Design Thinking and Fuzzy Frontend

Dr. Pavan SoniInnovation Evangelist and Founder

Inflexion Point Consulting Innovation.evangelist@gmail.com

www.pavansoni.com

When inventors go wrong!!

“Fooling around with alternating current (AC) is just a waste of time.  Nobody will use it, ever.” — Thomas Edison (1889)

"There is no reason anyone would want a

computer in their home."Ken Olsen, founder of

Digital Equipment Corporation (1977)

"There's just not that many videos I want to watch." — Steve Chen, CTO and co-founder of YouTube (2005)

"I think there is a world market for maybe five computers."Thomas Watson, president of IBM (1943)

Invention ≠ Innovation

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Most Innovative Firms- 2014

Highest R&D spent- 2013

Most patents granted- 2013

VolkswagenSamsung

IntelMicrosoft

RocheNovartisToyota

J&JGoogleMerck

AppleGoogle

Tesla MotorsMicrosoft Samsung

ToyotaBMWGilead

AmazonDaimler

IBMSamsung

CanonSony

LG ElectronicsMicrosoft

ToshibaPanasonic

HitachiGoogle

05/02/2023 Pavan Soni | www.PavanSoni.com |

Source: BCG, Booz & Co., USPTO

Innovation starts with ‘Discovery’

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The price of missed innovations

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Incumbent

Missed innovation

Innovator Real loss in incumbent's market cap

% drop in incumbent's market cap

Est. gain in innovator's market cap

Time period

Yahoo! PageRank search Google $27 billion 60% $98 billion 2005- 2012

HP Touch-screen tablets

Apple $43 billion 47% $258 billion 2010- 2012

Nokia Touch-screen smartphones

Apple $95 billion 87% $195 billion 2007- 2012

RIM Touch-screen smartphones

Apple $60 billion 90% $195 billion 2007- 2012

Sony LCD screens Samsung $6 billion 23% $144 billion 1996- 2006

The final solution should be…

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Competitive

Positioning: Why you can’t be

everything?

Source: Porter (1980)

Why you can’t be everything for

everybody!

Imitation barriers

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3 2

4 1ENTRY

BARRIER

EXIT BARRIER

HIGH

LOW

HIGH LOW

Property rights (patents, trademarks, etc.)

Being a moving target

Saturating the market’s carrying capacity

Low adoption barriers for customers, and high

imitation barriers for competitors

Sources of value, pricing

and costs

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Chose where you derive your value from and the cost and pricing targets

Sources of value, pricing

and costs

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Chose where you derive your value from and the cost and pricing targets

Motivators and detractors for the customers

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Lower Prices

Greater Benefits

Easy to Use

Easy to Buy

Idea 1 Idea2 Highten purchase motivators:• Less expensive than existing

products (Lower Price)• Provide better features than

existing products (Greater Benefits)

Eliminate purchase barriers:• Must not have any switching

or adoption cost (Easy to Use)• Must be readily available

(Easy to Buy)Source: Source: Can you Spot the Sure Winner?, Eric Mankin

Are you creating a new market?

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Twitter

Non- Customers

Who? Why? How?

Soon to Be

Refusing

Unexplored

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Think of the entire value chain Pre-purchase Purchase Usage Repurchase

Value for money

Risk reduction

Convenience

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Look at the non-customers Soon to be non-

customers Refusing non-customers Unexplored non-

customers

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Designing for the ‘extreme users’

Denmark based Arla Foods develops milk products for NASA

Movies with sub-titles were meant for hearing impaired

Volvo buses were designed to get wheelchairs inside

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Key takeaways

• Competitive positioning• Differentiation• Cost leadership

• Identify the source of value, pricing and costs• Think of the entire value chain • Look at non-customers• Soon to be non-customers• Refusing non-customers• Unexplored non-customers

• Design for the ‘extreme users’