Management of Product and Service Innovation 23rd October 2017 Nishant Bhaskar
Contents Understanding PSI • Realising PSI • Role of Design in PSI • Assignment • 2 2
Products and Services: Levels of Innovation The Levels of Innovation indicate the relationship between the level of potential gain with a significant innovation and the higher risk that goes with that opportunity. 4
Products and Services: Types of Innovation The Ten Types of Innovation framework provides a way to identify new opportunities through experience, offering, and an organisation’s internal structure. How Netflix turned the video rental How Google is parlaying Pixel, industry on its head by Android, Apps, Google Home, implementing a subscription Chromecast, Google Wifi etc. into model a pervasive suite How Uber has built a robust How Muji has ironically created a feedback system for drivers and strong brand by promoting the riders motto - 'No Brand Quality Goods’ How Zara ’s “fast fashion“ strategy How Wii ’s experience draws more moves its clothing from sketch to from the interactions in the room shelf in record time than on-screen How Target works with renowned How Nespresso locks in external designers to differentiate customers with its useful members itself only club How Amazon is gaining trust How OXO Good Grips cost a worldwide by its consistent service premium but its “universal design” and A-to-Z Guarantee has a loyal following 5 https://www.doblin.com/dist/images/uploads/Doblin_TenTypesBrochure_Web.pdf
Products and Services: Types of Market Four types of market in which a product can operate New type of Low cost product Niche product New product product Existing market New market 6 Rowland, C., Goodman, E., Charlier, M., Light, A., & Lui, A. (2015). Designing connected products: UX for the consumer Internet of Things. O'Reilly Media, Inc., Chicago.
Products and Services: Types of Market Four types of market in which a product can operate New type of Low cost product Niche product New product product Existing market New market iBeacon for airports A new type of product in an existing market offers higher performance than what is currently offered. Higher performance can be a product or service that runs faster, does something better or substantially improves on what is already on the market. 7
Products and Services: Types of Market Four types of market in which a product can operate New type of Low cost product Niche product New product product Existing market New market Energy monitoring system for those who generate their own power Niche products attempt to convince customers that some of its characteristics are radical enough to change the rules and shape of an existing market. 8
Products and Services: Types of Market Four types of market in which a product can operate New type of Low cost product Niche product New product product Existing market New market DIY Home Automation Kits (eg. SmartThings) Low cost products are for customers at the low-end of an existing market, who will buy “good enough” performance if they could get it at a substantially lower price. 9
Products and Services: Types of Market Four types of market in which a product can operate New type of Low cost product Niche product New product product Existing market New market GlowCaps Pill Bottle A new product for a new market addresses unmet need(s) of a section of customers by creating something, that never existed before or that solves availability, skill, convenience, or location issues in a way no other product has. 10
Products and Services: Types of Market Four types of market in which a product can operate New type of Low cost product Niche product New product product Existing market New market DIY Home Automation Kits (eg. Energy monitoring system for those iBeacon for airports GlowCaps Pill Bottle SmartThings) who generate their own power 11
Potential Benefits of PSI Market Position A new product can set industry standards, standards that become a barrier to competitors or open up new markets. Superior products and services are a means to gain a lead on competitors, build on existing advantages by creating stronger competitive barriers, establish leadership image that translate into dominant designs in the market, extend existing products and service offerings, and increase market share. 12
Potential Benefits of PSI Resource Utilisation Capitalising on prior R&D investments, improving the returns on existing assets, applying new technologies for both products and manufacturing processes, and eliminating or overcoming past weaknesses that prevented other products or processes from reaching their full potential. ����� �� � ����������� ����� �������� �pnto�nn� �pnto�nn� ��/� sn� ���pitgm ��gS uirtoD� �� g ���n�n� �gui�D� � � �ssn� � og�e e tD�o��� �uue n� � og�Di�g��� ��gS uirtoD� �� ����� ��� ���� ����� ���� � � �� ��� ����� ���� ������ �� �� �� � � � ������ � � �� � ��� �� ������ ��� � ����� �� g �� � p�ptoD� M � ��� � � o�9 �e t�r� �ss� �pe �n� � � i �aupntoD� �uH���Huon� ��g�S �m � ��se um h �og� �tigp�e � �oDto�� ��nrgusn� �pnto�nn� ��/� sn� ��nupi��� �ti��g� � ��oHgm � � og�e e tD�o��� � uir uS � � �o�D�h �og� ��/t��� �uoo��g� �� uusc �a��uS n� �a�itoD� M � �s�ir� �sse t��Huo� �t� ��m �e �� �ue e ��ui�Huo� �m o�� � �o�D�h �og� �gi��h toD� ��g�� ���i�a� ��/t��� ���n� �o�e m ntn� � u�te �� �uog�to�in� �gi��h toD� ��g�� �o�e m H�n� � ��oHgm � �uisui�g�� �ue e ��Huo� ����i�Huo� �h �te � �h �te � ��/t��� �toDe �� � og�Di�g��� ��g�S �m � � � � �itDD�in� � ��ato�� �uonue �� ��� i otoD� �e �nH�� �pna� ��nupi��� ���rps� ��Dtngim � �i� o n�u�toD� ���i�a� �uH���Huon� ��h se �g�n� � og�Di�g��� �ss� ��se um h �ogn� ������ ��� � � �� � ��� �� ��� ��m � � ��oHgm � ����nn� � � uotguitoD� � �uo�Dpi�Huo� � ��� �sse t��Huo� �nn�nnh �og� � ��nupi��� M � � �o�D�h �og� M � � �o�D�h �og� �uogiue � M � �uDn� �uh se t�o��� �i�S �e e � o �� � i�suiHoD� � �n�D�� �p�tHoD� �gui�D�� �� g �� ���rpsn� �� ��� ����� ���� �gui�D�� �� g ���n�n� �uh spg�� ��gS uirtoD� ���� � �W ��gl� �e u�rnl� �i�at/�e l� ��e �Huo�e l� �u�� �l� �� nl� �pgu9 n��e toDl� M � ���l� ��l� ���� � h suigc�ksuig� ���atoDl� � tDi�Huo� �u��� ��e �o�toD� � og�Di�g��� � � ������������� ��nupi��� � �o�D�h �og� �/�te ��te tgm � �utogn� u� � ��Dtuon� �uo�n� �i�n�o��� 13
Potential Benefits of PSI Imagery The excitement, image, and growth associated with product and process development efforts capture the commitment, innovation, and creativity of the entire organisation. This success, in turn, enhances the firm’s ability to recruit the best people, improve their integration, and accelerate the pace of change. 14
Failure in PSI PSI can fail in many ways. For example because products and services: • Do not meet users’ needs. • Are not sufficiently differentiated from the products and services of competitors. • Do not meet technical specifications. • Are too highly priced compared to their perceived value. • Do not comply with regulatory requirements. • Compete with the company’s other products and services. • Lack strategic alignment with the company’s business portfolio. 15
Realising Product and Service Innovation 16
The Fundamental Questions The four often-forgotten questions that are at the core of any business: 1. What should we make? 2. Who will want it? 3. Why will it create enough value to make it worth producing? 4. How should we organise our key activities so we can make it? 17 Whitney, P. (2015). Design and the economy of choice. She Ji: The Journal of Design, Economics, and Innovation, 1(1), 58-80. Chicago
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