the current paradigm
Breakthrough from inside and outside „the box“
„Learning to see“
Job-To-Be-Done Outcome Expectations The Four Growth Quadrants
Deploying the „creation of novelty“
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One shared understanding of innovation?
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What is your understanding of innovation?
Note your understanding of innovation on a sheet of paper or post-it note: Legibly No more than 1-2 sentences
2 minutes
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News from early this year
From: The Economist, Jan 21st 2012
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Creating future business: Can we beat the odds?
80% of all venture capital investments fail
>90% of companies fail to sustain above-average shareholder return for longer term
75% of all new products fail that
established companies put into their markets (*). (*) D. Leonard-Barton, “Wellsprings of Knowledge” HBS Press, 1995).
Current Business Future Business
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Yahoo! - or failure to stay with the „Search engine paradigm“
10th of July 2008 Allen & Co Conference. Source: www.marketingpilgrim.com
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Kodak – or the failure to innovate
Managing Current Business
Creating Future Business
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Breakthrough from “inside the box”: The circular saw market
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Systematic approach to the identifiction of customer needs
Circular saw - outcome expectations
Minimize the cost due to cord cuts
Minimize the amount of debris thrown up into the user‘s face
Minimize the blade guard snagging the material when cutting at any angle
Minimize the frequency of kickbacks
Minimize the amount of times the cut line is blocked from view and can not be seen
Minimize the strain that builds on the wrist during use
Minimize the number of cuts that can be made with a single blade
Minimize the time it takes to make adjustments that can be made
Minimize the frequency with which the end plug gets caught on the material
...
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Definition of the strategy through opportunity analysis
How important is it for you to...
Ho
w s
atis
fie
d a
re y
ou
wit
h y
ou
r cu
rre
nt
abili
ty t
o..
.
Ready for Disruption
Right served Under-served
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Breakthrough ideas from inside the paradigm focused on customer needs
Fast bevel and depth adjustments
Debris directed away from user
Direct Connect cord Footplate with smoother glide
Hook to hang saw Blade guard for dust exhaust
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Double-digit Change in Customer Satisfaction
Based on historical data, most successful new products and services
introduced in a core market improved the satisfaction levels of
underserved outcomes by 5% to 10%. In contrast, a breakthrough
concept – one that will stand well out in front of current products and
likely take on a market leadership position – typically improves
satisfaction levels by 25% or more. Bosch circular saw increased level
of satisfaction by 38% [i.e., 87% / 63%] making it a breakthrough
product.
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Breakthrough from outside the paradigm
Carbon Monoxide as bio-marker and therapeutic agent
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Breakthrough from outside the paradigm
According to the patent
(Choi and Otterbein 2010):
“… It has unexpectedly been
discovered that the delivery of
a therapeutic gas comprising
low concentrations (…) of
carbon monoxide is an
extremely effective method for
delaying the onset of,
inhibiting or reversing the
effects of oxidative stress in a
patient. This is an unexpected
result… ”.
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Companies do have great systems capturing the Voice of the customer!
…. But …
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The trouble with the „Voice of the Customer“
How the customer explained it
How the project leader understood it
How the engineers designed it
How the programmer wrote it
How marketing promoted it
How the project was documented
How the consultants proposed installing it
How the customer was billed
How it was supported
What the customer really asked for
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Today‘s solution to a problem is the past - Therefore, the VOC is yesterday‘s voice
If I had asked customers what they wanted,
they would have asked for a faster horse.
Henry Ford
The Ford Motor Company
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Stable concepts for capturing people‘s needs: Job-To-Be-Done and Outcome Expectations
Manage personal finances at home
Clean clothes at home
Action verb Object of action Contextual clarifier
Maximize the accuracy while managing personal finances
Minimize the time it takes to clean clothes at home
Direction verb Attribute of object Contextual clarifier
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Capture your growth strategy: The Four Growth Quadrant
CU
RR
ENT
JOB
N
EW J
OB
CONSUMER NON-CONSUMER
Core Market Growth - Clearly understand the JTBD - Include social & emotional jobs - Identify un-met Outcome Expectations
Disruptive Growth - Understand barriers for non-consumption (price, access, …) - Understand the higher-level JTBD (can we make the original JTBD obsolete?)
Related Market Growth - Understand what people do before, during and after getting the original job done?
New Market Growth - List all the capabilities of the company - Which new jobs (that are poorly satisfied today) can be done with these capabilities?
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Extracting Jobs to be done and Outcome Expectations
The Chulha Stove
http://www.youtube.com/watch?v=_qbnyuGfXt0
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Classification of new products, services, processes biz-models
Study the examples in your handout materials Classify them according to the Four Growth Quadrants 10 min De-brief in the entire class 5 min
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D4 roadmap for the creation of novelty: Repeatable, teachable, deployable
Opportunity understood
Concepts available
„Plastic“ prototype
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BMGI‘s roadmap for „deployment of X“: The creation of novelty can be deployed!
SUSTAINDEPLOYDESIGNALIGN
Review
Financial
Results
KPI
Improvement
Project
Selection
Competency
Development
Structured
Problem
Solving
Stakeholders
Strategic
Objectives
Deployment
Strategy
Deployment
Plan
Infrastructure
Programme
Management
Leadership
Development
Review Review Review
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How ambidextrous is your organisation?
Sustainable growth
Execute today’s biz Create tomorrow’s biz Predictable I/O relations Governed by KPIs Accountability for
results
Cause/effect uncertainty Governed by experiments Accountability for
action & learning
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Sustainable growth creates conflicts inside the organisation
Sustainable growth
Operate
Shared Staff
Leadership
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How to create an „innovation mindset“?
Interview with Vijay Govindarajan: http://www.youtube.com/watch?v=sNzkmZdM4A4