INNOVATION
MANAGEMENT
Submitted by :
Rishika Chaudhary
Deepak Kumar
Himanshu
Aggarwal
Ashwini
Bhavna
outline
Definitions of invention
and innovation
Invention vs. innovation
Invention strategies
Innovation models
DEFINITIONS
Inventionis the "creation of a product or
introduction of a process for the first time."
Thomas Edison was an inventor.
Innovationhappens when someone "improves
on or makes a significant contribution" to
something that has already been invented.
Steve Jobswas an innovator.
For an example:-
"If invention is a pebble tossed in the pond,
innovation is the rippling effect that pebble
causes
INVENTIONVS.INNOVATION
Consider the microprocessor. Someone
invented the microprocessor. But by itself,
the microprocessor was nothing more than
another piece on the circuit board. Its what
wasdonewith that piece the hundreds
of thousands of products, processes and
services that evolved from the invention of
the microprocessor thatrequired
innovation
INVENTION
INNOVATION
Finding basic or the
core idea.
Invention is not
commercially
utilized.
It doesnt has any
legal boundaries.
It gives very less
inputs in industries.
Exploited version of that existing
idea.
Its commercially utilized by
entrepreneurs.
It has legal & strategic boundaries
obligation.
It is backbone of todays industries
& technological area.
Examples of that can be
A plan made by an organization to
encourage advancements in technology or
services, usually by investing in research
and development activities. Innovation
strategy is a long-range plan for innovation
and technology management.
INNOVATION
STRATEGIES
Inventive(first to market)
Adaptive(second but best)
Economic(low cost producer)
INVENTIVE
In marketing strategy, first-mover advantage, or FMA, is
the advantage gained by the initial ("first-moving")
significant occupant of a market segment. It may be
also referred to as Technological Leadership.
A market participant has first-mover advantage if it is
the first entrant and gains a competitive advantage
through control of resources. With this advantage, firstmovers can be rewarded with huge profit margins and a
monopoly-like status.
Not all first-movers are rewarded. If the first-mover does
not capitalize on its advantage, its "first-mover
disadvantages" leave opportunity for new entrants to
enter the market and compete more effectively and
ADAPTIVE
Second-mover advantage occurs when a firm following
the lead of the first-mover is actually able to capture
greater market share, despite having entered late.
A second-mover firm can learn from the experiences of
the first mover firm, and may not face such high
research and development costs, if it is able create its
own version of a product using existing technology.
A second-mover firm also does not face the marketing
task of having to educate the public about the new
project because the first-mover has already done so.
ADAPTIVE(Cont)
As a result, the second-mover can use its resources
to focus on making a superior product or outmarketing the first-mover.
Often second-movers are able to overwhelm firstmovers by taking the first-mover's product from a
niche consumer market to a mass market.
While firms may enjoy a first-mover advantage if
they jump out to an early lead and hold onto it, the
notion that winners are always the first to enter the
market is a misconception.
Second-mover firms are sometimes called "fast
followers".
ECONOMIC
In a low cost strategy, the true winner is the company
with the actual lowest cost in the market place.
For example, if two companies make essentially
identical products that sell at the same price in the
market place, the one with the lower costs has the
advantage of a higher level of profit per sale.
By having this advantage, the low cost company is
able to do a number of things to maintain or increase
its market share. It can invest more in marketing. It
can pay for better positions in retail stores relative to
its higher cost competitor. It can lower price, thus
squeezing its competitors margins and profits. It can
invest more in research and development, allowing it
to improve the performance of its product.
The bottom line here is that the higher cost
competitor is allowed to stay in the market at the
sole discretion of the lower cost competitor,
because, if it so choses, the lower cost competitor
could drop its price to the point where the higher
cost competitor would have to sell at a loss in order
to remain in the market.
Eventually, the higher cost competitor could be
driven out of that business. You need to understand
what percentage of the market is buying solely on
price. This often happens with mature products.
