Five Principles for Building Innovation Capabilities Learn Build - PowerPoint PPT Presentation

Five Principles for Building Innovation Capabilities Learn Build Measure Tendayi Viki PhD MBA

Situations emerge in the process of creative destruction in which many firms may have to perish that nevertheless would be able to live on vigorously and usefully if they weather a particular storm... Joseph Schumpeter 1883-1950 Author – Capitalism, Socialism and Democracy

The basic problem confronting an organization is to engage in sufficient exploitation to ensure its current viability and, at the same time , devote enough energy to exploration to ensure its future viability... James G. March Stanford Professor Author – Explorations in Organizations

The fear of cannibalizing sales of existing products is often cited as a reason why established firms delay the introduction of new disruptive technologies... Clayton Christensen Harvard Professor Author – Innovator’s Dilemma

Meanwhile At An MBA Near You...

Disrupting Education

Searching While Executing

+ Innovation =

An Innovation Ecosystem Learn Build Measure

Principle 1 - Innovation Thesis

We invest in large networks of engaged users, differentiated by user experience, and defensible through network effects. Fred Wilson Venture Capitalist Union Square Ventures

Principle 2 - Innovation Portfolio

A Balanced Portfolio

A Couple of Years Back...

We now have several internal global initiatives aimed at redressing this imbalance...

Principle 3 - Innovation Framework Explore Validate Idea Grow Retire Sustain

The Lean Product Lifecycle Idea Explore Validate Grow Sustain Retire Jobs to Be Done Growth Engines Business Model Design Sales Forces Practice Customer Development Optimizations Minimum Viable Products Feature Building Focus Early Adopters, Early Majority Late Majority, Laggards Duration Days Weeks Months Years Metrics Lean Analytics, Pirate Metrics Revenues, Profit-Margins, ROI, IRR, NPV

A Nonlinear Process Learn Build Measure

Principle 4 - Innovation Accounting The An accountable, Product focused group making clear Council data driven decisions

Validate Grow Sustain Explore Quarterly Financial validation template <£250k required to secure Quarterly ongoing investment To Validate Retire Product Council Idea <£50k Investment Approval Thresholds* to Explore RIGHT SIDE: Product-Market fit with a working LEFT SIDE: Validate assumptions and hypotheses business model Reduces the risk of wasted investment and allows Increase transparency of mature investments to teams to pivot to new and better ideas ensure alignment to strategy *Amounts need to be validated, by Business Model, and are subject to the thresholds established by the Schedule of Authority

Investment Governance Idea Explore Validate ✓ ✓ Product Product Council Council <£250k <£50k Can you Can you Have you ✗ ✗ identify a demonstrate validated core user Product/Market customer and problem in Fit or validated learner needs a target business model? in context? market? Product Council

Investment Governance Product Product Grow Sustain Retire Council Council Quarterly Quarterly Quarterly Quarterly Product Council Performance Performance Review Review

Reducing Investment Risk Idea Grow Explore Validate Funding & Evidence Risk Time

Moneyball for Innovation reworked on slide 11 ✓ ✗ ✗ ✓ ✗ ✗ ✓ ✓ ✓ ✓ ✓ £0 ✓ ✗ ✓ ✗ ✓ £<50k ✗ ✗ ✓ ✓ £<250k £ P&L ✓

Principle 5 - Innovation Best Practice Learn Build Measure

The PLC Ecosystem Playbook to Training to establish cohorts support adoption of embedded coaches across of best practice each area of the company Templates, Reports Communities and Portfolio tools for to help share best Product Teams and practices and deepen Investment Councils cultural impact Product Councils to manage investments using PLC criteria

http://learn.leanplc.com/

http://thecorporatestartupbook.com/

Thank You Learn Build Measure