MMO-Managing Innovation Koen

8/22/2019 MMO-Managing Innovation Koen

1/79

Innovation Management

Dr.CarlaKoen

ro essoro ec no ogy anagemen an n repreneurs p

[email protected]

c.i.koen hotmail.com


2/79

Structure

nnova on anagemen

1. Settingthe

Scene

Innovation:definition,types,strategy

Assessinginnovationcapabilities

2.Selecting

and

organizing

innovation

projects

3.Thechallengeofdisruptiveinnovation


3/79

Originality is nothing but judicious plagiarism. Voltaire

Defining Innovation


4/79

What is innovation?

Musical flamethrower

Gas-filled umbrella

Cheese-flavoured cigarette

Decoy ducks & stay dry!

Foetus Walkman [Bessant, 2005]

4


5/79

Revolutionaries and revolutions...


6/79

(average age of 105 years)

Company Founded Original product Current business

Goodrich 1870 Fire Hose Aerospace

Nokia 1865 Lumber Mobile Phones

3M 1902 Mining Office supplies

P ps 1891 Car on- ament amps Hea t care, consumer

lifestyle, lighting

DSM 1902 State-owned coalmining company

Chemicals, nutrition,coatings, etc

VanderLande 1948 Maintenance of textilemachinery

Producer of materialhandling systems

6


7/79

Whatisinnovation?

New ideas

New roducts

New services

Successful commercialisation

on nuous mprovemen

idea.

Improved processes

Radical chan e

Patents New intellectual

capital


8/79

Entrepreneur Inventor Vacuum cleaner W.H.Hoover J.Murray Spengler

Sewin machine Isaac Sin er Elias Howe

Telegraphy Samuel Morse many others

Action with vision, energyand strategic thinking about

what can be accomplished

,

perseverance, focus,

passion, etc.

8


9/79

Innovationoccursindifferenttypesfordifferent

consumer

Marketlifecycle Disruptivenesstoconsumer

Newtotheworld

Emerging Growth Mature Decline

Newadjacentcategoryy

Newinthecategory

h

nolo

mproveTe


10/79

Whatisstrategicaboutinnovation

&whatisinnovationstrategy?

a s a s ra egy anyway


11/79

Exercise:Please reflect and discuss for 10 min. with your

ne g our an e rea y or penary scuss on

What is a technology strategy? What in your viewshould it include?

How should strategy differ from technology strategy?

What should be the relationship between them?

Do ou know the strate and technolo strate ofyour company? What is the link between them?

11


12/79

Effectivestrategiesaddressthreekeychallenges:

Markets

Howwillwecreatevalue?Technologies

Howwillwecapture

value in the face of

Howwillwebuild

theorganizational

ca abilities

Competition?necessaryto

deliverit?


13/79

And answer critical questions:

How will we create value?

ow w e ec noogy evo ve

How will the market change?

How will we capture value?

How useful is uniqueness?

at compementary assets o we nee

Where should we compete in the value chain?

How should we compete if standards are important?

How should we design the business model?

ow w we e ver vaue

How do we manage the core business and growth simultaneously?

How do we use our strategy to drive real resource allocation?

13


14/79

Technology Strategy on one slide

Create

CaptureDeliver?


15/79


16/79

You are going to perform a preliminary assessment on your organisations innovation

Objective: Assess the innovation capabilities of your own organisation

Approach:

Complete Assessment Sheet provided

10 best practices for innovation

Template-based

Assess on t ical situation not if a ilot is in lace

4

5Vision & Strategy

Innovation ProcessTime to market

Be honest!

0

1

2

3

Leadership for innovationProcess improvement

Supportive culture

Learning

Customer involvement

Resources for innovation

New Offerings (as %sales)

2007 Codexx Associates Ltd


17/79

Innovation Capabilities Organization

AssessmentNo Practice Low (1) Medium (3) High (5) Score

(1-5)

Documented 3-5 year vision Documented 5+ year businessvision and strategy identifying

1 Vision andStrategy

No documented visionand strategy for the firm.

and strategy, primarily focusedon financial goals but with littleor no definition of goals andpriorities for innovation focus.

key business trends and defininginnovation goals and priorities.Created with the involvement ofmanagers and employees,together with externals a e o ers an communca e

throughout the firm.

