Presentation on theme: "Innovation distinguishes a leader from a follower Steve Jobs VL."— Presentation transcript:
Innovation distinguishes a leader from a follower Steve Jobs VL
Context Why Innovate? How can we lower the risk of this process? Main Causes of new Product and Service failure The critical success factors The old Product process The new NPSD Process (Maltezana Beach Hotel Case)
Maltezana Beach Hotel Maltezana Beach Hotel is the biggest hotel in Astypalea. The hotel offers a wide gamma of tourist services and facilities. In addition, Maltezana Beach hotel through its subsidiary travel agency fulfills a significant part of the Astypaleas tourist product. The company recorded revenues of $639.964 thousand during the financial year ended January 2009, a decrease of 5.7% over 2008. The operating profit of the company was $223.510 thousand during FY 2009. The net profit was $157.856 thousand in FY 2009, a decrease of 12.21% over 2008. The decline in net profit was partially due to reduced sales during 2009 as well as due to the change in tax policy.
Innovation: A history of business life through failure and success Innovation in business world functions as the front cortex part of our brain Innovation is a vital reason of business longevity 40% of the major corporations that existed in America in 1975 no longer exist today! 25 to 45 % of new products launched, fail. Percentage will vary by industry! Coca-Cola became a market leader with only one product!
Main causes of new product and service failure Poor or not at all the existence of a strategic plan Poor orientation to the market needs Inefficient market analysis (market oriented approach) Product or Service problems or defects Lack of effective marketing effort Higher costs than anticipated (low ROI) Poor timing of introduction Technical or production problems..but the most important cause is the lack of a clear and efficient NPSD process
The critical success factors A superior product or service that delivers unique benefits to the user A well-defined product prior to the development phase Quality of execution of technological activities Technological leverage Marketing leverage Quality of execution of marketing activities (build in the voice of the customer) Market attractiveness (more attractive markets lead to more successful products or services)
Problems with that process Not enough ideas (missed opportunities) The entrance of the management is late Not structural phases and steps in the process Resources and funds dont specific demonstrated Too vague to teach this process The whole process is not under a group of independent (killers) people The risk before launching the product is still high because there is a lack of preventing mechanisms
A superior process for superior products and services Well organized and well structured process Easy to teach it It s a powerful tool that brings together all the businesss departments Can be applied in any business type and in any level Can be customized and it is flexible for producing profit and non profit products and services It brings under the same umbrella all the necessary resources, tools and mechanisms to ensure the consistency of the process It builds the necessary environment to develop, execute and transform productively an idea to a product or service Expectations met Increases creativity, productivity and efficiency Blocks ideas that do not contribute positively to the company Decreases the risk of failure.
Before implementing the NPSD process Understand and leverage the whole process. Build it up according to your companys needs (stakeholders, employees, customers, society) Establish a) the screens and the necessary criteria to pass through your ideas b) the go/kill points Formulate the appropriate NPSD team and the appropriate Gate/keepers teams Put a time frame in each phase of the process.
Phases and Gates of NPSD Phase 1: Ideation Ideation Ideation screen Phase 2: Elimination Expansion and surface evaluation Surface evaluation screen Detailed evaluation Phase 3: Development Cross-functional Development CFD gate Testing Testing Gate Deployment Deployment Gate Launch Pro Launch Review PLR gate
Phase 1: Ideation This is the first step of our procedure Expand the mouth of the funnel Idea generation The most ideas we input in the system, the better probability we have in terms of developing a successful product or service
Creating Ideas Idea Bank Direct research Technological innovation Alliances/acquisition/licensing National policy Creative methods Exploratory customer studies Facilitating lead user analysis Linking marketing and technology
Hotels Idea Bank External Sources Suppliers Tourist Market Professionals Press – Media – Internet related with the Travel Market Research Internal Sources Front line Personnel (maids, waiters, front desk assistants, maintainers) Managers (from all the hotels departments) Questionnaires (guests opinions and suggestions)
Triggers of Innovation Wear others hat Spend more mental time in the future Awaken your childhood consciousness (family market) Change your physical workspace (sea view) Storyboard ideas (the hotel service itself is a story) Cross pollinate (combination of leisure and hobby) Take fields-trips (see other approaches) Take the international perspective (tourist product has a worldwide audience)
Ideation Screen Eliminate your ideas from 100 to 7 by implementing broad criteria such as: Must be service and not product From 5000 Euros to 50000 Euros Brand new service and not a new approach of an old one Guest-centered service Related with families holiday activities
