1. © 2010 IMD International. Not be used or reproduced without permission. Sales Channel Distribution Retailers Partners Product Offering Products Components Product Suite Collection of products & servcs that provide complete solution Marketing Branding Messaging Campaigns Web sites Catalogs Customer Interaction Cust Service Community (online or not) Events Core Capability Manuf Supply Chn Procurement Enabling Processes Legal/IP Research Product Developmt Incremental Improvement to current market in existing category New Offering in existing category With new value proposition Redefine Category “Never seen before” offering Business Model Revenue model Pricing model Innovation Matrix example

2. © 2010 IMD International. Not be used or reproduced without permission. Guidance for completing the Innovation Matrix Where is your team’s offering? Locate your offering on the matrix. What category (column) is it in? How revolutionary will it be (what row is it in)? Complete the matrix as fully as possible What complementary innovations are necessary or desirable? What new products, services, business models, pricing plans, etc. are possible or necessary? Where does each belong on the matrix? What type of innovation is it and how revolutionary is it? Place each on the matrix. If the categories in the matrix on the previous page don’t fit your situation, change them! Each industry will have its own unique matrix. What would be the effect of offering the complementary innovations? Which complementary innovation(s) would most help your primary innovation succeed?

3. © 2010 IMD International. Not be used or reproduced without permission. Sales Channel Distribution Retailers Partners Product Offering Products Components Product Suite Collection of products & servcs that provide complete solution Marketing Branding Messaging Campaigns Web sites Catalogs Customer Interaction Cust Service Community (online or not) Events Core Capability Manuf Supply Chn Procurement Enabling Processes Legal/IP Research Product Developmt Incremental Improvement to current market in existing category New Offering in existing category With new value proposition Redefine Category “Never seen before” offering Business Model Revenue model Pricing model Innovation piano for the Apple iPod Exclusive contract for new Toshiba hard drive Outsourced iPod devel. iTunes Pay-per- song Fairplay DRM Accessory Partnerships iPod “Silhouette” ad campaign Apple Store Training “Genius” support