Innovation Management

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Intended Learning Outcomes
What is Innovation, Creativity and invention

Difference Between Innovation, Creativity and Invention

Types of Innovation

Drivers and Sources of Innovation

Innovation Management – A Process

Ten Types of Innovation Framework

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 What is Creativity
“Creativity is the ability to generate new ideas or concepts.”

“A process through which something new is formed, and typically, most definitions
assume value is included with the new creation.”

“Creativity is about creation. It’s about harnessing the power of the mind to conceive
new ideas, products plans, thought experiments, tastes, sensations or art.”

Types of Creativity
• Deliberate and Cognitive
• Deliberate and Emotional
• Spontaneous and Cognitive
• Spontaneous and Emotional 3
 What is Invention
“Invention is the physical creation of a new concept or idea.”

“The creation of an idea to do or make something without verification that it works, or is

commercially valuable. Invention cannot occur without creativity, but just creativity is not
enough to properly develop an idea.”

“Truly novel product, service, or process that, though based on ideas and products that
have come before, represents a leap, a creation truly novel and different.”

Examples of invention:
• Product designs,
• Business models, or
• Working prototypes.
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 What is Innovation
Origins – Latin Innovare “to make something new”

1. New products, business processes and changes that create wealth or social welfare -
OECD

2. An idea, practice or object that is perceived as new - Everett Rogers

3. Turning an idea into a solution that adds value from a customer’s perspective - Nick Skillicorn

4. Innovation is about staying relevant - Stephen Shapiro

5. I cannot define innovation, but I know it when I see or experience it - Anonymous

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 What is Innovation- Definitions
“Innovation is the specific function of entrepreneurship, whether in an existing
business, a public service institution, or a new venture started by alone individual in the
family kitchen. It is the means by which the entrepreneur either creates new wealth-
producing resources or endows existing resources with enhanced potential for
creating wealth.”

• Through Innovation, we bring ideas into the world so they can make a tangible
impact. The end result of true Innovation is something that can be marketed as a
product or service.
• Innovation = Invention * Commercialization

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Creativity Vs Invention Vs Innovation
Creativity Invention Innovation
Creativity is novel ideas that are Creating something new Making the invention into a new
communicated, useful and product/service
appealing
Creativity is a fuzzy idea and can’t A new to the world discovered or Innovation is about changing
clarified until it is made into a created pattern for doing something
prototype
Idea Cash  Ideas Ideas  Cash
Based on thinking up new things Based on primary scientific skills Bases on broad set of strategic,
marketing and technical skills

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Innovation Drivers
Global Challenges More than 56% of Fortune 500 companies were replaced between
1995-2018, thanks to innovation - The American Enterprise Institute, 2019

1. Climate Change
2. Energy Supply
3. Population growth
4. Ageing population
5. Economic Stability
6. Scare resources
7. Poverty, Hunger
8. Disease

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Sources of Innovation
Source Description
The unexpected Looking for new opportunities in the market; unexpected product
performance; unexpected new products as examples
The incongruity Discrepancies between what you think should be and what is reality
Process need Weaknesses in the organization, product, or service
Changes in industry/market New regulations; new technologies
Demographics Understanding needs and wants of target markets
Changes in perceptions Changes in perceptions of life events and values
New knowledge New technologies; advancements in thinking; new research

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 Innovation- Types
Incremental Innovation: Adding features or
capabilities to an existing product one at a time

Architectural Innovation: Applying existing

technology or expertise to a new market.

Disruptive Innovation: Applying new

technologies, processes, or business models to
existing industries.

Radical Innovation: The rarest of all innovation

types, entirely new technologies or products
are created for entirely new markets 10
Innovation – A Process
A working Definition:-

The Process which generates value

from the creation, development, and
implementation of new ideas,
technologies, products and services.

