Digital Innovation

Question 1

What is Digitization? Give a few examples.

Answer 1

Digitization is information turned to Data where it can be read, processed,
transmitted and stored on and with digital technologies.

Examples: Old blueprints to f16 fighter jets added as pictures. Books turned to data (can now be searched and analyzed by AI). Music Turned to data.

Question 2

What is Digitalization? Give a few examples.

Answer 2

The ways in which our lives are organized through and around digital technologies.
Digitalization has transformed the way people live, work, and interact. As technology continues to advance, digitalization continues to evolve and shape the way information and processes are managed and leveraged.

Examples: We use the internet to collaborate around calendars, documents, and meetings. Repositories make sure we have the latest code and versions. We message instead of calling - in fact the normal phone is almost dead.

Question 3

What is Datafication? Give a few examples.

Answer 3

How digital traces are produced as a by-product of our actions and interactions in relation to digital technology.

Examples: Search history, Location data, Roaming for wifi.

Question 4

What is Digital Innovation? Give a few examples.

Answer 4

From the blue dot following the car to the car following the blue dot (self driving cars).

Question 5

What is the cooker boiling water?

Answer 5

It is a way to think about Digitalization. Digitalization doesn’t happen all at once, it starts heating up, then slowly builds until it eventually boils and you see the benefit spread rapidly.

Question 6

What is the difference between Technology and Digital Technology?

Answer 6

Digital Technology transmits (digital) binary signals as opposed to Electronic Technology which transmits (analogue) electrical signals or Mechanical Technology which transmits (kinetic) energy.

Question 7

What is a definition of Digital Innovation - (Yoo, Boland, Lyytinen & Majchrzak, 2012)

Answer 7

The incorporation of digital capabilities into objects that previously had a
purely physical materiality.

That is a combination of the digital and physical worlds - i.e. Smart phones, Cars, Books etc.

Question 8

Explain these characteristics of Digital Innovation:
- Reprogrammability
- Homogenization of data
- Self-referential nature

Answer 8

• Reprogrammability - Separation of function from physical device (We can reprogram and update an iPhone without touching the phone)
• Homogenization of data - Separation of content from medium (We can update the content of notes without changing how to they are accessed and read)
• Self-referential nature - Digital innovation requires digital technology, There is a broad availability of digital tools (We need the internet, the gps, bluetooth etc. to power Digital Innovation)

Question 9

How has Moore’s law impacted Digital Innovation.

Answer 9

Moore’s Law has driven digital innovation by continuously increasing computing power, reducing the size and cost of electronic components, enabling the development of smaller devices, and powering emerging technologies like AI, IoT, and quantum computing.

While its pace has slowed, it remains a key driver of technological advancement.

Question 10

What are Network Effects? Give a few examples.

Answer 10

The value of a product or service increases as more people use it.

Examples: Ride-sharing services and social media platforms (Tinder, Facebook)

Question 11

Explain Modular Architecture vs. Layered Modular Architecture

Answer 11

The main difference is that the characteristics of Digital Innovation is low in Modular Architecture and high in Layered Modular Architecture.

Product-specific components vs. agnostic components.

Innovations are product specific vs. Innovation can happen in any layer.

Question 12

What does it mean to go from a Product System to a System of Systems?

Answer 12

A Farm Equipment System is a product system with tractors, planters and harvesters. This system can be combined with other systems like, weather, irrigation etc. in a system of systems.

Think smart homes; tv, lights, heating in a housing system - now combined again with other houses to see a full set of data.

Question 13

Define these types of Innovation:
- Digital Product Innovation
- Digital Business Innovation
- Digital Process Innovation

All are off cause driven by IT

Answer 13

• Digital Product Innovation
  The iPhone or the Tesla - the Product is significantly new.
• Digital Business Innovation
  Uber, Airbnb - a significant way of creating and capturing business value.
• Digital Process Innovation
  Wonga - a significant change in the ways of doing things in an organizational setting

Question 14

Explain from product to platform to ecosystems.

