Transcript Document

1
The Joint Oireachtas Committee on Education and Science
The role of Education in Business Innovation:
How we can improve the innovation performance of business in Ireland
Whole-brained, connected innovation
– beyond Science and Technology
Frank Devitt
Department of Design and Innovation
School of Business and Law
NUI Maynooth
Leinster House
Notes:
11 main presentation pages;
21 supplemental information pages.
18th June 2009
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
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Innovation
• For the ordinary person:
doing something new
• For the scientist or engineer:
inventing or discovering something new
• For the business person or economist:
doing something new that adds economic value,
through being adopted by a user
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
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2 key points
1. Science is less than half of the innovation story
– Over-reliance on S&T research to drive economic renewal is incomplete and
hence economically wasteful
2. Innovation is a whole-brained, social Business Process
– It requires (beyond technology knowledge generation) …
• specialist management skills
• deep user/market understanding
• interdisciplinary, continuous learning
(Innovation Management)
(Design, Marketing, empathy)
(CPD, Networking)
Ireland has not yet recognised or supported innovation as a
connected Business Process
This weakness is not adequately addressed by current policy.
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
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Comparing Science Research and Innovation
Research converts money into knowledge
Innovation converts knowledge into money
(Primary roles)
Current policy is heavy on science research
– and needs to be re-balanced:
€

€
€
Knowledge
Research
€ 
18th June 2009
Innovation
 €
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
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What have they in common?
All are modern, innovative, successful, internationally trading businesses, whose
success is not dependent on direct or proprietary science research (now or past).
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
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Innovation comes from many sources
Te
c
Science &
Engineering
O
pe
Fo ratio
cu n a
s
l
Innovating from the
INSIDE-OUT
the customer
loves it
Innovating from the
OUTSIDE-IN
De
Fo sign
cu e r
s
Cu
s
Fo tom
cu e r
s
DESIGN
(user-centred
innovation)
INNOVATION
MANAGEMENT
hn
Fo olo
cu g i c
s al
it works
we can
make it
the customer
wants it
Darrel Rhea, “Bringing Clarity to the Fuzzy Front End”,
Design Research Methods and Perspectives, Edited by Brenda Laurel, MIT Press, 2003
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
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Linear Model of Innovation – too simplistic!
Science Push
Basic
Science
Engineering
(Technology)
Manufacturing
Marketing
Sales
“.. non-technical innovation may well be the 'missing link' that prevents
Europe from taking full advantage of new technological opportunities”
(CORDIS, European Commission, EIS commentary, 2004)
“Innovations that sustain prosperity have a variety of forms and are
developed and used through a massively multiplayer, mutlilevel and
multiperiod game.”
(Amar Bhide, The Venturesome Economy, 2008)
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
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Innovation system
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
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Educating for 21st Century Innovation - general
(rational)
science & technology
(emotional/personal)
design and creativity
depth
breadth
detailed rigour
speed
didacticism
discovery
exam success
learning from failure
strict procedure
open experimentation
analysis
synthesis/creativity
specialised
2008
18th June 2009
integrative
2009 +
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
Educating for 21st Century Innovation – 2nd level
10
• New Leaving Cert subject “Design and Communications Graphics”
shows great promise (started 2007, first exam 2009)
– Good student interest
– Good innovation relevance
• Tendency towards isolated specialisms must be limited. Encourage
more …
–
–
–
–
creativity
independent and integrative thinking
intellectual exploration
physical experimentation
“Countries showing a higher performance in creativity and design also show, taking into
account differences in per capita income, a higher innovation performance as measured by
the EIS Summary Innovation Index.”
