TTMG 5001 Principles of Management for Engineers Section P Session 1: Sep 10 Fall 2007
TTMG 5103 Module Innovation and business models Pulak Choudhury TIM Program, Carleton University...
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Transcript of TTMG 5103 Module Innovation and business models Pulak Choudhury TIM Program, Carleton University...
TTMG 5103 Module Innovation and business models
Pulak Choudhury
TIM Program, Carleton University
June 19, 2009
Agenda
Objectives
What will be learned
What can be done
Innovation
Necessity of innovation
Innovation strategies
Innovation facts
What is not innovation
What is innovation should do/should be
Business model
Business model design process
Business model innovation
Three step roadmap
Business model innovation matters
Ex1 – AMIES
EX2 – NOKIA’s all-you-can-eat
EX3 - SHAZAM
Innovation and business model
Moment of truth
Lessons learned
References
Objectives(1)
What will be learned
A detailed view of the innovation
Alchemy of business model
Relationship between innovation activities and business model
innovation
A new way of doing business - with new values, vision,
strategies, system and structures
Objectives(2)
What can be done
How to spark the disruption
Maximize the reach of the technology and an comprehensive value
network
Identify and improve your business model
Agenda
Objectives
What will be learned
What can be done
Innovation
Necessity of innovation
Innovation strategies
Innovation facts
What is not innovation
What is innovation should do/should be
Business model
Business model design process
Business model innovation
Three step roadmap
Business model innovation matters
Ex1 – AMIES
EX2 – NOKIA’s all-you-can-eat
EX3 - SHAZAM
Innovation and business model
Moment of truth
Lessons learned
References
Innovation
Innovation is the ability to come up with
something new that somehow facilitates a task
or endeavour
Innovation is purposeful and should be the
result of an occurrence, a need or an event
Innovation is progress
Necessity of innovation
To grow the business
To address a particular target market where they
see a major competitive threat or opportunity
To reinvent the business model for a tougher
economic environment
Innovation seems to be the key to success in
product development
Agenda
Objectives
What will be learned
What can be done
Innovation
Necessity of innovation
Innovation strategies
Innovation facts
What is not innovation
What is innovation should do/should be
Business model
Business model design process
Business model innovation
Three step roadmap
Business model innovation matters
Ex1 – AMIES
EX2 – NOKIA’s all-you-can-eat
EX3 - SHAZAM
Innovation and business model
Moment of truth
Lessons learned
References
Innovation strategies
Inventive
First to market
Doesn’t necessarily lead to success
Innovation strategies
Adaptive
Not the first but the best
Can work but can fail in industries with short
product life cycles or network effects
Innovation strategies
Economic
Low cost producer
Usually requires lots of manufacturing innovation
Innovation strategies
Innovative applications
Creative use of existing technologies
Innovation facts
What is not true about innovation
being innovative can be a costly venture for a
business Innovation means reinventing the wheel Big ground-breaking ideas or technological leaps
forward The outcome of R&D department or smart people
Innovation facts
What innovation should be Making changes to the established way of
doing things, which can result in a new product
Planned and managed as a core business process covering all parts of a business
Be done at a fraction of its previous cost and with quick, powerful results
Agenda
Objectives
What will be learned
What can be done
Innovation
Necessity of innovation
Innovation strategies
Innovation facts
What is not innovation
What is innovation should do/should be
Business model
Business model design process
Business model innovation
Three step roadmap
Business model innovation matters
Ex1 – AMIES
EX2 – NOKIA’s all-you-can-eat
EX3 - SHAZAM
Innovation and business model
Moment of truth
Lessons learned
References
Business model
A business model describes the value an organization offers to
various customers and portrays the capabilities and partners required
for creating, marketing, and delivering this value and relationship
capital with the goal of generating profitable and sustainable revenue
streams
Business model is a broad-stroke picture of how an innovative
concept will create economic value for the ultimate user, for the firm
and its shareholders and partners
Business model contd.
