Innovation Management Models

© Operational Excellence Consulting. All rights reserved.
This presentation is a collection of PowerPoint diagrams and
templates used to convey 25 different innovation management
frameworks, models and methods.
Innovation Management
Models
Diagrams and Templates of Innovation
Management Frameworks & Models

© Operational Excellence Consulting. All rights reserved. 4
Contents
1. Three Horizons of Growth
2. The Innovation Matrix
3. Innovator’s Dilemma
4. Disruptive Innovation Model
5. Innovation Circle Model
6. Stage-Gate Model
7. Ten Types of Innovation
8. Blue Ocean Strategy
9. Human-Centered Design
10. Five Modes of Design Thinking
11. Business Model Canvas
12. Business Model Design Process
13. Value Proposition Canvas
14. Value Proposition Map
15. Customer Segment Profile
16. Empathy Map
17. Customer Journey Map
18. Six Thinking Hats
19. Jobs-To-Be-Done Framework
20. The Job Map
21. Technology Adoption Life Cycle
22. 70-20-10 Rule
23. Business Process Reengineering
24. Six Sigma Methodology
25. Six Steps of Kaizen
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Insert Header
Insert bumper – takeaway statement
Three Horizons of Growth Model (TEMPLATE)
Source: McKinsey
Time (Years)
Profit
Horizon 1
Extend and defend
core business
Horizon 2
Build emerging
businesses
Horizon 3
Create viable
options

Description of the Innovation Matrix
The Innovation Matrix (4 Types of Innovation)
DESCRIPTION
Sustaining
Innovation
Sustaining
Innovation
 Sustaining innovation also refers to incremental innovation. Most innovation
is conducted because something needs to perform better than it is able to do
now. The goal is improve and expand existing possibilities. Examples: Apple,
Toyota.
Breakthrough
Innovation
Breakthrough
Innovation
 This innovation is sometimes also called radical innovation, or revolutionary
innovation. The matrix shows that the problem is generally well formulated,
but that the road towards it, the skills, and domain are still somewhat unclear.
Examples: P&G, Innocentive.
Disruptive
Innovation
Disruptive
Innovation
 These tend to be new approaches to old products and services. Disruptive
innovations generally target light or non-consumers of a category so require a
new business model and therefore have high failure rates. Examples:
Google, 3M.
Basic ResearchBasic Research
 Basic research is conducted by large companies that invest in R&D,
universities, government institutions, non-profit research centers, and
individuals. Neither the problem nor the domain is well defined. The point is
to discover more about how things work. Examples: IBM Research, PARC.

Innovator’s Dilemma is one of the most significant and widely
recognized theories which is designed to explain psychological and
economic phenomenon regarding disruptive innovations
Source: Clayton Christensen
Innovator’s Dilemma

Disruptive Innovation is an innovation that leads to a product or
service designed for a new set of customers
Source: Christensen, Raynor & Mcdonald
Disruptive Innovation Model
PRODUCT
PERFORMANCE
Higher
Lower
Time

The Innovation Circle is a model for analyzing and managing the life
cycle of a new innovation
Source: Krebbekx & de Wolf
Innovation Circle Model
Function
Creation
Process
Market
Introduction
Order
Realization
Process
Utilization Receive
incentives
Generate
ideas
Product
Creation
Process
Service
Realization
Process
Creation
Implementation
Capitalization

The Stage-Gate model takes the process of developing an idea from
inception to launch and divides it into stages, separated by gates
Stage-Gate Model
Source: Cooper, Edgett & Kleinschmidt
Gate
1
Gate
2
Gate
3
Gate
4
Gate
5
Stage
1
Stage
2
Stage
3
Stage
4
Stage
5
Idea
Initial
screen
Decision on
business
case
Pre-
commercialization
business analysis
Post
development
review
Preliminary
investigation
Detailed
investigation
(build business
case)
Development Full production
and market
launch
Testing and
validation

