Innovation in Exports - EDC · Innovation in Exports Paris de l’Etraz, PhD Managing Director...
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Innovation in Exports Paris de l’Etraz , PhD Managing Director Venture Lab, IE Business School, Spain Chairman Applied Innovation Institute, Silicon Valley, Singapore @parisdeletraz Dec 5 th , Manila, The Philippines
Transcript of Innovation in Exports - EDC · Innovation in Exports Paris de l’Etraz, PhD Managing Director...
Innovation in Exports
Paris de l’Etraz, PhD
Managing Director Venture Lab, IE Business School, Spain
Chairman Applied Innovation Institute, Silicon Valley, Singapore
@parisdeletraz
Dec 5th, Manila, The Philippines
What is Innovation?
1. Creativity
2. Impact
3. Leonardo Da Vinci vs. Thomas Edison
MRI for Kids
MRI for Kids
The GoPro
Story
Where is the Innovation here?
What caused the Disruption here?
Business Model
or
Brand Strategy?
What types of Business Models are
Disrupting across many industries?
1. Peer to Peer: AirBnb, Uber
2. Subscription: Netflix, Spotify
3. Revenue Sharing: Apple App Store
4. Open Source: Mozilla, Red Hat
5. Freemium: LinkedIn, Gmail
6. Experience Selling: Starbucks, Nespresso
7. Auction: Ebay, Winebid
8. Crowdsourcing: Threadless, Myfab
9. Ecommerce: Amazon, Zappos
The Business Model Navigator
Innovation Potential
1. Business Model Innovation
2. Process Innovation
3. Product Innovation
More Impact
The Business Model Navigator
What forces are making Brand engagement
easier?
1. Social Media
2. Cloud computing
3. Video
4. Mobility
5. Big Data
6. Internet of Things
7. Location
Whose Customers are more Loyal?
Business Model Strategies
1. Brand
2. Products
3. Technology
4. Limited or controlled Distribution
HOW DO YOU DEVELOPABRAND
MODEL?
THE ROLE OF
EMOTIONS
Emotions
Look at your watch
Did you spend more than $30 on it?
That was an emotional decision
Luxury & Emotional Decisions
1. Luxury sparks emotion
2. It Conveys passion
3. There is a terrific story behind every luxury brand
4. In the past, many companies spoke more about technology than emotions, fashion changed that
Internet PenetrationbyRegion
North America
Central America
South America
Western
Europe
Africa
Central/Eastern
Europe
Middle
East
Central Asia
South
Asia
East Asia
Southeast
Asia
Oceania
81
%
34
%
47
%
78
%
54
%
29
%
48
%
63
%
25
%
12%
37
%
18
%
Sources: US census bureau, Internet World Stats
0
50
100
150
200
250
300
Mobile Devices Penetration by Country
Sources: US census bureau, Internet World Stats
12.40%
8%
6.90%
5.60%
5.60%
5.30%
4.20%
4%
3.80%
3.70%
3.60%
3.50%
3.40%
3.30%
2.80%
2.50%
2.40%
2.30%
1.50%
0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00% 14.00%
UK
South Korea
China
India
Japan
US
Mexico
Germany
Saudi Arabia
Australia
Canada
Italy
France
Argentina
Russia
South Africa
Brazil
Turkey
Indonesia
Internet Economy as a Percentage of 2016 GDP
Sources: US census bureau, Internet World Stats
69.80%
63.50%
58.70%
57.10%
49.20%
44.40%
28.60%
17.50%
12.70%
11.10%
9.50%
7.90%
6.30%
4.80%
1.60%
0
0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00% 80.00%
BioTech&Healthcare
Big Data/Analytics (including Al)
Internet of Things (loT)/Wearables
Virtual Reality/Augmented Reality
Security Software
FinTech (including Blockchain)
CleanTech
Infrastructure Apps
eCommerce
Other Enterprise Software Apps
New Media
Other Mobile or Web Consumer Apps
Social Media/Messaging
Gaming (including video games)
AdTech
Online Travel
Ranking of Disruptive Innovation Areas
Sources: Fifth Era LLC
0
10
20
30
40
50
60
70
80
90
Social Technologies Penetration by Country
Sources: US census bureau, Internet World Stats
11%
6.40%
6.30%
5.40%
5.20%
3.90%
3.40%
3%
3%
2.20%
2.10%
1.70%
0% 2% 4% 6% 8% 10% 12%
Real Estate
Financial Services
Healthcare
Construction
