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Digital Innovation > Exam > Flashcards

Exam Flashcards

1
Q

Invention vs. Innovation

A

Invention: developing product, technology, or process for the first time
Innovation: successfully commercialising invention for the first time

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2
Q

Stages of Gartner hype cycle

A
  1. Technology trigger
  2. Peak of inflated expectations
  3. Through of disillusionment
  4. Slope of enlightenment
  5. Plateau of productivity
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3
Q

Tech trend: Blockchain

A

A digital ledger that records transactions in a secure and transparent way

Once data has been added to a block and that block is full, it can’t be changed, edited or deleted

Application: healthcare data, cryptocurrencies

Impact: secure data storage and transfer, growth of cryptocurrency and cash-free

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4
Q

Tech trend: artificial intelligence

A

Intelligent machines that can think and learn like humans; algorithms / software can do tasks that usually require human intelligence

Application: understanding natural language (voice recognition), making decisions, recognizing images

Impact: helpful tool in many professions and aspects of life, raises ethical questions

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5
Q

Tech trend: metaverse

A

A hypothetical future iteration of the internet that would allow users to engage in a fully immersive, shared virtual experience (business meetings, study sessions, dating, …)

Impact: economic/business environment disruption, social connection, digital divide, new forms of creativity and expression; raises questions about privacy and security

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6
Q

Tech trend: Internet of things

A

A network of physical devices, vehicles, home appliances, and other objects that are connected to the internet and can exchange data with each other

Application: remote monitoring of patients, supply chain optimisation, tracking/management of vehicles/equipment/assets, control home appliances and lighting

Impact: improved efficiency, productivity, convenience; security and privacy concerns, inter-operability and standardisation issues

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7
Q

Types of innovation

A

Incremental: product repositioning (new segments), improvement of current product/process

Substantial: product line extension, products that are new to firm but known in general

Radical: new to market (country, target group), or new to the world

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8
Q

Radical vs. disruptive innovation (Clayton Christensen)

A

Radical: major technological breakthrough / application to solve an existing need in a new way

Disruptive: not break-through innovation but product/process transformation – cheaper, more accessible for a much larger share of population

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9
Q

Examples of disruptive technologies

A

Film –> digital cameras
Wireline –> mobile phones
B&M shops –> online retailing
Manufacturing –> 3D printing
Music CDs –> music streaming

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10
Q

Traditional vs. open innovation

A

Traditional: vertical integration model where internal R&D activities –> internally developed products –> distributed by firm to customers

Open: inflows and outflows of knowledge to accelerate internal innovation and expand markets for external use of innovation

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11
Q

Outside-in vs. inside-out innovation

A

Outside-in: integrating external knowledge (customers, suppliers), scanning new technologies

Inside-out: bringing internally generated ideas to marking, prototyping

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12
Q

BMI: two-sided-market

A

Platform acts as a mediator between buyers and sellers, facilitating transactions and providing services such as payment processing, logistics, and customer support

Disrupts traditional industries by allowing for more flexible and decentralized forms of work, and enabling access to new markets and customers

Examples: Uber, Airbnb, Amazon

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13
Q

BMI: add-on

A

Core offering at low price, additional offerings drive up final price

Customers benefit from variable/customisable offer, but might end up paying more than initially anticipated

Examples: Ryanair, SAP, BMW, Mercedes

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14
Q

BMI: freemium

A

Basic version offered for free, hope to persuade customers to switch to premium version

Crucial to identify functionalities that provide enough value for customers to switch

Examples: LinkedIn, Spotify, Skype

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15
Q

BMI: long tail

A

Long tail of niche products generates majority of revenues

Company must be good at managing complexity, persuade customer of value of getting everything from one source vs. specialised provider

Examples: Amazon, eBay, iTunes

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16
Q

BMI: mass customisation

A

Customization of products through modular production systems

Critical to avoid significantly increasing cost structure, effient handling of back-office operations

Examples: mymuesli, Levi’s

17
Q

BMI: peer-to-peer

A

Platform for individuals to make transactions (financing, purchases…)

Consider revenue streams – freemium, fee-based model, advertising etc.

