Expanding the Innovation Horizon: The Global CEO Study 2006

Transcript

1 IBM Global Business Business Consulting Services Services Expanding the Innovation Horizon: The Global CEO Study 2006 November, 2006

2 The Global CEO Study 2006: Expanding the Innovation Horizon Scope: 765 CEOs and business leaders representing all major countries Asia Pacific 40% Americas 25% Europe 35% Purpose: Understand role of innovation on CEOs agenda Innovation Definition: New ideas or current thinking applied in fundamentally different ways resulting in significant change Innovation focus: - Products, Services, and Markets - Business Models - Operations 2

3 Innovation takes fundamental change, and CEOs seem uncertain about their organization s ability to manage it Extent of Fundamental Change Needed Over the Next Two Years Past Level of Success at Managing Fundamental Change Moderate change 22% Little or no change 13% Substantial change 65% Very successful 15% Successful 32% No change experience 5% Little to no success 15% Some success 33% 3

4 Further challenging them is the fact that Innovation the key to growth - is different today Myth: Innovation means developing new products and services Reality: Business model innovation matters Myth: Innovation is too critical and proprietary to involve outsiders Reality: External collaboration is indispensable Myth: Responsibility for innovation should be delegated Reality: Innovation must be orchestrated from the top 4

5 CEOs indicate that there must be a balance across innovation paths, but business model innovation plays prominently... % respondent emphasis by path 60% 40% 20% 0% CEOs Innovation Emphasis Products, Services, Markets Operations Business Model The business model we choose will determine the success or failure of our strategy. Products and services can be copied, the business model is the differentiator. Our greatest focus is on business model innovation, which is where the greatest benefits lie. 5

6 ... And correlates strongly to an increase in operating margin relative to peers Operating Margin Growth in Excess of Competitive Peers 6% % CAGR over 5 years 5% 4% 3% 2% 1% This is how we organize to deliver services and manage operations everything stems from the business model. 0% -1% Products/ services/ markets Operations Business Model The business model is the key driver for leveraging products, services, markets and operations. 6

7 ... Which is why outperformers are nearly twice as likely as underperformers to innovate their business model Innovation Priorities for Underperformers versus Outperformers (operating margin growth CAGR) 100% % respondent emphasis 80% 60% 40% 20% 0% Underperformers Products/ services/ markets Operations Business Model Outperformers We need to develop a business model based on strategic partnerships that creates value for our company and for the industry in this era of specialization 7

8 As an offensive strategy, CEOs use business model innovation to preempt threats and often to create them Likelihood of Competitor Altering Industry via Radical Change to Business Model Very Likely 38% Not at all likely 16% % of business model innovators Somewhat likely 46% Only through wide renovation can the company survive and grow. There s no growth without changing ourselves and the industry itself. 8

9 Business model innovations allow CEOs to capitalize on expertise and scale hidden within their own organizations Most Common Business Model Innovations Organization structure changes Major strategic partnerships Shared services Alternative financing/ investment vehicles Divestitures / spinoffs Use a third-party operating utility 0% 20% 40% 60% 80% % of business model innovators We need to develop a business model based on strategic partnerships that creates value not just for our company, but for the industry as a whole. 9

10 Winning CEOs orchestrate an innovation-enabling hierarchy Innovation Enabler Hierarchy Foster Collaborative culture Differentiating Innovation Enablers Reward individuals Integrate business and technology Key internal enabler Without collaboration, innovation would be impossible Tolerate innovation risk Measure innovation success Create incubation structures Sustaining Enablers Rewarding innovative ideas generates enormous competitive advantage. 10

11 From these findings, five recommendations emerge to expand the innovation agenda for the future Think broadly, act personally, manage the mix Challenge your business model to be deeply different Defy collaboration limits Force an outside look... every time Ignite innovation through business and technology integration 11

12 Quale Innovazione? 2 CEO su 3 affermano che nei prossimi2 anni dovranno affrontare cambiamenti di fondamentale importanza.. Qual è l innovazione che conta? Quali sono le principali leve? IBM Institute for Business Values (IBV) CEO Study 2004, multiple answers permitted IBV CEO Study 2006, top answer shown 12

13 L innovazione che conta Innovazione di Prodotto Innovazione di Servizio Innovazione del modello di Business Innovazione nei processi di Business Innovazione nei processi di management e nella cultura aziendale Innovazione nell infrastruttura IT Innovazione nella politica e nella società 13

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15 La polarizzazione del mercato Polarizzazione del mercato consumer Bell Curves Crescita e valore percepito Well Curves Mass Competitive Spectrum Targeted I consumatori cercano di massimizzare il proprio potere d acquisto per beni generici a basso impatto emotivo I grandi player di mercato stanno velocemente conquistando una posizione dominante, fornendo prodotti accettabili a prezzi molto bassi Gli specialisti di settore devono possedere value proposition specifiche e ben mirate per crescere in un mondo di estremi I consumatori cercano di massimizzare il personal value nell acquisto di beni ad alto valore emotivo Gli specialisti d industria creano nicchie di mercato ad alto sviluppo ed alto reddito, fornendo valore specifico a gruppi target di consumatori 15

16 Lo spectrum competitivo (le 3 aree di riferimento) Commodity Product Product-Service mix Value Product Spectrum Competitivo Economy of scale Strategy I nuovi leader di mercato stanno velocemente conquistando una posizione dominante, fornendo prodotti accettabili a prezzi molto bassi. Innovare significa progettare prodotti e/o modalità meno costose, comprese differenti locations (design to cost) 16 Business volumes Strategy Il business dei prodotti medi (ad alto volume) sta richiedendo value proposition di mix prodotto-servizio, in cui il servizio conta sempre di più. Innovare significa saper predisporre nuovi package di prodotto-servizio progettando prodotti service-oriented (full life cycle cost) Margins Strategy I nuovi leader di mercato stanno sviluppando (e/o): - prodotti sempre piùinnovativi - nicchie sempre più profonde (articolazione dei target) - maggiori capacitàdi customization - luxury brands Innovare significa progettare prodotti e/o modalità a maggior valore percepito (design to value)