Description of the five phases of the Stage-Gate Model
Stage-Gate Model
Phase Description
3 Development
After passing the third gate, where management has reviewed the
business rationale of the project, the actual detailed design and
development of the new product or new technology take place.
This often includes the design of the operation or production
process required for eventual full-scale production.
4 Testing and validation
After passing the fourth gate, where the technical feasibility (proof-
of-concept and/or prototypes) is reviewed, tests or trials in the
marketplace, laboratory and plant take place to verify and validate
the proposed new product or technology and its associated
brand/marketing plan and production/operation plan.
5 Launch
Once past the fifth gate, where the commercial feasibility (of the
validated product) is reviewed, the new product or technology is
commercialized and operations or production, marketing and
selling start at full scale.

Insert Header
Ten Types of Innovation Framework (TEMPLATE)
Source: Doblin
Profit
Model
Network Structure Process Product
Perfor-
mance
Product
System
Service Channel Brand Customer
Engage-
ment
Profit Model
The way in which
you make money
Structure
Alignment of your
talent and assets
Product
Performance
Distinguishing
features and
functionality
Service
Support and
enhancements
that surround your
offerings
Brand
Representation of
your offerings and
business
Network
Connections with
others to create
value
Process
Signature or superior
methods for doing
your work
Product
System
Complementary
products and
services
Channel
How your offerings are
delivered to customers
and users
Customer
Engagement
Distinctive
interactions you
foster
Offering ExperienceConfiguration

Six Blue Ocean Principles serve as a guide for creating uncontested
markets
Blue Ocean Principles
First principle
 Reconstruct market boundaries: identify commercially compelling blue
oceans in which the search risk is minimized
Second principle
 Focus on the big picture, not the numbers: tackle the planning risks by
focusing on the existing facts
Third principle
 Reach beyond existing demand: tackle the scope risk of aggregating the
greatest demand for a new offering
Fourth principle
 Get the strategic sequence right: reduce the business model risk by focusing
on how to build a robust model that ensures long-term profit
Fifth principle
 Overcome key organizational hurdles: reduce the organizational risk of
executing a blue ocean strategy
Sixth principle
 Build execution into strategy: focus attention on the motivation and use of
the competencies of employees to execute blue ocean strategy, thereby
overcoming management risk
Source: C. Kim, R. Mauborgne
Blue Ocean Strategy – Six Principles

The key to “Value Innovation” lies in challenging the industry factors
by answering four basic questions
Blue Ocean Strategy – The Four Actions Framework
Which factors should
be reduced well
below the industry’s
standard?
Which factors should
be raised well above
the industry
standard?
Reduce
Raise
Should factors should
be created that the
industry has never
offered?
Create
Which of the factors
that the industry takes
for granted should be
eliminated?
Eliminate
A new
Value Curve
Source: C. Kim, R. Mauborgne

HCD is a process that starts with the people you are designing for
and ends with new solutions that are tailor-made to suit their needs
Experience
Innovation
Emotional
Innovation
 Brands
 Relationships
 MarketingPeople
(desirability)
Business
(viability)
Technology
(feasibility)
Design
Thinking
Functional
Innovation
Process
Innovation
Start here
Three Lenses of HCD
Source: IDEO

Five Modes of Design Thinking
10

Insert Header
Five Modes of Design Thinking (TEMPLATE)
Source: Stanford d.school
Empathize
Define
Ideate
Prototype
Test

