Innovation a conversation on Concepts Terminology Management

1. Innovationa conversation on Concepts Terminology Management Vijay Sankaran Executive Director IT, Global Application Development Services Ford Motor Company

2. Agenda Today • “Innovate or Adapt? The Challenge of the New Decade" • Innovate or Adapt? • Innovate or Die? • Innovate and Thrive!

3. Innovation – it’s Essential! • – Michael Faraday • Physicist (1791 – 1867) “The five essential entrepreneurial skills for success are concentration, discrimination, organization, innovation and communication.”

4. Misconceptions about Innovation Innovation and invention are synonymous Innovation changes “a job to be done”for someone. Invention:Creation of a new idea, mechanism, or process. Tacky, non-permanent glue was an invention. Innovation:Putting inventions into practice, translating capability into successful use. Creating change and creating value.“Post-it Notes” was an innovation.

5. Misconceptions about Innovation Innovation and invention are synonymous Innovation creates whole new techniques, new ways of doing things. Invention:Creation of a new idea, mechanism, or process. Means to generate a concentrated beam of coherent light – the laser – was an invention. Innovation:Putting inventions into practice, translating capability into successful use. Creating change and creating value.“Laser eye surgery” was an innovation.

6. Misconceptions about Innovation Invention is the value generator Innovation creates the change, change creates/alters the value stream. 1947 – Scientists at Bell Laboratories (AT&T) invent the transistor -- patented, but the organization not able to promptly apply 1952 – AT&T licenses the invention -- for US$25,000 Texas Instruments (TI), Sony and IBM buy in too! 1954 – TI innovates: designs/manufactures first transistor radio 1958 – TI innovates: integrated circuit (7400 series to follow!) 1967 – TI innovates: hand-held calculator 1973 – TI innovates: microprocessor

7. Misconceptions about Innovation There is only one type of Innovation Product performance innovation(features, efficiency, etc.) is just one of 10 possibilities!

8. Types of Innovation 1. Weapons 2. Mathematics & the number zero 3. Money 4. Printing 5. Free markets and capital markets 6. Domesticated animals & agriculture 7. Property ownership 8. Limited liability 9. Participatory democracy 10. Anesthetics and surgery 11. Vaccines and antibiotics 12. Semiconductors 13. The Internet 14. Genetic sequencing 15. Containerized shipping 2. Mathematics & the number zero 7. Property ownership 15. Containerized shipping Let us consider important innovations to be those that most changed peoples' lives. Larry Keeleycofounder of Doblin Group

9. Thinking Outside the Box Innovation "We can't solve problems by using the same kind of thinking we used when we created them.“ – Albert Einstein “My team is having trouble thinking outside the box. We can’t agree on the size of the box, what materials the box should be constructed from, a reasonable budget for the box, or our first choice of box vendors.”

10. Thinking Outside the Box – Revisited Innovation Sometimes thinking outside the box means innovating inside the box!

11. Misconceptions about Innovation Innovation requires a new invention Portsmouth Block Mills – 1800’s In 1802 used patented machinery to manufacture interchangeable blocks for sailing ships. Ford invented the assembly line Ford invented the automotive assembly line Ford invented interchangeable parts Ford invented division of labor Division of labor helped manufacturing transition from small craft shops to early factories. Efficiency gains lead to the rise of furniture and clothing manufacture and other industries in the late 1800's. First automotive assembly installed by Olds Motor Company 1901 Increased production from 425 cars in 1901 to 2,500 in 1902! 12 years before Ford

12. Misconceptions about Innovation What did Ford do? Ford combined three key elements: Moving assembly line Division of labor Interchangeable parts Ford combined all these earlier innovations to create anew, innovative, effective means of automotive mass production!Ford was a man, and a team.

13. Combinatorial Innovation Just a history lesson? Ford combined three key elements: Moving assembly line Division of labor Interchangeable parts Cloud Computing SOA, Services Standards, APIs, Protocols, Service Bus Combinatorial Innovation. “Mashups” Huge innovation opportunity for IT!

14. Innovation – The time challenge • –Bill Buxton • Pioneer in the human–computer interaction field. “You have to spend as much time directing your innovation and creativity to fostering a culture of creativity and a receptiveness to innovation as you spend on the ideas themselves.”

15. Innovation Innovation!!

16. Evolve to Support Innovation Evolving From… Evolving To… Innovation is the objective of just dedicated research teams or individuals Innovation is a natural element of the global organization’s day-to-day life Innovation is the exception to our business model Innovation is supported through processes, actions and behaviors Innovation is focused on technology and tools Innovation encompasses the entire spectrum of our capabilities Innovation is viewed as disruptive Innovation is valued as disruptive

17. Some views of innovation Evolving From…

18. In-Vehicle Computing In-Vehicle Project #1 In-Vehicle Project #2 In-Vehicle Project #3 Initiatives / Process / Portfolio

19. Economize • Ensure core ideas can be created • Create business cases for core ideas • Engineer • Architect Platform • Define products • Integrate into environment Owner Deployment Team • ProductionPlanning • Business Use Cases • Business Value Proposition • Eng Project Charter • Tech Architecture • Production • Pilots • Arch and Patterns • Industry Standards • End Products • Services Innovation Process The e4 process is streamlined to introduce technology in a systematic fashion • Experiment • Illumination of new ideas • Recombination of existing ideas based on business need • Evaluate • Drive use cases around ideas • Prototype new technology x-functional team Individuals Owners • Informal Research • Sandbox • Position Papers • Formal Research • Technology vision and strategy alignment • Technology/Business PoCs • Research Products Deliverables

20. Innovation Portfolio • 10 ET Workstreams provide focus • ET e4 Process view promotes disciplined innovation • Completion dates drive results • Business Partner Engagement strengthens business focus

21. Portfolio Detail View

22. Project and PoC Detail

23. Training Themes Generalist Everybody • Breakthrough ideas are a matter of process, not luck • Tips for launching your new idea • When to refine or when to revise a new idea • How to organize your team and processes for developing Big Ideas • How to land on a breakthrough idea Subject Matter Expert/Coach • Innovation tools • Innovation methods • Groups & Teams in Organizations • Integrated Product Development Project • Industrial Design Fundamentals • Design History Management Focus • Tactics for dealing with the internal politics and resistance to change that can threaten innovation initiatives and early-stage developments • Get the right mix of people and skills to generate innovative ideas efficiently • Develop the processes required to support these people • Build cultures that encourage innovative behaviors • Decide which ideas are right for investment, and which new business opportunities are worth pursuing

24. Reward & Recognition – Why? • Democratize Innovation • Allow everyone to participate – by influence or action.  • Encourage more innovation • Promote an Innovative Environment • By rewarding and recognizing innovation. • Creating a culture of idea sharing. • Giving people an opportunity to make a difference. • Extract valuable ideas from the enterprise • Learn about the organization • Learn from the organization

25. “Innovate or Adapt?” – Revisited Good time to be a mammal! Additionally, it’s a good time to embrace change. “The picture’s pretty bleak, gentlemen. The world’s climates are changing, the mammals are taking over, and we all have a brain about the size of a walnut.” Source: Gary Larson

26. Innovation END

27. Thought on the Future The future is already here – it's just not evenly distributed. - William Gibson, 2003