Professor Peter Kawalek - MAS2011 Presentation

8/6/2019 Professor Peter Kawalek - MAS2011 Presentation

1/41

Professor Peter Kawalek

Professor of Information Systems, Manchester Business

School


2/41

Innovation and Social Media: Impact

On Product Development andMarketing

Peter Kawalek,

Professor of Strategy & Information Systems,Manchester Business School


3/41

1. Innovation as a whole.

How new markets are created and

then won.

2. Open Innovation.

and online platforms.

3. Emerging Markets


4/41

Innovation

4

Innovation is not the product of

logical thought, even though the final

product is tied to a logical structure

Albert Einstein


5/41

In a nutshell

5

This world is changing = GLOBALIZATION!!

The net makes contact cheap

Companies are already (long since) using the web to build in

emerging markets


develop innovation

With online communities, theres a chance to do something special

(given sufficient good thinking, design etc).


6/41

1. Innovation as a whole.

How new markets are created

and then won.


7/41

Technology & Innovation

Level of product

or service sophistication

offered by the market

New service

developing indefined market

segment

Level of

sophistication

required by

customers


8/41


Mainframe computing

PC

People only

really interestedin word-processing


9/41


The heavyweight motorcycle

market

50cc lightweightengines

Off-road, leisure

market


10/41

Social Inclusivity / Extending Markets

Motorcycle Engineering

iPad & Indian $35 iPad

Forms of Alphabet


11/41


Television

You Tube

Teenagers using

computersat home


12/41

Diffusion Curves


13/41

Diffusion Curves

This from Geoffrey Moore. Original studies

by Everett Rogers.


14/41

DISRUPTION

T

echnology adoption takes place within market formed by disruption

Next disruption. When will it strike?


15/41

2. Open Innovation.

and online platforms.


16/41

Fashion

Films

Automotive


17/41


18/41

What is Closed Innovation?

Invention is the source of advantage for the firm

Firms maximise (and guard) inventions

Closed process, inward looking

How to succeed in three steps (Conant, 2002):

1. Pick Genius

2. Give them money

3. and leave them alone!

Examples Menlo Park, Bell Labs, PARC, TJ Watson

18


19/41

Closed Innovation Paradigm

19


20/41

Drivers for Open Innovation

Increasing R&D costs

Growing complexity of R&D projects

Shortening Technology Life Cycles

Knowledgeable Suppliers and Clients

Availability of Venture Capital

Diffusion of leading edge knowledge between Universitiesand Research laboratories

20


21/41

Open Innovation

21


22/41

US Industrial R&D Spend by Firm Size

Firm Size

(Employees)1981 1989 1999 2001

< 1,000 4.4 9.2 22.5 24.7

1,000 4,999 6.1 7.6 13.6 13.5

5,000 9,999 5.8 5.5 9.0 8.8

10,000-

24,999

13.1 10.0 13.6 13.6

> 25,000 70.7 67.7 41.3 39.4

22

Source: National Science Foundation, Division of Science Resource Statistics

Research and Development in Industry Arlington, VA (2001)


23/41

Open Innovation Economics

Innovation efficiency

Reduce internal R&D costs

Shorter cycle times

Generate new revenue streams from:

Licensing

Spin-offs

Sales/divesting

23

Chesbrough, H. (2007) Sloan Mgmt Review 48, (2) p21


24/41

Open Innovation Examples

Open Source Software

P&G

IBM Virtual Worlds Online platforms e.g. SAP, Microsoft

Many others

24


25/41

Open Innovation and Business Models

25


26/41

Secondary Markets for Innovation

26 Emerging Secondary Markets for IP, NCIPI Research Report ( 2006)


27/41

Innovation Networks

Firms network position explains performance (Gulati, 2000)

Network experience linked to innovation (Powell, 1999)

Recent study of the US software industry shows complexity of

networks is increasing but NOT within vendor eco-systems(Iyer, 2006)

Are Innovation Networks Strategic nets or Emergent

Networks?

