Innovation by design
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Transcript of Innovation by design
© copyright 2006, youngjin yoo
innovation by design
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0.0
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youngjin yoo
http://yoo.cwru.edu
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innovation
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information infrastructure
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ubiquitous information environments
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0.1
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two ideas
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first idea:
how to find innovation idaes that are not obvious
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“If I had asked my customers what they
wanted, they’d have said a faster horse”
-- Henry Ford
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Performance
Time
Ferment
Takeoff
Maturity
Disruption
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how to spot the next curve in knowledge
economy?
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the problem of innovations
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assumption:
innovation is different from creativity
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innovation is a result of systematic, organized, and disciplined efforts
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the morning is about methods
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second idea:how to organize to
continue to innovate
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afternoon:
structuretechnology
culture
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1.0
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what is the most famous innovation over the last
three years?
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since 2001
42,000,000 iPods850,000,000 songs8,000,000 videos
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14 million iPods in a quarter
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108 iPods per minute3 million songs per day
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There are many MP3 players and iPod clones.
But none of them copied its success.
Why?
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multiple meanings
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buy it
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take it
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watch it
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from things to actions
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1.1
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deep changes in the economy
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CFO of the year
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CFO magazine
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1998 - Scott SullivanWorldCom
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1999 - Andrew FastowEnron
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2000 - Mark SwartzTyco
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sponsor - arthur andresen
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ethical issue?
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fundamental shifts in the economy
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from industrial economy to knowledge economy
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from things to meanings
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1.2
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one more personal example
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TV series
Movie
On-line game
Trading card GameBoy pack
Toys
Yu-Gi-Oh Economy
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more than just cards
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connections create unique experiences
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knowledge economy
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from possessions to connections
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from having to experiences
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from nouns to verbs
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from single meanings to multiple meanings
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from or to and
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from foreground to background
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1.3
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traditional goods
service products knowledge products
physical elements
yesno
intangibleelements
no
yes
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Starbucks vs.
Dunkin’ Donuts
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Lous Vuittonvs.
grocery bag
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Mon Blancvs.Bic
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solution selling
IBMUPS
Rockwell AutomationParker Hannifin
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products with layers of knowledge
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what is your company’s iPod?
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it takes a paradigm shift
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2.0
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Netflex vs. Blockbuster
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2.1
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what do they sell?
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video vs. experiences
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different meanings of video rental experiences
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opens up new innovation possibilities
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requires new combination of resources
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outside-in approach to innovations
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most R&D focus on inside-out perspectives
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how can you see the outside-in opportunities that customers cannot
articulate?
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how can you beat the curse of disruptive
innovations?
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three approaches
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2.2
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understanding the hierarchy of innovation
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Performance
Time
Ferment
Takeoff
Maturity
Disruption
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Performance
Time
Main frame
Micro computers
Personal ComputersMobile Computers
innovations in computer industry
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disruptive innovation is not as disruptive as it
looks when you focus on parts
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Number of Transistors Per Chip
110
1001000
10000100000
100000010000000
1000000001000000000
1959
1983
1965
1970
1973
1978
1985
1993
1999
2002
Year
Num
ber o
f Tra
nsis
tors
Microprocessors
Logic Chips
Source: (Moore, 2004)
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Declining Feature Size of Semiconductors
0.001
0.01
0.1
1
10
100
1960 1970 1980 1990 2000
Year
Mic
rom
eter
s (M
icro
ns)
Gate OxideThickness
Junction Depth
Feature length
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Growth in Hard Disk Recording Density
1
10
100
1000
10000
100000
1000000
10000000
1957 1962 1967 1977 1982 1987 1992 1997
Year
Rec
ordi
ng D
ensi
ty
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radical distruptive innovations comes from novel combinations of parts that are following linear innovation paths
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new combinations of parts offer meanings of
the product
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creates new competitive space with new customers and competitors
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personal computer
personalcalculator
potential new market through
expansion of meaningsof computers
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portableCD player
mp3players
potential new market through
expansion of meaningsof computers
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incumbents are not well equipped to see the new
meanings, failing to capture the opportunity
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2.3
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focus on the meanings not the product in thinking about the
innovations
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if you are the product manager of
Tide, how would you create the Tide
killer?
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asking right questions
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Q: why do you use Tide?
A: to have clean cloth
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product-focused question
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Q: what do you mean by clean cloth?
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meaning-focused question unlocks the
door for product innovations
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fresh smell
soft fabric
clean color
ready for important meeting
no dirt
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multiple meanings of experiences
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physicalcognitive
social cultural
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who is your customer
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when and where
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what do they do before and after
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customer experience map
Activities
Actor A Current experience
Actor B
Actor C
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where do you get these ideas?
