Innovation Strategies A workshop for the MEET U.S. Program Facilitator: Alex F. DeNoble, Ph.D. San Diego State University

MEET U.S. A Mandate for Corporate Innovation and New Business Creation! New business creation must be considered the most important task of the senior executive in the existing enterprise, especially the larger one. Without it the enterprise is unlikely to survive. Let alone do well in a period of rapid transition such as the one we live in and are likely to live in for the foreseeable future … Peter Drucker

MEET U.S. Overview of the Workshop The workshop is organized into four parts: Part I - Exploring the concept of Corporate Entrepreneurship Part II - Introducing the concept of Entrepreneurial Intensity Part III - Developing skills in creativity Part IV - Strategies for entrepreneurship, innovation and creativity

MEET U.S. Corporate Entrepreneurship PART I

MEET U.S. What is Corporate Entrepreneurship? A term used to describe entrepreneurial behavior inside established organizations which leads to the creation of new business initiatives through: –product and service innovation –process innovation and –market development

MEET U.S. Why Should Companies Invest in Innovative Activities? Use of Corporate name Use of board of directors Importance of strategic fit Use of marketing clout Use of internal financing Use of technology Use of corporate assets Use of production and manufacturing Use of top management as mentors Use of corporate network Use of corporate infrastructure Use of staff support Product/Service to market quickly Win/win for corporation and employee

MEET U.S. Challenges to Innovation Inside the Company Corporate Culture Hierarchical structure Bureaucratic management style Difficulty in managing mavericks Punish risk-taking Lack of motivation Inappropriate reward systems Turf wars

MEET U.S. Gains from Innovative Investments Exposure to possible new markets Add new products to existing markets Develop antennae for new technologies To generate capital gains Efficiently utilize plant space, time and people Integrate activities of multiple departments A platform for management development Ownership position in new companies

MEET U.S. Exercise I Identifying and Evaluating Innovative Companies

MEET U.S. Entrepreneurial Intensity PART II

MEET U.S. Entrepreneurial Intensity Entrepreneurship is not an “ either-or ” proposition! There is some level of entrepreneurship in every organization! In determining how entrepreneurial and organization is we look to “ Entrepreneurial Intensity ”

MEET U.S. Entrepreneurial Intensity Entrepreneurial Intensity captures the Frequency and Degree of Entrepreneurial Initiative

MEET U.S. To be Entrepreneurial… Degree of Entrepreneurship Innovativeness Risk-taking Proactiveness

MEET U.S. A Few Words About Innovation There's a way to do it better...find it - Thomas Edison

MEET U.S. Product/Service Innovation New-to-the-world products/services New-to-the-market products/services New product/service lines in a company Additions to product/service lines Product improvements/revisions New applications for existing products/services Repositioning of existing products/services Cost reduction for existing products/services Degree of innovation High Low

MEET U.S. Directions for Innovation Diversified Market Space Diversified Product Space Diversified Product/ Market Space MARKETS ExistingNew Existing New PRODUCTSPRODUCTS Existing Product/ Market Space

MEET U.S. Process Innovation Major new process Minor new process Significant revision of existing process Modest improvement of existing process Degree of innovation High Low

MEET U.S. Process Innovation Where can innovation happen? Administrative systems Service delivery systems Production methods Financing methods Marketing or sales approaches Procurement techniques Compensation methods Supply chain management And more …. The bottom line is that Innovation can happen anywhere!!

MEET U.S. Risk-Taking A decision-making under conditions of uncertainty with the possibility of incurring significant losses Two perspectives on risk: –Sinking the boat risk –Missing the boat risk

MEET U.S. Sinking the Boat Risks What happens if the company pursues a concept and it does not work out? Could result from: –Poor thought-out concept –Bad timing –Insufficient market research –Inadequate marketing mix (4P ’ s) –Undercapitalization

MEET U.S. Missing the Boat Risks What is the impact of not pursuing an opportunity that would have become profitable? Could result from: –Delays in acting on a concept –Preempted by competitors –Changing customer needs –Overemphasis on market research, financial data or input from consultants …

MEET U.S. Always remember There's as much risk in doing nothing as in doing something. - Trammell Crow

MEET U.S. Proactiveness Involves –Action –Perseverance –Adaptability –Willingness to assume responsibility for failure

MEET U.S. Entrepreneurial Intensity If you always do what you have always done, you will always get what you have always gotten …. Tom Peters

MEET U.S. Exercise II How effective is your company ’ s Innovative Practices?

MEET U.S. Developing Skills in Creativity PART III

MEET U.S. Creativity Applying a person ’ s mental ability and curiosity to discover something new Relating previously unrelated things Connecting things together in new and different ways "Being creative is seeing the same thing as everybody else but thinking of something different"

MEET U.S. Exercise III What ’ s wrong with today ’ s Laptop Computers

MEET U.S. Exercise IV Let ’ s reinvent the Laptop Computer!

MEET U.S. Strategies for Entrepreneurship, Innovation and Creativity PART IV

MEET U.S. Setting the Environment …. It's the job of a manager not to light the fire of motivation, but to create an environment to let each person's personal spark of motivation blaze. - Frederick Herzberg

MEET U.S. Setting an Innovative Environment entails …. Envision the future Create a sense of urgency Expect calculated risk-taking Encourage experimentation Develop incentives Focus on customer needs Seek feedback from stakeholders

MEET U.S. But Beware of the Pitfalls … Barriers to an innovative culture include: –Too much focus on the present –Not understanding innovation processes –Fear of and resistance to change –Punishing failure –Top-down management

MEET U.S. And finally ….. The person who says it cannot be done should not interrupt the person doing it. - Chinese Proverb

MEET U.S. Thank You!