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Innovation – A Process
Learning

Pro-active Linkages

Innovation Strategy

Search Strategic
Implementation
Selection

Innovative Organization

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 Goals
Structure

Resources
Strategy Organization
Culture
Indicators

1 2
Integrated
Innovation
Management
5 3 Ideas
Framework
Selection
4 Process
Network

Linkage Indicators
Open

Learning
Knowledge Management
(Nada et al., 2012) 13
 Doblin’s TEN Types of Innovation
Framework
• Innovation = synonym of new products, services etc  Narrow View of Innovation

• Narrow innovation view is one of the root causes leading to many of the mistakes
inexperienced innovators make.

• Larger view is complex and intertwined like thread.

• Innovation consultancy Doblin actually realized that way back in the 90’s and
developed the Ten Types of Innovation Framework to help solve the problem.

• It’s a simple, elegant, and practical tool that pretty much every innovator can benefit
from by looking at bigger and holistic picture of innovation battle fields.
• The Art of Discovering Breakthrough Products 15
Doblin’s TEN Types of Innovation Framework

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 Why we need TEN Types of Innovation
Framework
• Innovation mostly fails. It doesn’t need to. You shouldn’t let it.
• Innovation almost never fails due to a lack of creativity. It’s almost always because of
a lack of discipline.
• The most certain way to fail is to focus only on products. Successful innovators use
many types of innovation.
• Successful innovators analyze the patterns of innovation in their industry. Then they
make conscious, considered choices to innovate in different ways.
• Innovations can be broken down and analyzed. When you do so, you will learn why
most fail and a few succeed.
• Innovations can be built up systematically. Doing so increases your odds of success
exponentially.
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TEN Types of Innovation Framework
CONFIGURATION
These types of innovation focus on an enterprise's innermost workings and business
system.
+ Profit model - How you make money
• Innovative profit models find a fresh way to convert a firm’s offerings and other
sources of value into cash.
• Great ones reflect a deep understanding of what customers and users cherish and
where new revenue or pricing opportunities might lie.
• Innovative profit models often challenge an industry’s tired old assumptions about
what to offer, what to charge, or how to collect revenues.
• This is a big part of their power: the dominant profit model often goes unquestioned
for decades in most industries.
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TEN Types of Innovation Framework
CONFIGURATION
+ Networks - How you connect with other to create value
• In today’s hyper-connected world, no company can or should do everything alone.
• These innovations mean a firm can capitalize on its own strengths while harnessing
the capabilities and assets of others.
• Network innovations also help executives share risk in developing new offers and
ventures.
• These collaborations can be brief or enduring, and they can be formed between close
allies or staunch competitors.

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TEN Types of Innovation Framework
CONFIGURATION
+ Structure - How you organize and align your talent and assets
• Structure innovations focus on organizing company assets hard, human, or intangible
in unique ways that create value.
• They can include everything from superior talent management systems to ingenious
configurations of heavy capital equipment.
• An enterprise’s fixed costs and corporate functions can also be improved through
structure innovations, including departments such as Human Resources, R&D, and IT.
• Ideally, such innovations also help attract talent to the organization by creating
supremely productive working environments or fostering a level of performance that
competitors can’t match.

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TEN Types of Innovation Framework
CONFIGURATION
+ Process - How you use signature or superior methods to do your work
• Process innovations involve the activities and operations that produce an enterprise’s
primary offerings.
• Innovating here requires a dramatic change from “business as usual” that enables the
company to use unique capabilities, function efficiently, adapt quickly, and build
market-leading margins.
• Process innovations often form the core competency of an enterprise and may
include patented or proprietary approaches that yield advantages for years or even
decades. Ideally, they are the “special sauce” you use that competitors simply can’t
replicate

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TEN Types of Innovation Framework
CONFIGURATION

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TEN Types of Innovation Framework
CONFIGURATION

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TEN Types of Innovation Framework
OFFERING
These types of innovation are focused on an enterprise's core product or service, or a
collection of its products and services.
+ Product Performance - How you develop distinguishing features and functionality
• Product performance innovations address the value, features, and quality of a
company’s offering.
• It involves entirely new products and updates and line extensions that add substantial
value.
• Product performance it is only one of the Ten Types of Innovation, NOT the sum of
innovation.
• Product performance innovations that deliver long-term competitive advantage are
the exception rather than the rule.
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TEN Types of Innovation Framework
OFFERING
+ Product System - How you create products and services
• Product system innovations are rooted in how individual products and services
connect or bundle together to create a robust and scalable system.
• This is fostered through interoperability, modularity, integration, and other ways
of creating valuable connections between otherwise distinct and disparate
offerings.
• Product system innovations help you build ecosystems that captivate and delight
customers and defend against competitors.

