SBE 330 Week 1 Discussion Question 2 – Innovation, Strategy and Purpose

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SBE 330 Week 1 Discussion Question 2 – Innovation, Strategy and Purpose Two companies: 1) Large, well established company in mature market (think oil & gas, etc) 2) New start-up in growing & ... emerging market (think software app development, etc) Which of the two do you believe has a better opportunity to provide innovative products, processes, & ideas? Why? I like the well established company, maybe because I work for one of those, but also because of the resources available to them. A well established company has the resources to take the chances that a start up cannot afford to take. Our company can take a risk & allocate resources to a market, if that market or product does not pan out, then we have the size & the ability to take the hit. Many start ups either cannot afford to take the risk or if they do & fail they do not have the capital to come back. Our Parent company operates in the billions & gives us the resources to invest in emerging technologies. This enables us to research technologies in many different areas, knowing that may be only one or two will produce products that will make it to market. Definitely an advantage to us ! Week 2: Identifying Opportunities for Innovation - Discussion Characteristics of Innovation Opportunities (graded) What are the characteristics that define incremental/do better innovation, radical/do different innovation, & existing frame/new frame innovation? Which innovation activity is the most risky, & why? Responses Responses are listed below in the following order: response, author & the date & time the response is posted. Response Author Date/Time W Professor Chao- ee Hrenek 3/9/2013 11:34:30 AM k 2 - C h ar ac te ri st ic s of In n o v at io n O p p or tu ni ti es R Jane Sanders 3/10/2013 9:04:13 PM E : W e e k 2 - C h a r a ct e ri st ic s of I n n o v at io n O p p o rt u ni ti es Modified:3/10/2013 9:15 PM I believe the radical innovation is the most risky because there is no history, experience or product affiliation to refer to. Everything is new & unproven. The cost is great to research,test & market something radical & there is no certainty of any level of success. R Savanah Shettel 3/11/2013 1:46:36 PM E : W e e k 2 - C h a r a ct e ri st ic s o f I n n o v a ti o n O p p o rt u n it ie s - Jane, thank you, I completely agree. With radical innovation you are starting from scratch basically & you have no past experience to predict how it will do. It’s just like starting your own business. Unless you’ve somehow tested it before you have no idea how you are going to do. Going back to our case study last week, when apple introduced the iPod & iTunes. They had no idea that this was going to be a huge success. They just noticed a need for something of the sort & ran with it. Obviously ending up to be a huge success, but they did not know that to begin with. Could you use new company budgets as a radical innovation? It’s not new, yet if they are a new business, they have to previous record & they are starting from scratch. Thoughts? R Amanda Rutto 3/14/2013 9:32:59 PM E : W e e k 2 - C h a r a ct e ri st ic s o f I n n o v a ti o n O p p o rt u n it ie s Savannah I think you made some great points here as well. Especially that with radical innovation you are starting completely from scratch & therefore causing more concern about the outcomes, merely because there is absolutely no past experience with this certain thing to learn from. I think that these facts are often the cause of failure as well. Some people do not do proper research & trail & error runs to determine if what they are trying to bring is worth the try, if it could take to the public or if it is actually useful in some way. I think that it is always important to do as much research as possible in order to just get an idea organized & thought out well enough to execute. R E : W e e k 2 - C h a r a ct e ri st ic s Savanah Shettel o f I n n o v a ti o n O p p o rt u n it ie s 3/16/2013 12:44:43 AM Amanda- I also think it is so very important to do as much research as possible before executing the new idea. If you don't know what you are doing are start is anyway then you are taking a big step blind to the risks & what could go wrong. If you don't know the risks, then how can you avoid them? Its like what they say about history; we are taught about history so we aren't apt to repeat it. If we aren't taught about the mistakes others have made in the past, then we have no idea how to avoid it in the future. This is the same with innovation; if you do not get knowledgable about the risks & everything about what you are doing, then there is a big chance you will not succeed. R Kathryn Curry 3/17/2013 1:29:10 PM E : W e e k 2 - C h a r a ct e ri st ic s o f I n n o v a ti o n O p p o rt u n it ie s Amanda & Savanah, Part of the process is not only to figure out what works but also what doesn't work. Part of the success is overcoming your expected failures, wherein lies the high risk. This is where the prototyping & "probe & learn" tools & methods come into play. Although new frame innovation also carries some of these risks, it still involves a restructuring of the known, whereas radical innovation is the research & development of the untried & unknown. I would agree that radical innovation carries the highest risk & think you both made some excellent points. RE: Week 2 - Characteristics of Innovation Opportunities Christine Klosterman 3/15/2013 7:56:26 Thank you ladies for explaining this, it helps a lot. R Kathryn Curry 3/17/2013 1:42:44 PM E : W e e k 2 - C h a r a ct e ri st ic s o f I n n o v a ti o n O p p o rt u n it ie s Savanah, I'm not sure I understand your last question regarding new company budgets. If you mean the budget being projected by a new company, then it would depend on the type of company; is it new to an existing market or is it entering a new & untried market? If you mean a new budget structure for an existing company, then are they deviating slightly from previous budgets, copying other company's budgets or trying something completely different & new? My understanding of radical innovation is something new & untried or unknown. I would not think that a budget for a company new to an existing marketplace would not fall into this category. Neither would a budget for an existing category entering a previously unknown marketplace. I would think that the budget for a new company specifically being structured to serve a radically innovated market might qualify. You pose a very interesting question though, what are your thoughts? RE: Week 2 - Characteristics of Innovation Opportunities Timothy Caruso 3/11/2013 2:22:10 PM I agree with this statement. You really play a 50/50 odd when doing a radical innovation, & o investors it can come across as a desperation move. R E : W e e k 2 - C h a r a ct e ri st ic o Professor Chao- 3/11/2013 4:52:15 PM f Hrenek I n n o v a ti o n O p p o rt u n it ie s Timothy & All: This is a chance to refine our view of innovation activities & to develop an appreciation of the level of risk associated with different classes of innovation projects. A you develop your responses, please refer to our text and, as appropriate, other sources of quality information. Who wants to go first? Dr. Chao-Hrenek RE: Week 2 - Characteristics of Innovation Opportunities Natalya Borodina 3/12/2013 5:45:29 I would have to agree with my class mates. radical innovation is significantly different processes that do not have past failed or successful attempts to refer too therefore making it a much riskier investment. RE: Week 2 - Characteristics of Innovation Opportunities Shirlina Knight 3/12/2013 9:22:01 PM Jane I agree with your response. to add, radical characteristics, due to being new, have not acquired brand loyalty, brand image, & the brand name has not been established. Due to the lack of the aforementioned as well as the extensive costs for R&D, these type of innovation opportunities can end up being a hit or miss. Radical/do different characteristics, require extensive marketing in order to push the new product, service or concept to the consumers. R Rosa Stewart 3/13/2013 7:40:26 PM E : W e e k 2 - C h a r a ct e ri st ic s o f I n n o v a ti o n O p p o rt u n it ie s Modified:3/13/2013 7:43 PM Maybe I have a misunderstanding of the information concern incremental & radical offering --Can a product start with similiarity of the older model but lead into something new or something difference... my example is PERTEXT-Windows Vista replacing XP – essentially improving on an existing software idea-to a New to the world software – for example, the first speech recognition program. PERTEXT-Windows Vista replacing XP – essentially improving on an existing software idea-to a New to the world software – for example, the first speech recognition program. Pertext-VW EOS replacing the Golf – essentially improving on established car design to Toyota Prius – bringing a new concept: hybrid engines .Per text LED-based lighting, using completely different & more energy efficient principles . ( RE: Week 2 - Characteristics of Innovation Opportunities Christine Klosterman 3/13/2013 10:53:33 PM I agree with Jane, I think it is the most risky also because we are testing the unknown anything new is taking a chance. However, we will never know unless we try so taking the risk is worth it either way. RE: Week 2 - Characteristics of Innovation Opportunities Jamarr James 3/12/2013 9:30:02 PM I believe a radical innovation carries the most risk. "A radical innovation will require completely new knowledge and/or resources & will be, therefore, competence-destroying. A radical innovation will involve large technological advancements, rendering the existing products non-competitive & obsolete." Source: http://innovationzen.com/blog/2006/08/04/innovation-management- theory-part-2/ R Alritta Sanders 3/13/2013 12:26:08 PM E : W e e k 2 - C h a r a ct e ri st ic s o f I n n o v a ti o n O p p o rt u n it ie s Radical innovation is often defined as the commericalization of products & technologies that have strong impact on two dimensions: 1. the company, in terms of its ability to create new businesses, & 2. the market, in terms of offering new customer benefits relative to the previous product generation in the category. For example, Amazon.com is internet based approach to selling books enabled it to offer many more books than a traditional book store, this ultimately led to a number of the traditional book stores going out of business. As of 2010 Amazon was that largest online retailer in the U.S. RE: Week 2 - Characteristics of Innovation Opportunities Rosa Stewart 3/13/2013 7:47:06 PM PER TEXT-By contrast taking a leap forward could bring big gains – but also carries higher risk. Since we are moving into unknown territory there will be a need to experiment – & a good chance that much of that experimentation will fail. We won’t be clear about the directions in which we want to go & so there is a real risk of going up blind alleys or getting trapped in one-way streets. Essentially the kind of searching we do – & the tools we use – will be different. (Tidd 249) Tidd, John Bessant & Joe. Innovation & Entrepreneurship, 2nd Edition. John Wiley & Sons, (UK), 04/2011. <vbk:9781119961987#outline(8.3.1)>. R Professor Chao- E Hrenek : W e e k 2 - C h a r a ct e ri st ic s o f I 3/14/2013 1:24:51 PM n n o v a ti o n O p p o rt u n it ie s Needs & Wants - Opportunities - Hello All, very good arguments & comments came this week requiring to Needs & Wants in relate to opportunities. Most people will have the same argument when this question is asked. Yes, you are absolutely correct that human only needs the basic needs to live. Yes, when we give some thoughts on this question from business, market, & product strategy's perspective, we will have the iPhone 5 example like you stated. For example, can we create a "need" for people that need to drive an hour to work? Thoughts? R Christine E Klosterman : W e e k 2 - C h a r 3/15/2013 7:29:49 PM a ct e ri st ic s o f I n n o v a ti o n O p p o rt u n it ie s I never thought about creating a need, but that is a pretty out of the box way to think. I suppose we could create a need for just about anything. For an hour drive maybe we can create some sort of music player, a drink to keep us awake, or some kind of entertainment that makes the drive more enjoyable. R Kathryn Curry 3/17/2013 1:51:34 PM E : W e e k 2 - C h a r a ct e ri st ic s o f I n n o v a ti o n O p p o rt u n it ie s Christine, I would agree with you that a need can be created for just about anything. Take electricity as an example. A human does not actually require it to survive, yet many people would classify it as a necessity to life (as we know it), aka a need. Same with running water, indoor plumbing, owning a car if you live in a rural area; the list goes on. All of these began as luxuries & eventually became needs. As far as the hour long commute to work; just try it without a radio in the car, it totally sucks. RE: Week 2 - Characteristics Douglas Rohde 3/13/2013 9:43:16 AM of Innovation Opportunities A characteristic of incremental innovation is that it is a better way of doing something that a company is already doing. An example, as stated in case study 6, page 294, is Zara outsourcing the sewing to small local workshops instead of trying to do it themselves. & in order to make the process as smooth as possible, they pre-cut the material to the proper forms & then give simple step by step directions so that there is no misunderstanding. Another characteristic is exploitation of existing competencies & the development of new competencies. A characteristic of radical innovation is that it is new to the world. Something such as a new discovery or invention that is used to solve problems. An example would be the discovery of a cure for AIDS or a new invention that would allow cars to run without any fuel at all. R Rosa Stewart 3/13/2013 7:50:03 PM E : W e e k 2 - C h a r a ct e ri st ic s o f I n n o v a ti o n O p p o rt u n it ie s PER TEXT-For all but the smallest start-up we will be looking to balance a