chapter 2 bda 10602

2.1 DEFINITION AND CONCEPT OF INNOVATION

2.2 RADICAL VS EVOLUTIONARY CHANGE

2.3 PRODUCT, SERVICE AND PROCESS?

2.4 DISRUPTIVE AND OPEN INNOVATION

2.5 OBSERVATION AND OPINIONS ON THE INVENTIONS

CHAPTER 2 – BDA 10602

2.1 Definition andConcept of Innovation

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- A new idea, creative thoughts, new imaginations in form of device or method.

- The act or process of introducing new ideas, devices or methods.

Definition of Innovation

2.1 DEFINITION AND CONCEPT OFINNOVATION

Concept of Innovation

VIDEO of INNOVATION


Creativity and Innovation.mp4

2.2 Radical vs Evolutionary Change


2.2 RADICAL VS EVOLUTIONARY CHANGE

Two categories of innovation for products or services:

• Evolutionary change: improvements within a given frame of solutions; can be thought of as a process that modifies, adjusts, or refines the status quo via relatively simple and minor changes (i.e., “doing better what we already do”); OR

an incremental change and takes place gradually, over time....

• Radical : a change of frame (i.e., “doing what we did not do before”).

The major difference between the two is whether the innovation is perceived as a continuousmodification of previously accepted practices or whether it is new, unique, and discontinuous.

Dahlin and Behrens suggest three criteria for identifying an innovation as radical:

• Criterion 1: The invention must be novel: It needs to be dissimilar from prior inventions.

• Criterion 2: The invention must be unique: It needs to be dissimilar from current inventions.

• Criterion 3: The invention must be adopted: It needs to influence the content of future inventions.

Ref-Design Issues: Volume 30, Number 1 Winter 2014

Radical vs Evolutions


2.3 Product, Service And Process?



2.3 PRODUCT, SERVICE & PROCESS

• Innovation can be everywhere, Innovation can be everything, Innovation can

be anytime, not limited to product innovation only,

• Innovation non stop = continuous improvement

Product Innovation Service Innovation Process Innovation


2.3.1 Product Innovation

INNOVATION


• Product innovation categorized into three (3):

• (i) New product

A product which not exist before, i.e; when the first time telephone introduced by Alexander Graham Bell.

• (ii) New Perfomance

Improvement of existing product performance, i.e; the improvement of engine specification to a new model compared to previous model.

• (iii) New Features

New Feature to existing product, i.e; addition of airbag system to a car.


2.3.2 Service Innovation

INNOVATION

• New or improvement of service, i.e McD delivery system, direct line call to mobile app for delivery order


• The service innovation change the systems to serve the customer/user better and most

applied in business or organization management.

• The innovation in services able to focus on following areas:

Service concept - type of service such as retail concept, online concept for shop

organization

Client interface - the way of dealing with customer, i.e; Hunting Line, Website,

Translator etc.

Technological option - The used of technology to delivering the services and

survey the services. i.e; loyalty cards, communication, the way to inform the

customer about sales, discount etc.

Delivery system - improvement on transportation, packaging, way of deliver etc.

• Impact of service innovation

Gain customer/user satisfaction

Reduce time

Smooth work flow

• Example of service innovation

Taxi service to Grab service

Online shopping, i.e; Shopee, Lazada


2.3.3 Process Innovation

Process is the combination of facilities, skills, and technologies to produce product or service.

• Process innovation could be achieved by:i. Implement updated equipment and technologiesii. Tools improvementiii. New techniques


• In process innovation, most step are less visible compared to productinnovation which typically seen and valued internally. Differed toprocess innovation, most of the changes affect the cost and time.

• Impact of Process innovation

Reduce cost

Reduce time

Increase productivity

• Example of process innovation

Moving assembly line by Henry Ford

Toyota Production System

2.4 Disruptive and Open Innovation


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• A disruptive innovation is

an innovation that creates a

new market and value network and

eventually disrupts an existing market

and value network, displacing

established market-leading firms,

products, and alliances.

The term is used in business and

technology literature to describe

innovations that improve a product or

service in ways that the market does

not expect.

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2.4.1 Disruptive Innovation

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High technology – known as disruptive technology

• Electric cars disrupts the support network for gasoline cars (network of

gas and service stations). Such disruption is fully expected and therefore

effectively resisted by support net owners. In the long run, high

(disruptive) technology bypasses, upgrades, or replaces the outdated

support network.

