innovation Flashcards
Invention vs. idea
• The invention:
-the process of idea generation
–prototypic implementation of a new solution
on purpose or accidently.
• An idea - structured thought - spontaneously or by making use of creativity. - subject to ongoing and continuous developments
Typical reactions to crisis situations
• Cost saving initiatives • Conserving cash/liquidity • Efficiency improvements • Re-stabilizing the core business • Risk minimization What does this mean for innovation spending? Often, innovation activities are being de-prioritized.
What makes innovation projects so special?
- Novelty:
Existing/previous knowledge and routines have to be left behind
-Uncertainty:
The probability to reach a desired (or undesired) result can not be assessed im vorhinein
-Complexity
Caused by unclear temporal dimension (e.g. jumps intechnology, dynamic arkets, new legal rules) as well as by manifold, different und interlinked relevant issues
-Conflict potential:
Caused by different, contradictory conditions of objects and goals of acting persons (e.g. intrapersonnel, interpersonnel, standards, cannibalisation of new nd existing products, scarce resources, enterprise culture, ethical and moral alues, public opinion, existing laws and regulations)
-Heterogeneity:
Innovation as a crossfunctional tasks unifies different internal and external actors/stakeholders having individual values, goals, interests, idioms, mental odels, working and knowledge culture,…
Goals of innovation management
- Customisation
- Growth
- Competitiveness
- Profit maximisation
innovation typologies
Trigger (Why a novelty? Push vs. pull )
Content (What is novel? Dimensions of change, Component vs. system level innovation)
Degree (How novel is it? Incremental vs. radical innovation)
Subject (To whom is it novel? New to the company vs. new to the)
innovation typologies - trigger
External drivers of innovation
Technologies • Digital ubiquity • Rising technological complexity • Increasing power of artificial intelligence • …
Customers • Shorter life cycles • Customization • Megatrends • Climate change • …
Competitors • Globalization • Shorter development cycles • Imitation • Vanishing industry boundaries
push innovation trigger
› Own technological means as guideline for planning
› Results in the diversification of the product spectrum of the company
› For means (technologies) suitable purposes (markets) are sought
limits:
-High risk investments
- Risk of building “a better mousetrap”
that no-one wants
pull inovation triggers
› Requirements of market and customers as guidelines for planning
› For a purpose (market) suitable means (technologies) are sought
limits:
- Catching up to frontier, diminishing returns
- Leading vs. following the market
- The “faster horses” problem
innovation typologies - content - dimensions for innovation
- Product (Changes in what (products/services) the organization offers)
- Process (Changes in the ways in which these offerings are created and delivered)
- Position (Changes in the context into which the products/ services are introduced)
- Paradigm (Changes in the underlying mental models that frame what the organization does)
levels of change
component level until system level and incremental until radical
innovation typologies - degree-
incremental vs radical
incremental: Advantages • Low risk • Builds on what we know • Easy to implement
Disadvantages
• Low impact
• More of the same, risk of being overtaken by something radical
radical:
Advantages
• Changes the game
• Step change in key performance dimensions
Disadvantages
• High risk
• Uncertain to implement
• Requires new knowledge (learning effort
innovation typologies - subject
The perceived units of the idea for the individual determines his or her reaction to it. If the idea seems new to the individual it is an innovation.
innovation typologies - actors
crowdvoting , crowdfunding, crowdcreation (increasing costs)
Motivation of the crowd:
Intrinsic motivation
- Learning: Contributors explore new ways to overcome problems and have the chance to try out ideas; feedback enhances the learning experience
- Fun/ satisfaction: Contributors enjoy the intellectual challenge, it does not seem like work to them, enjoying the competition
Extrinsic motivation
- Recognition/ acknowledgment: Contributors expect positive response from other participants or the company when demonstrating their skills, abilities and competencies
- (Monetary rewards)
lead users
those users whose needs and preferences lead the market. These lead
users […] will modify products or use them in unforeseen ways to meet their needs.