Phase 2: Elimination This is the second step of eliminating our ideas (from 7 to 3 ideas) It is divided in four steps: Surface Evaluation Surface Evaluation Screen Detailed Evaluation Detailed Evaluation Screen
Surface Evaluation Fields that we have to consider in this step: Strategic compatibility Product superiority Market attractiveness Research Laws and Policies in specific regions
Surface Evaluation Screen Specific criteria that we have to implement in this step: No more than five months of development No more than three employees to run the service Compatible with the hotels philosophy which is to create memorable vacation time through an aesthetic place where functionality meets your personality Easy access and transfer of any demandable resource to launch the service
Detailed Evaluation In-depth detailed review of the existing ideas Gathering as much information as we can: Competitive analyses in-depth investigation with customers target market product strategy product benefits value proposition features, attributes market studies cost to manufacture ROI investment Extent of research and time, amount and format of research data
Detailed Evaluation Screen Specific criteria that we have to implement in this step: Net contribution to hotels revenue >5% Compatible with the specific and general legislations that this service is required to fulfill ROI no more than two seasons Cost of failure no more than 1/8 of the total investment This is the last step before the company starts to invest a significant amount of money in developing the service Only one idea passes on to the next phase We move from the thinking investment to the money investment in our process
Phase 3: Development Our idea is going to be developed under a strict and careful process Gate keepers are going to regulate the process (my parents are going to play the role of the referees) This is the five stages and four gates of the Development process Cross functional Development/CFD Gate Testing/Testing Gate Deployment/Deployment Gate Launch Post Launch Review/Post Launch Review Gate
Cross-Functional Development This is the stage that we start transforming our idea into a product or service In this step we formulate cross – functional teams in order to contribute with their experience from the previous phase in building the appropriate characteristics of the product or the service Sub-NPSD processes start running from separate departments (we want the ideal support for our departments) Parallel marketing & operationsIn-house tests Rapid prototypeAlpha tests Working modelUpdate financials First prototypeFacilities requirements Legal – patent/trademarksMarket launch plans Lab testsContinue:
Cross-Functional Development Gate Gatekeepers ensure all essential activities which has been performed For example: They check the quality of your work Review your financials
Testing Build a variety of scenarios and run your prototype product or service into these scenarios Analyze and evaluate the service through a variety of characteristics: During Christmas and Easter the hotel is going to offer this service, by inviting for free accommodation and vacation, in a variety of people like loyal guests, friends, suppliers and tourist professionals Review our financials
Testing Gate Gatekeepers evaluate the tests and check if the outcomes meet the criteria Were the tests conducted properly? Did the testers build a representative scenarios for the service (ask the right questions?) Did the testers do their jobs without emotional attachments? Did they act independently? Were questions skewed or was the test skipped altogether?
Deployment Set up all the necessary resources, activities and teams in order to start launching the service This stage gives the chance to the company to adjust everything before launching In our case, to make sure that we have the necessary verifications and insurances before launcing
Deployment Gate The one last checking point before launch This is the most vital gate which our service is going to pass through
Launch Put life and offer our service to guests Launch the service Place advertisements and other promotions to press, internet, magazines, and tourist exhibitions Fill the distribution channel ( tour operators and travel agencies)
Post Launch Review A stage that we try to excellence the whole development procedure of the product or service In this point we need to take under consideration: Costs (Are my actual costs meet my estimation costs?) Profits (Are my profits the desirable ones?) Team members (Did my team members do their job accurately/independently?) Make a SWOT Analysis for my new service Place of improvement (Can I provide the same service faster, cheaper and better) What has been learned Source of competitive advantage
Post-Launch Review Gate It contains the final check point that compares the desirable characteristics of our new service with the actual characteristics of the service.
A suggestion to think about.. Dont fall in love with your own ideas..we paid to think not to love our thinking! Put them as all the other ideas in a well structured and customized NPSD process without exceptions Minimize the risk and any challenge of failure Maximize your desire outcomes by offering a more sophisticated and superior product or service Goldsmiths NPSD process guarantees better results THANK YOU
Your consent to our cookies if you continue to use this website.