Examples: eBay, AirBnB, kickstarter, Uber

18
Q

Elements of BM Canvac

A
  • Key partnerships
  • Key activities
  • Key resources
  • Value proposition
  • Relationships
  • Channels
  • Customer segment
  • Cost structure
  • Revenue streams
19
Q

Elements of innovation strategy

A
  • Product/market strategies (position focus)
  • Technology strategies
  • Process strategies
  • Timing strategies (market entry focus)
20
Q

Innovation triggers

A
  • Technology: technology push (supply-push)
  • Market: changing customer demand (demand-pull)
  • Ecology: overcoming environmental and societal challenges
21
Q

Timing strategies

A
  • Pioneer / first-mover (technology leader)
  • Early follower, late follower (customer orientation)
  • Me-too (cost leader)
22
Q

Innovation management process:

A
  1. Search phase: idea collection / generation –> idea registration
  2. Select: idea screening –> analysis and assess (RWW) –> short-list and selection
  3. Implement: stage gate principle (go/kill decision)
  4. Capture: capturing benefits of innovation (economic success)
23
Q

Idea collection vs. generation

A

Collection: “solutions for most problems already exists, must be identified”

Generation: “truly innovative ideas have to be generated using creativity”

24
Q

Creativity techniques

A
  • Brainstorming / reverse brainstorming
  • De Bono’s six thinking hats
  • Brain dumping
  • Brainwriting 6-3-5
  • Mind mapping
25
Q

Innovation management success factors

A
  • Foster an innovation culture
  • Honour (investigate) and appreciate ideas
  • Follow-up on ideas
  • Don’t have negative reaction to feedback
26
Q

RWW model

A

R: Is it real? (market, product)
W: Can we win? (competitiveness)
W: Is it worth doing? (profit, risk, strategy)

27
Q

Stage-gate principle (3. implementation)

A

Each stage (activity): information gathering –> integrated results analysis –> define deliverables

Each stage is followed by a gate and go/kill decision

Apply company specific KPIs and evaluation criteria for passing each gate/stage

28
Q

Platform characteristics

A
  • Network effects –> production shifts from inside firm to outside
  • Possible to scale as fast as they can add partners (no additional production costs)
  • Platforms orchestrate value creation by outsiders –> users = producers
29
Q

Network effects (definition)

A

Multiple entities (people, companies) participate in product development and value creation

Utility value of product / service / information exchanged in a network increase as the number of members increases

“Winner takes it all” –> difficult for new players to enter, added value has to be significant

30
Q

Direct vs. indirect network effect

A

Direct: More users = each user perceives network to be more useful

Indirect: Utility of one network/market site depends on number of users of another market site.
Example: companies/recruiters benefit from more LinkedIn users

31
Q

Positive vs. negative network effect

A

Positive: Value of product/service increases as the number of users increases
Examples: social media, online help forums, marketplaces (eBay), dating apps

Negative: After reaching / exceeding critical mass –> value declines as the number of users increase
Congestion: too many users leading to drop in product quality (overloaded) and customer service
Examples: car drivers & traffic, internet bandwidth, chatGPT, telephone queue

32
Q

Value innovation principle

A

Cost reductions + (customer) value increase –> value innovation

Cost focus: eliminate and reduce
Value focus: raise and create

33
Q

Blue ocean strategy

A

Blue ocean strategy based on value innovation principle, creating blue oceans makes competition irrelevant.

Porter “inherent structures in certain industries” vs. Blue Ocean “we can create industries, don’t have given nature”

34
Q

Blue vs. red ocean

A

Blue: Unknown, uncontested market space, create new demand through differentiation and cost reductions
Examples: Apple, Tesla, Netflix, IKEA, Zara

Red: Known, established market, highly competitive, focus on competitive positioning
Examples: tele communications, groceries, soft drinks, fast food

35
Q

Design thinking challenge (background)

A
  • Invented by David E. Kelley (engineer at Boeing, product design degree from Stanford)
  • Origin: concept taught at Stanford, named by David Kelley (USA)
  • It’s been around for a while, but only getting popular in recent years (3-5 yrs)
36
Q

Design thinking stages

A
  1. Empathising (customer)
  2. Define (problem)
  3. Ideate (brainstorm)
  4. Prototype
  5. Test
37
Q

Design thinking success factors

A
  • Customer centricity!!
  • Stay open, encourage wild ideas
  • Go for quantity of ideas
  • Build on ideas of others – “yes, and…”
  • Defer judgement

Digital Innovation (1 decks)

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