diffusion vs adoption
Diffusion
The process by which something new spreads throughout a population (a consequence of adoption decisions)
Adoption
The choice to acquire and use a new invention
Theory of the diffusion of innovations
2,5% innovators 13,5% early adopters 34% early majority 34% late majority 16% laggards
The 9x effect of wanting consumers to
embrace innovations
-consumers overweight the common products benefits by a factor of three and companies overweight the new products benefits by a factor of three
technology acceptance modell
external variables:
perceived usefulness and perceived ease of use
model no2:
enhanced by social influences and cognitive instruments
7 influencing factors:
-performance Expectancy
- Effort Expectancy
- Social Influence
- Facilitating Conditions
- Hedonic Motivation: „the fun or pleasure derived from
using a technology“
- Price Value: „consumers‘ cognitive tradeoff between the
perceived benefits of the application and the monetary
cost for using them“
- Habit: „the extent to which people tend to perform
behaviors automatically“ (161)
3 moderation effects
- Gender
- Age
- Experience
shark fin of technology adoption
few innovators lots of early adopters few early majority only very very few late majority now laggards
Approaches to categorize technologies –
Life-cycle
Demand driven technology lifecycle models
- How do customers perceive a technology?
- Gartner‘s Hype Cycle Model
Performance-oriented technology lifecycle models
- What is the technology‘s performance
- McKinsey‘s S-Curve
- Arthur D. Little‘s tlc model
gartners hype cacle model
characterize the typical progression of innovation, from overenthusiasm through a period of disillusionment to an eventual understanding of the innovation’s relevance and role in a market or domain.”
Phase 1: Innovation Trigger
breakthrough, public demonstration, product launch or other event generates press and industry interest in a technology innovation.
Phase 2: Peak of Inflated Expectations (maybe adopt too eraly)
“A wave of “buzz” builds and the expectations for this innovation rise
above the current reality of its capabilities.
phase 3: Trough of Disillusionment (maybe give up too soon)
“Inevitably, impatience for results begins to replace the original excitement
about potential value. Problems with performance, slower-than-expected
adoption or a failure to deliver financial returns in the time anticipated all lead
to missed expectations, and disillusionment sets in
phase 4: slope of enlightenment (maybe adopt too late)
Some early adopters overcome the initial hurdles, begin to experience
benefits and recommit efforts to move forward. Organizations draw on the
experience of the early adopters. Their understanding grows about where and
how the innovation can be used
Phase 5: Plateau of Productivity (maybe hang on too long)
“With the real-world benefits of the innovation demonstrated and accepted, rowing numbers of organizations feel comfortable with the now greatly reduced levels of risk. A sharp rise in adoption begins (resembling a hockey stick when shown graphically), and penetration accelerates rapidly as a result of productive and useful value.”
mckinsey S curve
x = performance y= effort and time
low effort, low performance: embryonic
increasing effort increasing pefromance: growth
high effort high performance maturity and after that ageing
between growth and majurity umschwung von S , wachstum nimmt wieder ab man kann die technologie nicht weiter verbessern
arthur d little
time and level of realisation of competitive potential:
Future technologies: Technologies, which recently have been discovered and it is not clear, whether and to what extent they can be applied in future markets
pacemaker technologies: Technologies, which are likely to have a strong future
market position
Key technologies: Technologies, which are already established in the market, offer strong competitive advantages
Basic technologies: Technologies, which have been established in the market for a while; important for the company, however, no source of competitive advantage
Displaced technologies: Technologies, which have almost been completely substituted by superior technologies
kurve increased bis basic technolgies und nimtm dann ab
tension between the logics of “exploration” and
“exploitation”
Exploration • Revolution • Start-Up • Trial and error • Speed • Uncertainty • Creativity • Breakthrough
Exploitation • Evolution • Corporate • Control and Monitoring • Scale & scope • Security/predictability • Optimisation • Cost
