innovation through technology
DESCRIPTION
Slides from my lectures on Management Information Systems at Università Cattolica di Milano. More at www.alessandrocederle.comTRANSCRIPT
Innovationthrough and
bytechnology
1. Innovation in action2. Why should you innovate?3. What can you innovate?4. How can you innovate?5. Innovation as a cycle6. Start-up or organic?7. Roadblocks – tips & tricks
Innovation in action
Innovation is at the heart of the use of MIS.Technology has evolved greatly and continues to
do so,creating new markets, products and processes
at every turn of the road,therefore changing the competitive landscape
and the bases for competition.Mastering Information Systems therefore is key
to sustaining the thrust towardsinnovation based competition
which is the key to company success nowadays.
"If you rethink this problems from the ground up you can come up with innovative solutions"Google's R&D 2102 budget = $ 7+ BLN"Larry and Sergey are behind this 100%"
GOOGLE X-LAB
http://youtu.be/-XE8Cq-ncj0
Ге́7нрих Сау́7лович Альтшу́7лле́р
Genrikh Saulovich Altshuller (1926,1998)The inventor of TRIZBiography
Working as a clerk in a Russian patent office Studied 200,000 patents Found out very few of them are real inventions, most are just
improvements The same set of rules are applied over and over to discover
something new = the 40 Inventive Principles = the TRIZ method An inventive solution does not compromise following a trade-off,
but rather eliminates the contradiction
THE TRIZ METHOD
1. Innovation in action2. Why should you innovate?3. What can you innovate?4. How can you innovate?5. Innovation as a cycle6. Start-up or organic?7. Roadblocks – tips & tricks
1. Competitors are exploiting technology to innovate, regardless2. Technology is advancing, someone will exploit the opportunity
sooner or later3. Product commoditization as an effect of innovation is pushing down
prices and eroding competitive advantages4. Adjacent markets are producing substitutive products as an effect
of new capabilities5. Innovation is needed for a new comer to enter or to gain a decent
positioning on a market6. The business model all resolves around innovation (e.g. VC firms)7. The company owns a technology which "per se" can be applied to
different market/products
COMPANIES NEED TO INNOVATE
Ask a company executive about his agenda, how much time did he spend last week on innovation, rather than on sustaining what's already there?
1. Innovation in action2. Why should you innovate?3. What can you innovate?4. How can you innovate?5. Innovation as a cycle6. Start-up or organic?7. Roadblocks – tips & tricks
WHAT CAN YOU INNOVATE?
Products: we shall do something different Process: we shall do something differently Business models: we shall be something
else entirely
Through and bytechnology
Technology abilitates the production of something completely new
Technology allows to do something "better" (faster, cheaper, with a shorter time to market, etc.)
PRODUCT SIDE
A brand new product Product features Product positioning Target market Usage habits
PROCESS SIDE
New production machines Process automation New organization (e.g. functional vs. matrix) Insourcing vs. outsourcing Talents and competencies
BUSINESS MODEL
Revenue share between different businesses
Product portfolio Company values/success criteria Geographical spread
1. Innovation in action2. Why should you innovate?3. What can you innovate?4. How can you innovate?5. Innovation as a cycle6. Start-up or organic?7. Roadblocks – tips & tricks
APPROACHES TO INNOVATION
TQM and Six Sigma BPR The blue ocean strategy The lean startup
TQM
Based on small incremental changes Greater personnel control and ownership
leads to wider acceptance Vastly popular in the 80s,
a lever of the riseto competitivenessof the Japanese industry
SIX SIGMA
Continuous efforts to achieve stable and predictable process results are of vital importance to business success.
Manufacturing and business processes have characteristics that can be measured, analyzed, improved and controlled.
Achieving sustained quality improvement requires commitment from the entire organization, particularly from top-level management.
It seeks to eliminate defects from any process.
BLUE OCEAN STRATEGY
A 2005 book from the INSEAD, heavily case based.