INNOVATION STRATEGY:
4 KEY TACTICS OF TOP
GROWTH COMPANIES
Find the next Scurve
Lean on customers
Think like a
designer
1. Find the next S-curve
Nothing grows forever. The best products, markets,
and business models go through a predictable cycle
of growth and maturity, often depicted as an Scurve.
Diminishing returns set in as the most attractive
customers are reached, price competition emerges,
the current product loses its luster, customer
support challenges emerge, new operating skills
are required, and so on.
The S-curve illustrates cycles of growth for
companies
Unfortunately, growth company leaders are often
blinded-sided by this predictable speed bump.
2. Lean on customers
Successful growth companies have a deep
understanding of their customers problems. Many
are embracing tools such as the customer empathy
map to uncover new opportunities to create value.
This customer insight is the foundation for their lean
approach to product innovation: rapid prototyping,
design partnerships with lead users, and pivoting to
improve their product and business model.
3. Think like a designer
Managers are trained to make choices, but they
dont always have good options. Innovation
involves creating new options. This is where
designers excel.
Design thinking requires a different set of tools.
4. Lead the way
Unless the CEO makes innovation a priority, it wont
happen. Innovation requires a level of risk-taking and
failure thats impossible without executive air cover.
More important are innovative leaders as role models.
Amazon founder Jeff Bezos has told both employees and
shareholders that he cares less about profitability and
more about planting seeds that are likely to pay off in
five to seven years.
To launch his successful Think Different campaign, Steve
Jobs commissioned The Crazy Ones, a video that
featured Einstein, Edison, Gandhi, Muhammad Ali,
Hitchcock, Richard Branson, and other trouble-makers
who changed the world. Every employee understood the
RADICAL VERSUS INCREMENTAL
INNOVATION
Explores new technology
High uncertainty
Focuses on products,
processes or services
with unprecedented
performance features
Creates a dramatic
change that transforms
existing markets or
industries, or creates
Exploits existing
technology
Low uncertainty
Focuses on cost or
features improvements
in existing processes,
products or services
Improves
competitiveness within
current markets or
OPEN VERSUS CLOSED INNOVATION
INNOVATION PROCESS
MODEL
Linear model
Technology push model
Market pull model
Flexible innovation process model
Linear innovation process model
Also known as TraditionalPhase Gate Model,
under this model, product or services concept
is frozen at early stage so as to minimize risk.
In this model, innovation process in
enterprise involves series of sequential
phases/steps arranged in such a manner that
the preceding phase must be cleared before
moving to next phase.
Thus a project must pass through a gate with
the permission of gatekeeper before moving
to the next succeeding phase.
Linear innovation process models
Linear model contd.
Criteria for passing through each gate,
and the person at each gate(gate
keeper) are defined beforehand.
The gatekeeper examines whether the
stated objectives for preceding phase
have been properly met or not and
whether desired development has taken
place at the preceding phase or not?
Limitations of linear model are
Low gatekeeper knowledge may lead to
poor judgments , delayed evaluation or
rejection of good projects.
Slow &serial process as it is step
approach, thus time consuming
Concept frozen too early, however
customer need may undergo changes
subsequently at later stage
Focused on control through gates, not on
customer
Narrow criteria for evaluation which may
be rigid
More focus on attaining target ,less focus
on learning
Long review preparation time
Types of linear model
Common types of linear
model are :Technology push model
Market pull model
Technology push model
Technology
Push is when research and
development in new technology, drives the
development of new products.
Technology
Push usually does not involve market
research. It tends to start with a company
developing an innovative technology and
applying it to a product. The company then
markets the product.
Market pull model
The term Market Pull, refers to the need /
requirement for a new product or a solution to
a problem, which comes from the market
place. The need is identified by potential
customers or market research. A product or a
range of products are developed, to solve the
original need.
Market pull sometimes starts with potential
customers asking for improvements to existing
products. Focus groups are often central to
this, when testing a concept design or an
existing product.
