Where's the Beef

(IX) Where's the Beef: Value Innovation or Blue Ocean Strategy

This is the ninth article in the series "Where's the Beef": quick-and-dirty methods to make a go or no-go decision regarding whether or not and how to try to commercialize an invention.

Ernst Max Nielsen continues his series on "Where's the Beef?" (Click the Category on your right hand side: "Where's the Beef". The articles are numbered in Roman numbers: I, II, III etc. If you scroll down this site, you'll get the articles in reverse order)

Value Innovation or Blue Ocean Strategy
Dr. Chan and Mauborgne of INSEAD studied the interesting phenomenon, in line with Dr. Schnaar’s findings, that the gazelle, ie. high growth, profitable firms are not necessarily very innovative in the technological sense. Very often the fastest and most sustanainable growth in (new) companies has been found by entrepreneurs, who are not pioneers in a technological sense. But they know how to add value at critical points in the delivery of a product or service. How can we best identify and serve buyers’ overall needs and offer them unparalleled value? That demands the mapping of an “innovation value curve”: a chart. You can get the book at Amazon .

The Value Innovation Chart promises to let you find the “Blue Ocean” of your innovation: a place where the big fish are (“where’s the big fish?”) and you see only blue ocean, i.e. no other fishermen. In my course I give  examples of Innovation Charts and let participants develop a few themselves. I have found a number of other references, which we use to understand and use the concept.

Drawing a VI Chart is the “acid test” of any invention. You need to focus on your strong and weak points compared with that of the competition. To do so, you need to iterate the process many times, finetuning your parameters and your competition, which in turn requires support from good intelligence sources, which is another topic in my clinic. See later

I quite often find that researchers are not very keen on or even understand that there is a need for an added value proposition. How does your invention (radically) improve existing practice? Very often researchers will tell you that their goal was to find something Novel, not necessarily to test whether it is Good compared to prior art. I teach and practice some  interview tricks to find the Blue Ocean.

In a later article, I'll review and give reference to the Danish Gazelle studies, a very interesting body of insight for the tech transfer professional.

PS: ;-) recently, some microbiologists, I work with, told me that they don't understand the "Blue Ocean" metaphor. For them the Big Fish are close to the coastline, not in blue oceans!

(VII) Where's the Beef? Copy-Cats

This is the seventh article in the series "Where's the Beef": quick-and-dirty methods to make a go or no-go decision regarding whether or not and how to try to commercialize an invention.

Ernst Max Nielsen continues his series on "Where's the Beef?" (Click the Category on your right hand side: "Where's the Beef". The articles are numbered in Roman numbers: I, II, III etc. If you scroll down this site, you'll get the articles in reverse order)

Copy-Cats
Personally I have had a lot of benefit from using the perspectives I learnt from Porter and Pavitt’s work. The underlying assumption is that the innovator, the pioneer, will capture competitive advantages by being smarter, faster etc. Basically this is why we are interested in the ”knowledge economy”.

On the other hand, experience is a good teacher. Through my years of practice, I have come to work with cases and hear and read about other cases, which have made me doubt the blue-eyed innovation naivism of some TIM researchers. We see many cases in which the pioneer gets punished for being first.

Steven Schnaars has written an extremely insightful book (”Managing Imitation Strategies”) on how ”copy-cats” win over the pioneers, in other words that plagiarism and even outright theft of ideas (not well enough protected) and inventions is more profitable than being a pioneer. Mr. Schnaar’s gives 65 good cases to prove his point. The BIC ball point pen case is a classic, see this teaching material from Tulane .

I have tried it myself both in the loser’s and the winner’s role. In the ”Where’s the Beef” method this means that it makes sense to always think of how a good opportunity may be copied, and try to think smarter of how to prevent copying or make it too unprofitable by putting obstacles on the copy-cat road. I look for substitutes for the invention: how could the same function be performed in slightly different ways or how could the same objective be reached by totally different technologies (I call these functional and substantial substitution forms).

An interesting case is my good friend Manfred R. Kuehnle, a genius, who has been granted more than 600 patents to his name. Have a look at Daimler-Benz’ patent US5817407 and you will see that the good car-maker got  all they needed in terms of insights from working with Manfred to slightly improve his discovery and claim a new patent. Who has money to take Daimler to court?

Another good case is that of the world’s real cancer drug blockbuster, Taxol (I ask you to read the case story of Taxol, an extremely successful case from Prof Holton of Florida State University in the US ). Read how Bristol-Myers Squibb developed their own version of the technology they licensed from FSU.

Nanotechnology, the next industrial revolution, is going to cause even more such legal wrangling, see the interesting article from Lux Research about how around 3,000 US nano-patents in 2005 show ”vulnerability” for weak IP positions, thus opening the field for copy-catting.