Week 4 Innovation Strategy Flashcards
(21 cards)
What are the 4 types of ‘New Products’ table + Axis labels + reference?
X-Axis = ‘Newness to customer’ = Low (Old) or High (New).
Y-Axis = ‘Newness of Technology’ = Low (Existing) or High (New).
Incremental Innovation = Low, Low (iPhone update)
Market Breakthrough = Low Tech, High Newness to consumer (Netflix)
Technological Breakthrough = High Tech, Low Newness to consumer (SpaceX reusable rockets)
Radical Innovation = High, High (Tesla electric cars).
(Chandy and Tellis, 1998).
What key argument of the Bottom of the Pyramid (BOP) + reference?
Prahalad (2012) argues the BOP—over four billion low-income individuals—is a major source of radical innovation. By focusing on the 4As (Awareness, Access, Affordability, Availability).
Businesses can create impactful products and models, like the biomass stove in rural India. These BOP innovations are now shaping strategies even in developed markets (Prahalad 2012).
What is an organisation that has successfully exploited the BOP? + reference.
Apple: iPhone SE.
Launch of the iPhone SE in India in 2022 to provide them with an ‘affordable’ phone with the necessary technology but not the top-of-the-range technology that is not required.
(Prahalad 2012).
What is the challenge of Strategic Entrepreneurship + reference?
Challenge = Balancing Strategy and Entrepreneurship.
Strategy:
- Developing competitive advantages.
- Advantage-seeking behaviour.
- Designing the firm’s scope.
- Managing the firm’s resources.
Entrepreneurship:
- Organisational renewal.
- Opportunity-seeking behaviour.
- Creating newness.
- Creating units.
Strategic Entrepreneurship:
- Balancing exploration (radical innovation - long-term) and exploitation (incremental innovation - short-term).
- Continuous stream of innovation for short and long-term success.
(Ireland and Webb 2007).
How to make Strategic Entrepreneurship work? + reference
Combine multiple Strategic Entrepreneurship strategies (opportunity seeking and advantage seeking) to develop Explorative and Exploitative Innovations to become Innovation Ambidextrous.
Innovation Ambidextrous leads to profit as a performance outcome.
(Hughes et al. 2021).
What is an example of a firm that failed to combine Explorative and Exploitative Innovation to be Innovation Ambidextrous?
Tough Mudder.
- Focused on incremental innovations (exploitative) rather than radical innovations (explorative) and therefore only planned for the short-term and was therefore sold.
What is the process from Knowledge Creation to Diffusion?
Basic Knowledge –> Invention –> Innovation –> Diffusion –> Imitation (supply side) or Adoption (demand supply).
What is the New Production Planning Process (in terms of stages and percentage complete) + reference?
Idea = 0%
Screening = 10%
Business Analysis = 15%
Development = 60%
Testing = 80%
Launch = 100%
(Hooley et al. 2004).
How did Dasani Water fail at each stage of the New Production Planning Process + reference?
…
What is the Stage-Gates structured process + reference?
At each stage of the new product planning process there will be information collected and then followed by a gate: Go/Kill decision (continue or stop the process).
(Cooper 2008).
How does the Chinese market operate in terms of new product development + reference?
New Product Development in China:
Execution phase, building the product + testing, then commercialisation is seen as the most crucial steps in NPD.
- Speed in getting product to market rather than making it perfect before it launches.
- Make improvements after the product has got to the market, based on customer feedback.
- Opposite to Western firms that perfect the product then send it to market.
(Robson et al. 2022).
What are the 7 stages included in Structured NPD Process: Knowledge Integration? + reference.
- Product development and testing capability (NPD process execution).
- Marketing-technical integration (NPD integration mechanisms).
- Commercialisation capability (NPD process execution).
- New product implementation capability (NPD integration mechanisms).
- New product competitive advantage.
- Penetration pricing capability.
- New product performance.
(Robson et al. 2022).
What are the controls in the Structured NPD Process: Knowledge Integration? + reference.
Controls:
- Firm size.
- NPD experience.
- NPD resources.
- Market turbulence.
- Technological turbulence.
- Market potential.
(Robson et al. 2022).
What is the 1.’Product development and testing capability’ in
the structured NPD process: Knowledge integration? + reference.
Product development and testing capability:
A strong competence in product development and testing.
Includes:
- Technical expertise to build product effectively
- Rigorous testing
- Getting initial market feedback.
(Robson et al. 2022).
What is the 2.’Marketing technical integration’ in
the structured NPD process: Knowledge integration? + reference.
Marketing technical integration:
How well the marketing team collaborates with the technical team.
- The better the collaboration, the shorter the time between product development + testing and the commercialisation, the better the likely product performance in meeting consumer demands.
(Robson et al. 2022).
What is the 3.’Commercialisation capability’ in
the structured NPD process: Knowledge integration? + reference.
Commercialisation Capability:
The skill in managing the product line and how the company connects with the market after launch.
- Using the market feedback to make continuous improvements to the product (similar to Kaizen).
(Robson et al. 2022).
What is the 4.’New product implementation capability’ in
the structured NPD process: Knowledge integration? + reference.
New Product Implementation Capability:
- The systematic learning and application of marketing strategies across all of the company’s NPD projects.
Includes:
- Evaluating the marketing strategies used and their effectiveness
- Compare to other strategies.
- Make adjustments for other NPDs.
(Robson et al. 2022).
What is the 5.’New Product competitive advantage’ in
the structured NPD process: Knowledge integration? + reference.
New Product Competitive Advantage:
- The long-run competitive advantage based on the adaptations made from the initial launch, previous products, market analysis, and customer feedback.
(Robson et al. 2022).
What is the 6.’Penetration pricing capability’ in
the structured NPD process: Knowledge integration? + reference.
Penetration pricing to quickly gain market share in dynamic market.
However, strong penetration pricing capability can lead to:
- Customers believing price is the USP, therefore not recognising the product’s quality and innovations that other competitors don’t have.
- Customers unwilling to pay higher prices of they can get high quality at low initial price.
- Perceptions that low price = low quality.
(Robson et al. 2022).
What is the 7.’New Product Performance’ in
the structured NPD process: Knowledge integration? + reference.
New Product Performance:
- The performance of the product after the adaptations, innovations, pricing strategies, market analysis, etc.
- Not the initial performance based on the first version of the product.
(Robson et al. 2022).
What is an example of a company using Robson et al. (2022) NPD process + how do they achieve this + criticisms of this approach and company?
Shein - Chinese Fast Fashion Company.
Their practices align with this approach of quickly getting products to market, without making them perfect (Robson et al. 2022).
Good:
- Gained significant market share quickly + internationally.
- Use of influencers to promote the company appeals to younger audiences.
Bad:
- Ethical concerns regarding the extremely long hours and poor working conditions.
- Have to source raw materials (e.g. cotton) rapidly to keep up with demand - questions over suppliers? links to supplying from forced labour in Xinjiang.
- Environmental concerns.