17 Innovazione nel Prodotto o Servizio o Innovazione nel Mix Prodotto-Servizio o addirittura Conversione del Prodotto in Servizio 17

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19 Innovazione nel Modello di Business Innovazione della posizione/ruolo all interno della Catena del Valore oppure. Innovazione nella struttura di business dell azienda/capacità di riconfigurazione organizzativa 19

20 Le domande dei CEO sul loro modello di Business: Quali sono le nostre competenze distintive? Quali processi ddobbiamo gestire direttamente? 100% Valore % sul fatturato 0% 23-27% Product or service building blocks Azienda Tipo Competenze Differenzianti=> Efficacia Focalizzazione del sulle attività core, differenzianti verso i competitors Allineamento di risorse e working capital alle prioritàstrategiche 32-47% Critical Yet Non- Differentiated Business Processes and Components 13-28% Differentiated Business Processes and Components 5-10% EBITDA Competenze non differenzianti=> Efficienza Outsourcing di alcune attività a partners best-ofbreed che garantiscano maggiore efficienza e eccellenza operativa Le attività vengono gestite dai partners; l azienda si concentra su definizione di obietivi e SLAs Spese IT legate ai volumi di business con costi unitari decrescenti al crescere dei volumi Source: IBM Institute for Business Value based on McKinsey analysis 20

21 Redesigning the business model for a flexible operational management Consumer Relationship Customer Relationship Manufacturing Inventory and Distribution Business Administration Direct Category/Brand Strategy Category/Brand Planning Brand P&L Customer Relationship Strategy Customer Relationship Planning Assessing Customer Satisfaction Manufacturing Strategy Supplier Relationship Production/Materials Development & Planning Supply Chain Strategy Inventory Planning Network & Asset Configuration Distribution Oversight Corporate Strategy Corporate Planning Alliance Corporate Governance Business Performance Control Execute Matching Supply and Demand Marketing Development and Effectiveness Product Ideation Concept/Product Testing Product Development Product Marketing Execution Consumer Service Product Directory Customer Insights Account Value-Added Services Customer Account Servicing Retail Marketing Execution In-store Inventory Mgmt Customer Directory Manufacturing Oversight Supplier Control Product/Component Manufacturing Assemble/Pkg. Products Plant Inventory Manufacturing Procurement Inbound Transportation Outbound Transportation Distribution Center Operations Transportation Resources En route Inventory External Market Analysis Organization and Process Design Legal, Tax and Regulatory Compliance Treasury & Risk Mgmt Financial Accounting & Reporting Indirect Procurement Facilities & Equip Mgmt Resource Development HR Administration IT Systems & Operations Strategic Invest in and expand to gain advantage Support Manage to meet the needs of strategic components CBM= Component Business Modelling (example) Partner Develop alliances to meet critical business req ments Utility Use specialists to reduce costs and free up resources 21

22 Possibili azioni sui componenti di Business selezionati Matrice Decisionale Alta INTERNALIZZAZIONE Ottimizzazione Differenziazione Differenziazione Strategica Bassa Gestione interna per rispondere alle esigenze di business ESTERNALIZZAZIONE Uso Outsourcing Utilizzo di fornitori che svolgano attività standardizzate a prezzo variabile/on demand Enfasi e gestione interna per guadagnare vantaggi competitivi Utilizzo di partners leader per attività tipiche di industry, ma non differenzianti Bassa Specificità di industry Alta 22

23 Attraverso la re-ingegnerizzazione dei processi chiave o Attraverso l empowerment tecnologico dei processi 23

24 Processes Re-engineering Gestione del cambiamento HR 24

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26 Il modello di Business flessibile richiede un IT flessibile Business flessibile Processi flessibili Customer Bank Shared Service Bank 2 Supplier IT flessibile Outsourced Application Service Application Service Application Service Application Service Enterprise SOA Service Bus Application Service Application Service Application Service Application Service 26

27 L IT come Service Flexible Business Transformation Business Process Outsourcing Mergers, Acquisitions & Divestitures Requires Composable Processes (CBM) Component Business Modeling Flexible IT On Demand Operating Environment Service Oriented Architecture (SOA) Development Infrastructure Composable Services (SOA) Software Development Integration Infrastructure 27

28 CBM for IT IT Customer Relationship IT Business Business Resilience Information and Knowledge Service and Solution Development Service and Solution Deployment Service Delivery and Support Directing Business Enablement Service & Solution Strategy Business Technology Strategy Enterprise Architecture Portfolio Technology Innovation Business Resilience Strategy Regulatory Compliance Strategy Integrated Risk Strategy Information Strategy Knowledge Strategy Development Strategy Deployment Strategy Services Delivery Strategy IT Support Strategy Controlling Business Performance Planning Demand Communications Planning Financial Business Technology Performance & Value Human Resources Continuous Business Operations Regulatory Compliance Integrated Risk Security, Privacy & Data Protection Information Architecture Information Resource Knowledge Resource Services and Solutions Lifecycle Planning Services and Solutions Architecture Change Planning Release Planning Operations Planning Infrastructure Resource Planning Support Services Planning Executing Business Performance IT Services and Solution Marketing IT Financial Staff Administration & Development Supplier and Contract Administration Business Resilience Regulatory Compliance Remediation Data and Content Knowledge Capture And Availability Service and Solution Creation Service and Solution Maintenance Change Implementation Release Implementation Support Services Infrastructure Resource Infrastructure Operations 28