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• Ask
• Watch
• Learn
• Try
Design Methods
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• Cognitive Maps
• Scenario Cards
• Conceptual Landscaping
• Visual Journals
• Customer Experiences
• Narrative
• Extreme User Interviews
• Personal Archaeology
Ask
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• Behavioral Mapping
• A Day in the Life
• Fly on the Wall
• Immersion / Shadowing
• Video / Photo Journal
Watch
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• Cognitive Task Analysis
• Profiling the Users
• Affinity Diagrams
• Competitive Product Survey
• Cross-cultural Observations
• Historical Analysis
• Activity Analysis
• Scenarios
• Error Analysis
• Flow Analysis
Learn
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• Paper prototype
• Multiple Model with different scale
• Bodystorming
• Try it yourself
• Role Playing
• Rapid Prototyping
• Rewriting Narratives
Try
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two most important methods
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observation
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prototyping
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not to collect databut to get inspired
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not to convergebut to open up new
possibilities
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to understand the context and background in order to
innovate foreground
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2.4
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small group exercise
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the meanings of keychain
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what’re on your keychain?
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2.5
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analyzing the innovation space
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Business model
FinanceNetworking
2. Networkingenterprise’s structure/value chain
1. Business model how the enterprise makes money
Channel
DeliveryBrand Customer
experience
10. Customer experiencehow you create an overall experience for customers
8. Channelhow you connect your offerings to your customers
9. Brandhow you express your offering’s benefit to customers
Core process
Process.Enabling process
3. Enabling processassembled capabilities
4. Core processproprietary processes that add value
6. Product systemextended system that surrounds an offering
Product performance
OfferingProduct system
Service
7. Servicehow you service your customers
5. Product performancebasic features, performance and functionality
Source: Doblin Consulting
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• More space for info
• Flat space for easier readability
• Clear visual hierarchy to differentiate really important vs required information
• Space for individual comments
• Sleeve for patient info card
• Color coded neck rings for different patients
Target Story
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2.6
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summary
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the big idea
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how to spot next breakthrough innovation
opportunity?
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outside-in
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customer driven
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seeking multiple meanings of your product
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understanding the hierarchy of innovations
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applying design methods to understand meanings
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understanding innovation space
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3.1
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Sony Case Discussion
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what was the symptom of the problem
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why could not Sony build “walkman” iPod?
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strong product organizations
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fiefdoms
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language
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mental model
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innovation processes
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Sony is not alone in this struggle
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IBM
OneIBM
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NASA
OneNASA
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Nestle
OneNestle
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HP
Front and Back
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TechnologyInnovation
OrganizationalInnovation
InstitutionalInnovation
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3.2
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who killed it?
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organization kills ideas
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why organization is the problem?
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detour: a brief history (1)
Human Resources Finance
New Products Operations Marketing Sales
CEO
Single business with a function structure
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detour: a brief history (2)
Human Resources Finances
Staffs IT
Division A Division B
CEO
Functions Functions
A diversification strategy with a product or a market structure
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detour: a brief history (3)
Functions Staffs
Divisions International
CEO
Functions Countries
A international strategy with a division+international structure
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detour: a brief history (4)
Functions Staffs
Divisions International Customer
CEO
Functions Countries Global accounts
A customer-oriented strategy with a multi-dimensional structure
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innovations require both specialized expertise and
integrations of knowledge
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Geographicfocus
Product/Customer focus
Functional focus
ideally,
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Geographicfocus
Product/Customer focus
Functional focus
in reality,
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Geographicfocus
Product/Customer focus
Functional focus
innovation strategy should focus on
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managing the tension between the two
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the problem of knowledge
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situated
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contextualized
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multiple meanings
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customer
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Integrated Knowledge Infrastructure
solution A solution B
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leadership providing design vision
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organization structure
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technology platform
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culture
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3.2.1
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“What happened was, the designers came up with this really great idea. Then they take it to the engineers, and the engineers go, ‘Nah, we
can’t do that. That’s impossible.’ And so it gets a lot worse. Then they take it to the
manufacturing people, and they go, ‘We can’t build that!’ And it gets a lot worse.”
