INNOVATION AXES
Market
Product Technology
Manufacturing
Technology (Process)
Product
MEDINOL
Market Driven Innovation
Market
Product Technology
Manufacturing
Technology
Product
Generations of Products
Picture 8.1: First Generation
Picture 8.2: Second Generation
Picture 8.3: Third Generation
PHASE I
Market Driven Innovation
Water Saving
Drip Technology
Manufacturing
Technology
Drippers
PHASE II
Water Saving
Drip Technology
Manufacturing
Technology
Drippers
Product Driven Innovation
PHASE III
Market Driven Innovation
Growth Control
Technologies
Drip, Liquid Fertilizers
Polymer, Control
Manufacturing
Technology
Feeding System
Market
Product Technology
Technology Driven Innovation
Manufacturing
Technology
Product
Product Driven Innovation
DISC O TECH
Fixion™ IM (Intramedullary) Nail
Fixion™ IL (Interlocking) Nail
DISC O TECH
THE B-TWIN EXPANDABLE SPINAL SYSTEM
B-Twin Reduced
Configuration
(5 mm diameter)
Post-Operative (after
B-Twin Expanded
expansion)
Configuration
(up to 15 mm diameter) Anterior-Posterior View
Market Driven
Innovation
Technology Driven
Innovation
Corning Glass Fiber
optics Apple IBM PC
3 M Post it
Seagate-Conner 3.5
HDD
Sony-Philips Compact
Disk
Nike : Tc: nylon, Tn: Max
Air, Max chock
Raytheon Microwave
Laser, Bell Labs
Manufacturing Driven
IKEA – LACK table and
Product Driven
Innovation
WHY CONTINUOUS/DISCONTINUOUS
INNOVATION?
Continuous Innovation
• Existing infrastructures
• Existing knowledge
• Existing markets
• Incremental
• Convergent thinkingprogressive refinements
• Increasing specialization
Discontinuous Innovation
• Discovery of new
knowledge related to
market need or
technological capabilities
• From horse to car
• Business reshaping:
kerosene for lighting; ice
for cooling; IT+telecom
and airline, banking,
entertainment
PRINCIPLES OF DISRUPTIVE
TECHNOLOGY
Good Management is the reason that companies fail
because they listened to customers wants and needs
, invested in technology to support customers and
subsequently lost market leadership
(Christensen,1997)
• Companies depend on customers and investors.
• Small market don’t solve problems of large firms.
• Market that don\t exist cannot be analyzed
• Technology supply may not equal market demand
• Disruptive technologies are lower performing
• Companies overshoot their market with technology
• IBM survived the move to PC’s
• More experienced firms made better decisions
SOURCES OF DISCONTINUITY
New market
PC, Mobile phone
New technology
Photo and digital images
New political rules
Free trade, Communism
Running out of road
Kodak
Change in market-behavior
Apple, McDonalds
Deregulation
Telecom, airlines
Rules of the game change
Amazon, cell phone
Architectural innovation
Photo-lithography in chip
CELL PHONES FORECASTING
FOR AT&T
Cell phone quantity
17 Millions
900,000
1984
1994
2000 Time
R&D GENERATIONS
1st Generation :
• Unbounded search for
scientific breakthrough
• Leap from current to new
knowledge
• Breakthrough inventions
2nd Generation
• Applicability
• Project management
• Fusion innovations
R&D GENERATIONS
3th R&D Generation
• Marketing role:
determine customer
needs
• R&D role: supplies
technology
• Continuous innovation:
experience, expectations
walls Fig. 1.7
4th R&D Generation
• Mutually dependent
learning
• Market evolution:
Competitive architecture
• Broader mission for R&D
• Organizational capability
• Fusion & Discontinuous
Innovation: beyond the
walls. Fig. 1.8, 1.9, 1.10
3rd GENERATION & CONTINUOUS
INNOVATION
Market Knowledge
Wall of Experience
Continuous Innovation
Pc, Mc, Tc
Wall of Expectations
Scientific & Technical Knowledge
DISCONTINUOUS INNOVATION
Market Knowledge
Mn, Tc
Mn Tn
Wall of Experience
McTn
Pc Tc Mc
Wall of Expectations
Scientific & Technical Knowledge
FUSION INNOVATION
Market Knowledge
Market Fusion
Market & Technology Fusion
Wall of Experience
Technology Fusion
Wall of Expectations
Scientific & Technical Knowledge
MARKET & TECHNOLOGY FUSION
Market Fusion
• Milk + Juice Drinks
• Cheese + others for
breakfast
• Printer+ Scanner+Fax
for new applications
• Telephone + TV
• Cell phone + Portable
Computer
Technology Fusion
• Optics-ElectronicsMicroscope
• Fiber optic + laser
• Laser + Audio
• Composite Materials
Market Knowledge
Target zone: new
technology, latent need
Wall of Experience
Wall of Expectations
Scientific & Technical Knowledge
PERFORMANCE IMPROVEMENT
INDUSTRY VERSUS CUSTOMER
Product performance
High-end markets
B
Trajectories –
customer needs
performance
Disruptive technology
A
Low-end markets
Time
DISCONTINUOUS INNOVATION AND
BUSINESS STRATEGY
Nokia forest eqpt-paper
Cell phone,to morrow?
