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Architecting Innovation!
Perspective on Quick Wins!
!
March, 2012!
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© 2011 X-FERT INNOVATION srl – All rights reserved
BRM_Comp on Innov_ExBr_120329

Innovation Poles!
Countries!
Cultures!
Personalities!Networks!
Technologies!
Disciplines!
Institutions!
Businesses!
Universities!
Inventors!
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© 2011 X-FERT INNOVATION srl – All rights reserved BRM_Comp on Innov_ExBr_120329

Innovation: Riding the Life Cycle!
Management must pursue two concurrent business construction and deconstruction paths:
•! Differentiation-creating innovation
•! Productivity-enhancing deconstruction
Disruptive
Innovation
Product
Innovation
Application
Innovation
Process
Innovation
Technology Adoption Lyfe Cycle
Business
Model
Innovation
Experiential
Innovation
Marketing
Innovation
Structural
Innovation
Revenue Growth
Time
3
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Promoting Open Innovation!
Evalueserve: one out of fifty selected OI intermediaries worldwide
Source: Cambridge University
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The New “Eureka” Capital!
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Patents as Entry Point to Innovation!
Patent
Searches
220
B$
Patent
Data
WW Patent
Licensing
Business
15
1993 2011
Patent
Analysis
Patent
Landscape
Innovation
Landscape
© 2011 X-FERT INNOVATION srl –– All rights reserved BRM_Comp on Innov_ExBr_120329
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Business
Impact
6

The Rising Power of Patents!

IP Str!!!!
a!! tegy
The Shape-shifting World of IP!
IP NOT part of the business
IP ! Legal Office
NO IP valuation models
! NO economic value
! NO competitive value
IP integral part of the business
IP ! CTO / CFO
Protects firm’s assets
! Technologies
! Processes
! Patents
Strategy Definition
"!Valuation of patentable technologies
"! Patent filing
Increases firm’s market value
Facilitates protection of future business
Strategy Implementation
"! Patent licensing
"! Competitive intelligence
"! Prosecution

Understanding the Real Value of Technology!
Technology does not produce any return. It only generates a performance change: in processes,
materials, functionality, utility of a product/service. This contribute is the productivity of the technology.
It is not the technology that creates value but the impact of performance changes on one or more
substantial elements of the business model.
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Business Model
Value Proposition
Operating Model
•! Value Chain – Key activities for value offering
•! Resources – Key competencies – Process organization and assets
•! Partners and value network necessary to the process
•! Cost model
Productivity
The extent to which an investment in technology to
cause a measurable change in one or more
performance characteristics of a product, process, etc.
Leverage
The extent to which an improvement in performance
characteristics generated by a technology is capable
to generate a success potential in one or more
elements of a business model.
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•! Customers – Market segments – Relationships – Channels
•! Structure, elements and attributes of product / service
•! Revenue model
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Profit Models !
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The company invests in customer
knowledge to create one-to-one solutions
and relationship, with winning returns
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The suppliers offering is structured along a
product hierarchy, with the most profitable
product concentrated at the top
$/Unit
The supplier wins a price premium before
followers begin to erode margins
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The product is made of several
components. Some of them contribute to
overall profit in a disproportionate way.
Specialists are more profitable for a number
of reasons: higher quality, better image,
lower cost, and so on.
Small business units maximize customer
proximity and facilitate accountability for
results.
Profit
Time
0
Price
Volume Time
Margin
ROS
Generalist Specialist
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Despite the great effort and success of many companies to transform innovation in a “process
discipline”, there is still a lot of people who patronize the “lone inventor” theory of innovation.
Facts are witnessing that a winning factor for succeding with innovation is to adopt the same logic of
Venture Capitalist: work selectively with big numbers to find great ideas and businesses.
Several thousands
!100
Investments: !10
Another key element is that success is not achieved through increased innovation
budgets. In fact this can just increase the risk to to finance marginal opportunities.
Success is the result of building a portfolio of extraordinary opportunies selected
on the base of their profit potential.
Curva dei Profitti
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, © 2011 X-FERT INNOVATION srl – All rights reserved
Profitability Index
Cumulate investments
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$
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10
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Profit line
Profit curve !..
The Innovation Figures!
Business plans received:
Screening meetings:
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Two Value Threads of Innovation!
The innovation process is a virtuous combination of two asynchronous answers to “What is
needed?” and “What we have?”
Radical
Innovation
Margin
Cost
Value
Sustaining
Innovation
Technology-Driven
Interest
Products
Customer-
Defined
Solutions
Technology Thread
The vertical thread (Development
Factory) works as a non-stop flow and
controls the functions of product platform
planning and of modularization/
standardization of components (used
either on a stand-alone basis either as
parts of more complex systems).
Strategic Aim: Radical Innovation
Customer Thread
The horizontal thread (Customer Lab)
works as an intermittent flow and controls
the functions of customer need
management and of product/system
requirement development
Strategic Aim: Sustaining Innovation
Here we exploit the value
of customer knowledge to find
more advanced solutions...
V = B –
– C = M
Benefit
Value
Price
Because today’s customer
preferences have no inherent
predictive value for tomorrow’s
markets, it is simply not savvy
enough to rely to build future
strategies on current customer
preferences
1.!Customer
Lab
Here we explore
and apply new or
unproven technologies...
2. Innovation
Factory
“Invention is the mother of necessity” vs. “Necessity is the mother of invention”
x