portfolio of ideas – most of them ‘do better’ incremental improvements on what has gone before but with a few which are more radical & may even be ‘new to the world’. The big advantage of innovation of this kind is that there is a degree of familiarity, the risk is lower, we are moving forward along a path which has already been trodden. The benefits from doing so may be small in themselves but their effect is cumulative. & the ways in which we can search for such opportunities – tools & directions – are essentially well established & systematic. (Tidd 249) Tidd, John Bessant & Joe. Innovation & Entrepreneurship, 2nd Edition. John Wiley & Sons, (UK), 04/2011. <vbk:9781119961987#outline(8.3.1)>. R Professor Chao- E Hrenek : W e e k 2 - C h a r a ct e ri st ic s o 3/14/2013 1:29:18 PM f I n n o v a ti o n O p p o rt u n it ie s Hello all, Please continue & analyze the three basic types of competitive strategy. R Douglas Rohde 3/14/2013 5:24:43 PM E : W e e k 2 - C h a r a ct e ri st ic s o f I n n o v a ti o n O p p o rt u n it ie s According to our text, in an existing frame all the players play by a shared & accepted set of "business as usual" rules. In an existing frame, those who are established do well "...because they have the resources & experience & they have built up strong networks all playing the same game" (Tidd 251). However, the comfort zone that the established players enjoy makes it even more difficult to step out of the existing frame & accept new ideas, new ways of doing business & new business models. Reframing takes them away from what they know & have accepted as well as separates them from their normal pipeline of resources. Established players not only find it difficult to "think outside the box", but often fight the concept of change. R Christine E Klosterman : W e e k 2 - C 3/15/2013 8:01:19 PM h a r a ct e ri st ic s o f I n n o v a ti o n O p p o rt u n it ie s Yes, I can see how people get trapped in a certain way of thinking & doing things when they are used to doing a certain system. It may be hard for them to think change or to plan a change, so I can see how thinking outside the box could be challenging. It may help to get ideas from other people or maybe even research other industries or similar companies to see what they are doing. RE: Week 2 - Characteristics of Innovation Opportunities Heidi Brannen 3/13/2013 12:43:22 PM Radical innovation most certainly carries the highest level of risk. The uncertainty of complete R E : W e e k 2 - C h a r a ct e ri st ic Michael Gross 3/13/2013 1:54:25 PM s of I n n o v at io n O p p o rt u ni ti es Modified:3/13/2013 2:04 PM The most risky innovation is the radical innovation. Radical innovation is the creation of a new product or service that could bring in new & huge profits. This innovation is new to the market, world, or industry which means there is no accurate background information or experience pertaining to this creation. This innovation brings high risk, a much higher risk than an incremental or existing product. According to the text, a need to experiment with the product is needed but assumptions predict it will fail (Bessant,pg.248). Information came from: Bessant,J., Tidd,J. Innovation & Entrepreneurship. (2011) (2e) John Wiley & Sons RE: Week 2 - Characteristics of Innovation Opportunities Matthew Guzman-Mercado 3/13/2013 2:32:53 PM Incremental innovation: small improvements to existing products, services or processes – ‘doing what we do but better’. Radical innovation: significantly different changes to products, services or processes – ‘do what we do differently’. Just as human beings need to develop mental models to simplify the ‘blooming, buzzing confusion’ which the rich stimuli in their environment offer them, so individual entrepreneurs & established organizations make use of simplifying frames. They ‘look’ at the environment & take note of elements which they consider relevant – threats to watch out for, opportunities to take advantage of, competitors & collaborators, etc. Constructing such frames helps give the organization some stability but it also defines the space within which it will search for innovation possibility. Risk/Innovation It’s safe to say that companies are not naturally inclined to try new approaches without clear evidence that those approaches are likely to work. Like many innovators, you may find yourself struggling to innovate in advance of an anticipated economic recovery, while still working to keep costs down in a decidedly uncertain business arena. To increase initiative & innovation, you have to encourage & even embrace failure. R Professor Chao- E Hrenek : W e e k 2 - C h a r a ct e ri st ic 3/14/2013 1:30:44 PM s o f I n n o v a ti o n O p p o rt u n it ie s Matthew & All: What are some reasons why we become blinded by what we see as an innovation opportunity & fail to identify significant risks? R Petra Jadan 3/14/2013 3:37:13 PM E : W e e k 2 - C h a r a ct e ri st ic s o f I n n o v a ti o n O p p o rt u n it ie s I think that money is a huge influence for us not to see risks in an innovation. Wanting to make money will drive us bypass any signs that we are going right in track for failure. R Randeep Singh 3/14/2013 6:07:42 PM E : W e e k 2 - C h a r a ct e ri st ic s o f I n n o v a ti o n O p p o rt u n it ie s I agree. I think money is the biggest blindfold that makes one not see the risks that stand when innovating. The biggest reason one innovates existing business is to grow & make profits. What they fail to see is the risk that is involved & the details on how to execute the plan. All one thinks about is the positive when they should also considered the worse that can happen. RE: Week 2 - Characteristics of Innovation Opportunities Douglas Rohde 3/14/2013 7:04:22 Another reason we become blinded to risk is passion. Many people love what they are doing so much that the risks are not even an issue until they encountered. RE: Week 2 - Characteristics of Innovation Opportunities Christine Klosterman 3/15/2013 8:12:12 We may be blinded by our own stubborness, pride or lack of experience & education on the idea. There can be unforseen circumstances. Also, maybe we don't want to think about failure. R E : W e e k 2 - C h a r a ct e ri st ic s Matthew o Guzman- f Mercado I n n o v a ti o n O p p o rt u n it ie s 3/16/2013 10:49:35 PM Risk is inevitable in everything we do. There may be commonplace risks that are almost inevitable, for example, the risk that a member of the team is sick for part of the project. There may be some unlikely but high impact risks, for example, the risk that the solution could cause the destruction of the organization The good Project Manager will constantly assess the risks & take action as needed. There are three possible outcomes for each risk: • take action now to avoid the risk, to reduce its likelihood, or to reduce its impact, • make contingency plans so that the team is ready to deal with the impact & mitigate the risk should it occur, • agree that it is an acceptable business risk to take no action & hope that the risk does not occur. The process for managing risks is: • identify all realistic risks • analyze their probability & potential impact • decide whether action should be taken now to avoid or reduce the risk & to reduce the impact if it does occur • where appropriate, make plans now so that the organization is prepared to deal with the risk should it occur • constantly monitor the situation to watch for risks occurring, new risks emerging, or changes in the assessment of existing risks. http://www.epmbook.com/risk.htm RE: Week 2 - Characteristics of Innovation Opportunities Kathryn Curry 3/17/2013 2:03:40 Seeing outside the box not only applies to innovation but also to risks. Although we might be able to see an innovative opportunity, is it within the box & we are only looking at the known risks? I would agree with my classmates that profits & passion are strong blinders to underexplored & underresearched risks. R E : W e e k 2 - C h a r a ct e ri st ic s Ashli Barclift o f I n n o v a ti o n O p p o rt u n it ie s 3/17/2013 3:46:12 PM The radical innovation would be the more risky approach based on further research but the benefits in most cases are worth the risk. For example, in an article on Forbes website, the writer talks about innovative ideas being both favorable & unfavorable by investors. This does not mean the process will not continue to get better. The inventors of these innovative ideas are continuing with the process of new products or services despite the risk involved. These new ideas are favorable to some investors because they see the void in the market for the type of product or service offered. The non-favorable investors view the innovation as too risky. In any instance, a risk involved does not lead to a product or service never making it to into the market. The product line would not be “killed” by risk alone; it can also be the way the product/service is introduced to the market. RE: Week 2 - Characteristics of Innovation Opportunities Randeep Singh 3/13/2013 5:19:15 PM The strategy that seems the most risky is the radical strategy. Radical innovation means that every almost every aspect of the business needs to be changed. From relationship with customers & suppliers to technology, everything is changed. This strategy is mostly risky for businesses that are established because the outcome may ruin the business & relationships with its customer & suppliers. However radical strategy is less risky for new businesses & or businesses that have hit rock bottom. R Ashli Barclift 3/13/2013 7:44:38 PM E : W e e k 2 - C h a r a ct e ri st ic s of I n n o v at io n O p p o rt u ni ti es The radical/do different innovation is risky but the most risky would be new frame innovation. This is due to the uncertainty of how the innovative process or product will do when put into action. With the incremental & radical innovative ideas, the risk is not as high because the territory is familiar. Response 1 Timothy Caruso 3/10/2013 9:31:52 PM Incremental innovation is innovation that is by small steps of improvement which help keep the product in the competative edge seat. in n ov at io n o Xavier Rossom 3/11/2013 2:05:39 PM p p or tu ni ti es What are the characteristics that define incremental/do better innovation, radical/do different innovation, & existing frame/new frame innovation? incremental/do better innovation characteristics involve exploiting existing innovations & making them better. Radical/do different innovation characteristics involve new innovations also long-term, highly uncertain & unpredictable.Which innovation activity is the most risky, & why? the radical innovation is more risky because innovating a new product rather than an existing product is more difficult. for one you have to come up with the process, target market, & so on. Monday - Strategies for Opportunities Professor Chao-Hrenek 3/11/2013 4:50:37 PM R E : M o n d a y - S tr e Arlene 3/11/2013 8:47:55 PM gi Jamshedji es fo r O p p o rt u ni ti es According to the text, some tools to help enable research include: searching inside the company's existing structures & workforce; listening to the "voice of the customer"; sending out idea hunters to investigate & culminate about technology, emerging markets, & upcoming trends; exploring & identifying possible alternative "futures"; active instead of passive use of the Web; engaging active users who feel strongly about your product; become a diversified company in exploring corporate ventures; & the use of social bridges & networking, among numeours other means to develop research & ideas. The common theme is the constant search & question for ideas & innovations, & it is probably wisest for a firm to employ not just one, but a combination of any of these. R E : M o n d a y - S tr a te gi Rachel Labs 3/13/2013 5:06:25 PM e s f o r O p p o rt u n it ie s I agree with Arlene. The wisest strategy is a combination. Combinations of any variety will kick off a new business & then improve as they grow. Opportunities can come from many places - Imagination, the voice of the customers, a market need, competitor insight, trends, new technology, etc. RE: Monday - Strategies for Opportunities Alritta Sanders 3/15/2013 2:57:33 PM According to the text, strategic opportunities enables cross-functional teams to be key players in defining & implementing incremental innovation projects, cross-functional disruptive individuals tend to be key players in defining radical innovation projects. Individuals who are likely to excel in a radical innovation project, besides having superior technical capabilities, should be goal-oriented, broadly educated, creative, extremely bright, not afraid to be different, integrative, flexible, aggressive, entrepreneurial, eager to learn business, able to take risks, & inquisitive. R Christine E Klosterman : M o n d a y - S tr a te gi e s f o r O p p o rt u 3/15/2013 8:18:38 PM n it ie s I agree, I think listening to the customers is the best way. Take note of what they like, dislike, want, would like to see etc. Customer satisfaction is what will lead to higher profits & growth. RE: Monday - Strategies for Opportunities Michael Howard 3/11/2013 9:28:17 PM Discontinuous innovation truly transforms an industry or product & to ultimately develop a radical change idea is not for the faint of heart. These type of disruptive changes would fall into zone 3 or 4 in the innovative process where a complete new path needs to be paved. Discontinuous innovations are full of risk & disappointment as it requires learning what works & what doesn't. Timing is important. If the support system is not strong & flexible the idea is doomed to failure. Rules to use are: 1) Get in the game early 2) Be flexible & adjust as necessary 3) Probe & learn. R Jane Sanders 3/12/2013 10:39:55 AM E : M o n d a y - S tr at e gi es fo r O p p o rt u ni ti es Per the text, larger firms may try to recreate entreprenuership within the organization by exploring new diversification options through corporate venturing. The other options mentioned were "Deep Diving" innovations created based on customer s advice, reviews or complaints, & "Probe & Learn" which involves prototyping