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Example;

• Mobile phone


LiFi– Light Fidelity

WiFi

– Wireless Fidelity

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Open innovation is a situation where an organisation doesn’t just rely on their owninternal knowledge, sources and resources (such as their own staff or R&D forexample) for innovation (of products, services, business models, processes etc.) butalso uses multiple external sources (such as customer feedback, published patents,

competitors, external agencies, the public etc.) to drive innovation.

• Reduced cost of conducting research and

development

• Potential for improvement in development

productivity

• Incorporation of customers early in the

development process

• Increase in accuracy for market research and

customer targeting

• Potential for synergism between internal and

external innovations

• Potential for viral marketing

• Enhanced digital transformation

• Potential for completely new business models

• Leveraging of innovation ecosystems

• Possibility of revealing information not

intended for sharing

• Potential for the hosting organization to

lose their competitive advantage as a

consequence of revealing intellectual

property

• Increased complexity of controlling

innovation and regulating how contributors

affect a project

• Devising a means to properly identify and

incorporate external innovation

• Realigning innovation strategies to extend

beyond the firm in order to maximize the

return from external innovation

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2.4.2 Open Innovation

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CLOSED INNOVATION PRINCIPLES OPEN INNOVATION PRINCIPLES

The smart people in our field work for us. Not all the smart people work for us so we must find

and tap into the knowledge and expertise of bright

individuals outside our company.

To profit from R&D, we must discover, develop and

ship it ourselves.

External R&D can create significant value; internal R&D

is needed to claim some portion of that value.

If we discover it ourselves, we will get it to market first. We don’t have to originate the research in order to

profit from it.

If we are the first to commercialise an innovation, we

will win.

Building a better business model is better than getting

to the market first.

Table 1: The differences between Closed and Open Innovation Principles (Source: Chesbrough, 2003)

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2.5 Observation and Opinions on The

Inventions


• Nowadays it is impossible to imagine our life without technologicalinventions. We can not do without them and our lives depend onthem a lot.

• Some people suppose inventions to be the most important thingson the way to progress, but others think that they make us unableto do a lot of useful and necessary actions that help humans to behealthy, sporty and smart.

• Where is the truth? Let’s try to look at the problem to find out theanswer.


The History of the Invention of Steam Trains

• George and Robert Stephenson built the first steam train, the«Rocket», in 1829.

• It had a lot of problems and was very slow. By 1870, trains becamemore

popular and easier to run.

• By 1895, people started

using electric trains.

• They were cleaner and

quieter than steam trains.


• By 1920, most countries in Europe had railways. Today there arerailways all over the world. They have greatly changed our lives andhelped to save a lot of time for travellers.


• The US rail network, with an operating route length over 250,000km,is the biggest in the world.

• Modern trains are fast and comfortable. People can find beds,restaurants, watch TV and listen to the radio there.


• No doubt, the invention of the train was a great step toward progress.

• To travel long distances in old days was tiring, uncomfortable anddangerous. Travelling by train nowadays is not the fastest, butconvenient and not very expensive.

Iron

• People wanted to look smart through all the time.

• They dreamt to have clean and accurate clothes. So, the thirst irons appeared.

• They were very heavy and hot because

people made them from iron and heated

in the fire.

• Later they decided to put hot charcoal inside.


• There were irons which worked with the help of spirit that burnt inside,but they were not very good and the flammable liquid often burnt theclothes.

• Due to the inventor Earl Richardson the first electric iron was madein1903. He convinced some of housewives to test it.

• The new invention became very successful, though it was too hot in thecentre and not hot enough at the edges .

• Richardson produced an advanced model n1905.Now at the marketthere is a number of various models of irons.

• They are light, multifunctional and even wireless. Some of them have aspecial device which helps not to spoil clothes. No doubt that it is a veryuseful and helpful invention.

Can you imagine your life without this device??


• A lot of inventions appeared in people’s lives to make their existence

more comfortable and easier.

• The inventions help us to save much time for our hobbies and

interests and to get much freedom from our housework.

• There is another point of view on the problem. A lot of people

suppose that all the inventions make us lazy, passive and unhealthy.

• But if you are sensible, you will always have something interesting to

do in your free time and if you care of your health, you will go to a

sports club to have some exercises to keep fit.


chapter 2 bda 10602

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