Do you have a Vision & Strategy in place that defines focus areas for innovation?

Were they created with a high level of involvement of key stakeholders?

Comment Score (1-5)


18/79



(1-5)

No formal rocess new Basic innovation rocess inFormal stage-gate process inlace for eneratin , selectin

2 InnovationProcess

service and processimprovements emerge inan ad hoc fashion.

place, using stage-gates, butnot well deployed across thefirm.

and implementing new ideas forservice and processimprovement, supported by amanagement system.

Do you have a robust process in place for generating, selecting and implementing new ideas?

Comment Score (1-5)


19/79



(1-5)

Mana ers are not active in There are some de artments inManagement across the firm giveleadershi on innovation as

3 Leadershipfor Innovation

promoting or supportinginnovation in the firm.

the firm where managers areactive in driving innovation, butthis is not firm-wide.

evidenced by their involvementin, and resourcing of, innovationprojects and makinginnovativeness a core part of thefirms strategy and aKPI.

How effective are management, incl. you at leading innovation in your firm?

Comment Score (1-5)


20/79



(1-5)

Innovation activities are Innovation is sou ht fromThe firm values innovators andsu orts innovation cham ions. It

4 SupportiveCulture

seen as taking peopleaway from daily businessand hence regarded as acost.

Managers and senioremployees only.

is known as an innovator.Managers are expected to leadinnovation activities. Innovation isexpected and encouraged fromall employees.

How supportive is your culture for innovation?

Comment Score (1-5)


21/79



(1-5)

The firm has effective inte rated

5

No formal process tocapture and sharelearning from clientprojects andim rovements across the

The firm has some processesand IT systems in place tocapture and share learning fromprojects and improvements, butthese are often not used.

processes and IT systems inplace to capture and sharelearning across the firm.Managers and employees aremotivated to share learning.

Learning

firm. At best learning is

done within teams ordepartments.

Manager support for learning is

typically half-hearted.

Partners support a learning

culture in the firm.

Do you have effective processes for capturing and sharing learning?

Comment Score (1-5)


22/79



(1-5)

Customers are not Customers are sometimesThe firm is close to customersand understands their lon er term

6 CustomerInvolvement

involved in newinnovations until the newproduct/service or processchange is completed.

involved in new product/servicedevelopment, but this isdependent on the managerinvolved and is not a formalrequirement.

business needs. The firmregularly seeks the opinion of keycustomers as part of developingnew service and processofferings and this is part of theformal innovation process.

How are customers/clients involved in your innovation?

Comment Score (1-5)


23/79



(1-5)

There is no coordinationor resourced su ort of

Innovation is managed on aro ect-b - ro ect basis and

There is a group providingcoordination and su ort for

7 Resources forInnovation

innovation activities in thefirm. Little or no time ismade available forinnovation activities.

project-specific tools are madeavailable. Time is madeavailable for innovationactivities on specified projectsonly.

innovation activities within thefirm together with appropriatetools. Time is made available toall employees for innovationactivities.

What resources and skills are available for innovation activities?

Comment Score (1-5)


24/79


Assessment

No Practice Low (1) Medium (3) High (5) Score(1-5)

8 New Offerings Few newproducts/services havebeen launched in the last3 years.

Some new products/serviceshave been launched in the last3 years.

Many new products/serviceshave been launched in the lastthree years. Firm is consideredamongst the leaders forproduct/service innovation.

How much new innovation has there been in your products/services recently?

Comment Score (1-5)


25/79


Assessment

No Practice Low (1) Medium (3) High (5) Score(1-5)

9 ProcessImprovement

The firm has madenegligible changes in keybusiness processes overthe last 3 years.

