Gig Overview

The Growth and Innovation Group

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Discover, Shape and Launch New Growth

Platforms

© 2008 THE GROWTH AND INNOVATION GROUP

Our Mission• We strive to greatly enhance the success of our

client’s New Business Innovation and Growth efforts

• By providing Training & Implementation Services

• Grounded in demonstrated Principles

• Captured in effective tools and processes

• Yielding ongoing improved capabilities

to Discover, Shape, & Launch New Growth Platforms


We help Solve Growth Issues

• Our current opportunities are too small.• We lack clear direction or strategy for

growth.• We have too many opportunities and are

struggling to direct them.• We need to improve our overall capability

for new business growth.• Our business development teams lack

tools and processes.• Etc. …04/13/23

The Growth and Innovation Group Confidential

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We are experienced practitioners & consultantsin numerous Fields :

• solar energy • bio chemicals • renewable energy• safety and security • renewable water • nano technology• chemicals • plastics • printed electronics• electronics • medical • photonics• beverages • power • transportation• construction • cleaning • adhesives• coatings • oil& gas • packaging • inks • personal care • fibers and non-wovens• paper • cosmetics • analytical services• batteries • insulation

for numerous clients :

• Hoechst AG • WL Gore & Assoc. • McKinsey & Co.• Appleton Papers Inc. • Cargill Inc. • Equistar Chemical Co.• Dow Corning Corp. • Ferro Corp. • The Dow Chemical Co.• Guinness Beer • NewPage Paper • Valmet Corp.• Sawyer LLC • Fluoro -Seal Intl. L.P. • Materia Inc.• Genomatica Inc. • Allylix Inc. • Invista Inc.


Does your company need to go beyond the “incremental” and develop whole New Businesses?

“Some 70 percent of corporate leaders say innovation is among the top three priorities for driving growth.”

“How Companies Approach Innovation: A McKinsey Global Survey”, mackinseyquarterly.com, October 2007.

“Breakthrough Innovations that are marketable matter the most.”


“…breakthrough innovation. Every executive we’ve spoken with in the past ten years wants it. The trouble is they don’t know how to make it happen.”

Although many desire growth through New Businesses – few are confident in their approach….

“Grabbing Lightning” Gina C. O’Connor et.al. 2008 John Wiley & Sons Inc.


Copyright Hatfield Group LLC

The track record is not impressive……..

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1 2 3 4 5 6 7

Stage

3000 Raw Ideas

300 Ideas Submitted

125 Small Projects

9 Large Devel.

4 Major Devel.

1.7 Launches

1 Success

WinOvations Inc. Reference: G. Stevens and J. Burley, “3000 Raw Ideas = 1 Commercial Success!” Research • Technology Management, 40(3): 16-27, May-June, 1997.


And it is clear that new approaches are required……

“Business and market needs and opportunities should be evaluated in concert with technological possibilities– and this needs to happen early, when strategies are first being developed.”Expanding the Innovation Horizon, The Global CEO Study 2006, IBM GLOBAL Business Services


GIG’S Principles for reduced risk and enhanced returns

1. Develop New Business opportunities by systematically identifying and reducing a defined set of uncertainties in 3 domains.

2. Develop New Business opportunities as New Business and Offering Platforms, i.e. groups of opportunities with real synergies that enable rapid market testing and can be developed in phases or steps over time.

3. Identify and develop new business opportunities that lie beneath a market discontinuity that can be addressed by company capabilities.

4. Minimize financial exposure of a new business opportunity by flexibly outsourcing or partnering capabilities that lie outside capabilities critical to competitive advantage.

5. Develop or adapt your existing Business Model and organizational design to new business development including: processes & tools, structure and staffing, competencies and capabilities, and culture.


Our principles for reduced risk and enhanced returns



Time

Start-up

Growth

Maturity and Decline

Growth and RenewalCash Flow

Higher RiskHard To Identify,

implement:New BusinessDevelopment

Lower riskEasier to identifyOpportunities:Line Extensions

Renewal


New Business Development has significant uncertainties, however they fall into predictable categories.

Mark P. RiceF. W. Olin Graduate School of BusinessBabson CollegeOlin Hall 242ABabson Park MA 02457Gina Colarelli O’Connor*Rensselaer Polytechnic InstituteLally School of Management and TechnologyPittsburgh Building #2214110 Eighth StreetTroy NY 12180Richard LeiferRensselaer Polytechnic InstituteLally School of Management and TechnologyPittsburgh Building #2110110 Eighth StreetTroy NY 12180

A COMPREHENSIVE MODEL OF UNCERTAINTY ASSOCIATED WITH RADICAL INNOVATION


Multidimensional Study of Uncertainty

• “The model incorporates the commonly used sources of uncertainty: technical and market uncertainty, but adds two others: organizational and resource uncertainty. Each of these four categories is further distinguished via two additional dimensions: criticality and latency.


