Profitable innovation doesn't just happen. It must be managed, measured, and properly executed, and few companies know how to accomplish this effectively. Making Innovation Work presents a formal innovation process proven to work at HP, Microsoft and Toyota, to help ordinary managers drive top and bottom line growth from innovation. The authors have drawn on their unsurpassed innovation consulting experience -- as well as the most thorough review of innovation research ever performed. They'll show what works, what doesn't, and how to use management tools to dramatically increase the payoff from innovation investments. Learn how to define the right strategy for effective innovation; how to structure an organization to innovate best; how to implement management systems to assess ongoing innovation; how to incentivize teams to deliver, and much more. This book offers the first authoritative guide to using metrics at every step of the innovation process -- from idea creation and selection through prototyping and commercialization. This updated edition refreshes the examples used throughout the book and features a new introduction that gives currency to the principles covered throughout.
Autorentext
TONY DAVILA leads the Entrepreneurship Department and Entrepreneurship and Innovation Center at IESE Business School, and is one of the world's leading scholars, speakers, and advisers on entrepreneurship and innovation. Building on his doctoral work at the Harvard Business School, he works with both large industrial companies and Silicon Valley startups to design management control and performance measurement systems that drive innovation.
MARC J. EPSTEIN is Distinguished Research Professor of Management at Jones Graduate School of Business at Rice University. Previously Visiting Professor at Harvard, he has been a senior consultant to leading corporations and governments for more than thirty years, specializing in strategy implementation, innovation, governance, accountability, and performance metrics. He has also served as professor at Stanford Business School and INSEAD.
ROBERT D. SHELTON is the Leader of the Innovation Practice at a major global consulting firm. Through many years as an innovation consultant, his client list is a "who's who" of innovative companies including leaders in high tech, consumer goods and services, software, financial services, cleantech, aerospace, and healthcare industries. He was Vice President and Managing Director with Arthur D. Little, and Managing Director of the SRI Worldwide Technology Management practice.
Inhalt
Introduction to Updated Edition xiii
Introduction xliii
Chapter 1 Driving Success: How You Innovate Determines What You Innovate 1
Innovation Is the Power to Redefine the Industry 1
The Innovation Imperative: Driving Long-Term Growth in Top and Bottom Lines 5
How to Make Innovation Work: How You Innovate Determines What You Innovate 7
The Rules of Innovation 9
1. Exert Strong Leadership on Innovation Direction and Decisions 12
2. Integrate Innovation into the Business Mentality 15
3. Match Innovation to Company Strategy 16
4. Manage the Natural Tension Between
Creativity and Value Capture 18
5. Neutralize Organizational Antibodies 23
6. Cultivate an Innovation Network Beyond the Organization 24
7. Create the Right Metrics and Rewards for Innovation 25
Summary: The Innovation Company 28
Chapter 2 Mapping Innovation: What Is Innovation and
How Do You Leverage It? 29
A New Model of Strategic Innovation 29
Business Model Change 31
Value Proposition 32
Supply Chain 33
Target Customer 34
Technology Change 35
Product and Service Offerings 35
Process Technologies 36
Enabling Technologies 37
Three Types of Innovation 39
Incremental Innovation 42
Semiradical Innovation 47
Radical Innovation 51
Ersatz Radical Innovation 55
Disruptive Technologies 57
Innovation Model and the Innovation Rules 58
Chapter 3 Choosing Your Destiny: How to Design a Winning Innovation Strategy 59
Choosing the Right Strategy 59
Play to Win and Play Not to Lose Strategies 60
Play to Win Strategy 60
Play Not to Lose Strategy 63
Too Much of a Good Thing 71
Clearly Defined Innovation Strategy Drives Change 72
Do You Select an Innovation Strategy? 75
Internal Factors 76
External Factors 77
Risk Management and Innovation Strategy 78
Innovation Strategy: The Case of the Pharmaceutical
Industry 79
Attempts to Solve the Innovation Problem 81
Changing the Innovation Approach 82
Strategy and the Innovation Rules 85
Chapter 4 Organizing for Innovation: How to Structure a Company for Innovation 87
Organizing for Innovation 87
Developing an Internal Marketplace for Innovation 88
Balancing Creativity and Value Creation 89
The Balance Changes as the Organization Matures 91
Five Steps to Balancing Creative and Commercial Markets 98
Outsourcing Innovation 100
Making Good Use of Your Partners 103
Integrating Innovation within the Organization 105
The Value of Networks and Innovation Platforms 106
The Corporate Venture Capital Model 110
The Ambidextrous Organization 112
The Leadership Role 115
Organization and the Innovation Rules 116
Chapter 5 Management Systems: Designing the Process of Innovation 119
Systems and Processes Make Things Happen 119
The Objectives of Well-Designed Innovation Systems 120
Choosing and Designing Innovation Systems 124
Systems for Ideation: Seeing the Gaps 127
Structured Idea Management 128
Experimentation 130
Prototyping 131
Making Deals 133
Innovation That Fits 134
Management Systems Comparison 137
Electronic Collaboration 139
Management Systems and the Innovation Rules 142
Chapter 6 Illuminating the Pathway: How to Measure Innovation 145
To Measure or Not to Measure? 145
What Gets Measured Gets Done 146
The Three Roles of a Measurement System 148
A Balanced Scorecard for Measuring Innovation 150
The Business Model for Innovation 150
Inputs, Processes, Outputs, and Outcomes 151
From the Business Model to the Measurement System 155
Designing and Implementing Innovation Measurement Systems 159
Measures for Ideation 160
Measuring Your Innovation Portfolio 163
Measuring Execution and Outcomes of Innovation 168
Measuring Sustainable Value Creation 170
The Barriers to Effective Performance Measurement. 176
Measurement and the Innovation Rules 178
Chapter 7 Rewarding Innovation: How to Design Incentives to Support Innovation 181
The Importance of Incentives and Rewards 181
Motivation 182
Different Strokes for Different Folks 183
A Framework for Incentive Systems' Design 185
Setting Goals for Measuring Performance 188
Specific vs. Broad Goals 188
Quantitative vs. Qualitative Goals 190
Stretch vs. Expected Goals 190
Success-Driven vs. Loss-Avoidance Goals 191
Performance Evaluation and Incentive Contracts 193
Team vs. Individual Rewards 193
Subjective vs. Objective Evaluation 196
Relative Performance vs. Absolute Performance Evaluation 198
Incentive Contracts 199
Expected Level of Pay 200
The Shape of the Pay-Performance Relationship …