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Sources of Innovation
Sources of Innovation
Figure 7.1
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Markets vs Maturity
The real rate of growth of a market provides a good estimate of the stage in the product lifecycle and by inference the maturity of the market. Paramaters: 1. New Products contribution/Sales 2. Marketing cost/Sales 3. R&D cost/Sales 4. Gross Margin/Sales 5. Return/Sales
Prof.V.Seshadri MOI - 7. Markets Ref 1 Ch 7 28
Figure 7.2
Differentiating Products
Differentiation measures the degree to which competitors differ from one another in a specific market. Markets with low differentiation or perceived quality difference are characterized by low profitability. ROI is also low in such cases.
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Figure 7.3
Market Segmentation
Market segmentation is the process of identifying groups of customers with sufficiently similar purchasing behavior so that they can be targeted and treated in similar way. The objective of segmentation is to maximize across-group variance and minimize withingroup variance.
Prof.V.Seshadri MOI - 7. Markets Ref 1 Ch 7 33
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Nokia - 2010
10. Mr.Stephen Elop was drafted in from Microsoft as CEO - in September 2010 to halt Nokia's decline & to claim back market share and the innovative edge it has lost to Apple and other rivals. 11. including partnership with Microsoft and an organisational rejig.
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Nokia - 2010
12. As part of this innovation strategy. Nokia would make Windows Phone as its primary Smartphone platform & its own Symbian operating system would become a franchise platform. 13. Smart Devices unit, responsible for smartphones, would be led by Jo Harlow. Further, Symbian Smartphones, MeeGo Computers and Strategic Business Operations would come under the new division. 14. Each unit will have profit-and-loss responsibility and end-to-end accountability for the full consumer experience,
Prof.V.Seshadri MOI - 7. Markets Ref 1 Ch 7 45
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Figure 7.5
Innovation process at Enterprise level - Traditional phase gate model (Linear Model of Innovation)
Gate 1 Gate 2 Gate 3 Gate 4
Idea Generation
Concept feasibility
Capability Development
Ramp-up
Launch
Sanity Check
Test Marketing
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