Design Creativity and Innovation: A Scoreboard approach, Inno-Metrics, EU: DG for Enterprise
and Industry, February 2009
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
Actions –
3rd,
4th
11
level and CPD
1. Postgraduate programmes in
(i) Innovation Management
(ii) User-centred Innovation (Design)
–
Supported by EI, HEA, e.g. Graduate Skills Conversion (now for ICT only)
2. In-service CPD + Networking courses
–
–
–
–
Thinking, Practices and Tools for Innovation Excellence
Delivered by consultants, colleges, EI (Applied Innovation Department)
Dual, concurrent purposes: Expert direction and Peer learning
Supported by HEA / DETE / EI / Fas
3. Irish Business Innovation Foundation
–
–
–
–
Responsible for national coordination of strategies and structures
Policy, Research, Education, CPD, Consulting, International Expertise
Modelled on SFI’s success for Science  applied to Business Innovation
Budget = 10% x SFI …
18th June 2009
€

€
Business Innovation – beyond Science and Technology
€
Dr. Frank Devitt
12
The Joint Oireachtas Committee on Education and Science
END
The role of Education in Business Innovation:
How we can improve the innovation performance of business in Ireland
… beyond Science and Technology
Frank Devitt
Department of Design and Innovation
School of Business and Law
NUI Maynooth
Leinster House
18th June 2009
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
Doblin - Ten Types of Innovation
Finance
Networks and
Alliances
Customer
Experience
Brand
Channel
Delivery
Customer Service
Product/Service
System
Offering
Product/Service
Performance
Core Processes
Process
Outside-in
Business Model
Inside-out
Enabling Process
supplement: BUSINESS INNOVATION
13
DESIGN
“Ten Types of Innovation”, Larry Keeley, Doblin Inc. (1999)
INNOVATION MANAGEMENT
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplement: BUSINESS INNOVATION
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The Chain-Linked Model of Innovation
Kline and Rosenberg (1986)
R
3
D
C
Potential
Market
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R
4
3
K
K
1 2
1 2
Invent and/or
Produce
Analytic
f Design
4
3
I
S
1 2
C
Re-design
and Produce
Detailed
Design and
Test
f
f
4
Existing
Knowledge K
C
C
R
Research
f
Distribute
and Market
f
f
F
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplement: BUSINESS INNOVATION
15
The Chain-Linked Model of Innovation
Kline and Rosenberg (1986)
Research
Existing
Knowledge
Potential
Market
Invent and/or
Produce
Analytic
Design
Detailed
Design and
Test
Re-design
and Produce
Distribute
and Market
User-centred DESIGN
INNOVATION MANAGEMENT
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplement: BUSINESS INNOVATION
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more about Business Innovation …
• “Innovation is the successful exploitation of new ideas.”
– (Innovation Unit, UK Department of Trade and Industry, 2004)
• “[Innovation is] The creation and adoption of new
products, services, technologies, and business models”
– Boosting Productivity, Innovation and Growth through a National
Innovation Foundation (2008), Brookings Institution, USA.
– Quoted in Building Ireland’s Smart Economy, p30.
• Innovation is: creative problem solving
• Innovation is: using creativity to add value
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
Innovation Trends
# of participants
# of interactions
supplememnt: RESEARCH & INNOVATION
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18th June 2009
Corporate
innovation process
Lone inventor
Networked, social,
interdisciplinary,
innovation SYSTEM
19th century
20th century
21st century
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplement: BUSINESS INNOVATION
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Business Innovation is multi-dimensional
• “Innovations that sustain prosperity have a variety of forms and are
developed and used through a massively multiplayer, mutlilevel and
multiperiod game.”
– (Amar Bhide, The Venturesome Economy, 2008)
• “General national welfare is highly dependent on the ability of a
country to foster innovation and use that as a wealth building platform”
– Brookings Institution (USA), Boosting Productivity, Innovation and Growth through a
National Innovation Foundation, 2008.
– Quoted in Building Ireland’s Smart Economy, p30.
• “Innovation is the specific tool of entrepreneurs, the means by which
they exploit change as an opportunity for a different business or
service. It is capable of being presented as a discipline, capable of
being learned, capable of being practised.”
– (Peter Drucker, Innovation and Entrepreneurship , 1985)
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplement: BUSINESS INNOVATION
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‘Business Innovation’
Business is the mechanism for delivering value to users/markets/economies
“Because it is its purpose to create a customer, any business enterprise has two –
and only these two – basic functions: marketing and innovation. They are the
entrepreneurial functions. … Marketing and innovation create value, all the rest are
costs.”
Peter Drucker, The Practice of Management (1954)
Business success requires competence in:
Management
User/market understanding
Product Development and Delivery
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplement: BUSINESS INNOVATION
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Main sources of information
for innovation:
“within the
enterprise”
customers
suppliers
competitors
Forfas: Making Technological Knowledge Work (2005)
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplememnt: RESEARCH & INNOVATION
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Innovation is more than Science and Technology!!
