Strategic Innovation Capita Selecta Dr Hugo Velthuijsen, lector New Business & ICT

Center of Applied Research & Innovation: Entrepreneurship2 Position Professor Business & IT Leading Professor Center for Applied Research and Innovation on Entrepreneurship Education M. Sc. Mathematics Ph.D. Computer Science/Artificial Intelligence Experience 11 yrs research & development in The Netherlands and the USA 3 yrs ICT company 8 yrs business management ICT company 4 yrs Hanze University of Applied Science Dr Hugo Velthuijsen Introduction

Center of Applied Research & Innovation: Entrepreneurship3 Intrapreneurship inside KPN The biggest company turnaround in The Netherlands ■8 yrs of continuous change after near bankruptcy ■Approx lay offs (>30%) ■Crisis as a means to an end ■Quarterly results on target without fail ■Strong in financial results, challenge in innovative power

Center of Applied Research & Innovation: Entrepreneurship4 Entrepreneurship vs Intrapreneurship Who would you rather like to be?

Leadership vs Management Center of Applied Research & Innovation: Entrepreneurship5

6 ■NOT: a great idea to start the company ■NOT: charismatic leaders ■NOT: maximising profits ■NOT: “correct” core values ■NOT: only constant is change ■NOT: play it safe (BHAGs) ■NOT: great places to work for everyone ■NOT: briljant and complex strategic planning ■NOT: change from without ■NOT: focus on beating the competition ■NOT: “tyranny of the OR” ■NOT: through vision statements The Classics (1) Visionary companies

Center of Applied Research & Innovation: Entrepreneurship7 ■Level 5 leadership: personal humility and professional will ■First who, then what ■Face facts ■Passion + world class ability + business model ■Culture of discipline + entrepreneurship ■Technology accelerators ■Flywheel The Classics (2) Overcoming mediocraty

New Business & ICT8 The Classics (3) Crawford model – choose in which to excel LevelAccessExperiencePriceProductService DominateSolutionIntimacyAgentInspireCustomize DifferentiateConvenientCareConsistentDependableEducate At parEasyRespectHonestCredibleAccommodate Sub parHassleDisrespectMisleadingPoorForgettable Recipe for success: Dominate with 1 attribute; differentiate with a 2nd, operate at par with the rest (from: “The myth of Excellence”, Crawford & Mathews, 2001)

Center of Applied Research & Innovation: Entrepreneurship9 ■Canvas model ■9 pieces to the puzzle ■All parts need to fit and to support each other The classics (4) Understanding your business

New Business & ICT10 Opposition will be there Pre-empt opposition Look for lowest common multiple instead of greatest common divisor Strategisch Omgevingsmanagement

New Business & ICT11 China, India, fomer Soviet Union 3bn new capitalists India: new IT bachelors graduate every year Better educated, more eager Seamless collaboration thanks to New IT / Web 2.0 / Broadband Extreme competition The Network Economy

New Business & ICT12 N = 1 R = G The power shifts to the customer The Network Economy

New Business & ICT13 Market development

New Business & ICT14 Marktbenadering Het echte wonder van Apple en Steve Jobs

Center of Applied Research & Innovation: Entrepreneurship15 Work hard or work smart Inspiration or perspiratieon ■The hour rule ■Timing is key ■Gates & Jobs became experts by chance ■Gates & Jobs came at the right time

New Business & ICT16 Marktbenadering Apple is het schoolvoorbeeld van een heart brand Simon Sinek: the golden circle

Center of Applied Research & Innovation: Entrepreneurship17 ■Understanding customers and what the want, even before they know it ■Mastery of market dynamics ■Acumen of a poker champ ■Commitment to excellence ■Brutal rejection of “good enough” ■Accountability when things go wrong ■Charisma that make product launches as exciting as a Bruce Springsteen show ■“If anybody’s going to make our products obsolete, I want it to be us.” Steve Jobs, The Perfect CEO Wired, October 2011

Center of Applied Research & Innovation: Entrepreneurship18 ■IJdel ■Gierig ■Jaloers ■Gulzig ■Wraakzuchtig Van de zeven hoofdzonden scoort Jobs er vijf Technisch weekblad, 22 oktober 2011

Center of Applied Research & Innovation: Entrepreneurship19 Leiderschapsstijl Steve Jobs Inspirator of dictator

20 Evolution of supporting tools The Network Economy

New Business & ICT21 Production Marketing & Credibility Sales Distribution Business Model Example Music industry The internet has the power to destroy The internet as the great equalizer Source: David Byrne (Talking Heads) in Wired

New Business & ICT22 Thanks to the internet: –Smaller markets become addressable –Lower marketing & distribution costs –More choice Niches are getting more important Results in: –Decline in “best sellers” –More items –Higher total volume –Market growth

New Business & ICT23 Nothing in life is free… Free mobile Free CD Radiohead Free demo software Free web service Free club entrance Free drugs Free google search

New Business & ICT24 14 yrs young Ambition: to make available all information on Earth Business model defined after 5 years Market capitalization is starting to equal Microsoft’s New common enemy (used to be MicroSoft) More recent innovations through acquisitions –Google Earth –Gmail –Etc. An example New Business

25 Transaction costs have changed The Network Economy In the Next Industrial Revo- lution, Atoms Are the New Bits Mid-30s: Big organisations exist to minimize transaction costs (Ronald Coarse) Now: transaction costs are much lower Cost of overhead and bureaucracy much less offset

26 Traditional way of doing business is changing The Network Economy The IT industry is leading

27 Changing the relationship of businesses with their customers The Network Economy Customers: are better informed about you are better informed about competitors are better informed about their own preferences are global have more choice expect better service are easier to communicate with

Center of Applied Research & Innovation: Entrepreneurship28 The impact of social media Unstoppable force and powerful new tool kit

29 Social networks organising citizen participation into a 7 th power? The Network Economy Trias Politica Legislative Executive Judiciary Three additional powers Civil service Media External consultants

New Business & ICT30 The wisdom of crowds Business communities Social networking Integrating in business practices Solving SMEs problems? –Good employees –State of the art knowledge –Innovative power Global sourcing Crowdsourcing

New Business & ICT31 Caveats There are more ideas outside the company than inside Profit from the ideas of others Being smarter more important than being first The whole world can help you Open innovation

New Business & ICT32 Some ways to exploit different forms Xxxxxxxxx Crowd sourcing Shared innovation Professional networks Xxxxx (Out)sourcing The Network Economy

specificity standardspecific Added value high low workstation management communication Service management I II Data centers Adapted Kraljic model Tool for classifying systems & processes

New Business & ICT34 Thank you Any questions?