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Summary Product Innovation

- Product Innovation
- Mats Magnusson
- 2015 - 2016
- Exchange
81 Flashcards & Notes
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A snapshot of the summary - Product Innovation

  • Product Innovation - Sources of Innovation - Standard Battles

  • What is the difference between product and process innovation
    Product: output of an organization --> products and services

    Process: way an organization produces products / or markets products
  • What is the difference between Steady-state and discontinuous technologies
    Steady-state: fulfills similar market need (more) by using/expanding the same knowledge base

    Discontinuous:  fulfills similar market need by using a new knowledge base.
  • What is the difference between modular and architectural innovation
    Modular: Improving component of a bigger product

    Architectural: Overall design of a system or the way the components (modules) interact
  • Discuss the S-curve. Why is it an S. And what is the sailing effect?
    Two types:
    1. Diffusion/adaption patterns
    X-axis: time 
    Y-axis: Market penetration

    2.Technology performance dev.
    X-axis: effort 
    Y-axis: performance

    Initially slow: unfamiliar technology

    Middle acceleration: technology becomes better understood and utilized by mass market.      

    End: Market saturation. 

    The sailing effect:  In the end of the technology performance development S curve, the limits of the technology is reached: then a second technology can take over. Between them a sailing effect can occur: old technology is improved since it does not want to be replaced by new technology. (e.g. sail boats vs. steamboats)
  • What is meant with the chasm in the innovation adoption curve?
    Chasm needs to be crossed to get from the early adopters to the early majority. Companies need to scale up and become efficient to target the big early majority market.
  • What are factors that influence the diffusion/adaption of innovations?
    Fist customer from early majority

    Relative advantage: better than current practice

    Compatibility: degree same to existing values, needs and experiences of potential adopters.



    Observability:  visibility of results of innovation
  • What is a dominant design? Why do they emerge?
    Product or product architecture that dominates a product category. 
    It is adopted by the majority of producers, typically creating a stable architecture on which the industry can focus its efforts on.

    Why emerge:
    - Regulation
    - Increasing return on adaption
    - Learning effects
    - Network exeternalities (e.g. mobile phones, railroads)
  • Customer value & Business model innovation - Business planning

  • What is customer value based on functional analysis?
    Customer value =               Perceived benefits (by customers)
                                                            Total Customer Costs

    Perceived benefits: Main, adding, (-)harmful
    Total customer costs: Purchasing costs, operating costs, repair/removal costs
  • What is customer value in terms of utility?
    Customer value =                   Satisfaction of customer needs
                                                         Use of customer resources

    Sat: problems, results, feelings
    Use: Time, money, effort
  • Not customers are equal.. Name 3 ways to gain competitive advantage (in the sense of what do we offer to whom?)
    - Differentiate
    - Total Cost advantage
    - Focus
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