to see what works & what doesn't. But no matter which type of search they use it doesn't make cetain for success because as the book points out what people say is not always what they want. R E : M o n d a y - S tr a te Professor gi Chao-Hrenek 3/12/2013 8:34:19 PM e s f o r O p p o rt u n it ie s Hello All: Great job so far this week, let's move forward & please explain the influence of corporate strategy on new product development (NPD). R E : M o n d a y - S tr a te gi Petra Jadan 3/13/2013 7:38:08 AM e s f o r O p p o rt u n it ie s New product development (NPD) emphasizes the importance of introducing new products on the market for continuing business success. Its contribution to the growth of the companies, its influence on profit performance, & its role as a key factor in business planning have been well documented. New products are responsible for employment, economic growth, technological progress, & high standards of living. RE: Monday - Strategies for Opportunities Arlene Jamshedji 3/13/2013 8:56:53 Corporate strategy is what a company wants to focus its efforts on, the way it will build & grow its market, customer base, revenues, & profits. If a company wants to be successful in all those respects & stay relevant, it will have to participate in new product development, which essentially is innovation. Corporate strategy into new product development will involve research & development, budgeting of time, workforce & monetary resources, & researching the infrastructure of the company, customer demands, & market/competitor activities. A company must constantly be on the lookout for shifts in the market, or perhaps create that shift in the market with new product developments. R E : M o n d a y - S tr a te gi Douglas e Rohde s f o r O p p o rt u n it ie s 3/14/2013 6:54:51 PM If the corporate strategy is, in a nutshell, "customer satisfaction", then their need to develop new products is driven by the demand of the consumer. Part of a corporate strategy should always be to listen to their market & when they do, they hear that the consumer is always looking for better products & better value. This drives then company to increase R & D in order to create new products to fit the need. If a company is not customer driven, but are driven by internal needs, they may still be doing R & D but chances are, they will be missing the mark because they are not aware of what problems the market needs resolved. RE: Monday - Strategies for Opportunities Ddungu Wasswa 3/15/2013 1:36:24 In current competitive market no company can sit on its current or past products / services & still be sure of enjoying the same profits in future. So, for every organization there is a need to constantly look for development of new products & that’s where the corporate strategy towards development of new products plays a big role. This can be explained with an example of a technology firm, now this firm may opt for various strategies, which will influence the new product A focused strategy of building critical mass of technological skills will give the company a long-lasting competitive advantage Through strategy of evolving the technology, will allow the company to evolve multiple product areas which may be unrelated. Through an unfocused or diversified strategy of acquisition (of other companies or their technology), the company will create a diverse portfolio. R E : M o n d a y - S tr a te Christine gi Klosterman 3/15/2013 8:47:27 PM e s f o r O p p o rt u n it ie s I found this article very interesting & helpful in determining successful strategies that corporation use to stay on top. The Journal Report See the complete Business Insight report. We found—after surveying more than 300 employees at 28 companies across North America & Europe—that the businesses with the best product-development track records do three things better than their less-successful peers: They create a clear sense of project goals early on, they nurture a strong project culture in their workplace, & they maintain close contact with customers throughout a project's duration. Here is a closer look at what we found: Keep It Focused Whenever project requirements were clearly defined & communicated to teams before kickoff, the project had a greater chance of success. In our survey, 70% of the people working on high-performing projects—those that ranked in the top quarter of a performance index linking best practices to outcomes—said they had a clear view of the project's scope from the beginning, compared with just one-third of poor performers. We found that not thinking through a project's scope early on—say an appliance maker asks developers to design a new cooking range in the four-burner category but then later expands the project to include ranges with six burners—can create delays. The teams with a clear understanding of project requirements appeared better able to make trade-offs between product performance & things like cost, time to market & project risk. Only 19% of poor performers said they had the necessary information to make those decisions. Top performers also focused more intensely than low performers on staffing projects with the right people: 47% of the former researched employees' skill sets before the project kicked off to ensure the project team was well-rounded. None of the low performers did. Nurture a Project Culture The top-performing companies in our survey also nurtured a strong project culture by making product development a priority. They made more of an effort than the laggards—39% versus 12%—to minimize staffing disruptions due to external demands & to staff projects adequately. When people with critical skills become overburdened, they often decide on their own which of their many projects is the most important, a decision best made at the management level. Two-thirds of top performers compared with 39% of poor performers said team members focused more on the success of the project than on satisfying the needs of their job function when those interests competed. They also were more likely than the laggards—44% versus 17%—to give team leaders responsibility for reviewing team members' job performances. Three years ago, a North American medical-device maker in our study began an effort to stem market-share losses. Recognizing that one of the company's underlying problems was that project culture was weak, the device maker gave senior team leaders ownership of projects from beginning to end, as well as authority over staffing, personnel reviews and, in some cases, profit-and-loss responsibility. The new structure encouraged leaders to make better decisions, resolve conflicts quickly & reduce delays. Talk to the Customer The successful innovators in our study kept in close contact with customers throughout the development process. More than 80% of the top performers said they periodically tested & validated customer preferences during the development process, compared with just 43% of bottom performers. They were also twice as likely as the laggards to research what, exactly, customers wanted. That made them better able to identify & fix design concerns early on, minimizing project delays. The medical-device maker we mentioned created a matrix to identify & weigh the importance of various product features to different customer segments. It then tested trade-offs between product performance & things like price by bringing in surgeons & other medical specialists to use the product in simulated clinical settings. That allowed the team to fine-tune the product well before launch. The result? Three years after starting its effort to shore up market share, employee satisfaction with product development increased, time to market improved for all projects—up to 40% in some cases— & overall gross margin rose six percentage points. MIKEGORDON,CHRISMUSSO,ERIC REBENTISCH& NISHEETH GUPTA Gordon, M., Musso, C., Rebentisch, E., (2012) Th e Path to Developing Successful New Products. Retrieved from:http://online.wsj.com/article/SB1000142405297020344010 4574400593760720388.html RE: Monday - Strategies for Opportunities Jamarr James 3/16/2013 11:28:53 "This strategy is employed when a company's existing market is saturated, & revenues & profits are stagnant or falling. There is little or no opportunity for growth. A product development diversification strategy takes a company outside its existing business & a new product is developed for a new market. An example of this strategy is a company that has sold insurance products & decides to develop a financial education program aimed at college students. The new product is not revolutionary as there are other companies producing similar products, but it is new to the company producing it." Source: http://smallbusiness.chron.com/product- development-strategy-definition-5144.html RE: Monday - Strategies for Opportunities Xavier Rossom 3/12/2013 12:36:52 PM identify strategies that the entrepreneur can use to search for opportunities. In the book a map of innovation is used & the vertical axis refers to the familiar ‘incremental/radical’ dimension in innovation whilst the second relates to the way we frame things. Having drawn the map we can begin to look at strategies which individuals & organisations might use to search across it. http://devry.vitalsource.com/books/9781119961987/id/ch06fig3 R Kristina E Hernandez : M o n d 3/12/2013 3:22:38 PM a y - S tr at e gi es fo r O p p o rt u ni ti es The entrepreneur needs to be able to see oppertunity usually in combinations of oppertunities no one else has noticed. Then taking the oppertunity & persuading venture capitalists, investors, senior management ect into theis new oppertunity. Then the idea begins to take form & becomes more than an idea but a physical goal. Then it needs to be launched & become the servicce or product. RE: Monday - Strategies for Opportunities Petra Jadan 3/13/2013 7:02:07 AM According to our textbook, entrepreneurs look at the environment & take note of elements which they consider relevant – threats to watch out for, opportunities to take advantage of, competitors & collaborators, etc. Constructing such frames helps give the organization some stability but it also defines the space within which it will search for innovation possibility. (Tidd 250) Tidd, John Bessant & Joe. Innovation & Entrepreneurship, & Edition. John Wiley & Sons, (UK), 04/2011. <vbk:9781119961987#outline(8.3.2)>. R Douglas Rohde 3/13/2013 10:30:12 AM E : M o n d a y - S tr at e gi es fo r O p p o rt u ni ti es An entrepreneur who is just starting might put together a list of ideas that include mostly incremental improvements on old ideas. This way he/she would have the benefit of existing R & D to work with as a basis. From there, using existing products, processes, positioning or paradigms as a starting point, he/she can develop ways to improve what already exists. As an outsider, the entrepreneur is not burdened with pre-determined thoughts or habits that inhibit creativity & as a result has a better chance of seeing the faults with current methods & ways of improving it. If an entrepreneur is truly creative, once they have begun the creative process, the juices begin to flow & more radical innovations arise that can be addressed. R Professor E Chao-Hrenek : M o n d a y - S tr a te 3/13/2013 7:29:54 PM gi e s f o r O p p o rt u n it ie s Hello all, great discussions so far on Strategies for opportunities, What are some things we can do to mitigate the risks associated with new frame innovation? Your thoughts? Dr. Chao-Hrenek R Douglas E Rohde : M o n d a y - S tr a te gi e s f o r O p p o rt u n 3/14/2013 7:00:36 PM it ie s I think that one thing that can be done is to look at the competition to make sure that the new direction will be well received. Even if the competition is not doing so well, they can still learn from those failures by looking at what they are doing wrong & how they can do it better. Another thing that can be & should be done is monitoring the results on a daily basis to be sure they are getting the results they expected & if not, they need to be flexible enough to easily alter their course. R E : M o n d a y - S tr a te gi Arlene e Jamshedji s f o r O p p o rt u n it ie s 3/16/2013 1:00:22 AM Douglas, I will have to agree with your comment regarding monitoring of results & altering the course. In last week's discussion, it was mentioned that time & money should be budgeted wisely to innovation R&D. A firm should be aware if research & development is not going to bring the expected return on investment for an innovation or product. Innovation for the sake of innovation is interesting, alluring, but hardly practical. A detailed purpose to innovation efforts should be communicated to the firm's employees. RE: Monday - Strategies for Opportunities Brandy Spurlock 3/13/2013 10:49:40 AM As stated in the text strategies that entrepreneurs can use to search for opportunities are "voice of the customer"; become a diversified company in corporate ventures; idea hunters to investigate technology, emerging markets, & upcoming trends; use of social networking; exploring & identifying possible alternative "futures"; active instead of passive use of the Web; engaging active users who feel strongly about your product; As the text states, it is best for a company to use more than one of these strategies to be sucessful. R E : M o n d a y - S tr at Rosa Stewart e gi es fo r O p p o rt u ni ti es 3/13/2013 7:58:33 PM innovation can take a variety of forms – ‘product’, ‘process’, ‘position’ & ‘paradigm’ – & comes in incremental or radical flavours. So it would help to have a map of innovation search space – the ground we want to cover – before we start out on our journey. We’ll build it with two axes to create a simple view of the search space – then look at how we can cover it.