introduction to the killer innovation approach ver 5

Killer Innovations Workshop www.killerinnovations.com

Killer InnovationsIntroduction to a better way to innovate

Philip [email protected]

mailto:[email protected]

http://www.killerinnovations.com/


• Why Innovation?• Other Approaches• A Better Approach• Benefits • Lessons Learned

Agenda


Innovation Acceleration

Time

Impa

ct

-Innovations are having a larger impact

-The lifecycle of innovations is getting shorter


Technology Adoption is Accelerating

Phone 74 years

Radio 38 years

PC 16 years

TV 13 years

Internet 2 years

Blogs 1 year

How long does it take to get to 50 million users?


The Innovation Reality

Innovation GapThe shortfall between a organizations rapidly rising need for ideas/innovations and their inadequate supply

Innovation DelayThe delay between the time when decisions to adopt strategic innovations are made and their eventual impact to the organization.


Innovation Impact

Innovation has increased in importance over the last 10 years

Innovation plays an important role in assessment of company value

Confident in ability to manage and measure innovation impact

35%

73%

92%

Source: Arthur D. Little Research

0%0% 20%20% 40%40% 60%60% 80%80% 100%100%


Executive View of Innovation

• 87% rank innovation as one of their top 5 priorities• Executives boast that their companies excel at innovation• Executives, however couldn’t differentiate between

incremental improvements and breakthroughs• Very few executives said their firms have any kind of

structured approach to innovation

Source: DiamondCluster International, Techtrend Group


The Challenge of Innovation

• Maintain efficiency while fostering innovation

• Stressing bottom-line results without restricting innovation

• Adapting to changing markets and environments while maintaining stability


Value From Innovation

R&D

86%

14%

Revenue

62%

38%

Margin

39%

61%

Incremental Innovations to existing offerings

Creating new offerings/markets/industries

Source: Harvard Business Review, October 2004

What’s wrong with the current approaches to find ideas?


What’s wrong with current brainstorming approaches?

• Innovations are either incremental or totally unrealistic

• Rarely any real follow-up

• No confidence that there aren't better ideas to be had

• Lack of executive/organizational support


Incremental versus Breakthrough

Incremental improvements• Reduce expenses• Extend brand/product line

Breakthrough improvements• Find new markets• Create new strategic assets• Launch new businesses

Evolutionary change tools• BPR/TQM/Six Sigma• Feature enhancement

Revolutionary change tools• Killer Innovation• Lateral Thinking• TRIZ/TIPS

Killer Innovations


What is a killer innovation?

A Killer Innovation is defined as significant and highly profitable departures from current offerings or practices that is difficult to imitate


• Tools– The tools to find/create, rank and execute

against killer ideas

• Skills– Tricks to help change your perspective and

improve your ability to apply empathic design through observation

Killer Innovation Approach


Killer Innovation ToolsUsing FIRE

• Focus The Innovation Search– Focus the problem– Depth is better than breadth for idea quality

• Ideation– Structured questions that drive discovery/insight

• Rank The Ideas– Will this idea change the customer expectation?– Will this idea change the competitive landscape?– Will this idea change the economics of the industry?

• Execution– Define clear milestones– Kill projects early


• Question based methodology– Based on Socratic method of asking questions to eliminate ideas … the

best ideas are the ones left standing

• Build around a core of +70 killer questions– Based on “reverse” innovation analysis– Designed to unlock unique insights

• Structure is based on a “gated” model

• Tested– HP, Agilent, CSC and many start-ups

History of the KI Approach

Tool: Focus


Focus the search

Moving into new competitive

arenas

Expansion into new geographies

Improvement in industry structure

New or existing customers

Innovation in products or

services

Innovation in value delivery system


Search Areas for InnovationSix degrees of freedom Such as …

Creating a new business by selling existing products/services to existing or new, unfamiliar customer segment

Creating a new product or service, normally in a cocooned manner

Creating an innovation that redesigns the business system sufficiently to alter the value proposition

Changing the value proposition, value delivery system, or competitive relationships that improve/change the industry structure or redefine the industry

Expanding into a new geographic area with high value-added transfer from existing geography or when the activity is new

Developing a new business in an industry within which a company has not previously competed or when there is no overlap in customer value proposition

New/Existing customers

Innovation in products or services

Innovation in value delivery system

Improvement in industry structure

Expansion into new geographies

Moving into new competitive arenas

Source: Techtrend Group


Focus on the customer

YUPPIES Young Urban Professionals

YUFFIES Young Urban Failures

MOBY/DOBY Mom/Dad Older – Baby Younger

WOOFS Well Off Older Folks

SKIPPIES School Kids with Income + Purchasing Power

“Sandwichers” Adults caught between caring for their children and their older parents

Which are the right segments?