Discrete Manufacturing
Transportation
Internet
Education
Communication
Agriculture
Utilities
Mining
Contributionof Selected Sectors to GDP
Sources: US census bureau, Internet World Stats
2016 Rank Company Geography Industry R&D Spend
($Bn)*
1 Apple United States Computing & Electronics 8.1
2 Alphabet United States Software & Internet 12.3
3 3M United States Industrials 1.8
4 Telsa Motors United States Automotive 0.7
5 Amazon United States Software & Internet 12.5
6 Samsung South Korea Computing &Electronics 12.7
7 Facebook United States Software & Internet 4.8
8 Microsoft United States Software & Internet 12.0
9 General Electric United States Industrials 4.2
10 IBM United States Computing & Electronics 5.2
2016: Top 10 Most Innovative Companies
Sources: PWC Strategy
Symbol Company Cap Rank on
2/28/17
Market Cap on
2/28/17
AAPL Apple 1 718,7
GOOGL Alphabet 2 584,2
MSFT Microsoft 3 494,4
BRK-a Berkshire Hathaway 4 423,4
AMZN Amazon.com 5 403,2
FB Facebook 6 391,7
XOM Exxon Mobil 7 337,2
JNJ Johnson & Johnson 8 332,5
JPM JPMorgan Chase 9 323,6
WFC Wells Fargo 10 290,3
Largest Companies by Market Capitalization
Sources: PWC Strategy
1. Internet, broadband, www2. PC/laptop computers3. Mobile phones4. E-mail5. DNA testing and sequecing/human genome mapping6. Magnetic Resonance Imaging (MRI)7. Microprocessors8. Fiber optics9. Office software (spreadsheets, Word processors)10. Non-invasive laser/robotic surgery (laparoscopy)11. Open-source software and services12. Light-emitting diodes13. Liquid crystal display (LCD)14. GPS systems15. Online shopping/e-commerce/auctions16. Media file compression (jpeg, mpeg, mp3)17. Microfinance18. Photovoltaic solar energy19. Large-scale wind turbines20. Social networking via the internet
Forbes List of the Top Innovations of the Prior 30 years - 2009
So what is Corporate
Innovation Today?
Four Types of Innovation
1. Marketing Innovation : Better ways to market a product or service
2. Incremental Innovation: incrementally improve existing products
and services
3. Dis-Continuous Innovation: Find new business models
4. Disruptive Innovation: Change the rules
What types of Business Models are
Disrupting across many industries?
1. Peer to Peer: AirBnb, Uber
2. Subscription: Netflix, Spotify
3. Revenue Sharing: Apple App Store
4. Open Source: Mozilla, Red Hat
5. Freemium: LinkedIn, Gmail
6. Experience Selling: Starbucks, Nespresso
7. Auction: Ebay, Winebid
8. Crowdsourcing: Threadless, Myfab
9. Ecommerce: Amazon, Zappos
The Business Model Navigator
Starbucks as a Business
$.50
Cost to Produce
Next Best Alternative:
Needs served: coffee,
quality, addiction,
convenience, social status…
$5.00?
Selling Price = $3.00
Value Captured = $2.50
Value Created
Value Proposition for a cappuccino:
And if this is the value proposition,
what is the business model?
What is the role of Big
Data
in Innovation?
Case: How Does Target Know?Hypothesis-based model formation:
1. Noticed: that women on the baby registry were buying larger quantities of unscented lotion around the beginning of their second trimester.
2. First 20 weeks: supplements like calcium, magnesium and zinc. Also, soap and cotton balls.
3. Example signal of close to delivery: suddenly buying lots of scent-free soap, extra-big bags of cotton balls, hand sanitizers and washcloths, it
4. Pole found about 25 products, when analyzed together, allowed him to assign each shopper a “pregnancy prediction” score.
5. Take a fictional Target shopper named Jenny Ward, 23, Atlanta: I. In March bought cocoa-butter lotion, a purse large enough to double as a
diaper bag, zinc and magnesium supplements and a bright blue rug. II. There’s, say, an 87 percent chance that she’s pregnant and that her
delivery date is sometime in late August.