(Tidd 249)Tidd, John Bessant & Joe. Innovation & Entrepreneurship, 2nd Edition. John Wiley & Sons, (UK), 04/2011. <vbk:9781119961987#outline(8.3)>. This has been termed ‘exploitation’ by innovation researchers, & it essentially involves using what we already know as the foundation for further incremental innovation. It builds strongly on what is already well-established – but in the process leads to a high degree of what is called ‘path dependency’. Essentially what we did in the past will play a strong role in shaping what we do nex(Tidd 252-253) Zone 1 corresponds to the ‘exploit’ field & assumes a stable & shared frame within which adaptive & incremental development takes place. Search ‘routines’ here are associated with refining tools & methods for technological & market research, deepening relationships with established key players. Examples would be working with key suppliers, getting closer to customers & building key strategic alliances to help deliver established innovations more efficiently. (Tidd 254) Tidd, John Bessant & Joe. Innovation & Entrepreneurship, 2nd Edition. John Wiley & Sons, (UK), 04/2011. <vbk:9781119961987#outline(8.5.1)>. Tidd, John Bessant & Joe. Innovation & Entrepreneurship, 2nd Edition. John Wiley & Sons, (UK), 04/2011. <vbk:9781119961987#outline(8.4.1)>. RE: Monday - Strategies for Opportunities Christine Klosterman 3/13/2013 11:16:44 PM It seems that the way to succeed in a business & be above the competition companies need to learn to think outside of the box, I have heard this many times & have to learn to do this more myself. My goal is to be more creative & try to think outside of the box more. "For large organisations a major difficulty in search strategies is to find ways of ‘getting out of the box’ – as we saw earlier they are very good at searching within the mental frame in which they have traditionally operated. So they need to deploy new approaches to try to get outside this way of looking – & one powerful tool is to try to re-create entrepreneurship within the organisation. One widely used approach involves setting up of special units with the remit – & more importantly the budget – to explore new diversification options. Loosely termed ‘corporate venture’ (CV) units they actually cover a spectrum ranging from simple venture capital funds (for internal & externally generated ideas) through to active search & implementation teams, acquisition & spin- out specialists, etc. For example, Nokia has a very interesting corporate venturing approach for finding innovation. They have moved beyond ‘not invented here’ & are embracing ‘let’s find the best ideas whereever they are’. Nokia Venturing Organisation is focused on corporate venturing activities that include identifying & developing new businesses, or as they put it ‘the renewal of Nokia’. Nokia Venture Partners invests exclusively in mobile & Internet protocol (I/P) related start-up businesses. They have a very interesting third group called Innovent that directly supports & nurtures nascent innovators with the hope of growing future opportunities for Nokia." (Bessant, pg. 282) Bessant, J., Tidd, J. (2011). Innovation & Entrepreneurship (2nd ed.). UK: John Wiley & Sons Ltd. R E : M o n d a y - S tr a te Professor gi Chao-Hrenek 3/15/2013 11:18:25 AM e s f o r O p p o rt u n it ie s Class: Please explain the concept of discontinuous & disruptive innovation. R E : M o n d a y - S tr a te Christine gi Klosterman 3/15/2013 9:01:35 PM e s f o r O p p o rt u n it ie s Discontinuous change requires a new frame – & making it happen requires building new kinds of networks. Under these conditions organisations need a different approach to managing innovation – much more exploratory, agile, flexible in thinking & deciding, being able to turn on organisational sixpence. In short they need to be like a new entrant firm, an entrepreneurial opportunity seeker but backed with more extensive resources & experience. (Bessant, pg. 355) disruptive innovation is essentially one where entrepreneurs play a role in changing & reshaping business & social markets through often radical innovation. Smart organisations look to defend themselves against disruption to their world by setting up small entrepreneurial units with the licence to explore & behave exactly as free agents, challenging conventional approaches & looking at the edges of what the business does. (Bessant, pg. 216) Bessant, J., Tidd, J. (2011). Innovation & Entrepreneurship (2nd ed.). UK: John Wiley & Sons Ltd. RE: Monday - Strategies for Opportunities Petra Jadan 3/15/2013 10:18:51 Discontinuous innovation is a completely new product concept unlike anything the customer has yet experienced, which requires a significant change in behavior & thus involves a major learning experience for the customer with much information searching & evaluation. A great example of discontinuous innovation is the mp3 player. from cassette tapes to mp3, each innovation involves customer behavioral changes. A disruptive innovation is an innovation that helps create a new market & value network & eventually goes on to disrupt an existing market & value network (over a few years or decades), displacing an earlier technology. R Matthew E Guzman- : Mercado M o n d a y - S tr a te gi e 3/17/2013 3:50:17 PM s f o r O p p o rt u n it ie s Business owners who are thinking small when they launch their companies, typically stay small. But entrepreneurs who have a big vision from the start of their business, enjoy much greater success. Breaking out of the “small” mindset is the key to unleashing your potential. A big vision for your business also helps you make important strategic decisions as your business grows. You have a better understanding of the pieces you need to build your enterprise. So if you want to grow your company to millions, define your vision. Don’t be afraid to think big, & let the world know your intentions. RE: Monday - Strategies for Opportunities Ddungu Wasswa 3/14/2013 5:12:19 PM As an entrepreneur you need to be aware of the fact that most opportunities are lost because of unfocused search goals & poorly defined search strategies & priorities. Following are some important points that an entrepreneur should keep in focus while devising strategy for looking for new opportunities: Don’t waste your time in wading through volumes of raw & irrelevant information Have a well-defined & focused area of research for opportunities Be fully aware of how things are changing around in your business area & external world. Have a well prepared plan of how well & quickly you respond & grab to an opportunity once it comes. Have a three level business intelligence system to collect & analyze information from within the enterprise; industry & market structure; & external sources, such as demographics, changes in perception, & new knowledge. While implementing innovation strategy do a careful analysis of the knowledge available & knowledge needed. Characteristics Brandy Spurlock 3/11/2013 5:17:54 PM The defination of incremental innovation are small improvements to existing products, services, or process the "do better" innovation. The characteristics of this are improving performance, improve factory operations, The defination of radical innovation is changing the rules of the game, open up a new game in which new players are often at an advantage. The characteristics of this are bring a new concept, alternative systems. The defination of existing frame innovation is ways in which organizations & individuals make sense of a complex environment by simplifying it, using mental lenses to decide on what they pay attention to & what solutions they look at. The characteristics are thinking outside the box. Ta Andy ki Motdoch ng Ri 3/11/2013 7:19:47 PM sk s Incremental innovation involves the improvement of existing products. Rather than invent new products when the old products aren't that bad, it is sometimes better to fix the product by building something that is similar to it, but includes improvements to the features that were lacking in the old version. Software updates are a good example of incremental innovation, whether they are the 2.0 version or an entirely new version they are improving on something that already exists. Radical innovation is when something entirely new is invented, something for which there is no precedent or competition. The first hybrid car or commercial space craft would be examples of this, they are the first of their type; the hybrid would be a radical product innovation, while the first commercial space craft would be a radical paradigm innovation for space flight. I would say that radical product innovation is the riskiest form of innovation because you are inventing something entirely new that people have never seen before & really don't have a frame of reference to know how to use it or what to think about it, at least with incremental innovation or radical position or paradigm innovation people already know the product & are just seeing it improved or used in a different way. Characteristics Matthew Park 3/11/2013 9:26:54 PM Incremental/do better innovation examples may be the use of opportunity whether it be an idea from the ground up or a variation of an already existing product/service. Opportunity helps to see what type of benefits that may serve the market have been overlooked by previous manufacturers. Radical/do different innovations may be most involved with by characteristics of the outlier thinking or ideas that may have never been thought up but may possibly benefiting only the market & creator & not sources ie. Napster. Existing frame/new frame innovation involves more of a focus & concentration of innovation towards an idea rather than branching out so much... the focus allows for a stronger concentration towards selling the product. The most risky might be seen as the radical/do different only because not many people may attract or be attracted to the "do different" mindset. Being able to think up an idea may be different/risky due to being able to avoid any legalities; especially if it is an product/service that has not already been introduced to a market. T Professor ue Chao-Hrenek - Ri sk y In no 3/12/2013 2:45:23 PM va ti on Hello all: Happy Tue., let's move forward in our chapter, & please discuss should we avoid risky innovation efforts or are there some things we can do to mitigate risk? Your thoughts. Dr. Chao-Hrenek R E : T u e - R k Timothy 3/12/2013 2:49:22 PM y Caruso I n n o v at io n Modified:3/12/2013 2:51 PM This is an interesting threat. In our textbook we have two examples of companies in which one played it safe & the other acted on that risk. I am talking about Xerox & Sony. Xerox relied on its photocopier technology to always be the technology of choice. Through the 70's this was the technology of choice for photocopiers but when the 80's came many more Japanese companies like Toshiba & Ricoh emerged & became important players in the game which caused Xerox to hemorrhage money for many years & lose about 50% of it secured market share. This is an example of how being too conservative almost caused one of the main players in the photocopy industry to almost go bankrupt. Sony however is just the opposite. This company continually establishes themselves on the cutting edge of technology & even with some risky business plans like getting into the Gaming field where as previously thought that there was no room for another gaming system with Nintendo already having the majority share. So we can see how this benefitted them with their gaming sector pulling in a large percentage of their profits. R E : T u e - R is k Matthew y Park I n n o v a ti o n 3/13/2013 5:49:18 PM This is an awesome example of both! I wouldn't say that there is a "should" factor of whether we should decide to avoid risky innovations or mitigate risk... it really depends on the company & what they decide to do with it. As a whole, it does also allow for better competition within the market. Some companies may feel content & as if they are doing a great job while mitigating risks & concentrating on their main supplied products while others may be wanting to get their feet wet within different markets & industries & will offer more products & competition towards their competitors. Personally, I would prefer the risk only due to the fact that risk may bring greater down fall, yes, but may also bring greater reward... you will never know unless you try. As the great hockey player Wayne Gretzky had said,"You miss 100% of the shots that you don't take." which can also apply to the whole business scenario & risks. However, when getting involved with risky innovation, making sure to avoid certain illegal & unethical actions may decide the success or failure. R E : T u e - R is Professor k Chao- y Hrenek I n n o v a ti o n 3/15/2013 11:19:10 AM Matthew & All: Please Explain the role of an entrepreneurial mindset when searching for development opportunities either in start-ups or established organizations. R E : T u e - R is k Douglas y Rohde I n n o v a ti o n 3/16/2013 6:44:50 AM The role of an entrepreneurial mindset is one that sees things outside of the search area that a company is in. This mindset allows the ability to see a business, its structure or its products as they are as opposed to how the company thinks they are. The benefit to this is that the flaws are seen & can be acknowledged. Once this occurs they can be addressed & improved or placed. The entrepreneurial mindset is one that is open to new things & looks for opportunities to "replace or repair" as opposed to being satisfied with "business as usual". R E : T u e - R is k Matthew y Park I n n o v a ti o n 3/17/2013 1:03:16 PM Agreeing with what Douglas had said, an entrepreneurial mindset is able to see with an outside aspect towards the market as an outlier. However, entrepreneurs also have the ability to stay with trends but motivate changes & advancements towards the trends. Even some large businesses encourage an entrepreneurial mindset today so that they are able to initiate fuel for innovation, bring in & hire top talent, & sustain a strong competitive advantage within the industry. A basic mindset would involve coming up with original ideas & bring in new products onto the market; what company wouldn't want someone to do those things for them? RE: Tue - Risky Innovation Christine Klosterman 3/17/2013 9:51:48 PM I found this article very informational about the entrepreneurial mindset. I’ve developed the Ten Tenets of An Entrepreneurial Mindset, which I like to share with my students. These tenets, culled from years of research, experiences & sources, are meant to encourage students to solve problems creatively, launch their own startups & improve our collective economic future. 