The Business Model Canvas consists of nine generic building blocks
for developing new or documenting existing business models
Business Model Canvas
Key Partners Key Activities Value Proposition Customer Relationships Customer Segments
Key Resources Channels
Cost Structure Revenue Streams
 What are our Key Partners?
 Who are our Key Suppliers?
 Which Key Resources are we
acquiring from partners?
 Which Key Activities do
partners perform?
 What Key Activities do our
Value Propositions require?
 Our Distribution Channels?
 Customer Relationships?
 Revenue Streams?
 What do we deliver to the
customer?
 Which one of our customer’s
problems are we helping to
solve?
 What bundles of products and
services are we offering to
each Customer Segment?
 Which customer needs are we
satisfying?
 What type of relationships
does each of our Customer
Segment expect us to
establish and maintain with
them?
 Which ones have we
established?
 How are they integrated with
the rest of our business
model?
 How costly are they?
 For whom are we creating
value?
 Who are our most important
customers?
 What Key Resources do our
Value Propositions require?
 Our Distribution Channels?
 Customer Relationships?
 Revenue Streams?
 Through which Channels do
our Customer Segments want
to be reached?
 How are we reaching them
now?
 How are our Channels
integrated?
 Which ones worked best?
 Which ones are most cost-
efficient?
 How are we integrating them
with customer routines?
 What are the most important costs inherent in our business model?
 Which Key Resources are most expensive?
 Which Key Activities are most expensive?
 For what value are our customers really willing to pay?
 For what do they currently pay?
 How are they currently paying?
 How would they prefer to pay?
 How much does each Revenue Stream contribute to overall revenues?
Source: Strategyzer

Business Model Canvas Template
Business Model Canvas (TEMPLATE)
Key Partners Key Activities Value Proposition Customer Relationships Customer Segments
Key Resources Channels
Cost Structure Revenue Streams
Source: Strategyzer

Description of the 5 Phases of Business Model Design
Mobilize Understand Design Implement Manage
Objective
Prepare for a
successful
business model
design project
Research and
analyze elements
needed for the
business model
design project
Generate and test
viable business
model options, and
select the best
Implement the
business model
prototype in the
field
Adapt and modify
the business
model in response
to market reaction
Focus
Setting the stage Immersion Inquiry Execution Evolution
Activities
 Frame project
objectives
 Test preliminary
business ideas
 Plan
 Assemble team
 Scan environment
 Study potential
customers
 Interview experts
 Research what has
already been tried
(e.g. examples of
failures and their
causes)
 Collect ideas and
opinions
 Brainstorm
 Prototype
 Test
 Select
 Communicate and
involve
 Execute
 Scan the
environment
 Continuously
assess your
business model
 Rejuvenate or
rethink your model
 Align business
models throughout
the enterprise
 Manage synergies
or conflicts
between models
5 Phases of Business Model Design
Source: Strategyzer