Tool: Ideation


The typical brainstorming session begins with a simple question ….

“Create some new product ideas”“Develop some differentiators for x”

…. you get simple answers.

The Current Method ….


Better Questions = Killer IdeasNew or Existing Customers

• What emotional, psychological, or status benefit do (could) people derive from using the product?

• How can you create a social or group experience with the product?

Industry Structure• What are some of the basic assumptions under which the industry

operates?• What external jolts have the potential to significantly impact the

operational rules of the industry?

Product & Services Innovation• Who uses the product because of some benefit we did not foresee?• What regularly used makeshifts can we capture in a product design?


Exploring Beyond the Obvious

S Substitute?C Combine?A Adapt?M Modify – Magnify?P Put to other uses?E Eliminate or minify?R Reverse – Rearrange?

• Everything that is new is an addition or modification of something that already exists

• Based on the answers to the questions, use SCAMPER to generate a wide variety of ideas


Idea Quota

Idea quotas force you to actively generate ideas and alternatives

• The first 1/3 of the quota will be the easiest• The second 1/3 will typically extensions from first 1/3• The final 1/3 will be the hardest yet typically contain

the kernel of a killer innovation

Always fill the quota even if the ideas seem far fetched or outlandish.

The best ideas come to those that work at it ….


Characteristics of the Best Killer Ideas

• Purpose - the yield of high quality ideas is significantly higher with a clear business purpose and a supportive business sponsor.

• Timeliness - the difference between a great idea and a so-so idea is market/technology timing.

• Diversity - the pool of contributors needs to be broad, broader than you intuitively think.

• Perspective Change - the very best ideas come through individuals looking at things in a different way.

• Collaborative Development - environment, where people can comment and build on ideas thereby significantly increasing the overall yield of high impact ideas.


Suspend Disbelief

Let’s shelve that for the time beingWho is going to do it?I have something better.We tried that before.It won’t fit our operation.It’s against all our combined logic.Not enough return on investment.It’s great, but . . . . . .

Someone must have already tried it.I thought of that a long time ago.We can’t afford that.You’ll never get approval.You’re on the wrong track.Don’t rock the boat.The market it not ready yet.It’s not a new concept.

Tool: Rank The Ideas


Idea Criteria: Key QuestionsMust have a YES to at least one of the following:

– Will this idea change the customer experience/expectation?

– Will this idea change the competitive landscape/position?– Will this idea change the economic structure of the

industry?Must have a YES to the following:

– Do we have a contribution to make in this space?– Will this idea generate sufficient margin to the business?

For each key question, give a score from 0 to 5.


Idea Criteria: Ability To Execute

For the top 10 ideas based on the Key Questions, score each idea from 0 to 5 for the following questions:

• Can we get our groups/teams excited?• Will senior management support it?• Do we have the skill/expertise to pull this off?• Can we access the customers preferred

channel?

You now have a ranked list of your best ideas.

Tool: Execution


Execution = Stage Gate Management

Beta Coordinator's Role

Product Marketing

Softw are Developm ent

Q A/Test

Training

Documentation

Custom er Service

Marketing Com munications

Release Control

Sales

O perations

Milestones T im eline

Custom erAgreem enton w ants

P roduc tIdea

Concep tP resenta tion

M kt. R eq.Def. &Plng

Bus inesscase

S W Req. Def. &Plng - P relim X

QA /Tes tP lan -

P re lim X

Tra in ingP lan -

P re lim X

Doc. P lan- P re lim X

S upportIm pl. P lan- P relim X

IdentifyApp licab le

S tds .

ReviewSW R eq.

