Learning Innovation

Indra Makalanda

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Innovation
Invention

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Commercializing Innovation
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Invention = f (idea generation + problem solving)

Innovation = f (invention + implementation)
Economic value = f (innovation + diffusion)

A major part of innovation is about

selling, not just invention
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New

Near to existing

Semi Radical

Radical

Incremental

Semi Radical

Near to existing

New

Radical vs. Incremental Innovation

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Radical vs. Incremental Innovation

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How fast does Sony produce and

launch its new products ?

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Approximately 20 minutes

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Research intensive
Development intensive

Spend more on R&D

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Transformation
of Knowledge

Creation of
Knowledge
Scientific Research

Engineering and
Developmental
Research

Production and
Distribution
Utilization of
Knowledge for
Human purpose

Stages of Innovation Process

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Market

Product &
Process
Innovation

Innovation

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Now

Order
fulfillment

Product
Future innovation

Product Innovation is a key business

process for developing the future
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Market and other

needs/ opportunities

Product Innovation

New products/
services

Technological threats
and opportunities

Core Process of Product

Innovation
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New technological opportunities

Demand for increasing variety / customization
Demand for frequent product innovation
Increasing regulation
Shorter technology life cycles

Pull or Push
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Technology Push
Research &
Development

Production

Marketing

Marketing

R&D

Market Needs

Market Pull
Expressed
Market needs

Production

Matching Technical abilities

and Market Needs
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New to the world products

(10%)

Radical

New product lines (20%)

Improvements to existing products (26%)
Additions to existing product lines (26%)
Cost reductions (11%)
Repositioning (7%)

Incremental

(Booz, Allen, Hamilton, 1982)

Types of New Product

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Competition

New markets

Market demand

New technologies

Social needs

Retain market share

Regulation

Exploit R&D

Social trends

Accidents

Why Product Innovation ?

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Renewing the organisations ability to

produce something
Improvements in the way products are
made or services delivered
A learning process

What is Process Innovation

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Threats
opportunities
markets,
Process Innovation
competitors,
technologies,
regulation

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Better
processes

Process
Innovation

Component

Architecture

Integrated circuits

Computers, faxes, IT

Car components

Cars and other vehicles

Hi-fi elements

Hi-fi systems,
home entertainment

Component and
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Architecture
Innovation

Home
entertainme
systems

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Technology
Fusion
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Competence Enhancing and

Destroying Innovations
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Intel: microprocessor speed increases about 20% per

year.
Eli Lily: Purity of insulin improved from 50,000 ppm in 1925 to
10 ppm in 1980 (by about 14% per year).
Manufacturers of hydraulic excavators increased by 15% per
year the amount of earth their machine could heft in a single
scoop; from 0.25 cubic yard in 1948 to 10 cubic yards by
1974.

Competence enhancing

Innovations

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Intel, Sony, Bloomberg Financial Markets,

Honda, Charles Schwab, Wal-Mart, Intuit, Sony,
Nucor, Sun, Cisco, J&J Lifescan, Staples, U.S.
Surgical, and McDonalds are few examples of
prominent firms that originally entered their
industries as disruptive technologies.

Destroying Innovations
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