1. © Smart Hammer Innovation Mark Adkins February 23 rd, 2011 Linking Lean with Innovation™ (and more)

2. © Smart Hammer Innovation Today’s Focus & Definition Product Development Diversification Market Penetration Market Development Current Market New Product Current Product New Market Product Development Market Development Ansoff Product Market Matrix

3. © Smart Hammer Innovation Evolution of the Concept A 20 Year Journey Both as Practitioner and Consultant Dozens of Industrial B2B Companies Dozens of Thought Leaders and Collaborators 1. 1993 Stage Gate 2. 1998 Wolfpack 3. 2003 Open Innovation 4. 2007 Lean Thinking 5. 2010 Design Thinking

4. © Smart Hammer Innovation 1990 First Product Launch

5. © Smart Hammer Innovation 1993 Stage Gate: Phases and Gates Are the Dominant Design 1 24 5 3 Opportunity Identification Concept Generation Concept Evaluation Development Launch Business Case

6. © Smart Hammer Innovation 1993 Stage Gate: Phases and Gates Are the Dominant Design  The “Bible”  Process - Not a Collection of Projects  Discovery – Develop – Deliver  Risk Management  Portfolio Management

7. © Smart Hammer Innovation 1998 Wolfpack Cincinnati Machine Wins Outstanding Innovator Award Wolfpack = “Stage Gate on Steroids”

8. © Smart Hammer Innovation 1998 Wolfpack Cincinnati Machine Wins Outstanding Innovator Award Criteria for receiving the PDMA’s OCI Award: 1.Sustained success in the introduction of new products to the market 2.Significant company growth driven by new product success 3.A defined new product development process accessible to others 4.Unique and innovative characteristics of that organization’s process Multiple Projects Integral Part of the Operation Metrics Based System Process Tools Portfolio Management

9. © Smart Hammer Innovation 2003 Open Innovation The Product Development Pipeline Becomes Permeable

10. © Smart Hammer Innovation 2003 Open Innovation The Product Development Pipeline Becomes Permeable What is New? Outsourced R&D, technology collaboratives and licensing have been around for years. 1.Prominent “search” practitioners 2.Improved product innovation models 3.Internet based networks –technical and market solutions More Ways to Get the Great Idea More Ways to Compress Time to Market More Efficient Cost Structure

11. © Smart Hammer Innovation 2003 Lean Thinking Harley Davidson Defines Swirls & Bins

12. © Smart Hammer Innovation 2007 Lean Thinking Knowledge Systems are Fundamental  “Stages & Gates are Evil”  Phases Become Learning Cycles  Set Based Design  Advance Knowledge, Don’t Just Test  Gates Become Pull Events  Built Upon integration Points  The Value of Visual Management  Value Stream Mapping and Oobeya

13. © Smart Hammer Innovation 2007 Lean Thinking Ohio Funds the Partnership for Lean Innovation

14. © Smart Hammer Innovation 2010 Design Thinking Brand & Design Join Engineering & Marketing BRAND STRATEGY PORTFOLIO RESOURCES BUSINESS LEVEL Brand – Portfolio – Resources The Iron Triangle at the Business Level Risk – Cost – Value The Iron Triangle at the Project Level

15. © Smart Hammer Innovation  Brand & Design Ignored by Industrial B2B’s – All Acknowledge a Company Culture But Brand is Just a Brochure  Martin’s Knowledge Funnel – Mystery/Heuristic/Algorithm = Discover/Develop/Deliver – Domination of Analytics over Intuitive = Weak Discovery – Validity and Reliability Must Co-exist = Lean Innovation You Can’t Consistently Develop Great Products Without Design & Brand 2010 Design Thinking The Knowledge Funnel Meets the NPD Pipeline

16. © Smart Hammer Innovation BRAND STRATEGY PORTFOLIO RESOURCES IDEABUSINESS CASELAUNCH DISCOVERY DEVELOPMENT PROJECT LEVEL BUSINESS LEVEL 2011 Linking Lean with Innovation™

17. © Smart Hammer Innovation Poll Questions Analyze a product development success. 1. How did it succeed? 2. Why did it succeed? 3. What was the economic impact on your company? 4. What was the non-economic impact on your company?