M A R C OMP lan -

P re lim X

ReleaseP lan -

P re lim X

S alesP lan -

P re lim X

Opera tionsP lan - P relim

X

A gree m ent onDeliverab les

Com m ittto

Custom er

PITCreation

P ro jec tDefin ition

W orkBreakdow n

P rojec tP lan

Is sue X

Potentia lP roblemA nalysis

S W R eq. Def. &P lng Issue X

Q A /Tes tP lan -

Issue X

Tra in ingPlan -

Issue X

Doc. P lan- Issue X

SupportIm p l. P lan- Issue X

M A RC OMPlan -

Issue X

ReleasePlan -

Issue X

S alesPlan -

Issue X

O pera tionsP lan - Issue

X

B etaC oord ina tor'sP lan - Issue X

Im plem en-ta tion K icko ff

Se lec t 1s tbe ta s ite

Pre lim inaryP roduc t

A nnouncem ent

Sa les Fo rceP repe ration

D etailedFunc tionalDefin ition

D es ignR eview /Approva l

C ode S oftw areR eview

BetaRelease

DetailedD efin ition o f

Contents

1st Rev.Docum ents

Ready

PrelimDocum ent

P ackage Ready

DetailedD efin ition o f

Contents

P re lim Tra in ingP ackage Ready

D oc PartNum ber

R eleased

Custom er S erviceVerifica tion B egins

Produc t S upportPackage Ready

P re lim S a les /Support

M ateria ls

Com petitiveSe lling S trategy

- Issue X

Pre lim B etaP lan

F ie ldV erifica tion

B etaPlann ingM eeting

Fie ldVerifica tionBeta B egins

Fie ldV erifica tion

R eview

1st Cus tom erB eta

P lanningM eeting

1s tCus tom er

BetaBeg ins

1s tC us tom er

BetaEnds

B etaReview

R eady to S ell C us tom erAcceptance/

S tandard ization

B eta B u ild B eta R e leaseA pproved

Prod Bu ild P roduc tionRelease

S ales /SupportM ateria ls R eady

C S /P S RepsTra ined

R eleasedD ocum ents

R eady

C ustom erTra in ingR eady

B eta IssuesFixed

Produ ctRe lease

Produ ctRe leaseA ppro val

Pro jec tReview

Product Proposal Phase Definition Phase Developm ent Phase Release Phase Deploy

Ops - B etaP lann ing

Ops - 1s tC us tom er

P lann ing M tg

Ops - B etaProduc tion

Ops -Beta B il ls

O ps - B etaB ill/R ev

V erifica ton

O ps - P rod.Ready

Ops -P roc edure

D oc

O ps -Tes ting

Ops -Tra in ing

Produc tTes t P lan

P roduc tTes t

BetaTes ting

C om ple te

R evis edTest P lan

P roduc tTes t

ProdTesting

Com plete

QA /Tes tReview o f

R eq.

TargetCus tom er

S elling P lan

G o/N o G o D ecis ion Go/N o Go D ecis ion Go/N o Go D ecis ion Go/No G o Decis ion

Source: Techtrend Group

“The Best” use some from of a Milestone/Stage Gate process to introduce new products and services

Skills: Observation


What do you see?


What do you see?

Minimum space which can represent the full alphabet!

Look beyond the obvious ….


• Empathic Design (observational design)– In-house visits/recording– In-the-world observations– Trend Safari

• Ethnographic Studies/Analysis– Deep study of a “customer” social group

• Objective– Discover unspoken needs and wants of the target

customer segment

Observation Skills

Skills: Changing Perspective


What is half of thirteen?


Half of thirteen6.5

6 or 7 (rounded)

“thir” and “teen”

XII = VII and IIV(split horizontal)

1 and 3

. . . How many more can you come up with?

Be careful .. Don’t assume the definition of words (e.g. “half”)

Benefits of KI


• 360° search for innovations ensures you avoid a blind spot – Six degrees of innovation

• Generate higher quality ideas– Killer Questions based on reverse innovation approach– Forces participants to dig deeper for answers

• Work on the right ideas– Process to rank the best ideas

• Execution management– Gated/Milestone to ensure alignment of funding and execution

The benefits of the KI Approach

Lessons Learned


• Changing the culture• Metrics• Finding Innovation Champions• Reward failures & successes• Adapt to your organization

Lessons Learned


45

Thank youQ & A