SAS 15 The Entrepreneurial Mind

Types of innovation: Invention

totally new product, service or process

types of innovation: Synthesis

Combination of existing concepts and factors into a new formulation or use

types of innovation: Duplication

Creative replication of an existing concept

Myth. No.3

Creativity Relies on Dreams and Blue-Sky Ideas* - Accomplished innovators are very practical people and create from the opportunities left by reality - not daydreams. [*Blue Sky ideas, come from the blue sky thinking approach to idea generation. It consists mainly of the activity of "brainstorming with no limits."]

principles of innovation: Follow a milestone schedule

Every innovation should follow a schedule that indicates milestone accomplishments. Although the project may run ahead or behind schedule, it still is important to have the schedule in order to plan and evaluate the project.

types of innovation: examples of synthesis

Fred Smith - Federal Express Merrill Lynch - home equity financing

principles of innovation: Learn from failures

Innovation does not guarantee success. More importantly, failures often give rise to innovations

Name two (2) of the five (5) myths of innovation discussed by the teacher

Innovation is Planned and Predictable

principles of innovation: Make the product, process, or service customer-based.

Innovation must always keep the customer in mind. The more the innovator has the end-user in mind, the greater the chance that the concept will be accepted and used.

principles of innovation: action-oriented

Innovators must always be active and searching for new ideas, opportunities, or sources of innovation.

principles of innovation: Aim high.

Innovators should aim high for success by seeking niche in the marketplace

principles of innovation: Try-test-revise

Innovators should always follow the rule of try, test, and revise. This helps work out any flaws in the product, process, or service

principles of innovation: Start small.

Innovators should not attempt a project or development on a grandiose scale. They should begin small and build and develop, allowing for planned growth and proper expansion in the right manner and at the right time.

adds that this must also lead to commercial success to be rightfully called an innovation. Both agree that the success of a new business depends a lot on the innovative quality of an idea.

Josiah Go

The Major Myths of Innovation

Myth No. 1: Innovation is Planned and Predictable - This myth is based on the old concept that innovation should be left to the research and development (R & D) department under a planned format. In truth, innovation is unpredictable and may be introduced by anyone.

types of innovation: Extension

New use or different application to an already existing product, service, or process

principles of innovation: Make the product, process, or service simple and understandable.

People must readily understand how the innovation works.

"Innovation is the specific function of entrepreneurship...It is the means by which the entrepreneur either creates new wealth-producing resources or endows existing resources with enhanced potential for creating wealth."

Peter F. Drucker

For _________, innovators are those who introduce something new to the market - a new product, new service, or a new business model.

Peter F. Drucker

types of innovation: examples of extension

Ray Kroc - McDonald's Nolan Bushnell - Atari Kemmons Wilson - Holiday Inn

Myth No.2

Technical Specifications Should Be Thoroughly Prepared - Thorough preparation often takes too long. Quite often it is more important to use a try-test-revise approach.

Name four (4) of the seven (7) sources of innovation: Any 4 of the ff:

Unexpected occurrences b. Incongruities c. Process Needs d. Industry and market

types of innovation: examples of duplication

Wal-Mart - department stores Gateway - personal computers Pizza Hut - pizza parlor

sources of innovation: Changes in perception

examples: Exercise (aerobics) and the growing concern for fitness

sources of innovation: Industry and market changes

examples: Health care industry: changing to home health care

sources of innovation: Incongruities

examples: Overnight package delivery

sources of innovation: Demographic changes

examples: Rest homes and retirement centers for older people

sources of innovation: Process needs

examples: Sugar-free products Caffeine-free coffee Microwave ovens

sources of innovation: Unexpected occurances

examples: Unexpected success: Apple Computer (microcomputers) Unexpected failure: Ford's Edsel

sources of innovation: Knowledge-based concepts

examples: Video industry; robotics

what are four types of innovation?

invention, extension, synthesis, duplication

Principles of Innovation

A potential entrepreneur needs to realize that there are principles of innovation. These principles can be learned and, when combined with opportunity, can enable the individual to innovate. The major principles of innovation are

Myth No.4

Big Projects Will Develop Better Innovations Than Smaller Ones - This myth has been proven false time and time again. Larger firms are now encouraging their people to work in smaller groups, where it often is easier to generate creative ideas.

Myth No.5

Technology Is The Driving Force of Innovation and Success - Technology is certainly one source for innovation, but it is not the only one. Moreover, it is the customer or market that is the driving force behind any innovation. Market-driven or customer-based innovations have the highest probability of success. A good example is found in the case of Polaroid's Polarvision, a television camera that allowed for instant playback of the film. Polaroid hit the market with this technological advance at the same time that videocassette recorders arrived. Result: Polaroid's product was rejected and the company lost millions of dollars.

principles of innovation: Work, work, work.

This is a simple but accurate exhortation with which to conclude the principles of innovation. It takes work, not genius or mystery, to innovate successfully.

principles of innovation: Reward heroic activity.

This principle applies more to those involved in seeking and motivating others to innovate. Innovative activity should be rewarded and given the proper amount of respect. This also means tolerating and, to a limited degree, accepting failures as a means of accomplishing innovation. Innovative work must be seen as heroic activity that will reveal new horizons for the enterprise.

types of innovation: Examples of inventions

Wright brothers - airplane Thomas Edison - light bulb Alexander Graham Bell - telephone