1. Innovation fueled by creativity is this generation’s most important economic development engine. To paraphrase Lee Iacocca (a Lehigh University grad), “Educate to innovate & automate or you will be forced to emigrate or evaporate!” 2. The greatest opportunities for innovation occur at the intersection of disciplines. This doesn’t mean we eliminate disciplines or all become generalists. It means to look in the intellectual space between & across disciplines for the greatest opportunities for innovation. 3. Innovation is a process that has several facets and/or steps that can be learned by doing it. I believe the sooner students experience an innovation process, the better they are able to practice it themselves. 4. The greatest chance for entrepreneurial startups to be successful comes with management teams that have diverse, interdisciplinary, globally oriented backgrounds & that have experienced the innovation process many times. 5. All constraints are self-imposed. You have ownership of the conditions under which you are developing your idea, product & company. As such, all constraints & assumptions, including technical, economic or social ones, must be challenged. 6. A track record of ethical behavior leads to trust & faith in your ability to lead & deal with the inherent risk associated with new ventures. Ethical behavior leads to trust & loyalty that will definitely be challenged during the startup process. 7. Risk is always present with innovation. Quantifying it, understanding it without letting it scare you to inaction, is a key to success. Innovation is measured in value. Be sure to look at the value of your enterprise, which requires examining both the risks & the benefits. 8. Fail early & often to succeed sooner. Acknowledge & learn from your mistakes. Failure is a great teacher. 9. It takes a team & leadership of that team to succeed. The team can be co-located or geographically dispersed. Regardless, recognition of the team’s & individual contributions is critical for success that is sustainable. 10. Entrepreneurs are needed to find & assess opportunities, identify & manage risk, manage the development-to- commercialization process, locate & manage resources, & lead the team by example of work ethic, moral & professional behavior. Ochs, J. (2012). 10 Tenets of an Entrepreneurial Mindset. Retrieved from: http://www.usatodayeducate.com/staging/index.php/career/10- tenets-of-an-entrepreneurial-mindset RE: Tue - Risky Innovation Alritta Sanders 3/17/2013 7:36:42 PM Internal risks are uncertainties brought on by elements that support the development, launch, & operation of a project. Internal risks affecting digital are shaped by the availability & reliability of resources, whether these resources are physical (technology) or abstract (a brand), they can be stakeholders or partners. because internal elements are within reach, the outcome of internal risks can be controlled or impacted to varying degrees through proper planning. RE: Tue - Risky Innovation Libra Smith 3/12/2013 8:03:59 PM Modified:3/12/2013 8:05 PM There are some thing we can do mitigate risk. Researching other companies that have been successful & failed at the same innovation you desire to created. Doing research on the market you are trying to enter & finding out what are the pros & cons what worked & didn't work. Researching the consumers to see their buying patterns to ensure you can full fill the need. With anything you do there will be a risk, however it can be mitigated if the proper research is done. You also have to be willing to change if something doesn't work in order to be successful. R E : T u e - R is Savanah k Shettel 3/12/2013 10:25:34 PM y I n n o v a ti o n Thank you Libra, & I would have to agree; Research is the number one way to mitigate risk. By doing your research you can compare how other business did, & what they did wrong. It just amazes me that someone would not do any research. You steal from those who are more knowledgeable; meaning that learn from those who have succeed as well as those who have not. Someone did something right, mirror that & make it work for you as well. People didn’t get somewhere by not researching & learning from other people. Look at us right now; aren’t we learning from those who have been there & experienced what we plan to experience? It always amazes me that some colleges assign courses to teacher who have never gone through what they are teaching. It’s like assigning an engineer to teach people how to sew. I strongly believe that learning from someone who has been there, is second best to being there & doing it yourself. Who will train you when you get there anyways? Someone who has done it! R E : T u e - R is Professor k Chao- y Hrenek I n n o v a ti o n 3/14/2013 1:30:12 PM Class: Good point - all innovation has risks & you identified some important risks. Is there a risk that radical innovation seems glamorous & the perceived glamor may encourage pointless risk taking? If so, what can mitigate this risk? R Brandy E Spurlock : T u e - R is k y I 3/15/2013 6:46:27 PM n n o v a ti o n I do think that radical innovation seen as glamorous & that perceived glamor could encourage pointless risk taking. If something seems so easy that you feel you are being pulled into the innovation you are more likely to ignore the signs of risk. Ignoring the signs of risk because somethign seems so perfect can be the risk taking move anyone can do because they may not be thinking clearly enough to make a sound decision. I would think the best method would be to look at each innovation rather that be a radical innovation or discontinous & stop & think about the idea for a couple days before moving forward with the innovation. This could minimize the amount of risk associated with the innovation. R E : T u e - R is Christine k Klosterman 3/17/2013 10:12:59 PM y I n n o v a ti o n I agree, it would be a good idea to think about it for a couple of day. Maybe write out a list of possible risks, & think about all the pros & cons. Nothing comes too easy & the glamorous thoughts could be deceiving without looking into the possible risks. RE: Tue - Risky Innovation Andy Motdoch 3/12/2013 8:09:15 PM Feasibility analysis is your friend when you're thinking about trying an innovative risk; those analysis are pretty comprehensive & can get you thinking about, & hopefully planning for, all kinds of different possibilities that could pose a danger to the success of your business. If you take the time to do all kinds of pre-planning analysis & research beforehand you can identify the areas you need to watch out for, which will help you plan for them, & serve to mitigate the risks. R E : T u e - R is Professor k Chao- y Hrenek I n n o v a ti o n 3/12/2013 8:34:44 PM Class: Please determine how brand strategy overlies NPD (New Product Development)? Your thoughts? R Michael E Howard 3/12/2013 11:01:43 PM : T u e - R is k y I n n o v a ti o n Modified:3/12/2013 11:02 PM Brand strategy involves creating a product development strategy & then marketing direction after determining a need or want in a market. As such, new product development is a step in the larger brand strategy process. Essentially having a brand strategy is a way of organizing the multiple steps in bringing a product or service to the target market. The actual first step is identification (R&D) & everything that follows could be categorized as new product development. RE: Tue - Risky Innovation Petra Jadan 3/13/2013 8:04:55 AM It is essential to build & develop a strong brand. The brand will become the link between the values of the company & the customers. A strong brand image means brand recognition, an emotional connection with the user, customer loyalty, & lower costs of customer retention. R Timothy E Caruso : T u e 3/13/2013 3:30:41 PM - R is k y I n n o v a ti o n NPD is a step in Brand strategy after market research & then followed by R&D R E : T u e - R is Professor k Chao- y Hrenek I n n o v a ti o n 3/14/2013 1:25:46 PM Hello All: Which innovation strategy is the most risky, & why? RE: Tue - Risky Innovation Andy Motdoch 3/13/2013 4:42:34 PM Brand strategy focuses on building a the brand instead of individual products. The reputation built up in a brand is then applied to all the products in the brand, so it is important to build up a lot of strong products in your brand, so that when you debut a new product people will say, "Oh that's a Johnson & Johnson product, that's a good brand/company, I'll try their product." Branding is a focus on overall quality of all the products & services a company puts out, which helps greatly when developing a new product, because a company can use the reputation of its brand to help promote something entirely new, "Like other Johnson & Johnson products? Try our new whatever product it is that is completely new & innovative," If you already have a brand to build off, you have a leg up on the competition when it comes to NPD. R E : T u e - R is Professor k Chao- y Hrenek I n n o v a ti o n 3/13/2013 7:28:21 PM Hello All: Important observation - what are some things that determine the ability to effectively cope with gains & losses (glad you mentioned gains because too much, too soon is a problem)? R Rachel E Labs : T 3/14/2013 4:07:21 PM u e - R is k y I n n o v a ti o n I do not think I understand the specific question. Could you re-phrase? From hat I am understanding I would say that gaining too much profit or too many customers all at once could be overwhelming but also could mean that the marketing or implementation plan worked! The question then would be how to retain the customers or convert them into returning customers. Is your marketing accurate to the product or service? Did you tell a white-lie in your implementation plan that captured the first customers but now they won't return? What is it about the innovation that drew the customers in? RE: Tue - Risky Innovation Petra Jadan 3/17/2013 6:09:26 PM 1. Accept that change is a process First, recognize that change is a process. It follows a series of stages which engages everyone in the change. It is not complex but it is a journey. 2. Move forward step by step When organizations strive to restructure or refocus or create a culture of innovation, etc. it is important not to skip any of the steps in this process. John Kotter said, "Skipping steps creates only the illusion of speed & never produces satisfactory results" & "Making critical mistakes in any of the phases can have a devastating impact, slowing momentum & negating hard-won gains." Yes, there is a sense of urgency to bring about change as quickly as possible. This can be achieved, without skipping any of the steps. 3. Generate motivation First, executives or other players in the organization need to stir up a sense of urgency among employees & other affected stakeholders in order to generate the motivation to spur change within the organization. However, this sense of urgency has to be strong enough & perpetuated by outside analysis, customers, economics, etc. in order to propel change forward. The results of the strategic planning process will help with the messaging. 4. Form a powerful guiding coalition Once change is identified as the best solution to market share, profit losses, or other catalysts, leaders throughout the organization have to band together to guide the transformation process, & these leaders can include board members, customers, union leaders, executives, chairmen, & others. 5. Create a shared vision for corporate change The management team then communicates to all employees, creating a shared vision for corporate change. A clear vision should also include the transformation steps that are required to propel the organization towards reaching the strategic plan. The transformation of an organization includes short-term goals based on the strategic plan that can be tracked to show all employees how progress will be measured. It must include descriptions of the new environment of innovation. Employees need to be aware that this will be a long journey but will be worth it, even in spite of short- term job cuts or other immediate changes. 6. Continuously communicate the vision The change process effort will fail unless most of the organization understands, appreciates, commits to & tries to make the effort happen. The guiding principle is simple: use every existing communication channel & opportunity. 7. Empower others to act on the vision Remove obstacles there may be to getting on with change. This entails several actions. Allocate budget money to the new initiative & free up key people from existing responsibilities so they can concentrate on the new effort. Allow people to start living the new ways & make changes in their areas of involvement. Nothing is more frustrating than believing in the change but then not having the time, money, help or support needed to effect it. 8. Plan for & create short-term wins Real transformation takes time therefore; the loss of momentum & the onset of disappointment are real factors. Actively plan to achieve short-term gains which people will be able to see & celebrate. This will provide proof that efforts are working & adds to the motivation to keep going. 9. Consolidate improvement & keep the momentum for change moving A premature declaration of victory can kill momentum, allowing the powerful forces of tradition to regain ground. Keep in mind that new approaches are fragile & subject to regression. Use the feeling of victory as the motivation to delve more deeply into the organization: to explore changes in the basic culture, expose the systems relationships of the organization that need tuning, & to move people committed to the new ways into key roles. 