Example of Value Proposition Canvas – Tesla
8 YEAR
BATTERY
WARRANTY
8 YEAR
BATTERY
WARRANTY
MODEL S
60-85 kW-h
MODEL S
60-85 kW-h
OPTIONSOPTIONS
PERFORMANCE
0-100 km/h
4.4s – 6.2s
PERFORMANCE
0-100 km/h
4.4s – 6.2s
FOCUS ON
DESIGN & STYLE
FOCUS ON
DESIGN & STYLE
HIGH-TECH FEEL
WITH 17” TOUCH
SCREEN
HIGH-TECH FEEL
WITH 17” TOUCH
SCREEN
SUPER-
CHARGING
STATIONS
SUPER-
CHARGING
STATIONS ENABLING LONG
DISTANCE
TRAVEL
ENABLING LONG
DISTANCE
TRAVELFREE
½ CHARGE IN
20 MINS
FREE
½ CHARGE IN
20 MINS
BATTERY
45-90 km/h
BATTERY
45-90 km/h
5+2 SEATS
1,795 LITER
STORAGE
5+2 SEATS
1,795 LITER
STORAGE
RANGE
350-450 km
RANGE
350-450 km
HIGHEST
SAFETY BY
NHTSA
HIGHEST
SAFETY BY
NHTSA
CONVEY IMAGE
OF SUCCESS
CONVEY IMAGE
OF SUCCESS
OCCASIONAL
LONG DISTANCE
TRIP
OCCASIONAL
LONG DISTANCE
TRIP
IN SYNC W/
PERSONAL
VALUES
IN SYNC W/
PERSONAL
VALUES
DIFFERENTIATE
FROM OTHERS
DIFFERENTIATE
FROM OTHERS
COMMUTE TO
WORK
COMMUTE TO
WORK
PERSONAL
MONBILITY
PERSONAL
MONBILITY
ABOVE AVERAGE
MAINTENANCE
ABOVE AVERAGE
MAINTENANCE
BUYING BEFORE
PRICE DROP
BUYING BEFORE
PRICE DROP
BATTERY DRAIN
IN HOT WEATHER
BATTERY DRAIN
IN HOT WEATHER
ACCIDENTACCIDENT
CAR WITH BAD
DRIVING
BEHAVIOR
CAR WITH BAD
DRIVING
BEHAVIOR
FREQUENT
CHARGING
FREQUENT
CHARGING
FEAR OF DEAD
BATTERY
FEAR OF DEAD
BATTERY
LACK OF
CHARGING
STATIONS
LACK OF
CHARGING
STATIONS
LACK OF
NEARBY
SERVICING
LACK OF
NEARBY
SERVICING
LACK OF SPACELACK OF SPACE LAUGHED ATLAUGHED AT
ACCEPTABLE
CHARGING TIME
ACCEPTABLE
CHARGING TIME
PERFORMANCEPERFORMANCE
SAFETY RATINGSSAFETY RATINGS
HIGH-END
BATTERY
HIGH-END
BATTERY
RANGE
250-350 KM
RANGE
250-350 KM
DESIGNDESIGN
FIND MY WAY
(GPS)
FIND MY WAY
(GPS)
STATE-OF-THE-
ART
ELECTRONICS
STATE-OF-THE-
ART
ELECTRONICS
HIGH-END AFTER
SALES
HIGH-END AFTER
SALES
BRANDBRAND
SEATING 4-5
PEOPLE
SEATING 4-5
PEOPLE
Value Map Customer Profile
Customer Segment:
Upper middle class male, $100K+ income
Value Proposition:
Model S
Value Proposition Canvas – Tesla Example ILLUSTRATIVE

The Value (Proposition) Map describes the features of a specific value
proposition in terms of products and services, pain relievers and gain
creators
Value Map
This is a list of all the
Products and
Services a value
proposition is built
around.
Pain Relievers
describe how your
products and services
alleviate customer
pains.
Gain Creators describe
how your products and
services create
customer gains.

Customer Segment Profile
15

Insert Header
Customer Profile (TEMPLATE)

Description of the components of an Empathy Map
WHAT DOES SHE
SEE?
DESCRIBE WHAT THE
CUSTOMER SEES IN
HER ENVIRONMENT
 What does it look like?
 Who surrounds her?
 Who are her friends?
 What types of offers is
she exposed to daily
(as opposed to all
market offers??
 What problems does
she encounter?
WHAT DOES SHE
HEAR?
WHAT DOES SHE
REALLY
THINK & FEEL?
DESCRIBE HOW THE
ENVIRONMENT
INFLUENCES THE
CUSTOMER
 What do her friends
say?
 Who really influences
her, and how?
 Which media channels
are influential?
TRY TO SKETCH OUT
WHAT GOES ON IN
YOUR CUSTOMER’S
MIND
 What is really important
to her (which she might
not say publicly)?
 Imagine her emotions.
What moves her?
 What might keep her
up at night?
 Try describing her
dreams and aspirations
Empathy Map
Source: XPLANE

ILLUSTRATIVEEmpathy Map
Example 2: Empathy Map
Pain
Gain
Software
Developer
Think & Feel
Say & Do
Hear See
I’m going to
get fired
I think we’re
doing another
reorg
Microsoft
Project &
Excel
What if we
don’t need
that right
now?
Our stock is
down 15%
We’re
behind
schedule
Don’t rock
the boat
I have an idea
to solve that
nagging
problem
Did we ask
the
customer?
Yes I’ll have
that report
for you next
week
People
promoted for
green status
projects
Frustrated
coworkers Cubicles
everywhere
I’m so tired of
building
products no
one uses
This could
change
everything
I need
support
from peers
A software developer’s concern about work