Orchestrators, Platform Leaders

new innovation enablers? Route to market is a very important source of innovation

(especially for business models)

27


28/41

Open Innovation Bottom Line

Organisations can create value in TWO ways:

(1) Innovating new products and services (2) Developing new ideas and selling to others


29/41

15/10/2008 29

SAPs EcosystemSAPs Ecosystem


30/41

15/10/2008 30

SAPs Rising CommunitiesSAPs Rising Communities


31/41

15/10/2008 31

Community Metrics

Community Network (SDN+BPX) currently > 1.2 million total members Growing at 20K-25K per month

Members from >200 countries and territories worldwide

Record-high member satisfaction: 4.32 on a scale of5

~6,500 posts per day in discussion forums 200 major topic categories

~800,000 discussion threads 4 million posts total so far

It took three years to reach first million, nine months to reach the second million, and just sixmonths to reach the third million forum posts

~17 minutes until first response/answer to a question, on average

Typically 3-4 answers to each question, on average

84% of all discussion threads are closed as complete

>1,600 bloggers, 80% non-SAP but customers, partners and third party thought leaders

Core contributors power the community ~70 SAP Mentors, 100,000 Lifetime Contributors, ~10%

>1,000,000Total Community Members


32/41

15/10/2008 32

SAP Community Platform

Dedicated Spaces,

Tools and

Technologies:

SDN

BPX

Business Objects

Discussion Forum

Wikis

Blogs

Articles

Downloads

eLearning

Events

InnoCentive

Subscriptions

https://www.sdn.sap.com/irj/sdn/index


33/41

15/10/2008 33

Contribution Recognition Program

Contribution Points Awarded

Weblog / Podcast / Video Blog

Exceptional weblogs will earn

points in the Technical Article

range.

After a period of 5 days the weblog will be reviewed and can earn

between 0 and 120 points.

Video Blogs are awarded between 100 and 300 points.

Weblog Comments Generally, no points

Technical Article Up to 120 points are awarded for each original document submitted and

accepted for publication. Documents include: articles, how-to-guides,whitepapers, and FAQs.

Code Sample

Exceptional code samples may

earn additional points at the

discretion of the staff based on

community evaluation.

10 points are awarded for each code snippet published.

40 points for each code tutorial published.

eLearning Content Up to 120 points are awarded for demos and up to 200 points for

eBooks and eClasses

Wiki Contributions Adding a link awards 1-2 points, correcting spelling and formatting 1-5

points, while adding sentences or paragraphs gives 1-10 points and

creating a new page with content awards 10-40 points.

Referring a New Member Awards 20 points (limited to 5 members a week)

Forum Posts 2, 6, or 10 points maybe awarded for forum posts replying to existing

threads marked as questions. Points are awarded at the discretion of the

poster of the original thread.

Posts initiating threads that award points for helpful answers will award

the poster1 point.

To recognise

the valuable

contribution of

the mostactive

members

The 250-point

milestonesignifies users as

Active

Contributors


34/41

15/10/2008 34

Participation Behaviour

Membership roles:

Consumer

Participant

Contributor

Active Contributor

Top Contributor

Community Influencer

SAP Mentor


35/41

15/10/2008 35

Community Value

The strength of the community lies in the

collaboration they foster

Value is translated into Exclusive Content

Connectivity

Rich Assets Careers Enhancement


36/41

3Emerging Markets.


37/41

15/10/2008 37

Emerging Markets

The reach of the web for marketing.

Involvement in open innovation through thefunnel.


38/41

15/10/2008 38

Emerging Markets

Sourcing

Local market testing Development e.g. apps developers in India


39/41

15/10/2008 39

Emerging Markets

India R&D Innovation:

GE, Cisco traditional relocated

Xerox partnership hub

Online communities - virtual


40/41

In a nutshell

40

This world is changing = GLOBALIZATION!!

The net makes contact cheap


emerging markets


develop innovation

With online communities, theres a chance to do something special

(given sufficient good thinking, design etc).


41/41

Acknowledgements:

Dr Steve Moxey & Georgia Demetriou,Manchester Business School.

Email [email protected]

Professor Peter Kawalek - MAS2011 Presentation

Documents

Transcript of Professor Peter Kawalek - MAS2011 Presentation