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TEN Types of Innovation Framework
OFFERING

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TEN Types of Innovation Framework
OFFERING

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TEN Types of Innovation Framework
EXPERIENCE
These types of innovation are focused on more customer-facing elements of an
enterprise and its business system.

+ Service - How you support and amplify the value of your offering
• Service innovations ensure and enhance the utility, performance, and apparent value
of an offering.
• They make a product easier to try, use, and enjoy; they reveal features and
functionality customers might otherwise overlook; and they fix problems and smooth
rough patches in the customer journey.
• Done well, they elevate even bland and average products into compelling experiences
that customers come back for again and again.
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TEN Types of Innovation Framework
EXPERIENCE
+ Channel - How you deliver your offering to customer and users
• Channel innovations encompass all the ways that you connect your company’s
offerings with your customers and users.
• e-commerce has emerged as a dominant force in recent years, traditional channels
such as physical stores are still important particularly when it comes to creating
immersive experiences.
• Skilled innovators of this type often find multiple but complementary ways to bring
their products and services to customers. Their goal is to ensure that users can buy
what they want, when and how they want it, with minimal friction and cost and
maximum delight.

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TEN Types of Innovation Framework
EXPERIENCE
+ Brand - How you represents your offerings and business
• Brand innovations help to ensure that customers and users recognize, remember, and
prefer your offerings to those of competitors or substitutes.
• Great ones distill a “promise” that attracts buyers and conveys a distinct identity.
• They are typically the result of carefully crafted strategies implemented across many
touchpoints between your company and your customers, including communications,
advertising, service interactions, channel environments, and employee and business
partner conduct.
• Brand innovations can transform commodities into prized products and confer
meaning, intent, and value to your offerings and your enterprise.

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TEN Types of Innovation Framework
EXPERIENCE
+ Customer engagement - How you foster compelling interactions
• Customer engagement innovations are all about understanding the deep-seated
aspirations of customers and users and using those insights to develop meaningful
connections between them and your company.
• Great customer engagement innovations provide broad avenues for exploration and
help people find ways to make parts of their lives more memorable, fulfilling,
delightful—even magical.

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TEN Types of Innovation Framework
EXPERIENCE

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TEN Types of Innovation Framework
EXPERIENCE

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SIX principals for using TEN Types of Innovation Framework

1) UNDERSTAND ALL TEN TYPES: Virtually all projects can improve just by knowing and
deeply understanding the value and subtleties of each of the types.

2) DE-EMPHASIZE RELIANCE ON PRODUCTS AND TECHNOLOGY: These are the easiest

capabilities for competitors to copy.

3) THINK ABOUT CATEGORIES AS WELL AS TYPES: Consciously try to imagine new ways
to configure assets, build platforms, and foster fresh experiences.

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SIX principals for using TEN Types of Innovation Framework

4) USE THE TYPES THAT MATTER MOST: Use diagnostics to understand which types you
and others in your industry tend to overlook.

5) UNDERSTAND WHAT YOUR USERS REALLY NEED: User research can help you know
what is relevant to customers and what surprises other types might help to deliver.

6) USE ENOUGH OF THE TYPES TO MAKE A SPLASH: Using five or more types,
integrated with care, is nearly always enough to reinvent a category and become
newsworthy.

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TEN Types of Innovation Framework
TESLA
Configuration: Offering: Experience:
Abandoned dealer network Incremental innovations (price, Online purchase
Veridical integration range, acceleration, safety and Buy direct from company store
Pre-order model infotainment systems) Design customization
Return in 7 days
Mobile service fleet

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