Customer Labs – Intense Predictive Analytics on Future Needs !
‘Industries don’t “evolve”. Instead, firms eager to overturn the present industry order challenge “accepted practices”,
redraw segment boundaries, set new price-performance expectations, and reinvent the product or service concept.’
Prahalad, Hamel, “Competing for the Future”, HBSP, 1994
x

Illustrative
Advanced Technologies
Competence Lab
Ideation Factory – Combined Portfolios to Accelerate Innovation!
Basic Approach:
A virtuous combination of
Innovation and Development
Develop
Innovate
[Only proven technologies]
Cross-Portfolio
Integration Tools:
•! Technology Roadmap
Using demonstrators to ease
key evaluations and decisions
•! Platform Architecture
Defines how company draws
boundaries between technologies,
products and organization
•! Annual Product Review
Defines priorities and integrates
development efforts across
projects and portfolios
Illustrative
Answering to competitive
environment and to
customer feedback
Illustrative
New Products
Creation Projects
Targeted to reach the
market according to
demand development
Develop promising
technologies, disruptive
innovation and adaptation
Advanced Technology Demonstrators
Current Products
and Services
Building Blocks and Defining Technologies
“Must Have” Development Initiatives
14
x

In Search of Radicalness (a telecom research)!
Innovation
Radicalness
Newness
Impact
Pioneering
Recombinant
Newness
Business Model
Value Proposition
•! Customers – Market segments – Relationships – Channels
•! Structure, elements and attributes of product / service
•! Revenue model
Operating Model
•! Value Chain – Key activities for value offering
•! Resources – Key competencies – Process organization and assets
•! Partners and value network necessary to the process
•! Cost model
Impact
15
x

Strategic Segments are a Key Driver to Successful Innovation
x

ACCELERATED INNOVATION – CASE EXAMPLE
8. Supporto team di ricerca Evalueserve H24 in remoto
Presenza Globale – 4 Centri di ricerca a copertura delle aree BRIC Knowledge Centre
Presenza commerciale e Direttori di ricerca on-shore
Attività operativa 24h x 5gg
Team “on-site” flessibili, in base alle
esigenze del cliente
Attività di ricerca su Europa
e assistenza on-shore per
clienti UE
Attività di ricerca su
Cina, Corea e Giappone
Centro Cina
Centro India
Principale centro per la
ricerca su Europa, USA e
Resto del Mondo
Centro Romania
Centro Cile
Attività di ricerca su America
Latina, Brasile incluso, e
assistenza near-shore per
clienti USA
Offerta di progetti e servizi in tutto il
mondo in oltre 25 lingue
17
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9. Sviluppo di un Knowledge Portal ABCD
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10. Realizzazione di un knowledge webinar
•! Focus: Accelerating knowledge and technology
awareness of advanced technology offering
regarding ABCD platform.
•! Structure:
•! Identification of the 15 most attractive companies
for LMNO, on the basis of the research developed
•! Preparation of a common knowledge framework for
participants, highlighting the prioritized interest and
needs of LMNO in the business
•! Detailed definition of a detailed roadmap of the
event – structured on a before-during-after rationale –
targeted to enhance the effectiveness of the event
•! Timeline: 2 hours, 15:00 to 17:00 CET, in order to
assure an optimized coverage from the US
attendees.
•! 5-1-0 Rule of the game
- Five minutes presentation by an individual, with a bell used to keep presenters on schedule
- One page of a slide or a poster to provide visual support, if needed
- Zero questions or discussion during the presentations
After the presentations, the ABCD participants will be asked to vote the most valuable presentations.
•! Follow-up: After the internal selection, questions and additional information requests will be sent to the
presenters. The entire process will be managed by a small project team during the
Homework phase.
19
x

The End!
x
!!

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