Business Model Innovation Strategies

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Business Model Innovation Strategies – Your company isn’t the only one struggling with innovation. According to a McKinsey survey, 94% of managers of all companies surveyed said they were not satisfied with their company’s innovation performance.

One of the biggest causes of innovation failure is a missing or unclear organizational and innovation strategy.

Business Model Innovation Strategies

Business Model Innovation Strategies

In many companies, those responsible for innovation do not know which topics have priority or what to focus on when generating ideas. A company lacks basic knowledge of the direction it wants to grow.

Let’s Commit A Thoughtcrime

If you don’t have a clear strategy, your innovation efforts may look like the chart above. Each department can launch its own innovation efforts and move in its own direction without knowing what value their initiatives will bring.

Ask five people in a company what innovation means and you’ll get five different answers.

Is it an innovation for Post Notes in a new form? Is putting the same sauce in a new squeeze bottle an innovation? Are you up for the original iPhone innovation? Innovation can look and mean many different things within a company.

The first step is to agree on a uniform definition of innovation across the company. It is only possible if you have a clear corporate strategy. Because the starting point of every innovation action should be your corporate strategy.

Business Model Innovation With Genai

But what is an ideal innovation strategy? A strategy that answers these three big questions is a killer startup:

An innovation strategy should include a shared mission and key activities that will help you achieve this goal. It should be a bridge between your broader corporate strategy and day-to-day team activities ie. H. How these affect the achievement of the company’s overall innovation goals.

The best innovation strategies are simple and clear. Everyone in the company can understand them.

Business Model Innovation Strategies

Here you will find a step-by-step guide to developing an innovation strategy that includes all of the above ingredients:

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This is the “Where are you now?” Part of the strategy. Here you can find out what innovations are already working in your company. You need to look at all the innovation initiatives underway and see what of these initiatives are actually adding value and what still needs improvement. Here you list the activities that have the greatest impact on your company.

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Basically, it’s about gaining an understanding of how and why innovation is currently working in your company. What obstacles/challenges do you face in achieving your innovation goals?

Innovation is about understanding markets and technologies that can disrupt markets. First, answer the following questions:

This is the “where you want to go” part of the strategy. And this will shape your innovation philosophy. You look at two different dimensions:

House Of Innovation

Here, your motivation lies in finding long-term goals that will help the company grow in the future.

The most important goal here is to prepare the organization internally and externally for future changes in technology and markets. In the short term, this may not bring any financial benefits.

Your motivation here is to increase the company’s sales and profits or, in some cases, reduce operating costs. These initiatives won’t necessarily impact company culture, but can provide a nice boost to ongoing business.

Business Model Innovation Strategies

This is where you balance both your strategic and financial goals. These initiatives are strategic in nature and work to change corporate culture with the aim of creating new business models with clear financial goals.

The Quest For Sustainable Business Model Innovation

This is “How do you get there?” Part of the strategy. This is where you map your company’s goals to the types of innovation you want to implement. We have broadly divided them into six categories, three of which are internal and three of which are external:

If your goal is strategic and you want to drive innovation in your company, consider the following initiatives:

Hackathons and Bootcamps Ask yourself: How do we motivate our internal employees to develop new innovative ideas?

Intrapreneurship Ask yourself: How can we provide an ecosystem for our employees to test new business ideas and bring new products to market?

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If your goal is financial and you want to drive innovation in your company, consider the following initiatives:

Repackage Ask yourself: How can we change our product or sell our existing IP to offer a new customer segment?

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If your goal is both strategic and financial, and you want to drive innovation in your company, consider the following initiatives:

Business Model Innovation Strategies

Workforce Training: Ask yourself: How can we increase the knowledge of our company’s innovative practices so that employees can apply them in their work?

Business Model Innovation

Venture Builder Ask yourself: How can we create an ecosystem to engage our employees in building new business models that become (or spin off) their own companies and pay us well in the future?

If your goal is strategic and you want to drive innovation outside of your company, consider the following initiative:

Open Innovation Ask yourself: How can we collaborate with outside startups in our industry to learn from them and keep an eye out for disruptions in our industry?

If your goal is financial and you want to drive innovation outside of your company, consider the following initiative:

Harnessing Ai For Business Model Innovation And Sustainable Impact

The financial investor asks yourself: How can we use our spare cash to invest in interesting companies that will bring us good financial returns?

If your goal is both strategic and financial, and you want to drive innovation outside of your company, consider the following initiative:

Strategic investors ask yourself: How can we invest in startups that are strategically aligned with our corporate strategy to be part of new disruptions in our industry?

Business Model Innovation Strategies

Depending on your resources, you can now aim to drive one or all of the following four types of innovation in your company:

Business Strategy Revamping Approaches To Business Model Innovation Ppt Summary Graphics Pdf

Incremental innovation: It is the type of innovation that builds on your existing technical skills. And it always fits your existing business model. In fact, about 75% of companies succeed in incremental innovation.

Ask yourself: How can we make our existing product or service more efficient and more valuable to our customers?

Example: Amazon has continually improved its warehousing and logistics to enable same-day shipping, and this incremental innovation has actually strengthened its core business.

Adjacent innovation: It is the type of innovation that requires entering a new market or connecting with new customers by leveraging what your company already does well.

How To Create A Successful Innovation Strategy?

Ask yourself: How can we reinvent our existing products/services in a new space? Or how to develop a new product/service for our existing customers?

Example: Apple used existing knowledge and resources to create a new product with a cheaper iPhone – iPhone SE – and captured a new segment of consumers who wanted an Apple product but didn’t want it to stay in their pockets.

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Transformative/disruptive innovation: It is a type of innovation that requires an entirely new business model, usually unrelated to the company’s core business model. At some point such innovations are suitable for a reversal or the creation of a new company.

Business Model Innovation Strategies

Example: When Netflix entered the home entertainment industry as a distribution service for DVD rentals, the company wanted to revolutionize brick-and-mortar stores. But with the launch of its streaming services, Netflix not only revolutionized the terrestrial and cable television industry, but also changed the entire movie-watching experience.

Business Model Innovation Tools

Radical innovation: It is the type of innovation that requires a new technology – which ultimately creates a new market and business model. These innovations disrupt entire industries.

If you need to create your company’s innovation strategy or are unsatisfied with your existing functionality, download our Innovation Strategy Canvas 

About the Author: Narjeet works with product leaders and innovation teams to help them take an idea to a solution through customer discovery and prepare products for market. He supports companies with lean experimentation, design sprints, rapid product development and growth hacking. Digital healthcare is close to his heart – because this is where his digital skills can be most useful.

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Business Model Innovation: Strategies And Examples For Successful Transformation

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Business Model Innovation Strategies

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