Customer Journey Mapping is a method of documenting and
visualizing the experiences the customers have with your
organization with the intention of improving these interactions
Customer Journey Mapping
ILLUSTRATIVE
Customer
Actions
Activity Phase
Touchpoints
Thinking
Feeling
Backend
Processes
Enter Starbucks Find Seat Buy Coffee Wait for Coffee Drink Coffee
Look at café
surroundings
Entrance / Posters /
Signages
 Am I entering
the right place?
 Is the air-con
cold enough?
Walk towards
counter
Café space
 Can I find seats?
 Is there a long
queue?
Queue at the
counter to be served
Ordering Counter /
Wall Menu Display
 Which coffee do
I want?
 How much does
it costs?
Payment process (cash
/ membership card /
mobile app)
Seat at the table
Seat
 Is the seat
taken?
 Coffee done just
right. Yummy! 
Clearing the tables
Wait at the counter
Collection Counter
 How long do I
have to wait?
 Is the coffee
order correct?
Brew the coffee
+
-

Goals
Doing
Thinking &
Feeling
Stages
Metrics
Opportunities
Neutral
Positive
Negative
10
8
6
4
2
7
2
5
3
8
Insert Header
Customer Journey Map (TEMPLATE)

Insert Header
Six Thinking Hats (TEMPLATE)
The White Hat - Facts
White hat thinking focuses on
data, facts, information known
or needed.
The Yellow Hat - Benefits
Yellow hat thinking focuses on
values and benefits. Why
something may work.
The Red Hat - Feelings
Red hat thinking focuses on
feelings, hunches, gut instinct
and intuition.
The Black Hat - Cautions
Black hat thinking focuses on
difficulties, potential problems.
Why something may not work.
The Blue Hat - Process
Blue hat thinking focuses on
managing the thinking process,
focus, next steps, action plans.
The Green Hat - Creativity
Green hat thinking focuses on
creativity: possibilities,
alternatives, solutions, new ideas.
Source: Edward de Bono

The Jobs-To-Be-Done (JTBD) framework reveals the 5 types of jobs that
the job executor, the product lifecycle support team and the buyer are
trying to get done
The Jobs-To-Be-Done Framework
Source: Strategyn
Job Steps
(Conclude)
Job Steps
(Modify)
Job Steps
(Monitor)
Job Steps
(Execute)Job Steps
(Confirm)
Job Steps
(Prepare)
Job Steps
(Locate)
Job Steps
(Define)
Cross Functional Job
Related
Jobs
Emotional
Jobs
Install
Setup
Learn
to useInter-
face
Trans-
port
Clean
Store
Main-
tain
Upgr-
ade
Repair
Dispose
Consumption
Chain Jobs
Product Lifecycle
Support Team
Receive
Purchase
Financial
Metrics
Purchase
Decision
Maker
Job-to-be-Done
Needs Framework
Job Executor

Insert Header
The Jobs-To-Be-Done Framework (TEMPLATE)
Source: Strategyn
Job Steps
(Conclude)
Job Steps
(Modify)
Job Steps
(Monitor)
Job Steps
(Execute)Job Steps
(Confirm)
Job Steps
(Prepare)
Job Steps
(Locate)
Job Steps
(Define)
Cross Functional Job
Related
Jobs
Emotional
Jobs
Install
Setup
Learn
to useInter-
face
Trans-
portClean
Store
Main-
tain
Upgr-
ade
Repair
Dispose
Consumption
Chain Jobs
Product Lifecycle
Support Team
Receive
Purchase
Financial
Metrics
Purchase
Decision
Maker
Job-to-be-Done
Needs Framework
Job Executor

Insert Header
The Job Map (TEMPLATE)
Source: Strategyn
Define Locate Prepare Confirm
Execute Monitor Modify Conclude
1. Define your customers goals and resources.
2. Locate what information is needed to do the job.
3. Prepare the environment where the job will be done.
4. Confirm that your customer is ready to get the job done.
5. Execute the job.
6. Monitor the job so that it's successfully executed.
7. Modify and make alterations to improve execution.
8. Conclude the job or repeat.