10. Institutionalize the new approachesAt the end of the day, change sticks when it seeps into the bloodstream of the corporate body & becomes "the way we do things around here." This requires a conscious attempt to: show people how the new approaches, behaviours & attitudes have helped improve the organization & when the next generation of leaders believe in & embody the new ways. http://www.bia.ca/articles/Risk-and- Change-in-these-Economics.htm RE: Tue - Risky Innovation Christine Klosterman 3/17/2013 10:24:42 PM It is important to determine what you are trying to portray to the customer & how you want the new product to be represented, & what kind of image that you want give. It is what will stick with the product, & the image that you want to stick in the minds of the customer. RE: Tue - Risky Innovation Petra Jadan 3/13/2013 7:56:46 AM Modified:3/13/2013 7:57 AM Found this article, regarding management & risks in innovation. Risk Management Can Stimulate, Rather than Deter, Innovation Innovation & risk management seemingly do not naturally go hand-in-hand in many peoples’ minds – although we would argue that it should. Wouter Koetzier, who leads Accenture’s Innovation & Product Development consulting group, & I have been exploring the benefits of better connecting the two functions & as a result, Wouter is contributing to this column. What we have observed is that many people think a typical start-up – with its highly independent & empowered teams, agile development, minimal controls & executives who need to gain market share & have less to lose – is the ideal incubator for innovation. The opposite case could be made for a large organization, with a carefully structured risk management function. In our experience however, it doesn’t have to be that way – nor is it. We increasingly see innovation & risk management being viewed as partners, not adversaries. When properly fused, the two disciplines can help organizations pursue opportunities that a risk-averse culture might leave on the cutting room floor. Risk management can help foster a company’s innovation agenda by revealing blind spots & areas of underinvestment that threaten the upside of a company’s future. Many companies have established “stage gates”, essentially a funneling process designed to reduce uncertainty as exposure to risk grows. In many cases, however, the stage gating process is too focused on re-enforcing what the company does well today & the funnels end up producing only weak, incremental ideas that come to market slowly & lack emphasis on new areas for expansion. Without a strong link to risk management capabilities, stage gates often become risk averse & weed out big ideas in favor of small ones. Decision-making bodies may send back proposals for additional research & work, creating time-consuming, creativity-numbing rework loops – as opposed to getting early insight on how potential challenges can be addressed to give confidence to the idea. Ironically, another common impediment to innovation is an existing corporate culture that overly celebrates & rewards success. In these cultures, it is rare to find someone who has been able to rise in the ranks with a failed experiment on his or her resume, even if the failure provided valuable insights about future opportunities. Venture capital firms – typically designed to manage risk & encourage innovation – can provide some important lessons for large organizations seeking to advance the cause of innovation. These firms typically create a portfolio of investments & engage with the management team through the development process regarding new insights & unanticipated opportunities resulting from new learnings in the process. These firms also know in advance that most experiments will fail. We see organizations apply three key principles to their work to get a better balance of risk & innovation: 1. Flexibility. Rather than placing all their bets on one or two experiments, companies may want to consider building a portfolio of early innovation investments that act as options. Monsanto – number ten on the Forbes list of the world’s 100 most innovative companies – realized early on that genetic modifications could become very important to its seed business. To mitigate risks, Monsanto developed a portfolio of experiments, first investing in biotechnology companies, then opening its Life Science Research Center which ultimately came to house more than a thousand employees. In a 2012 presentation to investors, Monsanto’s Chief Technology Officer Robb Fraley described this approach as “growth layers” for the company’s R&D pipeline. Advanced analytics & other sophisticated risk management tools can guide such complicated decisions by regularly assessing value against multiple variables & scenarios. This support can include risk methodologies & tools designed to measure both positive & negative uncertainty & provide realistic estimates of results. Risk scenario analysis can also simulate results & provide better operational flexibility. 2. Speed. Successful innovation often requires speed. Companies can use rapid experimentation & agile development to increase their chances of filling their innovation portfolios with new products & extensions. An iterative approach that is closely linked to customers & markets can draw attention to risks & integrate them into decision-making. In a high-speed environment, effective risk management often encourages risk-taking within the bounds of a company’s risk appetite. Risk management can, & should, facilitate companywide dialogue to determine which risks are acceptable, which aren’t, & how much risk is appropriate based on potential returns. 3. Control. Venture capital firms use controls, but these controls typically are designed to increase risk tolerance, fostering a culture that embraces the logic of intelligent mistakes. Innovative companies often create a safe ground for experiments, “safe” because risks are controlled, managed & measured. This typically entails bringing together the finance & operating sides of the business. To the finance side, risk is often something to avoid or mitigate, while operations often sees risk as inherent & necessary for growth. Effective risk governance can bridge these two viewpoints, translating strategic challenges into specific risks to take & providing rules, parameters & measurements to guide both the investments & the process. Many of the companies we talk to are focused on growth strategies & their associated risks. Programs designed to accelerate innovation are becoming more common, in part, because successful innovation can be a cure for many of the risks companies face. The new & higher regard for risk management reflects its potential to provide controls in complex business environments. Risk management can, in fact, add a level of discipline & transparency to the innovation process, while supporting desired risk culture & appetite. Marrying risk management & innovation can boost innovation efforts by creating confidence that innovation bets are well-placed & that innovation risks are well-managed. http://www.forbes.com/sites/steveculp/2013/01/07/risk -management-can-stimulate-rather-than-deter- innovation/ R E : T u e - R is Petra Jadan k y I n n o v at io n 3/13/2013 8:09:56 AM I believe we can;t mitigate risks totally bit we sure can try to reduce the risk of failure. One way, is to make a prototype to customer testing before committing to full-scale development. In addition, during development, plan on usability testing or showing the product to trusted customers or surrogates to get feedback on implementation. RE: Tue - Risky Innovation Jane Sanders 3/13/2013 9:59:03 AM I think that risky innovation efforts should not be avoided. I believe that they should be well researched & made when the potential gain out weighs the risk. But i know that it is not that simple because a company has to take inconsideration their investors, their customers, their financial stability, their brand reputation as well as their standing in the market place. If they jeopardize even one of those depending on the situation or results they could potentially ruin their company. R E : T u e - R is Professor k Chao- y Hrenek I n n o v a ti o n 3/14/2013 1:26:18 PM Jane & All: What are some things we can do to mitigate risk? RE: Tue - Risky Innovation Michael Gross 3/13/2013 2:03:53 PM Modified:3/13/2013 2:05 PM In the past couple of years, risky innovation has gained major success & popularity with customers & profits. The iPod, iPhone, Tablet, & Instagram have all been risky innovations that paid off very well. A company that has the tools & resources to create a product or service can dominate a industry. Making sure your new product is successful can come from great research, great ideas, or just a great product. R Pedro Colon 3/13/2013 4:44:08 PM E : T u e - R is k y I n n o v at io n I believe that a certain level of risk is required to move innovations forward but there has to be a balance. If an organization is afraid to take too many risks, employees may be reluctant to "think outside the box" or offer ideas for fear of rejection of their ideas. They may also be discouraged if so much thought & analysis goes into instituting an idea that the job becomes mundane. Too much risk taking can also be very costly if proper planning isn't conducted in order to limit the damage of a failed risk-taking attempt. R E : T u e - R is Professor k Chao- y Hrenek I n n o v a ti o n 3/13/2013 7:28:48 PM Pedro & All: Well said, & we should not minimize the risks associated with incremental innovation, yes? RE: Tue - Christine Klosterman 3/17/2013 10:26:07 PM Risky Innovation I agree, well said Pedro, thank you for sharing. RE: Tue - Risky Innovation Kristina Hernandez 3/14/2013 2:58:19 PM I think that a company should mitigate risks by fully understanding potential risks & have measures outlined when those risks happen. Companies that have a more diverse product line & are established in other markets can more readily take risks. This is due in part because if one product fails you have other markets & products to fall back on. Therefore a more diverse company stands to have more success because it is able to take risks & have innovations exploited in multiple areas. R E : T u e - R is Natalya k Borodina 3/14/2013 7:20:03 PM y I n n o v at io n I think for most part people do not like risk. Especially stock holders. Do I think it is necessary? Absolutely. Innovation, technology, CEOs, Wall Street, Market, Corporate America & etc would not be where it is today if it wasn't for risk takers. What it comes down to is some people can tolerate risk while others not so much. It isn't for everybody thats for certain. To mitigate risk we learn from our & other peoples failures, do thorough research & prepare ourselves the best we can. R E : T u e - R is k Pedro y Colon I n n o v a ti o n 3/16/2013 8:05:00 PM Natalya, I respectfully disagree with your statement regarding risk. I think many people like the thrill of taking risk because most risks that are successful have a high reward attached to them. If this wasn't true, Las Vegas would not have thrived as much as it has. The stock market is another example of where taking great risks could be highly rewarding if successful. Most conservative risk takers may experience some gains, however, not as great as if the risks were greater. R Natalya E Borodina : T u e - R is k y I n n o v a ti 3/17/2013 4:22:23 PM o n I'm not saying there are no risk takers Im just saying that it is not for everyone & everyone handles it differently. Stock market can be both, low, moderat & high risk it all depends on the investor & investments they choose. Im personally a risk taker because I enjoy the rush of taking risks, my family, not so much. They stay with safer side investments such as the mutual funds. Hope it makes sense. RE: Characteristics of Innovation Opportunities Ddungu Wasswa 3/12/2013 4:41:39 PM Modified:3/12/2013 4:41 PM The characteristics of incremental, radical & new frame are as follow: - 1) Exploit & increase the competency level. 2) Brings in better technology for better productivity. 3) Reduces the risk & enhances the growth rate. 4) Accurate estimation of cost & decrease in cost. 5) Innovation helps in regulatory of the standard requirements. The innovation activity which I find more risky is radical innovation because in this the innovation knowledge which requires is totally different from the existing one. The existing knowledge becomes inoperative in radical innovation. & the newer knowledge goes wrong than it can destroy the competence of the organization. R E : C h a r a ct e ri st ic s of I Professor Chao- n Hrenek n o v at io n O p p o rt u ni ti es 3/15/2013 11:17:52 AM Class: How about blind optimism for the radical/do different? Can management teams become blinded by possibilities to the extent that what is highly risky is seen as doable with little risk? if so, what are some things that can cause this dangerous perception? R Petra Jadan 3/17/2013 5:46:54 PM E : C h a r a ct e ri st ic s o f I n n o v a ti o n O p p o rt u n it ie s In positive outcome circumstances (meaning outcomes where the positive outcome is most likely), it’s probably best to be an optimist, since you are more likely to reinforce success. In a negative outcome circumstance, it’s probably better to be a pessimist, since you’ll invest more readily in resources to recover or fix a problem. Where innovation is concerned, we typically have two conflicting goals. True innovators are optimistic people who believe in their ideas, their processes & their solutions. Innovation characteristics Michael Ball 3/12/2013 5:28:07 PM At one time the capitalistic mantra was "he who builds the best mouse trap wins". That meant always putting your best foot coward to be competitive. Although we talk about companies like IBM who used to control most of the computer market, a radical innovation came about in the form of the personal computer(PC), initially IBM pushed the idea aside as a fad, but quickly, PC's became the standard, & with that came the intel chip, who created its own monopoly with the market. Now here's the problem with monopoly; to maximize profits, release of upgraded technology became incremental, & primarily for market reasons. The only thing that forced Intel to accelerate the release schedules was the entrance of the AMD chip into the market. Competitive choices now forces back to the component innovation arena. Their chips now have to move information faster, be able to do more calculations & over-all improve. Although Apple is a major company, they control