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CONTENTS• INVENTION AND INNOVATION• TYPES OF INNOVATION• SOURCES OF INNOVATIVE OPPORTUNITIES• PRINCIPLES OF SUCCESFUL INNOVATION• “SCAMPER”- A METHOD FOR IDEA GENERATION• EVALUATING A BUINESS IDEA
The difference between Invention and Innovation• Invention - is the creation of new products, processes, and technologies not previously known to exist.• Innovation - is the transformation of creative ideas into useful applications by combining resources in new or unusual ways to provide value to society through improved products, technology, or services.
The difference between Invention and Innovation DISCOVERY/INVENTION INNOVATION• X-RAY • MEDICAL X-RAY• LIGHT-SENSITIVITY OF • PHOTOGRAPHY& SILVER COMPOUNDS CAMERA• SEMI-CONDUCTORS • RADIO• STORAGE OF DATA ON • MAGNETIC TAPE , MAGNETIC SURFACES CASSETTES & DISKETTES• LASERS • CDs , DVDs• E=MC^2 • NUCLEAR POWER
The difference between Invention and InnovationIn a market driven economy, the real winner is thecompany that can make something valuable through innovation – not the inventor who happens to come up with something that THE MARKET may or may not want. Innovation happens when you figure out how to make money from an invention. Necessity is the mother of Invention Profit motive and Creativity are the parents of Innovation!
SCHUMPETER’S TYPES OF INNOVATION• Source of supply,• Technology,• Commodity (Product),• Markets,• Type of organization
Drucker’s Seven Sources for Innovative Opportunities1. The Unexpected2. The Incongruity3. Innovation based on process need4. Changes in industry or market Structure5. Demographics6. Changes in perception, mood and meaning7. New Knowledge
DRUCKER’S PRINCIPLES FOR SUCCESFUL INNOVATION1. Begin with an analysis of the opportunity.2. Analyze the opportunity to see if people will be interested in using the innovation.3. To be effective, the innovation must be simple and clearly focused on a specific need.4. Effective innovations start small5. Aim at market leadership
SCAMPER ~ TECHNIQUES FOR INNOVATION• SUBSTITUTE, SIMPLIFY• COMBINE• ADAPT• MODIFY, MAGNIFY, MINIFY• PUT TO OTHER USES• ELIMINATE• REVERSE, REARRANGE
Screening Ideas: Are they Opportunities? 5 Questions1. What important customer problem can you solve?2. How are you going to do it?3. How many customers are there that are willing to buy from you?4. Why can only you provide the solution?5. How can you defend against others? Ask these questions BEFORE somebody else does!
Screening an Opportunity: 5 Questions1. What important customer problem can you solve? How valuable? How painful? Remember, you need to change somebody’s behavior to buy your product.
Screening an Opportunity: 5 Questions2. How are you going to do it? Business model: Product Distribution Location Technology/Innovation Service Brand
Screening an Opportunity: 5 Questions3. How many customers are there that are willing to buy from you? How many customers are there? (Market size) How many will buy from you? (Market share) Who will be your first customer (besides your Mom)? Who will be your 100th?
Screening an Opportunity: 5 Questions4. Why can only you provide the solution? How are you unique? What do you provide that nobody else can?
Screening an Opportunity: 5 Questions5. How can you defend against others? Location, Brand, Patent (or other IP), Great service, great taste, great fashion sense….