Example of market pull
The digital camera. Twenty years ago,
there was a market requirement for a
camera that could take endless
photographs, that could be viewed almost
immediately.
Market pull (market need) eventually led to
electronics companies developing digital
cameras, once miniature digital storage,
processing power and improved battery
performance was available. Market pull
ensured that photo editing software also
developed, in parallel with the
FLEXIBLE INNOVATION PROCESS
MODEL
Innovation was deemed to be linear /
directed / planned activity.
Innovation is regarded also as nonlinear and ideas / improvements can
emerge from any source and at any
stage of innovation process.
The combination of linear & non
linearity approaches have led to
emergence of Third Generation models
which reflect complexity of real
innovation process.
These models include Technology Push +
Market Pull combination, R&D + Marketing,
Cyclical Model etc.
The models attempt to explain the radical
innovation process in rapidly changing
business environment.
In these models, phases are over lapped i.e.
development in more than one phase can
continue at the same point of time.
No design is locked down earlier than
absolute necessary so as not to miss a newly
emerging technology or new opportunity.
Flexible Innovation process
Model
According to Cycling Model, innovation is cyclical in
the sense that it is driven by the product
improvement cycle.
This cycle often begins with customer needs.;
which keep on changing. Also an enterprises may
be working for new product development
simultaneously. Thus there are cycles of innovation.
The process of technological innovation involves
complex relationships amongst set of key variables
like Inventions, Innovations, Diffusion Paths and
InvestmentActivity.
Thus proper interaction & integration between
R&D, Manufacturing, Marketing & Other Corporate
Functions helps in proper management of
Innovation process.
Advantages:-
Continuous interaction with market
User needs oriented
More chances of acceptance of product etc
Less risk of failure & resultant after-effects.
Disadvantages:-
May become directionless.
Chaotic in nature.
Case Study On
AIRTEL
IDEATORS
CHALLENGE QUESTION:
Create an integrated, self sustaining,
comprehensive plan for www.airtel.comto
become the centralized hub for our
Marketing, customized pricing and CRM
process.
THE BRIEF
Acquiring customers online is becoming the buzz in the
Indian retail. The online market stands at Rs. 2000 Cr
which is growing at a rate of 35% and is projected to touch
Rs. 7000 Cr by 2015. Most of the successful websites have
turned out to be online e-commerce websites, which
generate revenue and suggest a sustainable business
model. No large company has truly leveraged the online
media to build a very successful brand. Airtel wants to
take the initiative and hence revamps the market to
accommodate online media and branding.
With the new business structure, Airtel has merged its
Mobility, Broadband and DTH divisions into a single B2C
unit which takes care of all the functions www.airtel.com<
is the parent website which would host Airtel India, Airtel
Bangladesh, Airtel Sri Lanka and other African countries.
The site would also be the single point of engagement for
all our products and services including (Fixed Line, Mobile,
DTH, Broadband).
THE PLAN
Innovative Ideators studied the various
Relevant Crowds and concluded that the young
students of the top B Schools of India were the
closest to the defined segment by Airtel. Thus,
Innovative Ideators reached out to the Top 122
MBA Institutes of India to participate in Indias
biggest ideation challenge Innovative
Ideators Challenge 2012.
CONTEST
Innovative Ideators Challenge 2011 was launched across
India in top 122 MBA Institutes. A THINC (The Innovators
Circle) Ambassador was appointed in each institute to
spread the message about the challenge. Social media
played an imperative role in publishing updates and
information about the challenge. A dedicated portal was
launched to submit the ideas in a structured manner.
OUTCOME
With the joint efforts of Innovative Ideators
team and THINC Ambassador, a staggering
number of 8000+ students participated in
the challenge. A total number of 2402
students from 220 teams solved Airtels
case study and generated Intellectual
Properties. The Jury then selected top 10
teams to present ideas to the senior
management. One winning team was then
awarded with the prize money.
Thank
You