Steve Jobs, Oct 14, 2005, in Time
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Apple’s solution
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deep collaboration
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cross pollination
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concurrent engineering
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design engineering manufacturing
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design
engineering manufacturing
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when there are more than one product organizations
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Functional structure Lightweight team
Heavyweight team Autonomous, “tiger” team
MarketConcept
MarketConcept
MarketConcept
Source: Kim Clark and Steven Wheelwright Revolutionizing New Product Development
alternative project structures
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Functional focus
Product/Customerfocus
“Heavy weight” teams
“Tiger” teams
“Light weight” teams
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Functional focus
Product focusGeographicfocus
Centers of excellence:Different parts of the firmare organized in differentways: line authority issplit
Matrices:Everyone has “two bosses”:both functions and products/customers have line authority
two other alternatives
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matrix organization
Function 1
Function 2
Function 3
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centers of excellence
Function 1
Function 2
Function 3
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importance of aligning incentive and power
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there is no silver bullet
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3.3
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from organization designto organization designing
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projects as the generative mechanisms for
knowledge integrations
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investing on people
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building “T” people
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tension between
the logic of familiarity and
the logic of variety
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what killed Segaway?
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why Rokr did not succeed?
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why did Walkman succeed?
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How does Frank Gehry organize his organization to consistently deliver remarkable buildings that are
distinctive yet all bear his design character?It is a balance between familiarity and variety.
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Gestalt of Organization Designing
• Cognitive Psychology
• Music
• Product Design
• Organization Design
• Notion of family resemblance
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Projects Owner Funding Time Size Cost
Barcelona Fish Olympic committee Public 6 months 180 ft x 115 ft $2.2 M
Bilbao Basque govern’t Public 1991- 1997 256 K ft2 $127.5 M
EMP Paul Allen Private 1995- 2000 140 K ft2 $110 M
PBL CWRU Donor + University 1997- 2002 150 K ft2 $61.7 M
Four Very Different Projects
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four different conditions
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four different sets of available resources
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four different purposes
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without losing your identity
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3.3.1
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Gehry’s Design Practice
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it begins with
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vision
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dream image
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what makes you to be in the business
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response to customer
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3.3.2
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building on information infrastructure
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centralized database
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layers of local information
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modular design
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same syntaxcoordinate
271
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multiple meaning
272
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attending to local contexts
273
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while seeing the global
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intense collaboration
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no more “throwing papers over the wall”
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FIREWALL
DESIGNCONSULTANTS
ARCHITECT
DESIGN
SUBS
CONTRACTOR
CONSTRUCTION
FABRICATORS
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engineer
architect
contractor sub-contractor
fabricatorCentral
Database
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other examples
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what if other people tell me what they know
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market place of knowledge
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when I need them
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del.icio.us
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flickr.com
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RSS feed
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all need strong technology infrastructure
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3.4
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Architectural Vision
The use of representation
tools
Collaborative & participative
project management
Buildings
Organization Structures for
Projects
is projected into the environment by designing
Gestalt of organization design
gives forms to
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familiarity and variety
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O
G
S1 S2
(a) Fish
Fish Project
• Most ideal experiences
• First use of Catia -- paperless
• Gave a birth to their organization design gestalt
• Becomes a dream image of future projects
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O
G
S1 S2
AA
P7 P6
P5 P4
P3
P2 P1
S3
S4
(b) Bilbao Gugenheim
• Working with public funding and foreign labor
• 7 prime contracts
• Catia -- for exterior and communication & coordination
• Intense collaboration in gallery and exterior
Bilbao
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(c) EMP
T8 O
G
S2 S3
PC
T77 T6
T5 T4
T3
S4 S1
S6
S5
T1
T2
• Strong prime contract
• Key subs were negotiation-based
• Catia -- bi-directional flow of information; five key subs using the system
• Minium paper-based drawing
• Intense collaboration at T2 -- structural steel
EMP
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(d) Peter B. Lewis building
O
G
S2 S3
PC
S4 S1
S22
S5 • Initially reluctant PC
• Catia used for design & no tape measures
• Class room and metal enclosure were key areas of intense collaborations
Weatherhead Building
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design gestalt
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intense focus on form-giving as means to
mobilize resources
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design attitude
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liquid vs. crystal
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multiple models
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being functional
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constraints
301
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reinventing wheel
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intensely collaborative
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building on the image of the past and tradition
while creating new path
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innovation is not done by a lone genius
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what is the design gestalt of your company?
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3.5
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big idea
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two tensions for organizing for innovation
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tension one:
specialization and integration of knowledge
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organizing principle one:
build project-based, customer driven
collaborative teams
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tension two:
the logic of familiarity and the logic of variety
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organizing principle two:
build on organizational gestalt
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market customer
engineering design
noun verb
or and
average exception
foreground background
data inspiration
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designing interactions within and without
organizations as mirror image of each other
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