1. Business Growth – Led by Innovation, Enabled by Technology Pranay Mital Director, SMB Operations SAP Asia Pacific

2.  SAP APA 2004, / PRANAY MITAL / 2 How Organizations Exist The key to successful competing is differentiation All products & services are a me too, but differentiation is the mee tooo The reason why our customers buy our products & services vs. competitors’ It is the value of the firm vs. the value of another firm The only profit one makes is through differentiation …it is the competitive advantage one firm has over another firm! Differentiate & Exist…grow!

3.  SAP APA 2004, / PRANAY MITAL / 3 Enterprise Advantages normalize with time Competitive Advantage normalizes over a period of time i.e. Differentiation withers away Therefore, the need to constantly ‚Innovate‘ to build differentiation

4.  SAP APA 2004, / PRANAY MITAL / 4 What is Innovation? Business innovation is the creation of incremental, substantial or radical new value for customers and the firm by changing one or more dimensions of the existing business system, or by creating entirely new business systems. Key points Value created: Incremental, Substantial or Radical Constant, Fast & Generally simple i.e. more incremental & repeatable than substantial or radical Business system: changing one or more dimensions of the business system May be disruptive to core business, though not necessarily so

5.  SAP APA 2004, / PRANAY MITAL / 5 Thus, for Innovation to be successful it must be.. Constant Repeatable Generally Simple

6.  SAP APA 2004, / PRANAY MITAL / 6 Adaptability, Repeatability & Flexibility enables Growth What a circus!

7.  SAP APA 2004, / PRANAY MITAL / 7 Adaptability, Repeatability & Flexibility enables Growth What a circus!

8.  SAP APA 2004, / PRANAY MITAL / 8 Adaptability, Repeatability & Flexibility enables Growth What a circus!

9.  SAP APA 2004, / PRANAY MITAL / 9 Adaptability, Repeatability & Flexibility enables Growth What a circus!

10.  SAP APA 2004, / PRANAY MITAL / 10 Adaptability, Repeatability & Flexibility enables Growth What a circus!

11.  SAP APA 2004, / PRANAY MITAL / 11 Adaptability, Repeatability & Flexibility enables Growth What a circus!

12.  SAP APA 2004, / PRANAY MITAL / 12 Creating Innovative Value & Advantage for Growth Creating Innovative Value Reduce What factors should be reduced that the customer may not perceive value in? Raise What factors should be raised beyond the average industry standard? Repeat What factors should be repeatable for ongoing revenue flows? Create What factors should be created that the industry has never offered?

13.  SAP APA 2004, / PRANAY MITAL / 13 Innovation Mapped to the Business System Only two common factors that touch all the business system components: People Technology Applications

14.  SAP APA 2004, / PRANAY MITAL / 14 Innovation Mapped to the Business System: Circus Only two common factors that touch all the business system components: People: Customer Experience, Actors, Customers Technology: Effects, Venue, Logistics, Promotion, Sale, The Act itself

15.  SAP APA 2004, / PRANAY MITAL / 15 Example: Dell Computers Technology driven business model that radically changed the industry: Technology enabled constantly enriching, fast & simpler customer experience Technology that constantly evaulated & improve channel efficiency

16.  SAP APA 2004, / PRANAY MITAL / 16 Example: Starbucks Coffee People driven business model that radically changed the industry: Focus on customer experience drove the business model Technology supported the change through store location review, process efficiencies, supply chain efficiencies, and customer relationships.

17.  SAP APA 2004, / PRANAY MITAL / 17 Advantages of Technology Enabled Innovation Clayton Christensen (1997) introduces a dichotomy between sustaining innovationand disruptive innovation. Sustaining innovations are technologies that make a product or service work better in ways that mainstream customers already value. Sustaining innovations are almost always developed and introduced by incumbents. Disruptive innovations create entirely new markets by the introduction of new kinds of products and services that are judged, at least initially, to be worse based on the performance metrics that mainstream customers value.  Incumbents have a hard time introducing or coping with disruptive innovations.  Disruptive innovations are difficult to deal with, because they not only require new resources,  but they conflict with the organization’s processesand values, which are deeply embedded. Back to our basics: To succeed daily, innovation must be  Constant  Repeatable  Generally Simple

18.  SAP APA 2004, / PRANAY MITAL / 18 Technology Applications enable Enterprise Adaptability Technology Application Investment as a must:  Profitable Growth  Productivity  Competitive advantage  Operational excellence + People Observations: Necessity to adjust Realise opportunities Technology new levers Build into a differentiation Competitive Advantage Key business scenarios Workforce efficiency Business transparency Flexibility to integrate Scalability to grow Enable Innovation Adaptability Low TCO Creating Sustaining Innovative Value

19.  SAP APA 2004, / PRANAY MITAL / 19 Innovation enables Real-time Enterprise Adaptability Needs: Necessity to adjust in almost real time to fast changing industry normalization Midsize companies realise opportunities of global markets (eg workforce optimization, global process architecture) Technology Evolution offers new levers (CRM, RFID, e-..,...) Ultimately work as a real time enterprise that can leverage all the levers together into a differentiation Growth Strategies that are both survival & leadership strategies! Business Applications Enable Culture: Business Transparency Processes: Clarity on dependancies Strategy: Scalability to grow Culture: Adaptability to changing conditions Structure & Culture: Enable Process & Product Innovation Culture & Processes: Workforce effectiveness & efficiency Strategy & Structure: Products, Processes, Customers & Channels are an ‚integrated view‘ Funding: Today‘s investment is protected by tomorrow‘s survival People: Employee Confidence & Value = Growth & Profit = Industry Leadership

20.  SAP APA 2004, / PRANAY MITAL / 20 Summary Differntiate > Innovate > Grow & Profit or Survive Incremental Innovation is common & sustainable: It must be Constant, Repeatable, Simple Innovation means change: Raise, Repeat, Create or Reduce product, process, channel or customer offering that does not add current customer value. Must impact the business system of the firm Enabled through People & Technology Applications Technology Applications enable sustaining innovation by providing business transparency & real-time enterprise adaptability

21. Business Growth – Led by Innovation, Enabled by Technology Pranay Mital Director, SMB Operations SAP Asia Pacific