Tuesday, November 24, 2009

Change by Design

Tim Brown’s book Change by Design explains how design thinking can be incorporated into organizations in order to inspire innovation. One topic in the book explains IDEO’s Diego Rodriguez and Ryan Jacoby’s business knowledge on how companies can manage their portfolios of design-based innovation. The “Ways to Grow” matrix resulted as a tool that evaluates the innovation efforts within an organization.

Innovation efforts are mapped out on a vertical axis representing existing to new offerings (product, system, and/or service) and a horizontal axis representing existing to new users. This matrix categorizes the innovation efforts of a company and demonstrates the balance of these efforts. Brown argues that a company’s best defense against a constantly changing world is to diversify its portfolio by investing in all four quadrants of the matrix.

-incremental tendencies
-important/ majority of a company’s effort is likely to be concentrated in this stream of innovation
-i.e. extension of a successful brand
-secure a company’s base

-extend existing offerings to solve unmet needs or current customers or adapt them to meet the needs of new customers or markets
-i.e. Toyota Prius is an example of incremental and evolutionary innovation (Prius caught the demand for energy-efficient personal transportation while competitors were making SUVs, offered customers lower fuel consumption as fuel prices increased, innovation behind the hybrid electric motor, indication of fuel economy)
-stretch a company’s base

-the most challenging and the riskiest type of innovation (both the product and the users are new)
-occurs rarely
-i.e. Apple’s iPod (core technology not new, but company created a market for a different type of musical experience)

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