Lesson 1

Introduction
Basic concepts
Importance of innovations
CHARACTERISTICS OF SUCCESSFUL INNOVATING
COMPANIES - 1

• Systematic collection of all impulses that could

lead to innovation
• Creativity of employees
• Ability to evaluate the possibility of the
innovation idea
• Good team work
• Project-based approach and ability to manage
projects
CHARACTERISTICS OF SUCCESSFUL INNOVATING
COMPANIES - 2

• Cooperation with external experts

(universities, research laboratories…)
• Proper rate of risk-taking
• Employees’ motivation (the employees are
willing to improve the product and the
operation of the whole company)
• Continued education of employees
• Ability to finance the innovation activities
 Definition of innovation - 1

• “Technological innovations are defined as new

products and processes and major technological
modifications to products and processes.
• An innovation is considered performed if it is
introduced to the market (product innovation) or
• implemented in the production process (process
innovation).
• Innovation includes many research, technological,
organizational, financial and commercial activities.
 Definition of innovation - 2

• R&D represents only one of these activities and can

take place during various stages of the innovation
process.
• It can play not only the role of the original source of
the innovation ideas but also the role of problem
solution framework, which can be turned to at any
stage of the implementation.„

OECD, Frascati Manual 1992

 Oslo Manual
• Product innovation
– A good or service that is new or significantly improved.
– This includes significant improvements in technical specifications,
components and materials, software in the product, user friendliness or
other functional characteristics.
• Process innovation
– A new or significantly improved production or delivery method.
– This includes significant changes in techniques, equipment and/or
software.
• Marketing innovation
– A new marketing method involving significant changes in product design
or packaging, product placement, product promotion or pricing.
• Organizational innovation
– A new organizational method in business practices, workplace
organization or external relations.
• Technological innovations – based on specific
technology, invention, discovery,
• Social innovations – in critical historic periods
more important than technological ones (mail,
educational systém, social systém, health care,
…)
 DEGREE OF NOVELTY

• Incremental innovations
• Radical innovations
• Systemic innovations
 Classification of innovations
SYSTEM New series of New generation Steam engine,
cars, planes, (MP3 and ICT,
computers, TV download as biotechnology,
substitution of nanotechnology
CD)
Improvement of New Advanced
components components for materials
existing systems improving
component
COMPONENT properties
INCREMENTAL RADICAL
„do better what „new for the „new for the
we already do“ company“ world“
 INNOVATION PROCESS
• Research and development (R&D)
• Production
• Marketing
• Innovation is an opportunity for something
new, different.
• It is always based on change.
• Innovators do not view any change as a
threat but as an opportunity
 FOCUS

• Use the limited resources in the most effective

manner; focus on one of the following:
– Operational output
– Top-quality products
– Perfect knowledge of customers
 RECOMMENDATIONS

• Solve the correct problem correctly – be

effective and efficient
• Manage innovation as a project
• Analyze risks
• Use models, scenarios, computer simulation
• Study examples of succesful and unsuccesful
innovation projects
 WHAT TO DO

1. Start with analysis and study of opportunities.

2. Go among people, ask questions, listen
3. Effective innovations are surprisingly simple. They
must be focused on specific needs and on specific
final products.
4. Effective innovation start on a small scale.
5. A successful innovation always tries to win a
leading position, otherwise you create
opportunities for your competitors.
 WHAT TO AVOID

1. Don’t try to be too “clever”.

– All that is too sophisticated will almost certainly
go wrong.
2. Don’t try to do too many things at once.
– Focus on the core of the problem.
3. Don’t try to make innovations for the future
but for today.
– An innovation can have a long-term impact but
there must be an immediate need for it.
 Three conditions for innovations
1. Innovation means work, hard, concentrated and
thorough work.
– If these qualities are lacking then there is no use for the
big talent, cleverness or knowledge.
2. Successful innovations must build on your strong
points.
– The innovation must be important to the innovator.
3. Innovation must focus on a market, must be
controlled by the market (market-pull).
CASE STUDIES
Linet Želevčice
• Hospital products
• Hospital beds, intensive care beds, medical furniture
and other equipment increase the comfort of patients
and help the nurses.

