ttmg 5103 module innovation and business models pulak choudhury tim program, carleton university...

TTMG 5103 Module Innovation and business models

Pulak Choudhury

TIM Program, Carleton University

June 19, 2009

Agenda

Objectives

What will be learned

What can be done

Innovation

Necessity of innovation

Innovation strategies

Innovation facts

What is not innovation

What is innovation should do/should be

Business model

Business model design process

Business model innovation

Three step roadmap

Business model innovation matters

Ex1 – AMIES

EX2 – NOKIA’s all-you-can-eat

EX3 - SHAZAM

Innovation and business model

Moment of truth

Lessons learned

References

Objectives(1)


A detailed view of the innovation

Alchemy of business model

Relationship between innovation activities and business model

innovation

A new way of doing business - with new values, vision,

strategies, system and structures

Objectives(2)

What can be done

How to spark the disruption

Maximize the reach of the technology and an comprehensive value

network

Identify and improve your business model

Agenda

Objectives


What can be done

Innovation



Innovation facts



Business model



Three step roadmap


Ex1 – AMIES


EX3 - SHAZAM


Moment of truth

Lessons learned

References

Innovation

Innovation is the ability to come up with

something new that somehow facilitates a task

or endeavour

Innovation is purposeful and should be the

result of an occurrence, a need or an event

Innovation is progress


To grow the business

To address a particular target market where they

see a major competitive threat or opportunity

To reinvent the business model for a tougher

economic environment

Innovation seems to be the key to success in

product development

Agenda

Objectives


What can be done

Innovation



Innovation facts



Business model



Three step roadmap


Ex1 – AMIES


EX3 - SHAZAM


Moment of truth

Lessons learned

References


Inventive

First to market

Doesn’t necessarily lead to success


Adaptive

Not the first but the best

Can work but can fail in industries with short

product life cycles or network effects


Economic

Low cost producer

Usually requires lots of manufacturing innovation


Innovative applications

Creative use of existing technologies

Innovation facts

What is not true about innovation

being innovative can be a costly venture for a

business Innovation means reinventing the wheel Big ground-breaking ideas or technological leaps

forward The outcome of R&D department or smart people

Innovation facts

What innovation should be Making changes to the established way of

doing things, which can result in a new product

Planned and managed as a core business process covering all parts of a business

Be done at a fraction of its previous cost and with quick, powerful results

Agenda

Objectives


What can be done

Innovation



Innovation facts



Business model



Three step roadmap


Ex1 – AMIES


EX3 - SHAZAM


Moment of truth

Lessons learned

References

Business model

A business model describes the value an organization offers to

various customers and portrays the capabilities and partners required

for creating, marketing, and delivering this value and relationship

capital with the goal of generating profitable and sustainable revenue

streams

Business model is a broad-stroke picture of how an innovative

concept will create economic value for the ultimate user, for the firm

and its shareholders and partners

Business model contd.

Considers the infrastructure required to move the product/service to the market in a manner that it both easy and convenient for customers and profitable for the firm


Identify interdisciplinary stakeholders -> set-up team Understand (business) environment –> frame

problem Suspend reality -> imagine Bring ideate to reality -> prototype Chose suitable design -> decide Execute -> project portfolio Evaluate, learn and redesign -> manage

improvement

Agenda

Objectives


What can be done

Innovation



Innovation facts



Business model



Three step roadmap


Ex1 – AMIES


EX3 - SHAZAM


Moment of truth

Lessons learned

References


Innovation does not always rests in the technology or product or service, but

in the business model itself

Business innovation refers to the creation, or reinvention, of a business itself

Think outside-of-the-box

Can we describe it ? No? we need to discuss it

Can we discuss it ? No? because is no common language

Can we improve it ? No? we do not have the proper tools

implement it


Figure: 4 areas need to looked at while innovating a business model


Figure: 9 building blocks of business model

Three step roadmap

Begin by considering the opportunity to satisfy a real customer need

Construct a blueprint for how your company will fulfill that need profitably

Compare that model to your existing model to determine how much change will be required to capture the new opportunity

Business model innovation matters (1)

AMIES st.

Fisrt gives away song for free

Number of download started to incrase

So AMIES’s startd to charge and increase


New talent discovery

New distribution channels

Increased revenue streams

Agenda

Objectives


What can be done

Innovation



Innovation facts



Business model



Three step roadmap


Ex1 – AMIES


EX3 - SHAZAM


Moment of truth

Lessons learned

References


Nokia launching ‘all-you-can-eat’ music service

Pay a monthly service

Listen as much as you want


Building a new platform

Leveraging a brand

Recurring revenues


Shazam SMS

You hear a tune you like but don’t know the title or artist..

Dial a number

Hold your phone to the speaker

Get the title and artist by SMS


Productive innovation

New channels

New revenue streams (communication, SMS charges, sales commission)


Innovation is needed to spark the disruption

where a new business model is then needed to

maximize the reach of this innovation and to

evolve an comprehensive value network to

support it Innovation needs to be linked to strategy and

the business planning process Innovation without a proper business model is

like a ‘Missile looking for a target’

Mistakes we make

Businesses tends to stay in their conservative box and not become more creative

Sometimes we hold up innovation by concentrating on the wrong thing at the start

Sometimes it’s because of the anchors and frames of the way we do things

Moment of truth

Discussions

Comments

Agenda

Objectives


What can be done

Innovation



Innovation facts



Business model



Three step roadmap


Ex1 – AMIES


EX3 - SHAZAM


Moment of truth

Lessons learned

References

Lessons learned (1)

Don’t focus on the business model at the outset but instead concentrate on the value they create

Work on useful things Solve problems Create value

Lessons learned (2)

Make something that is worth while and people will pay you for it

Figure out what you’re good at making and then make them well. You will make money as a result.

References

Johnson, Mark, Christensen, Clayton, Kagermann, Henning. Reinventing your

business model, Harvard Business Review, December 2008 http://www.slideshare.net/Alex.Osterwalder/business-model-innovation-matter

Knowing in advance how you’re going to make money from snake oil may sound like you have a business model; what you have is snake oil. And that’s the problem you need to concentrate on first, the fact that you’re not creating anything of value.

Fedex right turn

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