3. Innovation in Business (Schumpeter, 1934)
1. Introduction of a new/improved good
2. Introduction of a new method of
production
3. Opening new market or territory
4. Conquest of a new source of raw
materials
5. New type of organization
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4. Innovation in Business (Schumpeter, 1934)
1. Introduction of a new/improved good
Sweet
Chocolate
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5. Innovation in Business (Schumpeter, 1934)
2. Introduction of a new method of
production
Henry Ford’s
Assembly Line
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6. Innovation in Business (Schumpeter, 1934)
3. Opening new market or territory
Shushi in US
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7. Innovation in Business (Schumpeter, 1934)
Sugar Beets
in 1870s
4. Conquest of a new source of raw
materials
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8. Innovation in Business (Schumpeter, 1934)
Japanese
Automotive
Administration
5. New type of organization
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9. Innovation in Business (Schumpeter, 1934)
1. Introduction of a new/improved good
Sweet
Chocolate
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10. Steve Jobs
Master of
Innovation as
improvement
of an existing
good
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23. Ethnographic (Inductive)
Opportunity Analysis
Deductive Approaches
– Hypothesis Data Collection Analysis
from general to specific
Inductive Approaches
– Data Collection Analysis Hypothesis
from specific to general
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30. The Business Case for User-
Driven Innovation
Unprecedented specialization and
segmentation, multiplied many times over
by domestic and international cultural
diversity.
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31. The Value of the Use Case
Entrepreneurs can neither assume
that they are socially or culturally
close to users nor that they can keep
up with consumer trends themselves –
unless they seek user-centered
insights.
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32. Increased Competition
Increased competition from emerging
economies
Companies can no longer rely on the
advantages of being the first to introduce
new technologies to the market.
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33. Democratization of
Knowledge
The democratization of knowledge, driven by the
internet and information technology in general
Armed with lots of information and the ability to
buy from companies all over the globe, consumers
no longer consider the price/quality trade-off as the
sole driver of choice.
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34. Democratization of
Knowledge
Instead, consumers increasingly consider how a
company and its products match their own
personal values, behaviors and needs.
To get at this, successful companies must include
users in the innovation process.
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35. Just to Stay Solvent
As Squires and Byrne put it: “…companies
have to manufacture the right commodities and
deliver them in the right way to the right
consumers at least four out of ten times every
year – just to stay solvent” (Squires and Byrne
2002:xiv).
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36. Traditional R&D departments and
entrepreneurs with their own views on
“what people want” can no longer
keep up with the reality of rapidly
evolving needs and desires.
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37. THE ASSIGNMENT
1) Conduct some sort of “inductive
observation”,
2) analyze your notes, then
3) expand those notes into a brief
report about what you found.
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38. DESCRIPTION
– Rather than looking into a completely
innovative idea (service or product), the
goal is to 1) observe something that
already works; 2) observe it in great
detail; then 3) begin to understand it in
such detail that you can 4) make
concrete suggestions about improving it.
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39. In Other Words
– Rather than looking for how consumers
COULD use a NEW service/product, the
goal is to observe how consumers DO
use a EXISTING service/product with the
intention of looking for opportunities to
improve or “add value” to that
experience.
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40. Steps
– 1. Find a routine, taken-for-granted
task/service/product,
– 2. “Hang out” and “thickly describe” it in a
notebook,
– 3. In a one page pitch, suggest some sort of
innovation that will add value. DUE: next
Wednesday March 14 by 3:00pm in class.
– The best observations will be published on our
blog and presented in class on March 21st.
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