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Extracting Value from Your Product Development Process Yvonne Verse Vice President, Strategic Partnerships & Business Development Motorola, Inc October.

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Presentation on theme: "Extracting Value from Your Product Development Process Yvonne Verse Vice President, Strategic Partnerships & Business Development Motorola, Inc October."— Presentation transcript:

1 Extracting Value from Your Product Development Process Yvonne Verse Vice President, Strategic Partnerships & Business Development Motorola, Inc October 11, 2007

2 Classical Product Innovation Market Extension New Product/Market Existing Product Product Variation ProductMarket

3 Success Rates of New Product Innovations 60 40 75

4 The Requirements for Success have changed……  Customer Knowledge  vs. Market knowledge  vs. Opportunity size  vs. Channel knowledge  What is the true “customer value” ?

5 The Customer’s Hierarchy of NeedsCustomerSuccessBroaderUnderlyingProblem Basic Service Product Source: The Discipline of Market Leaders

6 Dimensions of Customer Value Price reliability & durability unique features brand experience service dependability convenience expert advice personalized services Cost Benefit Products “What we sell” Services “How we do business” Source: The Discipline of Market Leaders

7 Threshold vs. Leadership in Customer Value Product Leadership Customer Intimacy Operational Excellence “best total cost” “best product” “best total solution” Product differentiation Customer responsive Operational competence Source: The Discipline of Market Leaders

8 Driving Better Value…… Operation Excellence Product Leadership Customer Intimacy Value Propositions Best total cost Best product Best total solution Golden Rule Variety kills efficiency Cannibalize your success with breakthroughs Solve the client’s broader problem Core Processes End-to-end product delivery Customer service cycle Invention Commercialization Market exploitation Client acquisition & development Solution development Improvement Levers Process redesign Continuous improvement Product technology R&D cycle time Problem expertise Service customization Major Improvement Challenges Shift to new asset base Jump to new technology Total change in solution paradigm Source: The Discipline of Market Leaders

9 Product Leadership – The Story behind the RAZR’s creation  Background:  RAZR started as a skunkworks project within Motorola. A small team was created to drive the “next generation in cell phones” by thinking out of the box  Value proposition:  The idea was to push the boundaries of technology and design  Retrospect:  Catchy name and jewel like appearance. The RAZR debuted in November of 2004 and has become the highest selling cell phone ever. Motorola has sold 100 million units to date, making it the most popular cell phone of any kind.

10 New ways to derive value  Partnering  Acquisition  Technology Licensing  Patent Licensing

11 Partnering  Background:  Motorola with its leadership position in cellular handsets was looking for new ways to position its products – from a utility to a status symbol or fashion accessory. Dolce & Gabbana was interested in extending its line of fashion accessories into the technology area  Value Proposition:  Motorola provides a special phone edition that is co-branded with Dolce & Gabbana, Dolce and Gabbana launches the product at its fashion shows, sells the product through its stores and promotes it through its advertising  Retrospect:  The Motorola/Dolce & Gabbana cooperation was the first successful technology/fashion” cooperation and was both a commercial and PR success Co-branding with Dolce & Gabbana

12 Acquisitions  Good Technologies  Good Technologies, acquired on November 10, 2006, was a strategic addition to Motorola’s Mobile Devices business. The acquisition extends Motorola’s mobile computing capabilities and increases the company’s enterprise client base. Good Technology’s software and managed service delivers a rich user experience, low cost of ownership, industry-leading security and enterprise-class support. This acquisition will continue to strengthen Motorola as a leading provider of mobility devices and solutions both for enterprise customers and consumers.  TTP Com  TTPCom, acquired on June 1, 2006, focused on the three core areas of mobile phone technology - applications, protocols, and silicon. The TTP team possesses a great deal of experience and talent in these areas and brings to Motorola a world class mobile device software platform as well as an impressive portfolio of mobile device phone stack and silicon intellectual property. Source: Motorola Press Releases

13 Technology Licensing Simulation technology license with CoWare  Background:  As a pioneer in the development of cellular technology, Motorola developed advanced hardware simulation capabilities to enable parallel hardware and software development tracks. CoWare had a simulation test business with a variety of software testing solutions.  Value Proposition:  Motorola’s objective was to license the technology to a 3rd party who could take the technology and develop it further – ultimately providing the improved solution to Motorola for our use  Retrospect:  Thanks to Motorola’s technology infusion, CoWare’s product offering has surged ahead of its competition, enabling CoWare to capture new customers and improve their offerings to their existing customer base and Motorola has successfully outsourced a part of its business that was not its core competency.

14 Patent Licensing  Background:  Qualcomm Founded in 1985 FORTUNE 500® Company  Qualcomm owns approximately 6,100 U.S. patents and patent applications of CDMA and related technologies including WCDMA  Value Proposition:  A licensing program that enables third parties to design, manufacture and sell products based on Qualcomm’s wireless technology  Retrospect:  Qualcomm generated $7.53 billion of revenue in 2006. Up from $2.92 billion in 2002.

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