CORPORATE ENTREPRENEURSHIP AND BUSINESS MODEL INNOVATION
Shob
MGT731_08_Operations1.pptxBusiness model innovation through superior operations
MGT731 Corporate Entrepreneurship and Business Model Innovation
Course Coordinator: Dr Robert Ogulin
2
The quest for operational excellence can spark new business models
3
An emerging definition of Operational Excellence
Distinct from Industry 3.0, which involved the automation of single machines and processes, Industry 4.0 encompasses end-to-end optimisation of the value activities.
Digital products and services,
Operating connected physical and virtual assets,
Transforming and integrating all operations and internal activities,
Building partnerships, and
Optimizing customer-facing activities.
4
Source: PwC, Global Digital Operations 2018 Survey; https://www.strategyand.pwc.com/gx/en/insights/industry4-0.html accessed on 28/11/2019
A focus on Operational excellence makes ‘exceptional winners’
5
Deloitte (2018) Business Model Innovation in Consumer Goods; https://www2.deloitte.com/content/dam/insights/us/articles/business-model-transformation-consumer-goods-companies/DUP-1026_CP-business-model_vFINAL_11.2.15.pdf; accessed 9/12/2019
Deep Change: How Operational Innovation Can Transform Your Company
6
Hammer, M., Deep Change: how operational innovation can transform your company. Harvard Business Review, 82.
7
Efficiency-centred business model innovation:
Technology
People
Processes
Many Factors Influence Operational Excellence
Process Execution
Technologies
Knowledge
Organizational Structure
People
Operational Excellence
Customer Satisfaction
Value Generation
Operational Excellence addresses the challenges from complexity
Includes processes and structures for:
Redeployment and reallocation of resources
Introduction of new technologies and processes
Addition of new personnel
Retraining of existing personnel
Selective integration of organizations and processes
Organizing resources and actions around core processes and competencies
Selective integration of organizations through internal consolidation of common infrastructure functions
Selective use of key suppliers, alliance partners and outsourcing specialists
Development of Shared Service Organization (SSO) for extraordinary leverage of resources and common services
9
10
Source: PwC, Global Digital Operations 2018 Survey; https://www.strategyand.pwc.com/gx/en/insights/industry4-0.html accessed on 28/11/2019
Technology is a key enabler (refer to session 7)
Mobilising and enabling people to achieve step-changes in operational performance
11
PWC (2019) Operational Excellence: An integrated approach to unlocking business value; https://www.pwc.com/ca/en/industries/power-utilities/publications/energy-transformation/operational-excellence.html accessed 9/12/2019
Emerging digital workplace will impact future of work
Changes in working styles that enable employees to work more transparently and better leverage social networks.
Offline and online communications: employees connected through their mobile devices anywhere, anytime.
Employee experience changing: choice, flexibility and personalization.
Virtual work environments that allow employees to stay connected in distributed and virtualized work locations while balancing customer privacy and operational risk.
Minimize spending and enhance productivity by providing employees with the right tools and right information at the right time.
Win the war on talent by offering the progressive and innovative environments that top candidates now expect
12
Source: Deloitte: The digital Workplace. https://www2.deloitte.com/content/dam/Deloitte/mx/Documents/human-capital/The_digital_workplace.pdf, accessed 10/12/2019
Improve process efficiency by reducing manual and paper-based processes
13
PWC (2019) Operational Excellence: An integrated approach to unlocking business value; https://www.pwc.com/ca/en/industries/power-utilities/publications/energy-transformation/operational-excellence.html accessed 9/12/2019
Example: ZARA
At Zara, rapid timing and synchronicity are paramount.
Transfer both hard data and anecdotal information quickly and easily from shoppers to designers and production staff.
Track materials and products in real time every step of the way, including inventory on display in the stores.
Zara aligns strategic goals, financial commitments and building of new capability
Zara has made major capital investments in production and distribution facilities and uses them to increase the supply chain’s responsiveness to new and fluctuating demands.
Zara spends money on anything that helps to increase and enforce the speed and responsiveness of the chain as a whole.
Zara adapts the supply chain continuously
Regular creation and rapid replenishment of small batches of new goods.
It produces complicated products in-house and outsources the simple ones.
15
https://www.mckinsey.com/industries/oil-and-gas/our-insights/traditional-company-new-businesses-the-pairing-that-can-ensure-an-incumbents-survival#
16
https://www.mckinsey.com/industries/oil-and-gas/our-insights/traditional-company-new-businesses-the-pairing-that-can-ensure-an-incumbents-survival#
17
https://www.mckinsey.com/industries/oil-and-gas/our-insights/traditional-company-new-businesses-the-pairing-that-can-ensure-an-incumbents-survival#
18
The role of Corporate Entrepreneurship
Intrapreneur
Products
Processes
Marketing
Distribution
Service
…….
Customers
Source:http://www.retail-excellence.com/en/img/charts/5200_intrapreneur.jpg
Ten types of innovation – moving beyond products is important to create real sustainable value
Finance – how you make money and connect with others
Process – how things ‘happen’ in your organization
Offering – what is it that you sell (tangibles)
Delivery – how do you deliver the goods/services to the customer (mostly intangibles)
Moving beyond product development is important to create real sustainable advantage
Core competence vs innovation planning
Historically where do we place value (time and money) on innovation?
Where do we get the payback (money) from innovation ?
Updated Doblin model
Source: www.doblin.com
30
Operational efficiencies in bsuienss ecosytems
Operations Ecosystem
31
Characteristics of integrated, end-to-end supply and demand planning
32
Five benefits that Digital Champions gain from their Operations ecosystem
Transparency: They have a complete end-to-end view of the Operations ecosystem.
Real-time data sharing: All value chain members see information simultaneously.
Extended collaboration: Collaboration with partners (such as suppliers) develops organically, becoming deeper and more synergistic as the solutions in the value chain require.
Immediate responsiveness and flexibility: There is real-time response to demand changes from end customers, and prompt action at the planning and execution level across all tiers.
Connectivity: The seamless integration of internal and external product life-cycle management, supply chain management, and customer information enables a well-connected end-to-end value chain from product creation to the consumer.
33
34
Case examples
Case: Bossard
Source: http://www.bossard.com/en/
Case: Bossard
Why would a customer turn to Bossard ?
Source: http://www.bossard.com/en/
This is not new thinking
Example: Bosch: Connecting the entire value stream
38
Daimler: Maximum flexibility and transparency
39
Robots as a Service: A low-risk path to warehouse automation?
RaaS revenues and deployments are rapidly eclipsing those from robot purchases, as end users discover more value in securing robotic solutions rather than just equipment.
Excluding Amazon, more than 100,000 AMRs will have been deployed for order fulfillment by the end of 2020, and that more than 580,000 will be installed over the next five years. (Source: https://www.mhlnews.com/warehousing/4-million-robots-will-be-running-around-50000-warehouses-2025)
