INNOVATION PRACTICEENGAGING THE ORGANIZATION IN

TOP-LINE REVENUE GROWTH

BIOMEDICAL ENGINEERING AND ENTREPRENEURSHIP

SEPTEMBER 25, 2013

What we know...

CEOs have recognized an innovation imperativeIf you want to grow your business, you need to innovate

“The only future source of profit the only reason to invest in companies in the future is the ability to innovate and their ability to differentiate.”

- Jeffery Immelt, GE

Relying on sporadic idea generation,thinking employees will figure it out on their own, ormaking it the sole responsibility of a separate small team…

…isn’t the way to outperform your competition

Instead, you need to effectively infuse and harness an innovation - based competency throughout your enterprise

What we know...

What is your Innovation Effectiveness?

The return on innovation ROI2

varies among companies within their industries...

Example: Best performers in the

consumer healthcare industry

2Xindustry average

10Xworst performers

Source: Booz Allen Hamilton

A few ideas drive most of the new profits

A study of 108 new product launches by the authors of Blue Ocean Strategy revealed the positive revenue and profit impact that came from offerings that could be characterized as truly “innovative.”

Innovations that were not all that innovative

Innovations that created a new “market space”

The True Growth Driver

Expanding your innovation potential

Individuals Enterprise

...is central to bringing the innovation imperative to life in your organization

Value Creation: 1. Multi-dimensional Research2. Strategy Formulation3. Ideation & Design

Value Capture: 4. Portfolio development & management5. Intellectual Property6. Processes7. Financial Management

Value Delivery:8. Organizational Development9. Leadership & Culture10. Incentives & Expectations11. Collaboration & Outsourcing

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3

4

5

67

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89

Holistic Innovation Covers 3 Areas

Key learning

What we’ve learned at Fisher about Value Creation recognizes what happens before and after generating an idea are also critical to success in innovation.

For that reason, our approach to Innovation Strategy Training begins before and extends beyond our best practices in Ideation Training, captured in a framework we call SPARK.

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S P A R K

SPARKBegin with choiceful strategies and a longer view and evaluate options against a bigger picture

STRATEGYBeginning with focus andaligning with corporate strategy

RAPID DEVELOPMENTConcepts, prototypes and revenue models

PROBLEMS &ANSWERSUncovering customer wants and needs and their solutions

KILLER IDEASKilling ideas to get tokiller ideas

S

P A

R

K

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Start with strategy Instead of a ‘cold start’, teams ground their work in strategic relevance: determining areas of strategic importance or disruption to the future of the company, customer, or brand.

S

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Problems worth solving Client’s have business objectives; innovation begins with uncovering and identifying customers’ unmet needs, future dreams and problems within selected strategies. This results in problems worth solving and opportunities for incremental and radical innovation.

P

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Answers for the market Teams use brainstorming techniques as well as participatory design methods and tools to generate early ideas and initial concepts based on opportunities and problem statements.

A

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Rapid developmentChallenge ideators to develop ideas into concepts. Ideas that come out of brainstorming usually require further development to become concrete. Often everyone is excited about an idea but can’t define what “IT” might look like or how it might make money. Developing a minimally viable prototype makes ideas more tangible and begins to tackle the design and engineering aspects.

 

R

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K

Killing ideas to get to killer ideas Consider what criteria to use to evaluate the value of ideas to the company including financial and strategic elements. Build better ideas in an iterative process and consider a portfolio across 3 horizons of growth.

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Ethnography+Behavioral Psychology

= Empathology™

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Patients

Doctors, nurses

Doctors and patients

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UNCOVERING DISCONNECTSWith a connected POS

CUSTOMERS AS PARTNERS Codevelopment

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Disruptive innovation

SINGLES GAME CHANGERSLine extensions New ideas/marketsPredictable RiskObvious/ Stretch/easier to understand imaginationShort-term revenue Initially, lower profitLow differentiation Breakthrough

Do customers always want more?

Computer and iPad(sorry, Verizon ads)

Disruptive innovation

Disruptive innovation

Blockbuster. Bigness. Profitability. Category driver of breadth of titles. Best customers. Badwill.

Redbox, Netflix

Does more= features or value?

Two views of change

ResistorsChallengers

See RiskSee Potential

Ask Why?Ask Why not?

Already is Could be

Too small/nicheOpen space

Best customersNew customers

Maintain positionNew order

How can we see opportunity in change?

Trends are a way to look at what’s coming, and actively speculate on the opportunity that could be available.

We look at two types

TRENDS in an industryNear-term opportunities, 12-24 months

Illustrate with examples for contextGo deep: implications, opportunities

 

We look at two types

TRENDS that challenge an industryNo one has combined peanut butter

and chocolate yet

 

With an exercise called TRENDstorming

 

coffee

How could you sell coffee for $100/lb

in regular grocery stores?

Single households are more prevalent. Single parents, whether single from the start or from divorce, are managing work and parenting alone, or students move between two households in shared custody situations.

SOLO: LIVING ALONEtrend

1. TREND

trend

SOLO: LIVING ALONE: Single households are more prevalent

Keurig Once you buy the machine, you’re hooked into the k cups. At $1/serving, that’s about $87 a pound

coffee1 TRENDstorming

KEURIG

Fractional ownership or usage of services/things you don’t need all the time.

COLLECTIVE CONSUMPTION

trend

2. TREND

ZIPCAR

Seeking out and taking health action outside of traditional pharmaceutical solutions and Doctor advice.

DIY HEALTHtrend3 TREND

WEB MD

Thanks to the continued explosion of touchscreen smartphones, tablets, and the “cloud’, the screen culture will be not only more pervasive but more personal, more immersive and more interactive than ever.

SCREEN CULTUREtrend

4. TREND

PANDORA

The practice of obtaining needed services, ideas, or content by soliciting contributions from a large group of people, and especially from an online community, rather than from traditional employees or suppliers.

CROWDSOURCINGtrend

5. TREND

KICKSTARTER

Will coins and notes completely disappear in 2013. No. But a cashless feature is (finally) upon us, as major players such as MasterCard and Google work to build a whole new eco-system of payments, rewards and offers around new mobile technologies.

trend CASH-LESS

6. TREND

SQUARE

Consumers continue to hunt for deals and discounts, but they will do so with relish. Deals are now about more than just saving money; it’s about the thrill, the pursuit, the control, and the perceived smartness, and thus a source of status too.

trend

7. DEALER CHIC

TREND

GROUPON

Turning tasks over to computers and using systems, without assistance from a person, so that continuous attention is not required, or to improve performance of humans.

AUTO-PILOT &ROBOTICS

trend8 TREND

SELF-DRIVINGCARS

DA VINCI,BIONIC HANDS

the manipulation of matter on an atomic and molecular scale, often with a technological goal of fabricating macroscale products.

NANOTECHNOLOGYtrend9 TREND

“NANO-BEES”

the measurement of personal performance metrics, against goals or benchmarking, with the ability to share with others. Consumers take advantage of new technologies and apps to discreetly and continuously track, manage and be alerted to any changes in their personal health.

QUANTIFIABLE MEtrend10 TREND

NIKE FUELBAND

It’s never been easier for savvy consumers to

resell or trade in past purchases, and unlock the

value in their current possessions. Trading in is the

new buying.

RECOMMERCEtrend11 TREND

EBAY