Innovation In The Downturn

Innovation in the Downturn

Afrivate26 March 2009

Looking at the Landscape

How do you expect the economy to look at end of 1st quarter 2009?

McKinsey Global Survey : Economic Condition Snapshot (February 2009)

*Compared to September 2008

How active should government’s role be in the

economy, since the start of the downturn.


Where should government focus their efforts ?


What steps has your company taken to face the

downturn?


What is Innovation?

Innovation is therefore much more than invention

Need to successfully commercialize the invention

Trott 2005

New Idea Invention Innovation

Invention Process

Innovation Process

Idea to Tangible Exploit to Commercial Success

Why is Innovation important?

product Innovation Funnel

William B. Rouse, “Improvement & Innovation Improvement & Innovation” 2007

Simulation session Debriefing

workshop

Modeling phase

Ideas

Focussed process

development

projects

Next simulations

Duration ca 3 months

process Innovation Funnel

Innovation funnel across extended enterprise

ProductInnovation

ProcessInnovation

TechnologyInnovation

Op

erat

e

Op

tim

ise

Co

nti

nu

ou

s Im

pro

vem

ent

Rad

ical

In

no

vati

on

Gre

en F

ield

s In

no

vati

on

Incr

emen

tal

Inn

ova

tio

n

Com

petit

ive

Ent

erpr

ise

Operate

InnovateInnovate

Blending Innovation and Operation

The Competitiveness Challenge

Operate

InnovateInnovate

The Innovation Capability Dilemma

Strategy & Objectives

Function & Processes

Organisation &

Management

Data & Information

Customer & Suppliers

Organisational Construct

Inn

ova

tion

P

roce

ss

Kn

ow

led

ge

&

C

om

pe

ten

cy

Org

an

isa

tion

al S

up

po

rt

Inn

ova

tio

n C

apab

ility

Co

nst

ruct

A More Competitive Enterprise

ICMA 2 3 4 51

Innovation has finally Arrived

of 3000 global executives consider Innovation top 3 priority

Less than

of executives feel ROI is sufficient 50%

66%

Source: BCG Senior management innovation survey 2008

Currently,

Strengths |• Understand the customer

• Executive Level Support

| Weakness• Speed of delivery

• Discipline of Delivery

• Managing Risk

• Partnering with Others

• Earmarking sufficient funds

Source: BCG Senior management innovation survey 2008

Currently,

Types of Innovation

• 3 Life Cycles– Product Life Cycle

– Technology Life Cycle

– Enterprise Life Cycle

• Dealing with Darwin – 15 Types of Innovation

Geoffrey Moore’s 15 Innovation Categories

The Economic Good Times Scenario

OperationsGenerating revenues and funding innovation

Continuous monitoring and improvement of operations

Portfolio Management

Deploy, refine, formalise and exploit opportunities

Identify opportunities, generate ideas and

concepts, and determine feasibility

Executing Innovation Initiatives

Improving Innovation Capability

Ass

essm

ent

Infr

astr

uctu

re A

naly

sis

Re-

asse

ssm

ent

Innovation Process

Knowledge & Competency

Organisational Support

Impr

ovem

ent

Pro

gram

mes

The Economic Bad Times Scenario

OperationsGenerating revenues and funding innovation

Continuous monitoring and improvement of operations

Portfolio Management

Deploy, refine, formalise and exploit opportunities

Identify opportunities, generate ideas and

concepts, and determine feasibility

Executing Innovation Initiatives

Improving Innovation Capability

Ass

essm

ent

Infr

astr

uctu

re A

naly

sis

Re-

asse

ssm

ent

Innovation Process



Impr

ovem

ent

Pro

gram

mes

How innovation fit are you?

Innovation Maturity Fitness?

• 5 Levels of Innovation Maturity Fitness

3Practices, procedures and tools formalisedConsistent outputs maintain market share

SupportedInnovation

4Integrated and aligned activities and resourcesOutputs are a source of consistent differentiation

AlignedInnovation

Synchronisation of activities and resourcesOutputs provide sustained competitive advantage

5SynergisedInnovation

Consumed with day-to-day operationsOutputs are inconsistent and unpredictable

Ad-Hoc Innovation 1

Need to innovate identified and definedOutputs are inconsistent, but traceable

DefinedInnovation 2

What to do in the Downturn?

If you are at maturity

• No way of rapid recovery

– Get expertise’s help in

Ad-Hoc Innovation 1


• Obtain partial help from experts

3SupportedInnovation


• Adjust your idea filter

• Harvest ideas to solve problems related to the downturn

– How to cut costs

– Hire better people for less

• Adjust your feasibility filters

• Go to portfolio and re-align– Reposition for when market turns

5SynergisedInnovation

• Keep expertise• Cut costs

• Negotiate with suppliers

• Find shortest route to new ways to do business

– Different products

– Cheaper processes

– New markets

If you are at maturity?unknown

Innovation Capability Assessment

•Assess to determine maturity level, • Identifies best innovation improvement activities

Improvement ActivitiesInitial Assessment

Innovation Process



Imp

rov

ing

In

no

va

tio

n C

ap

ab

ilit

ies

(W

ed

ne

sd

ay

Fit

ne

ss

)

Infrastructure Analysis

PD, ED, IM, etc

Processes

IKN, BI, etc

Strat, Culture, Org struct, etc.

Sp

ec

ific

In

no

va

tio

n

Imp

lem

en

tati

on

s

(Sa

turd

ay

Ga

me

)

Analysis/ Idea

Generation

Concept Definitio

n

Concept Feasibili

ty

Develop &

Implement

Measure &

Optimise

Exploit

Business Unit A

Business Unit B

Business Unit C

Value

Chain

Measure, Optimise, Assess

Innovation Process



Innovation Process Improvement Roadmap(s)

Knowledge & Competency Improvement Roadmap(s)

Organisational Support Improvement Roadmap(s)

Identifying Immediate Pains

Identifying Immediate

Opportunities

Identifying Current

Innovation Projects

Identifying Prototype Innovation Project(s)

Portfolio

Mngment

Indutech’s innovation improvement lifecycle

Thank you