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Digital Technologies in Business > Week 4 - Digital Innovation and Strategy > Flashcards

Week 4 - Digital Innovation and Strategy Flashcards

1
Q

What is DIGITIAL INNOVATION?

A
  • the Use of Digital Technology and Apps to Improve Existing Business Processes and Workforce Efficiency, Enhance Customer Experience, and Launch New Products or Business Models
  • some of Latest Innovative Technology - e.g. chatbots, wearable devices etc
  • in an age where world’s largest taxi company has no taxi (Uber)
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2
Q

State the 3 Phases of Innovation

A

(1) INNOVATION
(2) PRODUCT/SERVICE OFFERING
(3) IDEA

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3
Q

Explain the Classification of Innovation - SUSTAINING or INCREMENTAL INNOVATIONS

A
  • offer Improved Performance Within an Established Market
  • May be Radically new Offerings Within the Market but they Don’t Change the Nature or Basic Assumptions About how Things Work. most New Offerings are Sustaining in Nature
  • obvious examples , New Apps Offered Through an App Store, and New, Improved Mobile Phone Handsets
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4
Q

Explain the Classification of Innovation - DISRUPTIVE or RADICAL INNOVATIONS

A
  • Bring to Market a Different and New Kind of Value Proposition, which May have the Effect of Changing the Market’s Assumptions around How Things Work
  • although a Disruptive Offering may Initially Underperform Against Established Products in some ways, it Needs to be Significantly Preferable through being Advantageous in Price, Size, Performance, Simplicity or Convenience
  • e.g. Amazon, Digital Camera, Netflix, Uber, etc.
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5
Q

Explain the Classification of Innovation - TECHNOLOGY PUSH

A
  • an Innovation Based on Technology Push is Driven by a Research and Technology Idea that has been Qualified as Offering the Potential to be Developed as a Successful Market Offering
  • e.g. Digital Camera
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6
Q

Explain the Classification of Innovation - MARKET PULL

A
  • an Innovation Based on Market Pull is Driven by an Observed Need, Problem or Opportunity in a Market
  • e.g. in 2018 - Facebook addressed Need (initially identified by snapchat) for Images that Disappear After a Period of Time
  • the Resulting Incremental Functionality is a Market-Pulled Innovation that’s Competitively Motivated
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7
Q

Explain the Classification of Innovation - VERTICAL MARKET

A
  • Innovation that Addresses Industry Specific Problems such as Energy, Education, Retail or Health Care
  • Involves Integrating New and Existing Technologies or Practices to Achieve an Improved Performance or Effect
  • e.g. in Healthcare sector is 3D4 Medical, an AR offering that helps medical staff to learn about anatomy without having to cut open a body
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8
Q

Explain the Classification of Innovation - HORIZIONTAL INNOVATION

A
  • Innovation that Addresses the Needs of Many Industries
  • Includes Technologies such as Cloud or Authentication Services that Provide a Technical Platform for a Range of Offerings
  • e.g. Apple Pay, enable Online Payments within or Across Any Sectors
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9
Q

Explain the Classification of Innovation - PRODUCT INNOVATION

A
  • one that Introduces Change in the Things that are Offered and/or in the Customer Experience Of the Offering
  • e.g. an Improved Encryption Search or Analysis Algorithm
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10
Q

Explain the Classification of Innovation - PROCESS INNOVATION

A
  • is one that Brings Change in the Way Things are Created, Performed or Delivered
  • e.g. the Introduction of Secure Online Payments ant the continuing evolution of such mechanisms
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11
Q

Explain the Classification of Innovation - PARADIGM INNOVATION

A
  • One that Brings About Change in the Underlying Mental Model Whereby People Think about How Something
  • e.g. the Change from On-Premise Installation of Software Applications to Cloud-Based Software as a service (SaaS) offerings
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12
Q

Define the Innovation Process

A
  • a Process through Which a New Product, Technique or Useful Service is Obtained from the Generation of New Ideas and their Development
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13
Q