The firm has made somesignificant changes in keybusiness processes over thelast 3 years.

improvements in businessprocesses over the last 3 years,which have significantly improvedits competitiveness.

What degree of business process improvement has been achieved in the last 3 years?

Comment Score (1-5)


26/79


AssessmentNo

Practice Low (1) Medium (3) High (5) Score(1-5)

Few new offerings orrocess im rovements are Many new offerings or processim rovements are com leted on Most new offerings or processim rovements are com leted on

10 completed on scheduleand budget

Typically very slow tomarket/ go-live.

schedule and budget.Pretty variable in time tomarket/go-live

schedule and budgetTypically fast to market/go-live.

Time toMarket

How successful is your business at bringing new innovations to market or first usequickly and to budget?

Comment Score (1-5)


27/79

did you learn?

TOTAL SCORE (Q1-7)

(Min =7, Max = 35)

TOTAL SCORE (Q8-10)

= = ,


28/79

Structure

1. Setting

the

Scene

Innovation:definition,types,strategy

Assessinginnovationcapabilities

2.Selecting

and

organizing

innovation

projects

3.Thechallengeofdisruptiveinnovation


29/79

Fromstrate allelseflows

us nesss ra egy

PIT

strategy

Portfolio

Stagegateprocess

Projectmanagement

Cooper&Edgett,2009


30/79

WhydidthingsgobadlywrongatMedtronic?

Ofall

the

things

that

Medtronic

did

to

fix

its

process,

what

do

you

think

wasthemostimportant?Why?

Whydidthenewproductdevelopmentsystemthattheyputinplacehelp?


31/79

Fromcatchuptoleadershipposition

Heav -wei htCareer Path: Ensure integration

and ali nmentof Focus

No failure aftercommitmentreview

& light-weightteam

pro ec mg . functionalmgt.

the market andtech. perspectives -Speed

- cost

Commitmentreview

-CEO

new products to develop Gate

documents

- Innovativeness

-Product quality

Business

analysisphase

-

mgr.-Productdevelopment

Technology

strategy -Cycle time

- fully allocated

Differentiate technologyfrom product development

Source advancedtechnology

reviewdates - Market share

- Defects/million

Design platform productswith an up-front plan forderivative models

TrainSchedule

Set start andcompletiondates forprojects

31


32/79

Alternative ro ectteamstructures

Functional structure Lightweight team

Function manager

Liaison (L)

MarketConcept

Working level

L LL

Heavyweight team Autonomous, tiger team

Project

manager

Market

ENG MFG MKG

MarketConcept

32Source:Kim Clark and Steven WheelwrightRevolutionizing New Product Development


33/79

Multidimensionalteam:Exampleofapersonalcomputer

manu acturer

Product team: terminals

ProductManagers

Team:printed

circuit

Team:Keyboards

(Engineering)

Cross-functional teams

Product team: Low-end PCs

boards

Product team: High-end PCs

Chaired by technically trained

managers from purchasing

Teams of Engineering andpurchasing representatives

Conflictreso u onteam

-

- product team leaders

- product managers

- engineering managerVP Purchasing

33

- computer architect

Oth fi h i t d ith h b id i ti l


34/79

Otherfirmshaveexperimentedwithhybridorganizational

structures

MarketProductConceptCenters of Excellence Teams Matrix

Heavyweight teamMarket A Market B Market C

Ceo

R&D area 1

Market A Market B Market C

Ceo

ENG ENG ENG

R&D area 2

R&D area 3

Pros Buildke ex ertisecentrall e. . Focusedcross functional coordination Focusedattentionto multi leobectives

Concept MNG MNG MNG

MKG MKG MKG

unc on

Function 2

Function 3

central basic research

Supports necessary scale for criticaltechnologies

Manage career paths of key individualsto maintain the skill base of the org.

Strong identification with and commitment to

projectsMore efficient development

Development of team and generalmana ement skills at all levels of the or .

