week 4 - digital innovation + strategy Flashcards
what is innovation?
the process of creating, improving, or implementing new ideas, products, services, or processes to add value.
what is digital innovation?
use of digital tech + apps to improve existing business processes + efficiency of them, enhance client experience + launch new products or business models.
what are the latest forms of innovative technology?
wearable devices, chatbots, ai, big data.
what are the types of classification of innovation?
- sustaining or incremental innovations
- disruptive or radical innovations
- technology push based innovations
- market pull based innovations
- vertical market
- horizontal innovation
- product innovation
- process innovation
- paradigm innovation
what is the sustaining or incremental classification of innovation + an example?
continuous improvements made to existing products over time to help companies stay competitive without changing the market or industry.
example is regular updates to camera quality, battery life and software on a phone.
what is disruptive or radical classification of innovation + an example?
groundbreaking advancements that alter industries. introduces something entirely new that will replace the existing ways of doing things.
examples are netflix disruptive blockbuster, iphones replacing basic phones.
what is technology push based classification of innovation + example of it?
driven by research or tech ideas that offers the potential to be developed as a successful market offering.
Example is a digital camera.
what is a market pull based classification of innovation + an example of it?
driven by an observed need, problem or opportunity in a market.
Example is when facebook addressed the need (identified by snapchat first) for images that disappear after a period of time, this is a market pull that’s motivated.
what is a vertical market classification of innovation + an example of it?
innovation that addresses industry specific problems such as energy, education, retail or healthcare.
Involves integrating new and existing tech to achieve an improved performance. Example in the health sector is AR offering that helps medical staff learn about anatomy without having to cut open the body.
what is horizontal classification of innovation + an example of it?
addresses the needs of many industries, including tech like cloud or authentication services that provide a technical platform for a range of offerings.
Examples include apple pay and google wallet which enable online payments within or across any sectors.
what is product innovation?
development of new or improved products that offer better performance or enhance user experiences.
examples are tesla innovation in battery tech, plant based meat revolutionising food.
what is process classification of innovation + an example of it?
improvement or creation of new methods, systems or workflows to enhance efficiency, reduce cost or improve quality.
example is contactless payment.
what is paradigm classification of innovation + an example of it?
shift in thinking or business models that transforms industries, redefining how things are perceived, organised or executed.
example is streaming services shifting dvd ownership to subscription models.
what is meant by the innovation process?
a new product, technique or useful service is obtained from the generation of new ideas and their development.
what is the innovation process?
ideas + their origins
exploitation of ideas through a product or service offering
market consumption of an offering
how are ideas created?
- through association
- through adaptation and analogy
- through serendipity and chance
what is meant by association?
the bringing together of previously unconnected ideas to solve a problem or open a new market. The idea to associate these functions contributed to the now ever present smartphone products.
what is meant by adaptation and analogy?
the adaptation of an existing solution for a different purpose in a different situation. Uber is a sharing economy which is being applied to many businesses to create platforms where people pay to access someone else’s goods or services.
what is meant by serendipity and chance?
a new idea arises through accident or random occurrence.
what is meant by exploitation of ideas through a product or service offering?
This phase is about an idea that can be taken to market through some form of offering.
An idea cannot be taken into market in its pure form: needs to be wrapped into a product or service offering with an associated business model.
what is meant by the market consumption of an offering?
about interpreting and handling the market’s response to an offering. Understanding this is only possible if the data is available.
Positive response shows the business model is working so encourages more of the same, negative response may reflect badly on the idea, the ways it’s been wrapped into an offering or on the business model adopted.
what is a business model?
set of propositions, analysis and design decisions that embrace all aspects of how an offering will be taken to market, empowered by a business structure.
what is strategy?
definition of the future direction and actions of a company to achieve specific objectives.
what are the different forms of corporate/organisational strategy?
business unit strategy, regional strategy, functional strategy.
what occurs in the absence of digital business strategies?
- missed opportunities for additional sales
- more efficient purchasing on the buy side
- fall behind competitors in delivering online services
- difficult to catch up
- poor customer experience from poorly integrated channels
- loss of competitive advance.
what are the stages of the digital strategic formulation process?
strategic analysis (external environment, internal resources), strategic objectives (vision, mission, objectives), strategic definition (option generation, option eval, option selection), strategy implementation (planning, execution, control).
how do you conduct strategic analysis?
techniques for external: legal, political, social, technological, economic, environmental.
techniques for internal:
resource analysis, swot, portfolio analysis, demand + competitor analysis.
Digital business specific technique: stage models digital business development, assessing sell side, buy side and value network opportunities and threats.
how do you make strategic objectives?
vision: replace vs complement, extent of adaptability needed.
objectives: smart, customer value targets, online rev contribution.
E business specific techniques: vision about capability to change, to reinvent. Online revenue contribution.
how do you conduct strategic definition?
8 key e-business strategic decisions: e-business channel priorities, market + product development, positioning + differentiation strategies, business + revenue models, marketplace restructuring, supply chain management capabilities, internal knowledge management capabilities, organisational resourcing.
how do you conduct strategy implementation?
Implementation issues: supply chain management strategies, digital marketing strategies, customer experience + service design, digital transformation + growth hacking.
what is mcfarlan’s strategic grid?
Used to indicate the strategic importance of info systems to a company now and future. referred to as an applications portfolio model since it assesses the current mix of business info systems within an organisation.
what is porter’s competitive strategies?
assesses how external competitive forces can be harnessed.
what are the categories of porters competitive strategies and what do they mean?
Overall cost leadership: firms aim to be the lowest cost producer in the industry. By reducing costs, more likely to retain customers + reduce threat of substitute products.
Differentiation: creates a unique product. By tailoring products to specific customer requirements or offering good quality of service, the risk of customer switching is low.
Focus or niche: identifying + serving a target segment well (eg product range, buyer group), seeking to achieve either or both of cost leadership and differentiation.
Stuck in the middle: unable to adopt any of the above approaches + is at the mercy of competitors that are able to offer these approaches.
what are the categories of mcfarlan’s strategic grid + what do they mean?
Strategic segment: the business depends on existing IS and the investment in new IS to sustain continued competitive advantage.
Turnaround segment: while a business in this position does not derive competitive benefits from its current IS, future investment can positively affect competitive position.
Factory segment: while depending on its current IS to operate competitively, it does not envisage further IS investment having a positive impact on competitive position.
Support segment: does not and believes it will not derive significant competitive advantage from information systems.