DESCRIPTION
InnovatorsInnovators
 People who are enthusiastic about new technology and have a
high risk tolerance. They are keen to be the first ones to try out a
new technology and allow to adopt innovation, even if it might
eventually fail.
Early adoptersEarly adopters
Early majorityEarly majority
Late majorityLate majority
LaggardsLaggards
 More discreet in their adoption choices compared to innovators,
but appreciative to potential products that may give them or their
organization a competitive advantage.
 People who adopt an innovation after a significantly longer time
compared to innovators or even early adopters. Makes up the
majority of the market.
 Adopt an innovation after the average participant, extremely
cautious and willing to see proof of results and usefulness before
buying.
 The last ones to adopt an innovation. Extremely skeptic and will
buy a new technology only if they really must.
Technology Adoption Life Cycle: Description of adopter categories
Technology Adoption Life Cycle

The 70-20-10 Rule is a simple rule for allocating resources between “the
core”, “the adjacent” and “the innovative stuff”, often referred to as
“the transformational”
70-20-10 Rule
INVESTMENT LONG-TERM RETUENS
CORE
ADJACENT
TRANSFORMATIONAL
70%
70%
20%
20%
10%
10%
The Core refers to the
activities that make up
the majority of existing
business
Adjacent refers to new
improvements and logical
extensions for the current
business
Transformational refers
anything brand new for
the organization that isn’t
related to the core

Since the Three Horizon Growth model and the 70-20-10 Rule are
focusing on the exact same thing, these two diagrams can be combined
for a more practical look at the issue
70-20-10 Rule
HORIZON 3:
Transformational
70%
20%
10%
HORIZON 3:
Adjacent
HORIZON 1:
The Core

Business Process Reengineering (BPR) is the fundamental
reconsideration and radical redesign of organizational processes
Business Process Reengineering Model
1.
Determine Scope
& Goal
1.
Determine Scope
& Goal
3.
Install
Management
3.
Install
Management
4.
Implement &
Integrate
4.
Implement &
Integrate
Indicator for need:
 Conflicts
 Meetings
 Non-structure
communication
 Strategic dialog
Key elements:
 Focus on output
requirements
 Critical success
factors
 Efficiency
Key elements:
 Define management
tools
 Performance
measurement
 Learning
 Compensation
Key elements:
 Install management
 Manage change
management
2.
Redesign Process
Structure
Source: Hammer & Campy

Six Sigma Methodology
24

 Identify the critical
business issues
and concerns
 Understand the
current process
and it’s customers
 Characterize the Y
and potential X’s
 Collect data for
process elements
 Verify/quantify
important X’s
 Identify factors
(X’s) that have an
influence on the
business issue.
 Implement
solutions to
improve Y
 Adjust the factors
that influence the
business concerns
 Manage important
X’s and monitor the
Y over time
 Mange routine or
day-to-day
operations for
these critical
factors
 DMAIC allows for the utilization of multiple tools and techniques when improving
processes; including statistics and Lean techniques.
 The Control phase allows teams to develop a process to ensure improvement
results will be sustained over the long-term.
Define
Opportunity
Define
Opportunity
Measure
Performance
Measure
Performance
Analyze
Opportunity
Analyze
Opportunity
Improve
Performance
Improve
Performance
Control
Performance
Control
Performance
Each step in the DMAIC process is required and results in
deliverables that ensures the team is focused on key process metrics
Six Sigma DMAIC Model

Insert Header
Six Sigma DMADV Model (TEMPLATE)
DefineDefine
MeasureMeasure
AnalyzeAnalyze
DesignDesign
VerifyVerify

Insert Header
Six Steps of Kaizen (TEMPLATE)
1. Discover
Improvement
Potential
2. Analyze the
Current Methods
3. Generate
Original Ideas
4. Develop an
Implementation
Plan
5. Implement the
Plan
6. Evaluate the
New Method
Source: Kato & Smalley

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