Target statistician
Andrew Pole
Case: How Target Figured Out A Teen Girl
Was Pregnant Before Her Father Did?
1. Father to Target Customer Service: “My daughter got this in the mail!” he said. “She’s still in high school, and you’re sending her coupons for baby clothes and cribs? Are you trying to encourage her to get pregnant?”
2. Later:
3. Father on phone: On the phone, though, the father was somewhat abashed. “I had a talk with my daughter,” he said. “It turns out there’s been some activities in my house I haven’t been completely aware of. She’s due in August. I owe you an apology.”
Top Business Models for Using Data1. Knowing your customer, leading to better targeting and
relationship. E.g. Target, Disney, Netflix
2. Information based better services. E.g. UPS, FedEx
3. Data driven reliability. E.g. GE and Siemens
4. Information Brokers, Arbitrage, and Trading Opportunities: Investment funds.
5. Improving the customer journey/experience.. E.g. Harrah’s
6. Risk Management, regulation, and compliance
7. Efficiency or Better Performance per dollar cost
8. Functional Applications: HR/Hiring, Operations etc..
Top Business Models for Using Data
1. Knowing your customer, leading to better targeting and relationship. E.g. Target, Disney
2. Information based better services. E.g. UPS, FedEx
3. Data driven reliability. E.g. GE and Siemens
4. Information Brokers, Arbitrage, and Trading Opportunities: Investment funds.
5. Improving the customer journey/experience.. E.g. Harrahs
6. Risk Management, regulation, and compliance
7. Efficiency or Better Performance per dollar cost
8. Functional Applications: HR/Hiring, Operations etc..
Usage Models• Efficiency
(save money)
• Wallet Share
(top customers spend
more time and money
with you)
• Brand alignment
(It reinforces how
people think positively
about the company)
Value to Business Customers
More
Value
Ikhlaq, de l’Etraz
In 2013, 90% of the world’s data
had been created in the last 2 years
Do you have a data strategy?
Customers are seeking Outcomes and
Experiences
Most companies are selling products and
services
New Ideas can only be found outside of current
concepts
but
90% of successful business model innovations
recombine existing business model elements
Decision making needs to move
from gut & instinct
to data-driven decisions
Decision making needs to move
from gut & instinct
to data-driven decisions
Boston Whaler: An example of Lean Innovation
to Increase Sales & Exports
An Innovation Case in Agriculture:
Philippine Coconut Sugar
CHINA
15.8 Million Metric Tons
EU
18.7 Million Metric Tons
INDIA
25.7 Million Metric Tons1
2
3
1
Sugar Consumption Worldwide
2
3
85
3
1
EuropeHow much sugar the average person consumes each day
2
3
GERMANY
102.9 grams
UNITED KINGDOM
93.2 grams
SPAIN
70.1 grams
ITALY
57.6 grams4
1
2
4
el mejor azúcar de la naturaleza…
Azúcar de Coco
Harvested from the
sap of the flower of the
Cocos Nucifera
Premium Quality
100% Traceability
Azúcar de Coco
Azúcarde
CocoNO Pesticides
NO Fertilizers
NO Chemical process
Glycemic Index 35
Contains Minerals
Potassium, Magnesium,
Zinc, Amino Acids
SUBSTITUTE PRODUCTS
COMPETITORS
Box of 40 Sachets: 5 grams each & 150 grams total
Box: 250 grams total
Glass Bottle: 150 grams total
el mejor azucar de la
naturaleza…
100% Organic
Azúcar de Coco
We are the
growers &
producers of the
finest sugar on
the planet
We have full quality and ethical
control from
seed to sugar
The Team
Philippines
Sugar Producer
Spain
Marketing Startup
United States
Marketing Startup
el mejor azúcar de la naturaleza
Some Advice on Exports1. Move from Commodities to “Value Added” products, the Companies that are exporting
the most have done this well.
2. Customers today are moving from buying products to buying experiences and outcomes, B2B as well as B2C, we need to apply more EQ…
3. Think Globally as a Firm and as a Country, and take your story abroad.
4. Train your people to deliver value added work.
5. Collaborate with your peers to make Grown in the The Philippines or
Made in the The Philippines a value added reference.