> 50% of innovations are not differentiated by proprietary technology
> 95% of innovations do not rely directly on basic research in Science
and Engineering
“Public sector research accounts for a vanishingly small share of
[OECD firms’] knowledge inputs.”
(Technopolis UK: Some New Ideas about Research, Technology and Development,
2001)
“.. non-technical innovation may well be the 'missing link' that prevents
Europe from taking full advantage of new technological opportunities”
(CORDIS, European Commission, EIS commentary, 2004)
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplememnt: RESEARCH & INNOVATION
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Economic Value of Science Research
• Direct economic output of science research is mainly human capital
– Providing research skills for MNCs and absorptive capacity for SMEs
– and limited IP
There is a lot more to business innovation than
Science and Technology research!
• Very few business innovations are derived directly from basic
research in Science and Engineering
– “…the main economic benefits of basic research are not knowledge directly applicable in
a narrow range of sectors, but background knowledge, research skills, instruments and
methods that yield economic benefits over a much broader range of sectors.”
• Keith Pavitt, The national usefulness of the research base, SPRU, UK, 1991.
– “Countless surveys of OECD firms show that their main sources of technology are
internal knowledge and other firms. Public sector research accounts for a vanishingly
small share of their knowledge inputs.”
• Erik Arnold (Technopolis, UK) and Martin Bell (SPRU, UK), Some New ideas about Research
for Development, SPRU (UK), 2001
– “… in most areas the results of scientific research are not directly useful for
technological advance”
• Jensen M.B., Johnson B., Lorenz E., Lundvall B.A., Forms of Knowledge and Modes of
Innovation, Science Direct – Research Policy 36 (2007)
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplememnt: RESEARCH & INNOVATION
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Linear Model of Innovation
Science  Technology  Manufacturing  Market  Sales ??
• “Everyone knows that the linear model of innovation is dead … the
linear model is no longer credible”
– Nathan Rosenberg, Exploring the Black Box: Technology, Economics and
History, Cambridge University Press, 1994
• “Technology draws on scientific knowledge in highly unpredictable
ways. … The body of knowledge called ‘science’ consists of an
immense pool to which small annual increments are made at the
‘frontier’. The true significance of science is diminished, rather than
enhanced, by extreme emphasis on the importance of the most recent
increment to that pool.”
– Nathan Rosenberg, Exploring the Black Box: Technology, Economics and
History, Cambridge University Press, 1994
• “.. non-technical innovation may well be the 'missing link' that prevents
Europe from taking full advantage of new technological opportunities”
– CORDIS (EU), European Innovation Scoreboard commentary, 2004
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplement: INNOVATION IS PERSONAL
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Innovation is personal – know the user!
Innovation is: using creativity to add value.
To whom do we add value?
The customer ... the user.
Understanding the user is the most important
Ingredient for successful innovation
“To develop the required knowledge of markets and customer needs, companies need a well-developed
system of market intelligence that encompasses knowledge of sectoral developments, competitor
positioning, technological advances, and regulatory changes. They also need to build strong relationships
with individual customers, in which they develop a comprehensive understanding of the customers
businesses and their problems, so that they can sell them solutions that meet or exceed their expectations.”
Ahead of The Curve, Enterprise Strategy Group (Forfas), 2004
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplement: INNOVATION IS PERSONAL
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Innovation is personal - whole-brained innovation
Left Brain
Logic
Analysis
Detail
Facts
Order / patterns
Knowledge
18th June 2009
Right Brain
Intuition / empathy
Synthesis
Holism / integration
Symbols
Creative expression
Uncertainty
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplement: INNOVATION IS PERSONAL
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Innovation is personal Products are more than technology
Users judge a product by the complete, extended-product experience
e.g. iPod
–
–
–
–
–
–
technology is no better than Sony, Creative, etc.…
styling and ergonomics is “cool” and “sexy” – user feels good
accessories and colours allow flexibility and convenience
music download and organisation
customisable for a personalised experience (h/w and s/w)
iTunes is essential to the success
It’s not just an MP3 player – it’s a Music for Life system
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplement: INNOVATION IS PERSONAL
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Innovation is personal –
Products are more than the core product
In mature markets, users look for “solutions” (extended products)
that provide a value-adding life-cycle experience.
“Value is now based on unique personalised experiences of customers.
Value is shifting from Products to Service and Solutions to Experiences.”
