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A Review of Innovation Strategy Types | |
Evaluate Strategy & Response to Change
Gaining a deeper understanding of your organization's response to external pressures, such as changes in the markets or technologies, will help to guide the company to make better decisions and gain competitive advantage.
 Following the classic Miles & Snow strategy typology definitions, we investigate how four ideal companies may approach New Product Development.
Defender: Uses checklists and relies heavily on procedures for NPD in order to maintain stablility and cost efficiency.
Prospector: Conducts in-depth, up-front Market Research in order to be first to market. Uses Portfolio Management tools to coordinate diverse business units.
Analyzer: Successful implementation of NPD tools in order to balance efficiency in core technologies while positioning as a fast follower for new markets.
Reactor: As implied in the name, the Reactor firm responds to market and technologies changes without much planning.
Register for a free one hour webinar on this topic to be held Tuesday, 24 August 2010 by clicking here. To maintain a shared experience for all, this webinar is limited to 15 attendees. |
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Greetings!
New Product Innovation | In this issue of The Village, we take a look at the different metrics used for evaluating how well an innovation strategy has been implemented. Perhaps, , you can take a look at where you'd like to position for the rest of the year: strategy, markets, technology, and products. Most importantly, be sure that your success metrics are aligned with your Innovation strategy! |
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Innovation Fun Fact | |
How Nylon is Made
Toward the end of the 1920s an important breakthrough for DuPont Corporation came as a result of fundamental rather than applied research. The head of research noted at the time: " We are including in the budget for 1927 an item of $20,000 to cover what may be called, for want of a better name, pure science or fundamental research work...the sort of work we refer to...has the object of establishing or discovering new scientific facts." In a short time the group that had been put together under this budget had developed an understanding of  radical polymerization and established the basic principles for condensation polymerization and the structure of condensation polymers. This led to the invention and commercialization of nylon in 1938 - the beginning of the modern materials revolution.
When America entered World War II, first silk and then nylon were commandeered by the federal government (specifically the War Production Board) to supply defense needs. Overnight, stockings made of any materials became hard to find. Nylon became important to the war effort because it was used, for example, in parachutes and tires. On the home front, the popular press presented nylon as a miracle of technology that Americans could again enjoy when the war ended.
Click on the photo of stockings in order to view a short video (approximately 4 minutes) on how nylon is made in a chemistry lab by Professor Bob Burk. |
| Metrics for Innovation Success | |
Choose Measures Consistent with Strategy
Strategy is one of the two most important drivers for NPD success. However, because the type of NPD projects which are undertaken are also an expression of the organization's strategic typology, innovation metrics will vary from firm-to-firm. Typical linkages between strategy and preferred metrics of successful innovation are discussed below.
Because the Defender firm is working to protect its market domain through high quality, superior service, or lower prices, one of the most important metrics is whether the new product fits the business strategy. Our idealized Defender company, Queen Royal Plastics, for example, will measure whether the single core technology can deliver a new product with minimum capital investment and without disruption to the existing product line.
In contrast to the Defender firm, the Prospector firm  values being "first" to market, so its primary measure of success involves whether the products of today will lead to future opportunities. In fact, the Prospector firm will introduce nearly six times as many " New-to-the-World" products as will a Defender firm (30% of portfolio vs. 5%). Measures for a Prospector firm will be consistent with changing product lines and early market entry. Innovation, also a high priority, may be tracked through metrics such as number of new patents issued over a period (quarter or year), as well as benchmarking patent portfolios with nearest competitors to ensure the Prospector firm is "winning" with the most new technologies.
Register for a free one hour webinar on "What is New Product Development?" to be held Tuesday, 20 July 2010, 10 am CDT, by clicking here. |
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