• Nursing-care products
• Nursing beds, bed accessories, bedside cabinets,
mattresses and other furniture.
No comment …

1990

2005
 TOSHULIN
Development of new machines:
1. Customized – the machines developed for
the specific customer according to its
requirements – market pull
2. Prototypes – there is no specific customer –
market push
35
3 0 ,2 2
30 2 8 ,8

2 5 ,7
25 2 2 ,7
ti me of del i v ery (i n
20
months )
1 4 ,9
15
12
1 0 ,7 1 0 ,8 cus tomi zati on coeffi ci ent
10 8 ,5 8 ,8
9 ,6 9 ,5 9 ,6 9 ,4
8 ,3
9 ,5
(%)
6 ,8 6 ,9

0
1998 2000 2002 2004 2006
 Types of design engineers

spouter of ideas system designer finisher of ideas routine engineer attendance

engineer

suggests designs examines all ideas elaborates efficient and performs routine
and problem and thoughts independently in reliable engineer; tasks
solutions without systematically details the ideas however, without
detailed which he gets to creative approach
consideration of all elaborate
possible results and
consequences

[1%] [5%] [54%] [30%] [10%]

Contipro

Connective
tissue
products

RNDr. Vladimír Velebný, CSc.

Holding – current state
167 employees

sales (2008) – 242 mil Kč

export – 98% of total sales

one of the biggest produces of
hyaluronanu in the world
30% of the world market
60% of the European
market

Customers in 43 countries
Sales in regions
 3 pillars of success

1. Maximum attainable quality

2. Sharing expenses with customers
3. Development of original products
 3M and post-it notes

http://www.3m.com/us/office/postit/pastpresent/history_ws.html
 iGO – distribution of bateries
• Bateries and accessories for notebooks, mobiles,
cameras and other equipment
• Vision: to develop and sell simple and elegant
solutions, facilitate the use of electronic devices
• online catalogue, e-commerce, CRM
• Customer - targeted marketing, flexibility
• Growth of sales by 80% in the first year, by 100%
in the following year
http://corporate.igo.com/about_us.aspx
 Adaptors

• Patented technology iGo Technology, powering of

mobile electronic devices using single (universal)
adaptor;
• Power Technology Patent Brochure (PDF)
 Bang & Olufsen
• www.bang-olufsen.com
• VISION: „Courage to constantly question the ordinary in search of
surprising, long-lasting experiences.“
• Founded in 1925 in Struer, Denmark, Bang & Olufsen a/s is world
renowned for its distinctive range of quality audio, video and
multimedia products that represent our vision: Courage to constantly
question the ordinary in search of surprising, long-lasting experiences.
Bang & Olufsen employs over 2.550 staff members and had a
turnover of DKK 4.092 million (EUR 548,6 million) in the 2007/2008
financial year.
• Bang & Olufsen manufactures a highly distinctive and exclusive range
of televisions, music systems, loudspeakers, telephones, and
multimedia products that combine technological excellence with
emotional appeal. Bang & Olufsen products are sold by over 1.200
dealers in more than 100 countries in an extensive network of retail
stores. Approximately 65% of these stores are B1-stores, which
exclusively sell Bang & Olufsen products. The B1 stores account for
81% of the total turnover.
• Production also in the Czech Republic
Bang & Olufsen – products
 More case studies

• IBM Case Studies:

http://www.ibm.com/search/?en=utf&v=14&lang=en&cc=us&l
v=c&q=case+study+innovation&x=13&y=5
• Industry podcasts: Midsized clients and experts in
seven industries share their insights - http://www-
1.ibm.com/businesscenter/smb/us/en/mbpodcasts?&ca=smbI
ndustryPodcasts101706&tactic=&me=W&met=inli&re=smbib
mcomTopPagesIndustriesPromo1usen101706
 More case studies
• Sustainable energy (hydrogen, fuel cells, biofuels,
zero emission, …
http://ec.europa.eu/research/energy/nn/nn_pu/arti
cle_1078_en.htm
• http://www.zoner.com/
• http://www.kerio.com/
 The most important innovations
in last 30 years

• http://www.pbs.org/nbr/site/features/special
/subdir/top-30-innovations_slide-show/