Makes the tension between functional

expertise and product/customer focusexplicit

Best of both worlds: coordination andspecialization

Leverage key learning across the firm

Cons Centralized groups can degenerate into Confusion of team roles & responsibilities Confusion of roles & responsibilitiesivory towers

Potential isolation from global needs

uneasy transfer of technologies tosubsidiaries worldwide

Shortage of effective project leaders

Degradation of functional skills

High overhead

Powerful individuals tip the balance ofpower

Worst of both worlds

34


35/79

Whatarethecriticalvariables?

eavywe g tlightweight team

structures

Train scheduleprocess

Platform

a e ocumen s oforce integration structure & process

No failure after

strategycomm menprocess

Measures ofperformance andsuccess - incentives

Changes in careerpaths - incentives

35


36/79

Whyhaveastrategy?

1.To

make

choices


37/79


38/79

Successinvolves

e.g. cross-functional teams, doing the up-front homework prior to

the develo ment sta e buildin in the voice of the customer

getting a sharp, early, and stable product definition, etc.

Project selection and portfolio management


39/79

UnderstandCapacity

Identify the Functions Most

Development and Understand

their Staffing Structures

Estimate the Demands Estimate the Resourceo ro uct upport

and Administration

Efforts by Functions over

Time

New Product Development

Project by Breaking

Out Project Tasks

Consider the Current

Portfolio of New Projects

and the Continuing Demands

o non-NPD to Determine

Overall Demand for

Development Resources

Understand the Impact of Current Commitments Upon

Resource Supply, Identify Bottlenecks and Over-

Commitment


40/79

Projects Product.Mgt.

Persondays Cumulative Persondays Cumulative Persondays Cumulative Persondays Cumulative

Marketing Research Group A Research Group B

Alpha 3 3 2 2 10 10 5 5

Beta 4 7 2 4 10 20 5 10

Gamma 3 10 2 6 15 35 5 15

Delta 5 15 3 9 15 50 8 23

Epsilon 6 21 3 12 5 55 8 31

Foxtrot 6 27 2 14 5 60 5 36

Available

Persondays20 10 60 40

% Utilization 135.00% 140.00% 100.00% 90.00%


41/79

a ng rea ec s ons w


42/79

Technology Strategy in Practice

real resource allocation decisions

Decide

Who will make the decisions

How often

By what criteria


43/79

AnAssignmentGiventoSmallGroupsofManagersat

1. Identif

thesalient

characteristics

of

our

or anizations

.

innovationfunnel

Wheredonewideascomefrom

W enare ec s onsma e

Who

is

involved

in

these

decisions?

2.Drawadiagramoftheinnovationfunnelthatcapturesthese

characteristics


44/79

Senior

Marketing Inputs

anagementInjector

Screen 1

Department Changes

Final Evaluation


45/79

Group B

Quality control

Research

Senior m t.

Cont.

Marketing

Strate ic

Planning


46/79

a oes e nnova on unne your company oo e

.

- Where do new ideas come from

-

- Who is involved in these decisions?

2. Draw a diagram of the innovation funnel that captures these characteristics

3. Provide examples of projects that are in the funnel

Beready

to

present.

Th f t f l


47/79

The erfect funnel

Screen 1 Screen 2

Individual projects goals:

a. Timing

Product vision

Business model

Product spec.

Business case

. u ge - cos spenc. Performance

Innovative ideasfrom

Customers and

Engineering

ManufacturingSuppliers etc.

Pre - developmentInvestigations

DevelopmentProjects

Source: Wheelwright & Clark


48/79

e ea nnova on unne

ase ase ase aunc

Each phase is cross-functional

In each phase information is gathered to drive uncertainties down.

Each phase costs more than the preceding one: incremental commitment


49/79

The Ideal Innovation Funnel

Defined separation between stages: Clearly defined

Senior managers engaged at the right time

,

organized way so that they turn into products A continuous rocess:Does this it with our strate ?

