Transcript 5.6 Innovation KGL

IB Business and Management
2.5 Innovation
Innovation
• What is innovation?
• Why is it important?
Invention & innovation
• Invention is the discovery of a totally new
and original product or new ways of
doing or making something.
• Innovation is the process of transforming
an invention into a product that
customers will buy. It may be a different
application of something that already
exists, something that adds value or
differentiates a product.
Invention
‘Necessity, who is the mother of
invention’
What does this quote mean?
Lets look at some examples
Chester Greenwood – Ear
Muffs
• In 1873, 13 year old Chester Greenwood found
that his ears got too cold when he was
iceskating meaning that he had to go home
early
• To protect his ears while ice skating, he found a
piece of wire, and with his grandmother's help,
padded the ends.
• In the beginning, his friends laughed at him.
However, when they realized that he was able
to stay outside skating long after they had gone
inside freezing, they stopped laughing. Instead,
they began to ask Chester to make ear covers
for them, too.
• At age 17 Chester applied for a patent. For the
next 60 years, Chester's factory made
earmuffs, and earmuffs made Chester rich.
Earle Dickinson - Bandaid
• At the turn of the century, Mrs.
Earl Dickson, an inexperienced
cook, often burned and cut
herself.
• Mr. Dickson, a Johnson and
Johnson employee, got plenty of
practice in hand bandaging. Out
of concern for his wife's safety,
he began to prepare bandages
ahead of time so that his wife
could apply them by herself.
• By combining a piece of surgical
tape and a piece of gauze, he
fashioned the first crude
adhesive strip bandage.
Arthur Fry and Spencer Silver –
Post It Notes
• Spencer Silver was working in the 3M research
laboratories in 1970 trying to find a strong
adhesive. Silver developed a new adhesive, but it
was even weaker than what 3M already
manufactured. It stuck to objects, but could easily
be lifted off.
• No one knew what to do with the stuff
• Then one Sunday four years later, another 3M
scientist named Arthur Fry was singing in the
church's choir. He used markers to keep his place
in the hymnal, but they kept falling out of the book.
• Remembering Silver's adhesive, Fry used some to
coat his markers. Success! With the weak
adhesive, the markers stayed in place, yet lifted
off without damaging the pages.
• 3M began distributing Post-it ® Notes nationwide
in 1980 -- ten years after Silver developed the
super weak adhesive. Today they are one of the
most popular office products available.
James Dyson – Cyclone Vacuum
Cleaner
• Watch the video
• Is James Dyson an inventor or an
innovator?
*
DC16 handheld
vacuum cleaner
DC01 upright
vacuum cleaner, 1993
Apex G-Force
A brief history of Dyson products
Dyson washing
machine, 2000
DC02
Dyson Airblade
9
2007
*
© easilyinteractive.com 2009
10
PROTECTING BUSINESS
IDEAS
Task
• Watch the Dragon’s Den Nova Flo
video
• How will the inventors protect this
business idea?
Task
• Watch the video ‘How to protect your
business ideas – Patents’
Protecting an Idea
1. Patents
2. Copyright
Right of ownership of
an invention that is
registered with
Government
Legal ownership of
material
Given for IPR such as
films, books and
music. Gives the right
to copy, produce and
control material.
Copyright protection is
longer than patents.
E.g Books for lifetime +
70 years after death
UK Patents –are for
20 years
International Patents
are more expensive
3.
Trademarks
The symbols,
signs or features
of a product
protected in law
Examples include
Coca Cola, Lego,
BBC & Scrabble
1. Patents and the patent
office
• Original products or processes can be
protected using a patent
• The Patent Office Charges a fee for
patenting a product
• If a patented product is unlawfully
copied, the patent holder can take the
inventor to court
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ocale=en_gb&FT=D&date=20060511&CC=US&NR=2006096942A1&KC=A1
2. Copyright
The creators of certain materials are automatically protected
from being copied by Copyright Law.
Literary works including books, poems and publications
Motions pictures and dramatic works
Computer software and animations
Songs, song lyrics, sound recordings, and music
Photographs, graphics, images, pictures
Web pages
Works of art including paintings, sculptures, architecture, and
computer graphics Educational materials including texts and
tests
3. Trademarks can be:
1. Logos
2. Pictures or drawings
3. Combination of letters and a design
4. Slogans
5. Product Shape
Innovations
• The company that makes the best use
of a new idea might not be its inventor.
• The innovator is the person who finds
a way to make a new idea work.
• There are 2 types of Innovation:
• 1. Product Innovation- New product
Ideas
• 2. Process Innovation- New ways of
working
Process Innovations Examples
• Ford’s first use of the production line
by bringing product to the person
during fabrication
• The factory to customer delivery of
custom-built computers by Dell
Corporation
Factors affecting innovation:
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Level of competition
Industry
Corporate culture
Business objectives
Available finance
Leadership
Peter Drucker
• 1909-2005
• An influential writer
and management
consultant
Druckers 7 Sources of
Innovation
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THE UNEXPECTED: An example of the unexpected is the development of
Nutrasweet. A chemist developed a new chemical. Accidentally he got some
of it in his mouth. To his surprise it tasted very sweet.
INCONGRUITIES: Incongruities or conflicts between opposing functions,
requirements or values may be the start of an innovation. For example the
request for a small car with still enough space on the inside seems to be
incongruent. This however was solved in a new design as the Smart.
PROCESS NEEDS: “necessity is the mother of invention”. Looking at
weaknesses as an inspiration for new ideas
INDUSTRY AND MARKET STRUCTURE: Competition and changes in
customers needs and wants creating the need for change
DEMOGRAPHICS: Changes in demographic trends that create the demand for
new products and services
CHANGES IN PERCEPTION: Changes in customers perception and beliefs
NEW KNOWLEDGE: Availability of new technologies/knowledge
Diffusions of Innovation
Theory
• Created by Everett Rogers in 1962
• Identified 5 types of consumers
• Particularly applies to technology
products
Sales
Adoption rates will depend
on:
• Relative advantages – is it better than
alternatives?
• Observable features – can the benefits be
seen?
• Compatibility – Does it work with existing
systems?
• Complexity – Do customers perceive that it
will be difficult to use?
• Trialability – Can customers try before they
buy?