Chapter 6 VALUE BLOCKERS NEUTRALIZING CORPORATE ANTIBODIES INNOVATIONS

Chapter 6 VALUE BLOCKERS: NEUTRALIZING “CORPORATE ANTIBODIES”

INNOVATIONS OFTEN FAIL WHEN THEY CONFLICT WITH EXISTING BUSINESS MODEL • Marketing tests indicated this would be a breakthrough product (cookies, name, packaging all tested strong) • Truck drivers not in habit of visiting snack isle … did not restock consistently • Launch failed relative to expectations © 2019 Kaihan Krippendorff, All Rights Reserved. 2

© 2019 Kaihan Krippendorff, All Rights Reserved. 3

© 2019 Kaihan Krippendorff, All Rights Reserved. 4

INNOVATIONS INCONSISTENT WITH CURRENT BUSINESS MODEL MORE LIKELY TO FAIL Source: George Day, “Is It Real? Can We Win? Is It Worth Doing? : Managing Risk and Reward in an Innovation Portfolio, ” Harvard Business Review, December 2007 © 2019 Kaihan Krippendorff, All Rights Reserved. 5

XBOX CASE: DISRUPTING COMPETITION WHILE REDUCING INTERNAL DISRUPTION YES DISRUPT WITHOUT DISRUPTING RADICAL DISRUPT COMPETITION? BUSINESS AS USUAL COPY CAT NO NO YES DISRUPT YOUR BUSINESS? © 2019 Kaihan Krippendorff, All Rights Reserved. 6

PRE-EMPTING BUSINESS MODEL CONFLICT: 8 DIMENSIONS TO CONSIDER 1. Position: Who your core customer is and what position your brand holds in their mind. 2. Product: What you sell, including your core product/service and all ancillary products/services. 3. Promotion: How you communicate to your core customer, including marketing, sales, public relations, and corporate communications. 4. Placement: How you deliver your product/service (e. g. , channels, store locations, distribution methods). 5. Pricing: How you price your product/service. 6. Process: The internal processes that allow you to deliver on your value proposition. 7. Physical experience: The physical experience your create for your customer, including what they see, smell, hear, taste, and feel when interacting with your company and brand. 8. People: Who you hire, how you organize them, and your culture. © 2019 Kaihan Krippendorff, All Rights Reserved. 7