no where near as much PC market share & to stay competitive they specialize the PC to primarily the artistic community. The most risky parts of this industry is introducing new or upgraded operating systems. Many of them have bugs, & sometimes they're just hard to use. & when the system fails, the must spend a lot of R&D money to replace the system to stay competitive. W hi ch is Amanda m Rutto 3/12/2013 8:27:23 PM or e Ri sk y? I am going to have to say that Radical innovation would be the more risky. I only say that because incremental is bettering something already existing, so here you are just making small changes in order to make the product or service better. So worst case scenario the option you made to make it better fails & you go back to what you had until you come up with another idea. Whereas radical is making a completely new product or service, & that means you are creating something from nothing & if it fails you are back to square one the drawing board. I think that for risky moves in innovation radical is the riskier of the two. Re: Risky Petra Jadan 3/13/2013 6:43:23 AM A high percentage of radical innovation are risky business. The revenues can be huge, but highly uncertain, while the hit rates are low & the costs of failure often very high. Many companies know the risks, however they seem pressured to engage in radical innovation efforts in order to gain & maintain competitive advantage. Radical innovation life cycles are longer, more unpredictable, have more stops & starts, are more context-dependent in that strategic considerations can accelerate, retard or terminate progress, & more often include cross-functional & or cross-unit teamwork. W ed - Ri sk s to N e Professor Chao- w Hrenek O p p or tu ni ti es 3/13/2013 7:27:44 PM Hello All: Good point - all innovation has risks & you identified some important risks. Is there a risk that radical innovation seems glamorous & the perceived glamour may encourage pointless risk taking? If so, what can mitigate this risk? R Xavier Rossom 3/14/2013 11:22:22 AM E : W e d - R is k s to N e w O p p o rt u ni ti es Is there a risk that radical innovation seems glamorous & the perceived glamour may encourage pointless risk taking? If so, what can mitigate this risk? Radical innovation may encourage pointless risk taking if you are not passionate about the product & just want to innovate for the fame. something that can mitigate the risk is if a person or company rushed a product & the product came back defective. RE: Wed - Risks to New Opportunities Amanda Rutto 3/15/2013 10:05:22 PM I feel as though radical innovation could seem glamorous because of its new & uniqueness. When a radical innovation comes to the table it seems overly appealing because it is most commonly something completely new & different than that of which we are used to. I think that sometimes the thought & excitement for something new over powers staying in the comfort zone. Think of buying a brand new car, new 2013 (newly designed) ford explorer. The thought of having the newest & nicest model & with its unique new sleek design, but costs $42,000 verses a used comparable specs but older model & design & a 2008 with the original body for $26,000. Now the realistic choice would be the less expensive reliable model. But commonly people desire the feeling of having something brand new & shinny. So you are taking a risk of wasting more money & hoping the newer model will last as long & be as reliable as the older models. Sometimes the idea of the glamour is more satisfying then being realistic. R Kristina E Hernandez : W e d - R is k s to N e w O p p 3/16/2013 7:10:43 PM o rt u ni ti es I think that there is glamor in radical risk because it could mean easy money with the correct gamble & so it would seem the risk may be worth taking. A person can mitigate the risk by balancing the risk with the reward. For example if a person spends their life saving on buying a thousand lottery tickets the risk being they don't win & the reward being they win several million dollars. The person needs to account for the statistical change of the odds which won't be a dramatic improvement & therefore probably not worth the risk overall. Characteristics of Innovation Opportunities Brandy Moschello 3/13/2013 7:51:38 PM Incremental innovation is often referred to as "do what we do but better" innovation. Incremental innovation is essentially making improvements to existing technologies. There is a low uncertainty with this type of innovation. Incremental innovation focuses on cost or feature improvements in existing products or services, processes, & marketing or business models. Radical innovation is referred to as "doing something different". Radical innovation explores new technology with a high level of uncertainty. Typically this type of innovation focuses on processes, products or services with unprecedented components. Radical innovation is a dramatic change that changes whole markets/industries, or potentially creates new ones. Existing frame/new frame innovation is essentially a road map for entrepreneurs to help give their organization a stable starting point & helps to define the space for innovation to be possible. w ee k 2: ra ca Brittany 3/13/2013 8:42:17 PM l Vrana in no va ti on I agree with my classmates, radical innovations are definitely the most of the risk takers. This is like the very beginning on an innovation, where you have no past history, no research, no bearings, you truly have no way of knowing if this will be a success or a failure? My example would be just graduating out of college & opening a bridal store, with mo past experience or history what so ever. All you have behind you is your business degree. The only thing you have backing you up was that your community did not have a bridal store within the vicinity. Let's say the cost is great to get the research & the market before before the grand opening. There is no certainty that this store will be a hit. Is it really worth it for a small business owner to enter this world? How long did the business owner have to wait before they realize this innovation was a complete failure? I just wonder of how many small businesses risk this radical innovation & fail? & how many actually succeed? R E : w ee k 2: r a Libra Smith di c al in n o v at io n Brittany, 3/14/2013 11:58:49 AM Very true, to piggy back on another example would be, someone who is in experienced in a particular area such as advocating for special needs children & adults. If you try to open a business assisting the special needs community, however you have no experience, this would definitely be a radical risk. Yes there maybe a need for services, however if you aren't knowledgable about the market & the people you are trying to service then you will experience an epic fail. The only way you would get around this would be if your partner was knowledgable about the field & you maybe were good at doing the finances, etc. R E : w e e k 2 : r Professor d Chao- 3/14/2013 1:28:31 PM ic al i n n o v a ti o n . Class: When evaluating opportunity search strategies, what is the difference between exploit & explore approaches? R Brandy E Moschello : w e e k 2 : r a d ic al i n n o v a ti 3/16/2013 7:03:38 AM o n Exploiting is basically taking what we already know & using it as a foundation for more incremental innovation. This approach strongly uses what is already in place. It can lead to 'path dependency' which states that what you did in the past will more than likely strongly shape what you will do next. The exploration approach is the opposite of the exploit approach. Exploration is taking a big jump into new & very different things. During this approach radical products/processes are created. RE: week 2: radical innovation Christine Klosterman 3/17/2013 10:40:59 PM "babies are most engaged when they’re exploring new things, while adults prefer exploiting known skill sets" Very young children imagine & explore a vast array of possibilities. As they grow older & absorb more evidence, certain possibilities become much more likely & more useful. They then make decisions based on this selective information & become increasingly reluctant to give those ideas up & try something new. Computer scientists talk about the difference between exploring & exploiting — a system will learn more if it explores many possibilities, but it will be more effective if it simply acts on the most likely one. Babies explore; adults exploit. This distinction matters in organizations, too. Despite our best managerial intentions, most organizations are primarily designed to do one or the other well. In our business, we call it “organized to execute” or “organized to learn.” The concept is the brain child of Frances’s HBS colleague, Amy Edmondson. A firm’s strategy, operations & culture generally line up to either explore or exploit opportunities, rarely both. http://decisiontolead.com/2009/08/18/explore-vs-exploit/ Characteristics of Innovation Opportunities Christine Klosterman 3/13/2013 10:06:22 PM I found this article & thought it went well with this discussion: Characteristics that distinguish incremental improvement Change impact or scope is the key aspect used to differentiate incremental from radical, breakthrough, or transformational types of innovation. Incremental innovation is characterized by: • Utilizing or enhancing current core competencies & capabilities • Modest technological changes from existing platforms, products, or services • Responding to customer needs identified from current offers • A more predictable path or process, particularly with respect to costs • Often following a formal stage-gate process • Prolonging the market life of a product or service while sustaining the competitiveness of existing products in the market • Enabling continued growth with low risk In some cases these incremental improvements may provide advantage to existing industry players as they capitalize on existing knowledge, resources, & processes. This type of innovation can also reconfigure current capabilities to serve a new use or need. Choosing the best innovation investments Incremental innovation most often moves along the established innovation framework for the business. In many cases, the business will have an established pipeline that evaluates new concepts & ideas that can move through the service or product innovation process within a defined level of risk. Factors that can establish viability as an incremental improvement include: • Time to market - The innovation can hit an expected market window for the enhancement. Often, this includes being able to maintain a steady flow to the market that will match forecasted demand. • Low technology, architectural, platform or process risk - Technology, architecture, platform & process changes can take longer than estimated & open new possibilities for failure. Innovation activities for enhancements will generally avoid these risks by limiting or http://www.innovation-management.org/incremental-innovation.html R Christine E Klosterman : C h a r a ct e ri st ic s of I n n o v at 3/13/2013 10:50:20 PM io n O p p o rt u ni ti es Radical innovation almost always seems to mean an order of magnitude improvement in performance or a significant shift from existing performance or solving a complex problem that existing products don’t solve. This means more sophisticated technology, based on pushing the boundaries of knowledge. http://jugaadtoinnovation.blogspot.com/2012/08/disruptive-radical- innovation-how-are.html I think radical innovation is the most risky because you are pushing a product or service to the limit, trying something new. It is unknown as to what kind of effect it will have. R Savanah Shettel 3/14/2013 7:20:34 PM E : C h a r a ct e ri st ic s o f I n n o v a ti o n O p p o rt u n it ie s - I have to agree Christine, radical innovation is probably the most risky. You are going out on a limb & creating something new. You do not have any history of it being successful, you have no idea it it’s going to work, but you are putting in time & not to mention capital into it. It is one thing to just change a current product, but coming up with something completely new is must more risky & can hurt an organization. I have an example that is more for incremental innovation, but it was still pretty risky. Coca Cola two years ago decided to go a different way with the holiday can. From their original red with can a white bear, they made the whole can white, & we all know how that turned out- it was a disaster, law suits even arose because diabetics thought it was sugar free! Risky & definitely backfired on them. THU - Risk Associated with New Frame Innovation Professor Chao-Hrenek 3/14/2013 1:22:43 PM Hello all: Happy Thu! Please continue & discuss what are some things we can do to mitigate the risks associated with new frame innovation? R Heidi E Brannen : T H U - R is k A 3/14/2013 7:45:19 PM ss o ci at e d w it h N e w F r a m e I n n o v at io n Doing a full SWOT analysis as if you were starting a business completely from the ground up would be a good way to start. Knowing what strengths & weaknesses you have as a company as far as internal skill, knowledge, & technology also knowing what you need to improve on. The opportunities that new frame innovation will present are also key points as well as threats to the venture you are about to embark upon. Knowledge is power use it. R Shirlina E Knight : T H U - R is k A ss o ci 3/14/2013 10:21:04 PM a te d w it h N e w F r a m e I n n o v a ti o n I agree Heidi, a SWOT analysis would be be beneficial to understanding & mitigating the risks associated with new frame innovation. As you stated knowing & understanding the strengths & weaknesses you have, concerning the product and/or the business allows for a business to use the strengths as a leverage in marketing, as well as make necessary changes to minimize or eliminate the factors of weakness. The SWOT analysis also allows a business to review external factors that would affect the success/failure of a new product/service. By understanding the opportunities & threats of the new frame innovation, a business can focus on opportunities of the innovation, & measure the threats that are posed