MODULE 2 TYPES OF INNOVATION 1

DEFINITION OF INNOVATION Definition source: Innovation is: “The creation of new or improved knowledge with potential on implementation to business of the company, with positive impact and market acceptance”. Keywords: new/improved knowledge, implementation to business. 2

1. Meaning of innovation 2. Think innovative – exercise 3. Types of innovation DefinitionsExamplesApplications 4. New approach CONTENT 3

Think...simple 1. Meaning of innovation 4

Innovation New… Great idea …Money… 1. Meaning of innovation 5

Business innovation Technology innovation Product innovation Process innovation Organizational innovation Marketing innovation Strategy innovation 6

1. Meaning of innovation Business innovation Technology innovation Product innovation Process innovation Organizational innovation Marketing innovation Strategy innovation 7

You're in a high street coffee shop (see pictures). 2. Think innovative – exercise Imagine a "Future coffee shop", "Internet café" or “Cybercafe“, based on new progress in IT. 8

Internet café 2. Think innovative – exercise Lapcoffee Wi-Fi network 9

3. Types of innovation development of Business innovation involves a wide spectrum of original concepts, including development of:  - new ways of doing business,  - new business models,  - business application of technology and communications,  - new management techniques, environmental efficiency,  - new forms of stakeholder participation, telecommunication, transport and finance. 10

In some cases, the innovation rests not in the technology or product or service, but in the business model itself. It is much related to non- technological innovation and to innovative services. 11

... is the implementation of a new organisational method in the firm’s business practices, workplace organisation or external relations. 12

customer value newly emerging customer needs  Strategy innovation is about challenging existing industry methods of creating customer value in order to meet newly emerging customer needs, add additional value and create new markets and new customer groups for the sponsoring company. 13

Why strategy innovation? You should respond by adopting a new approach to strategy, one that combines:  … You should respond by adopting a new approach to strategy, one that combines:  …  speed,  openness,  flexibility,  forward-focused thinking.  speed,  openness,  flexibility,  forward-focused thinking. 14

 In China, some doctors are paid monthly when their patients are healthy. If you are sick, it‘s their fault, so you don‘t have to pay that month. It‘s their goal to get you healthy and keep you healthy so they can get paid. Doctor s aren’t paid Doctors are paid Strategy innovation example 15

1 What do you think about this ? 2 What do you think about the profit of this idea? 3 In your opinion is it simple to implement this? 16 Toilet paper - example

significant changes in product design or packaging,  “A marketing innovation is the implementation of a new marketing method involving significant changes in product design or packaging, product placement, product promotion or pricing.” OECD – The OSLO Manual Social media 17

 A product innovation is the introduction of a good or a service that is new or significantly improved with respect to its characteristics or intended uses. 18

New products Improved products New services Improved services Types of product innovation 19

Exercise: Propose some idea to improve this product : 20

1 What do you think about this ? 2 What do you think about the profit of this idea? 3 In your opinion is it simple to implement this? 4 What else could be improved to this? 5 What disadvantage (s) would be? Possible solution: 21

 “A process innovation is the implementation of a new or significantly improved production or delivery method. This includes significant changes in techniques, equipment and/or software”. 22 Example 1

1913 Cars were built individually by hand Car mass production FORD – Assembly line Example 2 23

FORD – Assembly line Principles: interchangeable parts; continuous flow; division of labor; reducing wasted effort. Benefits: increase of productivity; wage growth (from 2.5 $/h to 5.0 $/h); raise of company profit (from $30 ml. in 1914 to $60 ml. in 1916); attraction of best mechanics. New verb: “to Fordize” (to standardize in the interests of efficiency and mass production) 24

 Technology innovation: implemented technologically new products and processes and significant technological improvements in products and processes. Explosive technology Implosive technology Technology innovation The product or process should be new from the point of view of the firm that introduced it. 25

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Discussion 27 Marketing or technology innovation ?

4. New approach Triangle: Creativity, R&D, Innovation 28

The attitude to look beyond the current reality and become something we are not yet. There is no motivation without future vision, and without motivation there is no possibility to innovate, to undertake, to assume new risks. Having a future vision allows venturing to exercise our creative thought. “Creative personality is made, not born” 4. New approach 29

Thank you! 30