Vodaphone steel tubes
Cell phone services
Tui mining
Travel group (Thomson)
Kodak
Palm
PC- DISRUPTIVE TECHNOLOGY
EVOLUTIONARY THEORY
Nelson and Winter: The core concern of evolutionary theory is with the
dynamic process by which firm behavior patterns and market outcomes
are jointly determined over time
Theory of dominant design
Single basic architecture that
becomes the accepted market
standard (Anderson-Tushman)
Punctuated Equilibrium
Periods of of incremental
change, punctuated by
breakthrough
• New comers initiate
competence
• Major tech innovations
• Competitive turmoil
• Boeing 247, 707, 747
Jolty theory of change
Abrupt alterations in
environments
Disruptive Technology
Source: Ettlie J.E.(2006) Managing Innovation Elsevier p 70-84
Source: Tidd J. Bessant J. Pavitt K.(2006) Managing Innovation, John Wiley and Sons
173
p
THE CORE COMPETENCE OF THE
CORPORATION CK Perahalad G/ Hamel
END PRODUCTS
BUSINESS UNITS
CORE PRODUCTS
COMPETENCIES
INNOVATION STRATEGIES
• Miles & Snow(78)
• Freeman(82)
Defenders, Prospectors, Analyzers
Offensive, Defensive, Imitative,
Dependent, Traditional
Opportunistic
• Ettlie and Bridges(87) Aggressive technology policy
Long term investment in technological solution
Planning human resources for it
Openness the environment
Structural adaptation
• Kerin et al (92)
First movers
Ettlie J.E.(2006) Managing Innovation Elsevier p 111-114
THE AGGREGATE PROJECT
PLANNING FRAMEWORK
Technology change
Radical
Breakthrough
Next generation
Platform
Derivative
Improvement
Product
support
Base
New market
Impact on Market
New Customer More sales Replace current product
LINEAR MODELS OF INNOVATION
Technology Push
Starting
Point
Science and
Technological
Technology
Developments
R&D
Needs of the
Market
Marketing
Market
Manufacturing
Market(ing) ? Pull
Starting Point
Scientific
Knowledge
Market
Technology
Concept
Product
Development
Production
MARKETING PULL-TECHNOLOGY PUSH
MP: New market services and goods that seek new
technology
TP: New ideas in technology that seek applications
System Technology Map: Robot
Technology Push
Marketing Pull
Manipulation & Control
Automobile
Sensing: Vision, Tactile
Aerospace
Internal Communication
Electronics
Environment Communication
TECHNOLOGY PUSH NEED PULL
COMPARED
Technology push
• Start with what easily
can be researched
• Address the need of
the atypical user
• Get locked into one
technical solution
Need Pull
• Looks at needs that
are easily identified
• Continue to change
the definition of the
opportunity
• Lack a champion a
true believer
SIMULTANEOUS COUPLING MODEL
Manufacturing
R&D
Marketing
An Overview of Innovation in Landau and
Rosenberg (Eds )The Positive Sum Strategy
Washington DC National Academy of Sciences
INTERACTIVE MODEL OF INNOVATION
Scientific & Technological
Knowledge
Idea
R&D
Manufacturing
Technology
Push
Product
Marketing
Innovation
Market
Marketing Pull
Market
Knowledge
NETWORK MODEL
Freeman C. (1992) Network of Innovators, a synthesis of research issues in
Freeman C, The Economics of Hope London Pinter 93-120
R&D
Production
Marketing
Finance
Internal Environment
External Environment
Tidd J. Bessant J Managing innovation John Wiley 2006 p 287
Tidd J. Bessant J Managing innovation John Wiley 2006 p 304
Tidd J. Bessant J Managing innovation John Wiley 2006 p 338
TECHNOLOGY POLICY AND
COMPETITIVE STRATEGIES
Cost
leadership
Differentiation Focus segment
Cost –diff
Product
Reduce cost,
technology efficiency
change
Quality,
features
Designperformance
Process
Economies of
technology scale
change
Quality, faster
Tune productiondelivery
Porter M.E. “The Technological Dimension of Competitive Strategy” Research
on Technological Innovation Management and Policy 1 (1983) pp 1-33
THE INNOVATION MAP
Mn
Mfn
Mc
Mfc
M
Mf
The Firm/
Product
T
Tc
P
INTERNAL ENVIRONMENT
Tn
Pc
Pn
EXTERNAL ENVIRONMENT
KNOWLEDGE AXES AND GATE KEEPERS
`
Mn
Mfn
M
Mc
Mfc
Mf
T
P
Pc
Tc
INTERNAL ENVIRONMENT
Tn
Pn
EXTERNAL ENVIRONMENT
Knowledge axis
Gate Keeper
PHASES IN MARKET LIFE CYCLE AND
INNOVATION BASIS OF COMPETITION
Sales
Functionality Reliability
Early
Growth
Convenience Price
Mature
Time
DISK DRIVE PERFORMANCE MET
MARKET NEEDS
3000 MB
14 inch
200
Mainframe
Capacity
Provided
Capacity
Demanded
8 inch
30
5.25inch
A
10
6
3.5inch
HDD invade to
B
minicomputer HDD invade to
C
Source:
Christiansen p16
HDD invade to
Portable Computer
PC
74
78
80
85
90
TIME OF ADOPTION OF INNOVATION (Roberts)
TECHNOLOGY ADOPTION LIFE CYCLE
Innovators Early Early Majority Late Majority Laggards
Adopters
2.5% 13.5%
34%
Visionary Pragmatist
34%
Conservative
16%