A picture of the business: an overview of the shape of the

i eline Gives teams the freedom they need between gates


50/79

Example stage-gate innovation process

Validated

concept

Defined idea Developed

Innovation

Piloted

Innovatio

Defined concept Available

Innovatio

12 3 4 5 6q #" ; ProductService

Capture Definitiononcep

Validation Development PilotLaunch

ProcessStrategy

Market

G1 G2 G3 G4 G5 G6

GO TO CONCEPT GO TO VALIDATION GO TO DEVELOPMENT GO TO PILOT GO TO LAUNCH LEARN

Example: Gate Selection Criteria


51/79

p

GatekeeperGatekeeper

GatekeeperGatekeeper

Idea

Generation

Feasibility Capability Launch &

Rollout

Contract

Launch

Proposal

Post Launch

Review

ar er

SELECTION CRITERIASELECTION CRITERIA

Key consumer needs identified.

SELECTION CRITERIA

Concept, product and packaging Product and Marketing mix

elements successfull meet Criteria Product ideas meet identified consumer

need, can be successfully communicated and

delivered, and are perceived to be unique

and different by consumers

Ideas pass strategic fit assessment:

standards.

Satisfactory assessment of practical

feasibility, and financial viability of

formulation, packaging, supply

chain, customer and total project

previously defined action

standards.

Safety requirements satisfied.

Capital proposal has been

implemented.

may change

depending Fits portfolio

Potential to strengthen a priority brand

Potential to be deliverable

Can pass minimum financial criteria (Pay-

Back Mar in Contribution

Capital expenditure proposal ready

Human resource and other resource

requirements are acceptable.

Defined and agreed action standards

for consumer tests to pass Stage III.

Key functional areas approve

launch plan.

Total project is commercially

viable and fits company plan.

on strategic

intent!

Project fits product line architecture.


52/79

a ng a unne wor

Formally:

Pacing the funnel to the needs of the business, not theother way around

Involving key decision makers early

Informally: Leadership: tolerating high respect, high conflict

debate

rust: ut t s wou on y wor we to t e trut

Consistency


53/79

But .

y w a cr er a o we ma e ec s ons a e

gates?


54/79

Usin decision tools that allow ou

to compare initiatives against each

ot erMaking gates effective


55/79

Choices

Benefit measurement methods- cor ng mo e s

- Checklists

Financial or Economic Tools:

Use at earlier Gates

IRR & NPV Decision Trees

Use at later Gateswhen more reliable

mu at ons

Option pricing

Risk vs Return Bubble dia rams

a a s ava a evalue

Portfolio Concepts: The Aggregate Project

Seeking the right

balance

Scenario Analysis

Checklist from the Dutch waste processing company AVR


56/79

Strategic fit of the project

Market attractiveness

Technical feasibility

Compliance with our investment rules

Is there sufficient budget

Should haves

Are we beating the competition

Contribution to turnover/salesContribution to our image

Risk vis--vis our current processes

Synergy e ects

Benefits for the environment

Scoring Card AVR


57/79

Weight Score Bottom Value Result

Financial

IRR

Sensitivity of IRR

Payback

Share in sales

Market

Market opportunity

Market size

Competitive advantage

Sustainability of this advantage

Innovativeness

Strategic

Fit

Strategic importance

Risk vis--vis current processes

Technical

Technical feasibility

Available technical knowledge

Reinforcement of competencies

Enlargement of portfolio

Remaining

Required permissions

Improvement of company image

Challenge for employees

Benefits for the environment

Total Score


58/79

Good for

Supporting exploratory initiatives

ompex, mu -s age, pro ec s

Relative ranking and selection

Must give way progressively to hardervaluations as projects mature


59/79

reat lace to be in but a terrible lace to inish?

StrengthsWeaknesses

A focus on the orces a ocus on t e

numbers

and benefits of the

eg ec s e ro e o

uncertainty

Allows for easyconsiderations

ranking and between projects


60/79

But rated lowest by users for decision-making

Market outcomes poorly predicted

Sin le oint rediction ives a s urious feelin ofaccuracy

Problems in use

Bias against novelty

eas re a e w en mos nee e - n eary s ages May fail to value management options


61/79

The businesses with the poorest performingportfolio rely almost exclusively on

- Cooper, 2001, 218


62/79

ere s w y

Procter and Gambles two-in-one conditioner and

shampoo technology platform is a technologicalbreakthrough. It has spawned winning products such

as Pert and Pantene.