Explain Ideas and Their Origins - ASSOCIATION

A
  • association : the Bringing Together of Previously Unconnected Ideas to Solve a Problem or Open a New Market
  • was Time where Phones were Used Only to Make Calls and Photos could Only be Taken by a Camera
  • the Ideas to Associate these Functions Contributed To the now Ubiquitous Smart-phone Products
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14
Q

Explain Ideas and Their Origins - ADAPTATION / ANALOGY

A
  • Adaptation of an Existing Solution for a Different Situation
  • Platforms such as Uber Under-lie Collaborative Consumption or the Sharing, Access or Peer Economy
  • this Approach is Now being Applied to a Wide Range of Business Situations to Create Platforms whereby Consumers Pay to Access Someone Else’s Goods or Services
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15
Q

Explain Ideas and Their Origins - SERENDIPITY / CHANCE

A

Serendipity / Chance - a New Ideas Arises Through Random Occurrence or Accident

  • e.g. 1945 , Percy Spencer was working with magnetrons –> he noticed the melting of a chocolate bar in his pocket when stood next to a magnetron –> this observation Led to the Invention of the Microwave Oven
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16
Q

Explain the 2ND PHASE of INNOVATION - Exploitation of Ideas Through a Product or Service Offering

A
  • About Way Idea can Be Taken to Market Through Form of Offering
  • Idea Cannot be Taken to Market In its Pure Form : Needs to be Wrapped Into a Product or Service Offering with an Associated Business Model
  • a Business Model is a Set of Propositions, Analyses and Design Decisions that Embrace all Aspects of How an Offering will be Taken to Market
  • a Business Model is Embodied In and Empowered by a Business Structure
17
Q

Explain the 3RD PHASE of INNOVATION - Market Consumption of an Offering

A
  • About Interpreting and Handling the Market’s Response to an Offering
  • Positive Response Provides Evidence that Business Model is Working, and Hence Encourages More of the Same
  • Negative or Disappointing Response may Reflect Badly on the Idea, on the Way it’s Been Wrapped Into an Offering, or on the Business Model Adopted
  • Understanding and Interpreting Market Response is Only Possible If the Required Data is Available
18
Q

What is Strategy?

A
  • defines How we will Meet Our Objectives
  • Sets Allocation of Resources to Meet Goals
  • Selects the Preferred Strategic Option to Compete Within a Market
  • Provides a Long-term Plan for the Development of the Organisation
19
Q

What are 3 Different Forms of Organisation Strategy in relations to Corporate Strategy

A
  • Business Unit Strategies
  • Regional Strategies
  • Functional Strategies
20
Q

What Happens in the Absence of Digital Business Strategy (4)

A
  • Missed Opportunities for Additional Sales and More Efficient Purchasing on the Buy-Side
  • Fall Behind Competitors in Delivering Online Services - may Become Difficult to Catch Up, e.g. Dell
  • Poor Customer Experiences from Poorly Integrated Channels
  • Loss of Competitive Advance
21
Q

State the 4 Stages of the STRATEGIC FORMULATION PROCESS

A

(1) STARETGIC ANALYSIS
(2) STRATEGIC OBJECTIVES
(3) STRATEGIC DEFINITION
(4) STRATEGIC IMPLEMENTATION

22
Q

Explain the Stage of the Strategic Formulation Process - STRATEGIC ANALYSIS

A
  • EXTERNAL ENVIRONMENTAL
    Social, Legal and Ethical, Economic, Political, Technological
  • INTERNAL RESOURCES
    Resource analysis, Portfolio analysis, Swot analysis, Demand analysis, Competitor anlaysis

DIGITAL BUSINESS SPECIFIC
- Stage Models of Digital Business Development
- Assessing sell-side, buy-side and value network opportunities and threats
- Stages Models of Digital Business Development
- Assessing sell-side, buy-side and value network opportunities and threats

23
Q

Explain the Stage of the Strategic Formulation Process - STRATEGIC OBJECTIVES

A
  • VISION
    Replace vs Complement
    Extent of Adaptability NEEDED
  • OBJECTIVES
    Smart Objectives
    Online Revenue contribution
    Balanced Scorecards
  • E-BUSINESS SPECIFIC TECHNQIUES
    Vision about capability to change, to reinvent
    Online revenue contribution
24
Q

