1
Innovation Process – OPIM 651
~500 opportunities identified by individuals
~50 opportunities developed
by individuals
~25 concepts developed by
teams of 2
multivote
Darwinator system
~13 companies prototyped by
teams of 4
simulated capital market
0-2 ventures launched
multivote
~250 opportunities submitted by individuals
Individual screening and
preferences
2
Shape of the Funnel “Yield” / “Filter Ratio” by Phase
(Approximate values; From multiple sources.)
3
Innovation Process Relative to Phase-Gate New Product Process
4
Modifying the Funnel
“taking more draws from the opportunity distribution”
“delaying picking a winner until more uncertainty is resolved”
0.00
0.20
0.40
0.60
0.80
1.00
1.20
1.40
1.60
0 50 100 150 200 250 300 350 400 450 500
Number of Ideas Generated
Exp
ecte
d V
alu
e o
f M
ax R
atin
g
5
6
Uncertainty and InvestmentQ
ua
lity
of
op
po
rtu
nity
Distribution of universe of all opportunities
realizationof value
LaunchConcept Development
Prototype
7
8
Capacity and Bottleneck Management
Essentially all key ideas from capacity/bottleneck management in operations apply to innovation processes: Bottleneck resource is typically resource with highest (yield-adjusted) cost of capacity. Low cost resources should typically not be capacity constraints. Projects/opportunities/work is released to the system at the bottleneck rate. Strategic use of buffers to trade off flow time and capacity utilization.
9
American Idol uses both flow and batch screens
• 10,000+ candidates
• Flow screening applied early
• Batch screening applied later
Batch screen helps pick the “best” winner, but:• Lumpy demand for process steps and/or• Extended flow time through process
Batch versus Flow Screening
10
Spiral vs. Waterfall Process
11
12
Business Development Relative to Existing NPI Process
Existing “Phase-Gate” Process
What are the criteria for release to development?• Business case.• Rank on Innovation Return Curve.
What are the different flavors of development organization?1. Autonomous team.2. Heavyweight project structure.3. Lightweight project structure (status quo)
When are opportunities released to development?• Hybrid batch/flow screening.• “Hot” opportunities released when ready.• Others released in planning cycles.
Where do opportunities originate?• Active, structured exploration led by BD org.
• “Pull” from innovation strategy.• Passive collection from various sources.• Active solicitation by BD org.
What are phases for early-stage opportunities?• Raw idea (text, single ppt)• Validated opportunity• Solution concept• Real, Win, Worth analysis• Prototype?Are these phases the same for every opportunity?
How are opportunities moved along?• In early phases, many opportunities handled by the same BD
team.• Later, a BD leader assigned, with part-time x-fn team drawn from
larger org. Aim to include some who would be on NPI team.
New “Business Development” Process
How is BD process budgeted?
Governance• Who decides/approves each round of selection?
13
Solution Novelty
Ma
rke
t N
ov
elt
y
new to worldin use by us new to us
serv
ed
by
us
ne
w t
o u
sn
ew
to
wo
rld
Horizon I
Horizon II
Horizon III
In what ways does approach vary by type of opportunity?
14
Levels of Innovation Process Management
1. We can describe the phases in our innovation process.
2. We know the current state of the process.
• Flow rates at each phase.
• Opportunities in progress at each phase.
3. We have analyzed and deliberately chosen our key process parameters.
• Number of opportunities considered for each launch.
• Aggressiveness of filter ratios by phase.
• Capacity of each phase.
4. We have deliberately considered and made process strategy choices.
• Organizational structure.
• Make-buy and partnering decisions by phase.
• Level of capacity flexibility.
• Batch vs. flow by phase.
5. We engage in deliberate process improvement projects.
Top Related