The program did not pass the financial criteria applied to P&G

projects, because it was such an uncertain and high-risk project

-


63/79

ere s w y

Procter and Gambles two-in-one conditioner and

shampoo technology platform is a technologicalbreakthrough. It has spawned winning products such

as Pert and Pantene.

The program did not pass the financial criteria applied to P&G

projects, because it was such an uncertain and high-risk project

-


64/79

Decision Trees

Pros Cons

Incorporates decision making and

uncertainty

Trees can become complicated with

many decisions and uncertainties

Determines optimal decisions

Transparent and easy to understand

Essentially limited to discrete

decisions and discrete characterizationof uncertainties

Building block for other more

complicated valuation methods


65/79

n ainvestment

os e youtcome

-$15M +$10M

-$6M

NPV@12% =-$6m -$15m/1.12 +$10m/1.122 =-$11.4m

Decision tree approach


66/79

Initial R&D R&D Launch Market

nves mendecision

ou come

-

0.3

probability

yes good0.6

-$6M

-$15M +$10M

poor.

-$15M -$60M

no

Option/Decision tree approach


67/79

Initial R&D R&D Launch Marketoutcome

decisionyes

excellent -$15M +$60M

0.3

yes

no

goo0.6

-$6M But what are the

nopoor

.

Option value (ECV)= -$6m - 0.3 $15m + 0.3 $ 60m =$7.5m

no

(from -11.4)


68/79

Why is an option valuable?

Thinking of investments as options values

Delaying investment until there is more


69/79

Risk-reward bubble diagram

Aggregate Project Planning Tools

Risk-Return Bubble diagram


70/79

HighAuto Seal

ss

PearlsBread and Butter

TP-40

Grade A Sealant

al)SuccDeck

Coat

Top FloorD-50

U.V.Seal

(Tec

hni

Reward - Return

02468$10M

T-400

ability

oSolvent 800Top Coat A Solvent 1

Edge Coat

ProOysters

Circle size = resources (annual) ColorWhite Ele hants

Top SealFirst

Coat

70

an a ng = pro uc

Cooper et al., 2001

ne


71/79

Entirely new

benefit Improvement No change

ar e ng mpac

Radical Breakthrough (10%)

Technology Platform(30%)

eacDerivative (60%)

Off the shelf ro uct Support

C/T Matrix - Balancing the portfolio


72/79

Portfolio clustered top leftConsumer Value PerceptionEnablingTechnology

NewCoreProduct

NewBenefits I mprovement V ari ant

No Change(Business benefitonly)

Consumer/Technology Matrix

high-risk upper left hand area of the matrix. This does not fit well witha strategy for an existing business as it exposes the business to therisk of potential launch failures and, at the same time, fails to support

existing brands through less ambitious brand support projects.

Radical

Incremental

Base

NextGeneration

:

reakthrough

Platform

Derivative

Brand Support

Consumer Value Perception

ology

APPINTR.ppt 6/1/95

Bubble Size Indicates

Resource Demand or

expected NPS

cae:

HighMed

Low


EnablingTechnology

NewCoreProduct

NewBenefits

Radical

I mprovement V ari antNo Change

(Business benefitonly)

Breakthrough


This portfolio could potentially illustrate a scenario in which a

business follows, rather than leads, the market and / or does notinvest adequately in support of its brand through technology orproduct innovation.

