Week 3 New Service Development Lecture Notes
Classical innovation Paradigm 1.Radical innovations
a.Major innovation: new service that customers did no know they needed (social media) b.Start up
business: new service in a market with existing services (Uber, Airbnb) c.New services for the market
presently served: new services to existing customers of an organization
2.Incremental Innovations a.Service line extensions: augmentation of excising service line b.Service
improvements: c.Style changes: modest visible changes in appearances
Christensen's Innovation Paradigm
1.Efficiency innovation: do more with fewer resources
2.Sustaining innovation: improve existing solutions and charge premium to existing customers
3.Disruptive innovation: makes products simpler and more affordable to expand the market Challenges
for service innovation -Protecting intellectual property and technology -Incremental nature of
innovation -Degree of integration required -Building prototypes or conduct tests in a controlled
environment Service Design Decisions -Structural: physical changes oDelivery system oFacility design
oLocation oCapacity planning -Managerial/infrastructur