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Business innovation everything you need to know!
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Summary BI:Chapter 1+2:
What Innovation is and why it matters
The succesful Exploitation of Ideas and first commercial Application/Production of a new
product or process. The Porcess of creating Value from ideas.
Creating value with growth and through recognizing opportunities to doing
something new
Making a change in the environment (social change, business growth)
Importance of innovation for a business' survival (continuity vs. change)
Strategic resource for getting an organization to where it wants to go
Driven by entrepreneurship, not just a random process (either external or internal)
Need of careful and systematic management to minimise the risk of innovation
(challenging to do it in an organized way and repeating it)
The four steps of the innovation core process
1. Recognizing opportunities
2. Finding resources
3. Developing the venture
4. Capturing value
Innovations don't have to be new, they can be...
o ...cost reductions
o ...product repositioning
o ...line extensions
o ...improvments to existing products
o ...new product lines
o ...completly new products
Three good questions for innovation
o What is desireable to users?
o What is possible with technology?
o What is viable in the marketplace?
The three parts of the innovation process
o Creative part (invention by the inventor)
o Business part (commercialization with multiple stakeholders)
o Social part (diffusion with multiple stakeholders)
SHAPE \* MERGEFORMAT
The four Dimensions of Innovation
Every Dimension has a specific type of change, pictured in the Brackets
Product (changes in the things (product/service) which the organization offers)
Process (changes in the ways that these offerings are created and delivered)
Position (changes in the context in which the product/service is introduced)
, Paradigm (changes in the underlying mental models which frame what the
organization does)
SHAPE \* MERGEFORMAT
Strategic Innovation
Makes sense to have a clear Direction and Framkework for Changes because Innovation
carries Risk and Uncertainty. It is not about writing a Report or having a detailed Plan but
more a Framework for Discussion and flexible learning Process with a core Role for
Leadership that provides Vision, Direction and streches the Goals of the Organizations. The
Leadership has to make sure that the Strategy is communicated with everybody for a higher
Contribution.
The three core questions of an innovation strategy
o Analysis (what could we do?)
o Selection (what are we going to do (and why)?)
o Implementation (how are we going to do it?)
Innovation strategy makes the organization capable to work in a complex and
changing environment
It creates routines to make innovation happen and adapt those routines to changes
Steps of the strategic management process
1. Mission
2. Objectives
3. Externals & internal analysis
4. Strategic choice
5. Strategy implementation
6. Competitve advantages
Basic framework strategy
o The firm (goals & values, resources & capabilities, structure & system)
↔︎Strategy ↔︎
o The industry environment (competitors, customers, suppliers)
A successful strategy is made through an effective implementation of...
o ...long-term, simple and agreed objectives
o ...profound understanding of the competitive environment
o ...objective appraisal of resources
Measuring performance (Resources ← Relevane → Goals ← Effectivness →
Results ← Efficiency → Resources)
The Resource-Based View
Determening Resources and Capabilities, comparing them with the Competitors and creating
Value out of them.
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