Answer 14

A product (Amazon Commerce App) can be part of a Amazon Platform which also has AWS, Alexa etc. Which are part of different ecosystems.

Illustration from Wang, P. (2021). CONNECTING THE PARTS WITH THE WHOLE: TOWARD AN INFORMATION
ECOLOGY THEORY OF DIGITAL INNOVATION ECOSYSTEMS.

Question 15

What is Modularity?

Answer 15

A way to reduce and manage Product complexity.

It is the combination of components (modules) into product systems in
order to reduce and manage product complexity

Question 16

What are visible vs. hidden design rules?

Answer 16

The visible design rules are what is public: Architecture (Modules and their function), Interfaces (How modules interact), Standards (Used for testing)

The hidden design rules are module-specific and are what differentiates your product. They can be implemented at any time you want.

Question 17

In Innovation Landscapes define:
- Peaked Landscapes
- Rugged Landscapes
- Coupled (dancing) Landscapes

You must be able to draw and explain these and how to optimize each.

Answer 17

• Peaked Landscapes - Optimization & Efficiency
  No connection between design choice of different components, e.g., shovel.
• Rugged Landscapes - Exploration & Exploitation
  Choices of one component effects the other components, e.g., house (Electric, water etc.).
• Coupled (dancing) Landscapes - Understanding Movement.
  Choices in my landscape is dependent on choices in your (other agent’s) landscape, e.g., airline.

Question 18

What are Exploration and Exploitation in Rugged Innovation Landscapes?

Answer 18

Exploration involves the initial phase of digital innovation where organizations seek new opportunities or technologies.

Once promising digital solutions are identified through exploration, exploitation involves the practical implementation and scaling of these innovations.

In a rugged landscape, the balance between exploration and exploitation is critical. Organizations must continuously explore new digital innovations to stay competitive and resilient in challenging environments, while also effectively exploiting these innovations to derive tangible benefits and improvements in their operations.

Question 19

What does it mean to think about Digital Innovation in 3D

Answer 19

Basically when looking a box in 3d; Digitalization is the Y, Data is the X and Disruption is the Z.

It means that you need to consider all three elements when working with Digital Innovation.

Question 20

What are a firm’s Digitization capabilities?

Answer 20

Data, Permission, and Analytics

Question 21

Digitalization changes fast, but does it mean everything changes fast?

Answer 21

No. Laws and businesses change much slower. We wait for the water to boil.

Question 22

Give examples on data types.

Answer 22

Meta Data, Location Data, Performance Data, Behavioral Data.

Question 23

Data can also be thought of as:
- Your Data
- Everyone’s Data
- Others Data

What does it mean?

Answer 23

• Your Data
  Data that is created in the company; production data or data about a customers score.
• Everyone’s Data
  Public databases - what is available to everyone.
• Others Data
  Data that we need to negotiate access to. i.e. customer data

Question 24

What is the DIKW model?

Answer 24

In a pyramid we have Data at the bottom, then Information, Knowledge and Wisdom on top.

Question 25

Data projects require D.A.T.A. - What does it mean?

Answer 25

1. Data - Can we access data that is valuable and rare?
2. Autonomy - Can we use data to create solutions?
3. Technology - Can out technology deliver solutions?
4. Accountability - Are we allowed to use data?

Question 26

Explain Christensens model for Disruption.

Answer 26

Incumbents are improving through innovation and are overshooting customer’s needs. A disruptive innovator targets customers with a product closer to customers’ needs and over time incumbents are disrupted and fall.

Disruptions take time- think Netflix.

Question 27

Disruption or disruption?

Answer 27

Disruption with a capital D is real Disruption; Netflix, Tinder, PC, Ride Sharing, E-commerce.

disruption with lowercase d is a disturbance. It can lead to lower income and it can even be temporary (Corona).