by the competition to alter its strategies. In sum, utilizing the data from the SWOT analysis will aid a business/person in determining what strategies & techniques would be beneficial in mitigating the risks associated with new frame innovation. RE: THU - Risk Associated with New Christine Klosterman 3/17/2013 10:42:44 PM Frame Innovation Oh yes the swot analysis is a good tool, thank you for sharing. RE: THU - Risk Associated with New Frame Innovation Michael Ball 3/15/2013 11:41:47 PM Risks come in many forms. One of forms is the fear of drastically changing established work rules or losing experienced employees to the less known entities. The answer to this quandary is true & false. I was true in the case of General Motors when the company attempted to mortgage its future through the radical innovation of the hydrogen vehicle(although the science was sound, the political environment, & infrastructure weren't ready), it nearly caused its demise. Conversely, the introduction of the hybrid vehicle, represented an incremental change that allowed society to easily absorb into in framework. Thus, incremental innovation not only mitigates the risks to be taken, it also creates a buffer to allow for adjustment in the innovation & the framework. R Ashli E Barclift : T H U - R is k A ss o ci a te d w it h N e 3/16/2013 8:55:02 PM w F r a m e I n n o v a ti o n New frame innovation starts when companies look at new ways to do things such as production or policies. The risks involved include not knowing how the new service or product will do once introduced to consumers. One way to eliminate or minimize risks is to have tests performed using a focus group. In addition, the best way to minimize risks is to spot risks in the early stages of production. RE: THU - Risk Associated with New Frame Innovation Timothy Caruso 3/16/2013 10:17:14 AM I would say taking the time to analyze your risk & ROI before you attempt it would reduce your risk Friday - Strategy for Entrepreneur Professor Chao-Hrenek 3/15/2013 11:17:25 AM Class, Can you identify strategies that the entrepreneur can use to search for opportunities? Any thoughts about which source is the primary source for innovation ideas? R Michael E Howard 3/15/2013 12:44:22 PM : F ri d a y - S tr at e g y fo r E n tr e p r e n e u r We are learning that creating innovation again & again requires a structured process that is encouraging & supportive. The structure that is created must be set up to dynamically enhance the way that new input & ideas are found. Some new methods of research include the dispatch of "scouts", using corporate ventures & brokers & bridges. Incremental or radical ideas require diverse points of view & varying perspectives that will not be found within the same old stream of resources. R Rachel Labs 3/16/2013 9:58:25 AM E : F ri d a y - S tr a te g y f o r E n tr e p r e n e u r Well said Michael. Creating innovations require open minds & many minds. Thinking out of the box, & having scouts to explore other options in the industry allows businesses to be creative & try new venues. Without walking outside of the regular everyday duties, the business will never grow. RE: Friday - Strategy for Entrepreneur Michael Ball 3/16/2013 11:53:34 PM In 647 BC, Plato say "Necessity is the mother of invention". That begs the question, "what is a necessity? What do we need? Maslov's hierarchy talks about mans basic needs, & as they're met the needs move to a more esoteric area. First of all, man needs to survive, & to survive he has to eat. So eating to survive is a core need. A primary source of innovation would be the desire for variety(ie. cooking, flavoring ,ect.) Another source of innovation idea is not just delivery, but ease of delivery & storage to be used later. All of these needs provide opportunities for entrepreneurs, By, offering sandwiches for breakfast & lunch, the local doughnut shop, has now given itself the opportunity to serve the community throughout the day as opposed to a doughnut & coffee for breakfast. R Natalya E Borodina : F ri d a 3/17/2013 4:35:58 PM y - S tr at e g y fo r E n tr e p r e n e u r I would say to remain informative of current market & innovations. Also to be observant of surroundings & niches missing in the market. RE: Friday - Strategy for Entrepreneur Petra Jadan 3/17/2013 5:52:38 PM I believe the primary source for innovation ideas is to recognize that all business starts with a customer not with know-how, not with the "bright" idea. For inventor-entrepreneurs, the best approach into business is to find who their customers are & what is a new product/service will be a need. Risky Innovation Brittany Vrana 3/16/2013 9:09:47 PM Risky innovations is what drives the most creative & "popular" innovation to this day. I think no one likes risk, it involves lots of stress, the worry of the unknown, the worst case outcome actually occurring, money being lost, business crashing, good reputation failing, etc. etc. I think it is absolutely necessary!, because these allow businesses or future innovators to expand their creativity, expand an already innovation or create something that will just blow everyone out of the water. I think this makes business actually work & stay on top of their business & on top of their competitors. Otherwise, these businesses will just slack around, which is not good for the business at all because then other competitors can take over & before you know it that business that was lazy is failing & fast. Different risk stories is like a book of knowledge for other businesses. It teaches them of what a risky success looks like & it shows was a risky failure looks like. By reading & researching & studying other stories like this, this can teach businesses what will happen, how stressful it will be, what an amazing outcome this could be, etc. I think these stories can prepare other businesses the best that they can. So. I completely agree with risks & taking that huge step to try & further you & your business. S at - In cr e m en ta Professor Chao- l Hrenek D ev el o p m en t 3/16/2013 9:54:41 PM Class: Let's finish our last topic of the week, please discuss do incremental development efforts have a guarantee of success? Could the wrong incremental innovation kill a product line? Thanks, Dr. Chao-Hrenek R Heidi Brannen 3/17/2013 11:33:17 AM E : S at - I n cr e m e n ta l D e v el o p m e n t There is no guarantee of success with incremental innovation, but the risks are lower when improving on something that you already do & are trying to do it better. As discussed in the lecture for this week, Coca-Cola tried this innovation technique in 1985 when they released New Coke...with disastrous results. If they had not decided to abandon the new formula, Coca-Cola could have lost its lead in the soft drink industry & had a very difficult time recovering from that. I don't feel that enough research was done on this new formula in the beginning with regular consumers. R Kathryn E Curry : S a t - I n c r e m e n t al D e v el o p 3/17/2013 2:17:16 PM m e n t Heidi, I would agree with you. "New & improved" is not always better or more successful as in the Coca-Cola example. Another example would be Microsoft Windows; Vista replaced XP but received mixed reviews so they quickly came up with Windows 7 & now Windows 8. This is company who is continuously looking at ways to make improvements on their product(s). Back to the Coca-Cola example: Coca-Cola & other soft drink companies seem to have learned from this mistake as they now "probe & learn" with new flavors (Coca- Cola Vanilla, Mt Dew in various colors & flavors) to see what sells & what doesn't. This way they still have the tried & true product while figuring out if the consumers are willing to make the change to a different or new & improved version. R E : S a t - I n c r e m Brandy e Moschello 3/17/2013 6:52:08 PM n t al D e v el o p m e n t I agree with you to an extent. New & improved may not always work or be successful for everyone. However, there are examples of incremental development working. In the automotive world, body styles are changed approximately every seven years. In between major redesigns manufacturers will update engines, enhance the navigation technologies, add new exterior & interior options & new packaging. This keeps the vehicle "new" & allows the customer to stay excited. These improvements may or may not be well received but that is a risk that the manufacturer has to take. These incremental developments are designed to follow the market trends & keep the customers interested in the brand. R E : S a t - I n c r e e Brittany 3/17/2013 10:52:45 PM n Vrana t al D e v el o p m e n t KAthryn, I agree. I think that new & improved may not always be as successful as anticipated. Maybe in time, sometimes consumers do not like change & with outdated models. maybe they will have to resort to this new & method. Like your example, new computers would never carry the older versions of Windows, no matter has dependent you are on this, the new versions will always be available to these new products. I agree that companies are always trying to improve. But in a sense they have too..do you not think so? The goal to the game is always be ahead of your competition. I think new innovations are constantly on the rise & while you are sitting there indulging in your success, someone is right underneath you trying to get ahead of you & steal your lime light. Though I agree with you on the coke example. No matter how many different styles & flavors & types & so forth they try to advertise & sell. No matter how much success or failures these new innovations create a stir about, they will always go back to the original. I agree this what coke is doing & other pop companies. The original is where the brand loyalty was created. This is where it all started. AS long as you on on top of your competition, I think steaming back to the original stomping grounds as helps as well. I think no matter what changes consumers make in a certain brand, they will always stem back to the original brand that caught their attention first site as well. RE: Sat - 3/17/2013 3:07:42 PM I agree. Incremental development efforts do not always mean success. A reason for that can be the nature of many people & how they adapt to change. Some people do not prefer change even if its for the better of them hence resulting in innovation not always being the best decision. The example of Coke is an excellant one & shows how innovation of a popular product can result in loss. RE: Sat - 3/17/2013 12:11:29 PM Does incremental development efforts have a guarantee of success? I think that incremental efforts have a guarantee of success because reinventing a product that has already been done & changing the process to fit the demand of another market will guarantee success. Could the wrong incremental innovation kill a product line? A wrong incremental innovation could kill a product line if the product is for say "played out" when a consumer wants something different but in a different way presented. R E : S at - I n cr e m e Pedro Colon n ta l D e v el o p m e n t 3/17/2013 2:35:19 PM Incremental development efforts don't always guarantee success. Coke & Microsoft are two examples mentioned by classmates in which the failed development of a new product did not kill the product line. Coke & Microsoft are two highly established & successful corporations that were able to regroup by changing their strategy. Coke went back to its original formula & Microsoft developed Windows 7. 3/17/2013 4:31:05 PM There are no guarantees with anything in life except death & taxes as they say. Wrong incremental innovation could kill a product line if it wasn't needed or correct approach wasn't taken. S at - I n cr e m e n ta l D e v el o p m e n t Many products each year are promoted wrong. Each year many products are recalled due to un-foreseen reasons. A major reason why products do not make it in this economy is due to poor research & development. Researching your product's target market & reason for being advertised & used should be well established before any promoting goes on. . Kaytelin, I see this a lot too. The hospital I work at is smaller than the other two facilities in our health system, so we get many of the uninsured or ones that do not have private insurance. The larger facilities take in the patients with higher rates going back to the hospital & give us anyone that has lesser insurance or none at all. It is frustrating, especially when those patients who are capable of working to obtain insurance choose not to. We see those that work hard & then end up paying more because of how the system works. The people who has to work two or three jobs just to get the basic insurance get less treatment than those who are just living at home off the system. With the Affordable Care Act, I have seen a lot of people taking advantage of the system. People who work hard, pay their own bills, yet, do not get the same healthcare treatment. The taxes have also increased on the working people. When I get my paycheck, I am astonished to see the amount that is taken to go to taxes. I feel like the system that was created was meant for the good of the people, to help those who are disabled, unemployed, etc, but a lot of people seem to have taken advantage of this system for their own benefits. The government should have foreseen this. The government needs to enact a better law for this & make sure people who really need help are getting help. (an instructor response) Thanks for your enthusiastic participation in this discussion thread. When we think of what politics is, hopefully we have come to understand that politics is not just what politicians do in political places. To be sure, politics is something that impacts our daily lives. We are political creatures even if we have no interest in politics. Politics is about deciding who gets what, when & how. Because each of us has this power & is impacted by this power, hopefully, moving forward, we will be more thoughtful in how we make decisions that can impact others & ultimately impact ourselves. Be sure to get any last posts in before the deadline. [Show More]

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