Considers the infrastructure required to move the product/service to the market in a manner that it both easy and convenient for customers and profitable for the firm
Business model design process
Identify interdisciplinary stakeholders -> set-up team Understand (business) environment –> frame
problem Suspend reality -> imagine Bring ideate to reality -> prototype Chose suitable design -> decide Execute -> project portfolio Evaluate, learn and redesign -> manage
improvement
Agenda
Objectives
What will be learned
What can be done
Innovation
Necessity of innovation
Innovation strategies
Innovation facts
What is not innovation
What is innovation should do/should be
Business model
Business model design process
Business model innovation
Three step roadmap
Business model innovation matters
Ex1 – AMIES
EX2 – NOKIA’s all-you-can-eat
EX3 - SHAZAM
Innovation and business model
Moment of truth
Lessons learned
References
Business model innovation
Innovation does not always rests in the technology or product or service, but
in the business model itself
Business innovation refers to the creation, or reinvention, of a business itself
Think outside-of-the-box
Can we describe it ? No? we need to discuss it
Can we discuss it ? No? because is no common language
Can we improve it ? No? we do not have the proper tools
implement it
Business model innovation
Figure: 4 areas need to looked at while innovating a business model
Business model innovation
Figure: 9 building blocks of business model
Three step roadmap
Begin by considering the opportunity to satisfy a real customer need
Construct a blueprint for how your company will fulfill that need profitably
Compare that model to your existing model to determine how much change will be required to capture the new opportunity
Business model innovation matters (1)
AMIES st.
Fisrt gives away song for free
Number of download started to incrase
So AMIES’s startd to charge and increase
Business model innovation
New talent discovery
New distribution channels
Increased revenue streams
Agenda
Objectives
What will be learned
What can be done
Innovation
Necessity of innovation
Innovation strategies
Innovation facts
What is not innovation
What is innovation should do/should be
Business model
Business model design process
Business model innovation
Three step roadmap
Business model innovation matters
Ex1 – AMIES
EX2 – NOKIA’s all-you-can-eat
EX3 - SHAZAM
Innovation and business model
Moment of truth
Lessons learned
References
Business model innovation matters (2)
Nokia launching ‘all-you-can-eat’ music service
Pay a monthly service
Listen as much as you want
Business model innovation
Building a new platform
Leveraging a brand
Recurring revenues
Business model innovation matters (3)
Shazam SMS
You hear a tune you like but don’t know the title or artist..
Dial a number
Hold your phone to the speaker
Get the title and artist by SMS
Business model innovation
Productive innovation
New channels
New revenue streams (communication, SMS charges, sales commission)
Innovation and business model
Innovation is needed to spark the disruption
where a new business model is then needed to
maximize the reach of this innovation and to
evolve an comprehensive value network to
support it Innovation needs to be linked to strategy and
the business planning process Innovation without a proper business model is
like a ‘Missile looking for a target’
Mistakes we make
Businesses tends to stay in their conservative box and not become more creative
Sometimes we hold up innovation by concentrating on the wrong thing at the start
Sometimes it’s because of the anchors and frames of the way we do things
Moment of truth
Discussions
Comments
Agenda
Objectives
What will be learned
What can be done
Innovation
Necessity of innovation
Innovation strategies
Innovation facts
What is not innovation
What is innovation should do/should be
Business model
Business model design process
Business model innovation
Three step roadmap
Business model innovation matters
Ex1 – AMIES
EX2 – NOKIA’s all-you-can-eat
EX3 - SHAZAM
Innovation and business model
Moment of truth
Lessons learned
References
Lessons learned (1)
Don’t focus on the business model at the outset but instead concentrate on the value they create
Work on useful things Solve problems Create value
Lessons learned (2)
Make something that is worth while and people will pay you for it
Figure out what you’re good at making and then make them well. You will make money as a result.
References
Johnson, Mark, Christensen, Clayton, Kagermann, Henning. Reinventing your
business model, Harvard Business Review, December 2008 http://www.slideshare.net/Alex.Osterwalder/business-model-innovation-matter
Knowing in advance how you’re going to make money from snake oil may sound like you have a business model; what you have is snake oil. And that’s the problem you need to concentrate on first, the fact that you’re not creating anything of value.
Fedex right turn