Enabling

Tech

Incremental

Base

NextGeneration

BubbleSize IndicatesScale:

Platform

Derivative

Brand Support


APPINTR.ppt 6/1/95

Resource Demand or

expected NPS

HighMedLow


EnablingTechnology

NewCoreProduct

NewBenefits

Radical

I mprovement V ari antNo Change

(Business benefitonly)

Breakthrough


There is no ideal but, generally a well balanced portfolio will tend tobe distributed along the diagonal top left - bottom right.Ena

bling

Technology

Incremental

Base

NextGeneration

Bubble Size IndicatesScale:

Platform

Derivative

Brand Support

APPINTR.ppt 6/1/95

Resource Demand or

expected NPS

gMedLow

Before: Medical Products Co.makes an automated diagnostic system that contains three components - electro optical hardware, software


73/79

Process Changes

g y p p

and a disposable panel for bio material.Very small

New Core

ew ore ext nge unng an oProcess Generation Dept. Incremental Change

Process Upgrade Improvement

competitors

were investing

heavily

Product

Next generation

Product

Changes

EARTH FIRE

CALIFORNIA

of Core Product

Addition to ROME V ROME I ROME III

NEW YORK

SPARROW

Not a single

new

latform inProduct Family

Add-Ons and

FINCH

SIGMA

CROW

DELTA O

ROME IVROME VI

KENYA

SUMMER

OWL ROME II

GEMINI 1-10 (10 PROJ ECTS)

7 to 8 years

En ancements

No Change ROLAND

HAWK

LEO

OAK

CEDAR

PINE

SOLSTACE

SPRING

WINTER

FALL

DALLAS

AUSTIN

SANTA FE

FLAGSTAFF

increasing

functionality and

features, counter

DERIVATIVE / CPSB-THROUGH / PLATFORMto what

customers wanted

After: Medical Products Co.


74/79

Process Changes

New CoreNext Single Tuning and NoGeneration Chan e

New Core

Product

.IncrementalProcess Upgrade

ALPHA

Next generation

of Core Product

Changes

VENUS

GAMMA

Addition toProduct Family

MARS

ZEUS ATLANTIS

BETA

Add-Ons andEnhancements

DELTA I

SIGMAROLAND

DELPHI

PINE

DELTA

No Change

DERIVATIVE / CPS

CLEO

B-THROUGH / PLATFORM

LEOROME I

OAKROME II

ROME III CEDAR

Within one year of implementing APP, the companys product developmentrestructuring process had the following effects...


75/79

Eliminated all but one of the breakthrough projects, and subsequently eliminatedall breakthrou hs.

Eliminated a lot of derivatives and feature enhancements that werent adding

value to customers.

New partnered platform project:

Outside companies are doing the hardware and software components.

e c ent company s o ng t e o components.

Sufficient amount of resources have been allocated to ensure that the projectis ade uatel staffed to meet all ro ect re uirements.

Focus Development efforts to be in line with core competencies and establish

alliances to do all other tasks outside their own business.

Results:

ut spen ng rom mm to mm.

Less Is More:


76/79

Medical Products Co.

21

8

5

e ore er# of Projectsin Portfolio

e ore er# of ProjectsLaunched /Year

By focusing their innovation efforts they saw more product launches in 1993 than 1992, even though they

had fewer projects and spend fewer dollars.


77/79

BenefitsofanAggregateProjectPlan:

Explicitchoice

of

projects

balances

the

long

and

short

term,

allows

for

theexplicitdiscussionofthematchtostrategy

Match between ro ect t e and or anizational form allows for a

focusonthegenerationofcompetence

Focusbuildsspeedandproductivityfortheindividualandtheorgan za on


78/79

Eight

steps

of

the

Aggregate

Project

Plan:

Defineprojecttypesaseitherbreakthrough,platform,derivative,R&D,

orpartnershipprojects

Estimatetheaveragetimeandresourcesneededforeachprojecttype

based on ast ex erience

Identifyexisting

resource

capacity

Estimatethenumberofprojectsthatexistingresourcescansupport

ec ew c

spec c

pro ec s

opursue

Worktoimprovedevelopmentcapabilities


79/79

Thankyou

Prof.Dr.CarlaI.Koen

MMO-Managing Innovation Koen

Documents

Transcript of MMO-Managing Innovation Koen