CK Prahalad and MS Krishnan, The New Age of Innovation, 2008
Products as Experience
–
–
–
–
–
Hardware-as-a service is common in the internet server market, following on Software-as-aService. The service provides a trouble-free, determinate, reliable experience.
Rolls Royce: “Power by the Hour” provides full maintenance shop contracts on a per flight-hour
rate. The service provides a trouble-free, reliable, determinate user experience.
Goodyear Tyres sell a tyre service where fleet managers pay per mile travelled.
Really successful services don’t just ‘remove hassle’ – they add extra value (beyond the core
and extended products) through meaningful experiences.
Branding projects a promise of experience. Branding has become the domain of (strategic)
product designers more than marketers, because the essence of the brand promise is delivered
through the (extended) product.
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplement: INNOVATION IS PERSONAL
28
Innovation is personal Experiences and Services are provided to individuals
With sophisticated markets or sophisticated innovations, the consumer wants and is
able to define and customise the value received from the product experience –
consumers co-create value.
Note: Mass-customisation requires sophisticated organisation and use of technology.
Products as experience
– Hardware-as-a service is common in the internet server market, following on Software-as-a-Service.
The service provides a trouble-free, determinate, reliable experience.
– Rolls Royce: “Power by the Hour” provides full maintenance shop contracts on a per flight-hour rate.
The service provides a trouble-free, reliable, determinate user experience.
– Really successful services don’t just ‘remove hassle’ – they add extra value (beyond the core and
extended products) through meaningful experiences.
– Branding projects a promise of experience. Branding has become the domain of (strategic) product
designers more than marketers, because the essence of the brand promise is delivered through the
(extended) product.
Personalised experiences
– Mobile-phone casings and accessories
– Mercedes, and many others: manufacturing batch = 1
– Facebook, Bebo etc
– Goodyear Tyres sell a tyre service where fleet managers pay per mile travelled. Goodyear provides
data analysis feedback to fleet managers on driving habits, miles travelled etc. for each driver.
– Amazon.com sends information on new releases of interest to each user according to the user’s
unique profile.
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplement: INNOVATION IS PERSONAL
Innovation is personal – each user is unique!
29
“Value is now based on unique personalised experiences of customers.
Value is shifting from Products to Service and Solutions to Experiences. …
N=1”
18th June 2009
CK Prahalad and MS Krishnan, The New Age of Innovation, 2008
Product  Service  Individual Experience
Innovation ideas come from understanding
how to add value to the lives of individual users.
Innovation Designers call it Deep User Understanding.
Ethnographic research, market analysis, design discourse,
voice-of-customer research, focus groups, strategic conversations …
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplement: DESIGN
30
Design and Research
Basic Research (S&T) provides:
Human Capital
Absorptive capacity
Some (limited) IP
Design provides complementary benefits:
Application to ALL businesses - goods and services
Enhanced value added across (nearly) all types of innovation
A natural gateway to open innovation – technology “agnostic”
Faster return on investment – from idea to cash
Recommend IBIF as complement to SFI,
with balanced spending budgets.
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplement: DESIGN
31
Design-driven innovation
•
•
“The results are compelling: companies that invest in design tend to be more
innovative, more profitable and grow faster than those who do not. At a
macro-economic level, there is a strong positive correlation between the use
of design and national competitiveness.”
“The document concludes that design has the potential to become an integral
part of European innovation policy, a building block of a policy model that
encourages innovation driven by societal and user needs, and that builds on
existing European strengths such as our heritage, creativity and diversity”
–
•
Design as a driver of user-centred innovation, EU Commission Staff Working Document,
April 2009
“Countries showing a higher performance in creativity and design also show,
taking into account differences in per capita income, a higher innovation
performance as measured by the EIS Summary Innovation Index.”
–
Design Creativity and Innovation: A Scoreboard approach, Inno-Metrics, EU: DG for
Enterprise and Industry, February 2009
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt
supplement
32
The Joint Oireachtas Committee on Education and Science
END
The role of Education in Business Innovation:
How we can improve the innovation performance of business in Ireland
… beyond Science and Technology
Frank Devitt
Department of Design and Innovation
School of Business and Law
NUI Maynooth
Leinster House
18th June 2009
18th June 2009
Business Innovation – beyond Science and Technology
Dr. Frank Devitt