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MBA 603: Spring Semester 2021 MANAGEMENT OF INNOVATION

AND TECHNOLOGY

Kenneth B. Kahn, Ph.D. [email protected]

March 15, 2021

mailto:[email protected]

Debrief from Last Week

Market (Need)

Technology (Solution)

Segmentation • Demographic • Geographic • Psychographic • Benefit • Usage

Positioning • Attribute • Benefit • Use of application • User • Competitor • Product Category • Quality or Price

Product Innovation Charter

BACKGROUND - rationale for the strategy, rationale for the opportunities

ARENA - area of focus: (1) technology, (2) Market - customer and/or

end-use, (3) Combination

GOALS, OBJECTIVES - profit, growth, and market status

SPECIAL GUIDELINES - special points to be made:

Innovativeness: (a) first-to-market by (1) state-of-the-art

breakthrough, (2) leverage creativity - technology in a new way,

(3) applications engineering - technology not new but use is; (b)

adaptation or second but best; (c) imitation or emulation

Timing: quick entry, slower entry, late entry

Miscellaneous

Innovation Charter Example Background Arena Goals/Objectives Special Guidelines

children can injure themselves with regular household staples

plastic staples are less expensive

company has a core competency in stapler manufacturing

want a 20% return on investment within two years

staples should be made of recyclable plastic materials

Children can very easily injure themselves using typical household staplers with

metal staples. It is proposed that a new stapler using plastic staples, which are

potentially less expensive, be developed. To accomplish this new product, we want

to rely on or core competency as a leader in stapler manufacturing.

A 20% return on investment is expected within two years after launch of the product.

Particular attention should be paid to plastic staples made of recyclable plastics.

Tonight’s Agenda

➢ What Is a Product (Service)?

➢ Concept Generation

➢ Different Ways of Thinking

➢ Concept Evaluation

What is a product?

Product from the Market Perspective

Core

Benefit

Generic Product

Expected Product

Augmented Product

Potential Product

Product from the Company Perspective

Product Item: a specific model, brand, or size of a product that a company offers

Product Lines: a group of closely related product items

Product Mix: all the different product lines a firm offers

Width = the number of different product lines

Depth = the number of product items within each line

Consistency = commonality among lines

Product from the Technology Perspective

Inventions

Innovations

[Devices Versus Products]

The Product Concept

Product Concept Elements

• Form

• Technology

• Benefit

Coming Up with the Product Concept: Concept Generation

Concept Generation Techniques

• Attribute Analysis

• Group Creativity

• Needs Assessment

• Relationship Analysis

• Scenario Analysis

• Lateral Search

Attribute Analysis

• Judgmental Map

• Determinant Gap (Attribute Rating)

• Perceptual Gap (Overall Similarity)

Group Creativity

• Brainstorming SCAMPER - Substitute - Combine - Adapt - Modify - Put to another use - Eliminate - Reverse

• Questionstorming

Needs Assessment Techniques

• Routine Market Contacts

• Problem Analysis - Focus Groups - Expert Opinion - Published sources - Household / industrial panel - User panel/advisory board - User observation - Role playing

• Potential Idea Sources: Trade Journals, Competitor Products, Current Customers and Suppliers, Magazine Articles, Employee Ideas, Patent Files, Outside Industry Experts and Technical Faculty, Customer Complaints

Relationship Analysis

• Two-Dimensional Matrix

• Morphological Analysis

Two-Dimensional Matrix

Auto Insurance

Life Insurance

Health Insurance

Travel Insurance

Renter’s Insurance

Home Insurance

Single 1 2 3 4 5 6 Young Couples with No Children

7 8 9 10 11 12

Families with Children Under 18

13 14 15 16 17 18

Families with Children 18 to 28

19 20 21 22 23 24

Empty Nesters

25 26 27 28 29 30

Morphological Analysis

Chocolate Nuts Fruit Size Wrapping

Dark Almonds Blueberries 2 ounces Gold Foil

Milk Brazilian Nuts Cranberries 4 ounces Silver Foil

White Peanuts Raisins 6 ounces Waxed Paper

No Nuts No Fruit

3 x 4 x 4 x 3 x 3 = 432 Ideas

Scenario Analysis

• Extend

• Leap

Lateral Search

• Analogies and Metaphors

• Animal Customers

• Big Winner

• Creative Stimuli

• Famous Person

• Swap or Drop

• Travel Poster

Analogies and Metaphors

Eraser is to a pencil as ___ is/are to a food-delivery service.

Sharpening a pencil is like a 10-mile hike.

Linear versus Lateral Thinking

Linear Thinking Lateral Thinking

Use logic Use imagination

Facts to an answer Question to ideas

Convergent Thinking Divergent Thinking

Convergent versus Divergent Thinking

Distill Expand

Concept Evaluation

NPD Testing/Evaluation

Development Activity Evaluation Task Evaluation Techniques

Strategic Planning Direction: Where should we look?

Opportunity Identification, Market descriptions

Concept Generation Initial Review: Is the idea worth screening?

Product Innovation Charter, Experience and Judgment, Preliminary Market Analyses, Concept Testing

Pretechnical Evaluation Full Screen: Should we try to develop it?

Checklists, Scoring Models

Technical Development Progress Reports: Have we developed it? If not, should we continue to try?

Protocol checks, Prototype Tests, Product Use Tests

Commercialization Market Testing: Should we market it? If so, how?

Pseudo Sale, Controlled Sales, Rollout

Post-Mortem Review

Concept Evaluation

• Product Innovation Charter

• Concept Testing

• Scoring Models

• Snake Plots

• Financial Analysis

Scoring Models

PRODUCT CONCEPTS

A B C D

Selection

Criteria Weight Rating

Weighted

Score Rating

Weighted

Score Rating

Weighted

Score Rating

Weighted

Score

Ease of

handling

5% 3 0.15 3 0.15 4 0.20 4 0.20

Ease of Use 15% 3 0.45 4 0.60 4 0.60 3 0.45

Readility of

Settings

10% 3 0.30 3 0.30 5 0.50 5 0.50

Accuracy 25% 3 0.75 3 0.75 2 0.50 3 0.75

Durability 15% 3 0.45 5 0.75 4 0.60 3 0.45

Ease of

manufacturing

20% 3 0.60 3 0.60 2 0.40 2 0.40

Portability 10% 3 0.30 3 0.30 3 0.30 3 0.30

Total Score 3.00 3.45 3.10 3.05

Rank 4 1 2 3

Continue No Yes No No

Snake Plots

Handling Use Readibility Accuracy Durability Mfg Portability

Assumptions-Based Modeling

Potential Market

Available Market

Qualified Available Market

Target Market

Penetrated Target Market

Wrap-Up

• There are different types of concept generation and concept generation techniques.

• There are different ways of thinking.

• Concept generation can be fun, but real application and problem-solving are essential.

• Be mindful of what is the problem and the objectives to be achieved.

❑ Assignment Six Due March 22 by 6:00p

❑ Read I&NPP Chapter 7 and Chapter 8

To Do’s