Red oceans are traditional markets wherecompanies compete on a traditional basis (product, cost, differentiation etc.).Inevitably this leads to commoditizationand cutthroat competition.
By contrast blue oceans is where the competitive basis is redefined by invention that overcomes set rules and traditional boundaries, creating new space = "value innovation".
THE LEAN STRATEGY
A 2011 book by Eric Ries incorporating his experience and thoughts in start-ups.Specifically originated from high-tech companies.An embodiment of Silicon Valley ethos and beliefs.
Minimum Viable Product Continuous Deployment - based on "agile" way
of thinking and specific sw development techniques
Focus on analytics - pointedly A/B testing Actionable metrics Pivot
AGILE PROCESSES
Agile processes are processes that iterate through a constant renewal cycle of design, deliver, evaluate, redesign, and so on.
Ultimate goal for some are agile processes that reconfigure themselves as they ‘learn.
For a process to be agile necessitates a high degree of use of IT.
Processes that run entirely on the Internet are candidates for becoming agile processes
1. Innovation in action2. Why should you innovate?3. What can you innovate?4. How should you innovate?5. Innovation as a cycle6. Start-up or organic?7. Roadblocks – tips & tricks
INNOVATION AS A CYCLE
The number of transistors on integrated circuits double every two years (Moore’s law)
This s the basis of technology driven innovation It’s embedded And it means that it's always happening, rather
than in discontinuous waves. Therefore "Innovation is a must"; apart from a
few top companies that determine the course of innovation, all the other need to comply with what is happening around them.
DRIVERS OF INNOVATION
Start-ups, VC push The big 5s (e.g. big data) Core hardware technology New applications, new devices (e.g. Kinect) Consumers invent new usage patterns (e.g.
texting) Individuals creativity (e.g. BitTorrent)
LEARNING TO INNOVATE
So the problem is not innovating; it's rather learning to innovate.You need to create a "learning organization" by:
Hiring, recognizing, rewarding talent Creating a "permission to fail" culture Allowing time and resources for discovery (e.g 20% time
rule at Google) Reducing hierarchical distance Developing a well set up approach to innovation (project
management) Creating shared metrics that define success
1. Innovation in action2. Why should you innovate?3. What can you innovate?4. How should you innovate?5. Innovation as a cycle6. Start-up or organic?7. Roadblocks – tips & tricks
You cannot buy your way to innovation; innovation is something you become, not
something you insert or attach.Still, innovation through technology requires
the acquisition of a distinct set of systems and competences that by definition were not there
before.Therefore there are a number of paths you
can pursue.
PRACTICAL PATHS TO INNOVATION
1. Buy a company that owns what you want (patents, systems, competences, sw or hw, etc.)
2. Buy talent on the HR market3. Partner with a company that
complements with you4. Use consultants that can teach you the
way5. Find talent in your own ranks6. Specialize a unit inside the company
1. Innovation in action2. Why should you innovate?3. What can you innovate?4. How should you innovate?5. Innovation as a cycle6. Start-up or organic?7. Roadblocks – tips & tricks
REAL LIFE HANDS ON ISSUES (1/2)
The first person that needs innovation is ... yourself - the management team is old fashioned or at least not "à la page"
Most of the company people grew up in a pre-Internet revolution world
The set of rules and standards in the company stifles innovation (bureaucratic, hierarchical, centralized, etc.)
Some (a lot) of people have something (a lot) to lose from innovation
Most of the company resources are devoted to maintaining the core business who is under fire; innovation remains a night job
REAL LIFE HANDS ON ISSUES (2/2)
It's hard to attract talent that will run to more fashionable (innovative) companies
Metrics defining success are unclear; this allows individuals to under perform
Innovation calls for a lot of bells and whistles that in reality hinder and hide real matter-of-fact efforts
Innovation was born in a period of strong economy; negative cycles make it necessary to protect young and still weak offsprings