Explain the Stage of the Strategic Formulation Process - STRATEGIC DEFINITION

A
  • OPTION GENERATION
  • OPTION EVALUATION
  • OPTION SELECTION
  • 8 Key e-business strategic decisions
    Decision 1 : e-business channel priorities
    Decision 2 : Market and Product Development
    Decision 3 : Positing and Differentiation Strategies
    Decision 4 : Business and Revenue Models
    Decision 5 : Marketplace Restructuring
    Decision 6 : Supply chain management Capabilities
    Decision 7 : Internal Knowledge Management Capabilities
    Decision 8 : Organisational Resourcing and Capabilities
25
Q

Explain the Stage of the Strategic Formulation Process - STRATEGY IMPLEMENTATION

A
  • PLANNING
  • EXECUTION
  • CONTROL

IMPLENTATION ISSUE
Supply chain management strategies
Digital marketing strategies
Customer Experience and Service Design
Digital Transaction and Growth Hacking

26
Q

State 4 Models for Digital Strategic Analysis

A
  • PORTER’S 5 FORCES - analyses the Different External Competitive Forces that Affect an Organisation and How Information can be Used to Counter Them
  • PORTER’S COMPETITVE STRATEGIES - assess how External Competitive Forces ccan be Harnessed
  • MCFARLAN’S STRATGEIC GRID - a Model for Assessing the Current and Future Applications Portfolio Within an Organisation
  • PEPPARD and WARD’S MODIFIED STRAGEGIC GRID
27
Q

Explain PORTER’S 5 FORCES MODEL

A

the business and it’s External Threats :
- BARGAINING POWER of CUSTOMERS
- THREAT OF SUBSITUTIES
- THREAT OF NEW ENTRANTS
- EXTENT OF RIVARILY BETWEEN COMPETITORS
- POWER OF SUPPLIERS

28
Q

State the 4 COMPONENTS of PORTER’S COMPETIVE STRATEGIES

A
  • OVERAL COST LEADERSHIP
  • DIFFERENTIATION
  • FOCUS OR NICHE
  • STUCK IN THE MIDDLE’
29
Q

Porter’s Competitive Strategies - explain OVERALL COST LEADERSHIP

A
  • Firm Aims To Become the Lowest-Cost producer in the Industry.
  • by Reducing Costs, One is More Likely to Retain Customers and Reduce the Threat Posed by Substitute Products
30
Q

Porter’s Competitive Strategies - DIFFERENTIATION

A
  • Creates a Product Perceived Industry-Wide as Being Unique.
  • by Being Able to Tailor Products to Specific Customer’s Requirements or by Offering Exceptional Quality of Service, the Risk of Customers’ Switching is Reduced
31
Q

Porter’s Competitive Strategies - explain FOCUS OR NICHE

A
  • this Involves Identifying and Serving a Target Segment Very Well (e.g. buyer group, product range, geographic market).
  • this Firm Seeks to Achieve or Both of ‘Cost Leadership’ and ‘Differentiation’
32
Q

Porter’s Competitive Strategies - explain ‘STUCK IN THE MIDDLE’

A
  • the Firm is Unable to Adopt Any of the Above Approaches and Therefore is Ultimately at the Mercy of Competitors that are Able to Offer these Approaches
33
Q

Explain what is MCFARLAN’S STRATEGIC GRID

A
  • Used to Indicate the Strategic Importance Systems to a Company and Now and in the Future
  • assesses the Current Mix of Business Information Systems (IS) Within an Organisation
    4 Segments
  • STRATEGIC - the Business Depends on Both its Existing IS and its Continued Investment in New IS to Sustain Continued Competitive Advantage
  • TURNAROUND - While Business in this position Doesn’t Currently Derive Significant Competitive Position
  • FACTORY - while Depending on its Current IS to Operate Competitively Doesn’t Envisage Further s Investment having a Positive Impact on it’s Competitive Position
  • SUPPORT - Doesn’t and believes it will Not, it will not, derive significant Competitive Advantage from Information SYSTEM

Digital Technologies in Business (11 decks)

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