Introduction Management of Innovation

What is Innovation Management ? Innovation Strategy Innovation Tools Innovation People Contents

What is Management of Innovation..?

Innovation Thinking Innovation Activities New Product New Tech New Biz New Market New. New.. New… What Is Management Innovation ?

Based on Webster online dictionary : Management : "Management" is characterizes the process of leading and directing all or part of an organization, often a business one, through the deployment and manipulation of resources (human, financial, material, intellectual or intangible). Innovation : 1. A creation (a new device or process) resulting from study and experimentation. 2. The creation of something in the mind. 3. Specific programmed for the dissemination and optimization of the results of activities in the field of research and technological development, including demonstration What Is Management Innovation ?

Management Innovation : about activity to manage all kind innovation activity follow the vision, use strategic and optimize tools the get the best result based on target set before Basic Concept Sharing  share info related to innovation about planning, role, authority, etc Challenge  give new paradigm of successful like project or target that must be achieve by person or Team Monitoring  take control to manage all kind of activity run well in advance PDCA : is about Cycle role of activity come from Plan - Do - Check – Action Concept Sharing Challenge Monitoring P-D-C-A Management Innovation What Is Management Innovation ?

Sharing Guidance and sharing to all group/employee always supported among program to make good condition of new thinking method about all kind of innovation thinking All improvement condition will be implemented by each team as innovation Project that will be evaluated by Mgt. Inn. Team Monitoring At the end of period Mgt. Inn. Team will held review and assessment and will evaluate by Manager and Director. Its about rewarding process after program, and also progress monitoring continued. Challenging Each group/employee collect & organize the problem occurred in the working area, and continue to analyze, and next is making solution, and finally is implementation, based on target setting in Innovation Plan What Is Management Innovation ?

Business System Manufacturing Finance Advertisement R&D Supply Produc-tion Logistics Market- ing Sales SVC Product Planning Design Pricing Accept- ance Syndica- tion Place- ment Trading Market- ing Media Purchase Product Planning Sales Make Ad. Air Ad. Monitor Exploit Customer Customer Management Innovation What Is Management Innovation ?

Blue Ocean Strategy is about Create New Market Space with no Competition & make Competition Irrelevant LGE Company innovation Logo 2 = Triple double (double profit, revenue, share holder value); BY = By Year; 10 = 2100 through Blue Ocean Strategy Strategy of Innovation 3 Core Strategy New Market Market – Expand No- Competition Non- Customer

Blue Ocean Strategy concept is based on Value Innovation. How to make product that have best value for customer, and optimum cost in production Strategy of Innovation Costs Value Innovation Buyer Value

Compare point of view between Red Ocean vs. Blue Ocean; in New Market Concept Stuck in the middle Old Market Capture the core of Expanded Market Value Innovators New Market Strategy of Innovation Competition Michael Porter Renee A. Mauborgne W.Chan Kim Cost Leaders Differentiators Cost Leaders Red Ocean Blue Ocean Divergence V Innovation

Value Chain 5 Force model Buyer Utility Map Define Industry Key Success Factor Create New Market A tool to help identify value drivers Check New Value from Cuctomer side 6 Paths’ Framework / Value Curve Red Ocean Blue Ocean Compare point of view between Red Ocean vs. Blue Ocean; in Non Competitor Concept Strategy of Innovation Focus Core Tools Strategy competition Strategy Value innovation

Value Chain 5 Force model Buyer Utility Map 6 Paths’ Framework / Value Curve Compare point of view between Red Ocean vs. Blue Ocean; in Non Competitor Concept Strategy of Innovation

Level 1: Non customer soon to be customer Level 2 :Non customer that refusing market Level 3 :Non customer that unexplored in the market Red Ocean Blue Ocean Compare point of view between Red Ocean vs. Blue Ocean; in Non Customer Concept Strategy of Innovation Mass customer Focus to current state customer by segmentation service variation Focus to non-customer Concentrate in similarity before differentiation First is documentation Level 1 Level 2 Level 3 Market Target Customer

Oops ! I heard that the average depth is 4 meters !!! 6 Sigma is one of Tool for Innovation 6 Sigma is about concept how to reduce “ variation ” 6Sigma is a highly disciplined process that helps us focus on developing and delivering near-perfect products and services It’s a way of thinking, a way of decision making. Average is not enough, so we must find the data of variation, don’t be stupid Man in graph Tool of Innovation

Tool of Innovation μ USL USL T μ USL USL T Precision but no accuration Shifting to Target & Reduce Variation Shift to Target Reduce Variation USL USL T μ Accuration but no precision The Object of 6 Sigma is Shift to target Reduce Variation

FSE : 9 Process Variation Data Improvement Statistical Thinking Statistical Tools Characterization Analysis Action Supplier Customer Process Input Output S I P O C Role of Manufacturing/Production is come from SIPOC Variation will be occur in all area of SIPOC, but 6 Sigma focused to reduce variation before “our Product” come to CUSTOMER We need improvement in process to reduce variation Cause 99% is not enough and 1 % is big in term of CUSTOMER SATISFACTION So 6 Sigma make standard that our product must be near perfect (99,9999 % or 3.4 PPM defect) Tool of Innovation

FSE : 9 No Excuse for customer satisfaction , there’s comparison between 99 % (4 σ) and 99.9999 % (6 σ ) Tool of Innovation

Z 6 5 4 3 2 PPM 3.4 233 6,210 66,807 308,537 Process Defects capability opportunity Bulk of Fruit Process characterization and Optimization Lower Fruit 7 Basic Tools of QC (commonly happen in all Factory) Ground Fruit Consist of “No Good” result 6σ Concept (Metric) Sweet Fruits Design for productivity PPM = Part Per Million 3.4 PPM = If Production quantity 1000.000 pieces, only 3.4 pieces in “No Good” condition (that’s mean almost perfect) Tool of Innovation

Strategy Tools People Blue Ocean 6 Sigma Intrapreneurship Successful Manage Innovation is come from good synergy of 3 factors:

Intrapreneurship : Is about mental and action from someone that work in the company/corporate, that take high responsibility to change their idea to become service or product that have any profit, through encourage action and measurable risk and do Innovation (The American Heritage Dictionary) In The Book of Management Intrapreneurship “The Farmer & Hunter” (Anthony Dio Martin) : Intrapreneurship = Working Situation like Farmer + With Mentality like Hunter

All of us MUST LEARNING by DOING Success is ONLY MIND Game It is Not HOW MUCH you know that count, It’s about WHAT YOU DO with what You Know

For further reading : Blue Ocean Innovation Strategy , W Chan Kim – Renee Mauborgne; Penerbit Serambi 2006 Management Intrapreneurship. Petani dan Pemburu; Anthony Dio Martin, Penerbit Gramedia Pustaka Utam, 2005 Tool books of Six Sigma, The Art of Innovation etc

Introduction Management of Innovation

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Introduction Management of Innovation