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Understand innovation
- 3. What can you learn from this?
• What innovation is
• Why it’s important
• The types of innovation
• The degrees of innovation
© Gordon Graham 2008
- 4. What is innovation?
Hundreds of similar definitions can be found
in the literature. Here is the one I use,
adapted from various sources:
“Innovation is the profitable implementation of
ideas.”
© Gordon Graham 2008
- 5. A Broad, American Perspective:
"Implementing new ideas that create value.”
- Innovation Network, U.S.A.
"The intersection of invention and insight, leading to
t
the creation of social and economic value."
- U.S. National Innovation Initiative
© Gordon Graham 2008
- 6. What about the Brits?
"The development of new ideas and their economic
a
application as new products or processes."
- U.K. Dept. Trade and Industry
© Gordon Graham 2008
- 7. An innovation can increase profits
on the value side (customers value
an innovation enough to pay more
for it) . . .
© Gordon Graham 2008
- 8. . . . or the cost side (the company
produces a product offering in a
more efficient way).
© Gordon Graham 2008
- 9. Either way, value is created for the
firm and the consumer.
$
© Gordon Graham 2008
- 10. What are the essential ingredients, or
elements, of an innovation
ecosystem?
*
* * *
** *
* *
*
© Gordon Graham 2008
- 11. There are many. They are rooted in national
culture and can take years to develop: Trust,
Curiosity, Tolerance of Diversity, Faith,
Confidence, Lack of Fear, the Will to a)
make the world a better place and b) wreck
the status quo c) take risks and fail.
© Gordon Graham 2008
- 12. Some firm-level elements include: a written
innovation strategy, a filter, an innovation
process, a rewards and recognition system,
humility, respect for seemingly insignificant
technologies/competitors (healthy paranoia)
etc.
© Gordon Graham 2008
- 13. An invention is different from an
innovation at any particular time in
that it doesn’t have commercial
value but . . .
© Gordon Graham 2008
- 14. . . . it may have in future.
© Gordon Graham 2008
- 15. Think of invention as the laying of
an egg, innovation as the laying,
incubation and hatching.
© Gordon Graham 2008
- 16. There is no shortage of ideas and
inventions in the world. The
challenge is to introduce these
successfully to a market.
© Gordon Graham 2008
- 17. Only then can the idea/invention be
called an innovation.
© Gordon Graham 2008
- 18. In other words, innovation requires
interplay between a product offering
(technology) and a market (people).
© Gordon Graham 2008
- 20. A market can be inside or outside
the firm’s physical walls.
© Gordon Graham 2008
- 26. Old strategies get replicated and,
consequently, margins get squeezed.
© Gordon Graham 2008
- 30. . . . but all these labels just describe
where something new, better or
different occurs.
© Gordon Graham 2008
- 32. Product
Process
Service
Business model
Value
Market
© Gordon Graham 2008
- 33. . . . and many more, depending on
level of detail. Basically, innovation
can occur anywhere in the firm’s
business by anyone. We all have
great potential!
© Gordon Graham 2008
- 34. Note!
There is another type that needs to be
considered separately. This is “disruptive
innovation,” a term first coined by Clayton
Christensen. Disruptive innovation refers to a
firm’s strategy relative to other firms. Often,
low-cost business models and “good enough”
solutions/products for low-end and/or non-
consumers
© Gordon Graham 2008
- 37. . . . however, they all describe the
degree of change required by the
innovating firm and/or the market.
© Gordon Graham 2008
- 42. Here’s a quote:
"He who innovates will have for his
enemies all those who are well off under the
existing order of things, and only
lukewarm supporters in those who might be
better off under the new."
Niccolo Machiaveli, The Prince
© Gordon Graham 2008
- 43. Thanks!
I completed an MSc dissertation on
Innovation in Taiwanese/Chinese
companies active in multiple international
markets. Please feel free to get in touch if
your firm is working in China, Taiwan
e
etc., as I’m interested in these areas.
Gordon@ westportwire.com
© Gordon Graham 2008