GIG captures these uncertainties in a simple model:

Market Uncertainties:•Is there a market opening?•Is there a market need?•Is there significant value?•Can that value be captured?

Offering Uncertainties:•Can we create offering?•Can we produce offering?•Do offerings uniquely satisfy market needs? •Do offerings have a sustainable competitive advantage?

Business Fit Uncertainties:• Does organization have needed capabilities?• Does organization have needed support?• Do projects match required returns, risk , and

strategic intent boundaries?

We look at each opportunity holistically and manage the critical uncertainties in steps…

BusinessOpportunity


Uncertainty is systematically reduced through Hypothesis Directed Learning – an interdependent, iterative, and disciplined learning process, with useful tools•A new business opportunity can be described by a finite and

consistent set of hypotheses, using the uncertainty categories. We provide the categories and develop the content into hypotheses trees.

•A level of validity can be assigned to each hypothesis based on our current level of knowledge and the source of this knowledge. We provide a level of validity model system proven over many projects.

•A prioritized set of critical uncertainties can be defined based on the hypotheses with the highest impact on value and the lowest level of content resolution or validity. We provide simple tools to rapidly identify the most critical uncertainties.

•Action items can be designed and implemented to address the critical uncertainties.


Copyright 2007 The Hatfield Group LLC GIG Confidential

Three Tools for Hypothesis Directed Learning

The Business Platform Map

The Project Hypotheses

The Hypotheses Tree

Is this a valid NewBusiness Platform?

Understand andidentify critical issues

In key projects

• Prioritize critical issues across platform

• Set action plan to resolve with milestones

• Assign resources across the platform

• Each key project is described by 12 hypotheses that cover business fit, opening and need, and advantaged offering

• Each hypothesis is assigned a level of validity based on consistent criteria and impact on value

• Hypotheses are prioritized within project s into critical issues based on validity and impact on value

Each objectIs a project

Create Prioritized Action Plan across

the platform

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1. The Opportunity Hypothesis

2. The market discontinuity with S-Curves

3. Market Need4. Market Opening5. Competitive Advantage6. Understanding of

Functional requirements7. Ability of Offering to satisfy

Functional Requirements8. Price9. Volume10. Manufacturing Cost11. Non Manufacturing Cost12. Timing to first $ 100K

sales

The New Business Platform Hypothesis

The Project Hypotheses

The Hypotheses Tree

Is this a valid NewBusiness Platform?

Understand andIdentify critical issues

In each project

Prioritize criticalIssues and resourcesAcross the platform

Note: Each circleAnd square is a

Project

Hypothesis Directed Learning


These Principles and tools are captured in three processes that Discover, Shape, and Launch New Business Platforms

Process Input OutputBusiness Platform Discovery

Broad and incomplete concepts of potential advantaged offerings, industries where they can be applied, business models that could be used

Partially validated and highly robust Business Platforms due to multiple iterations with market opinion leaders and a broad range of capability experts

Business Platform Shaping


Validated Business Platforms across 11 hypotheses through multiple market interviews across the value chain and design experiments across critical offering and manufacturing hypotheses

Business Platform Launch


Initiated Business Platforms with key internal capabilities, critical partnerships, early stage customers, initial offerings, and development agreements in place.



1. Develop New Business opportunities by systematically identifying and reducing a defined set of uncertainties.



New Business Platforms Allow:

• Synergistic development of Offerings

• Robustness: Multiple Projects, Offerings

• Significant Value: Typically value comes in long term projects

• Timely Value: Short term projects linked to long term projects

Net Result: Greater Value, Lower Risk


GIG’s New Business Platform Map Tool:

•Allows for multiple projects within an offering platform including relative value or attractiveness and time and multiple offerings

•Captures the level of uncertainty or validity of each Project•Describes the level of resourcing within the Platform

Each Project must address all

uncertainties!





3. Identify and develop new business opportunities that lie beneath a market discontinuity that can be addressed by company capabilities


Industry Discontinuities: A Pre-requisite to Successful Business Platforms

Business Platforms aligned to Market Discontinuities are:

•Significant in Value: Underneath Market Discontinuities multiple market openings and unmet needs are present •Robust: Open space for both Offering development and protection

•Timely and lower cost for entry: New entrants are “pulled into” the market versus fighting incumbents.


GIG utilizes S-Curves as a tool to identify and describe Discontinuities across value chains


The high level flow of how GIG consistently discovers robust new Business Platforms:

Search for market discontinuities where advantaged offerings can potentially fit……..

Underneath the Discontinuities lie multiple openings and needs. Flexibly shape advantaged offerings to meet openings and needs and create projects….

Projects are then linked for synergistic development into Business and Offering Platforms for Validation and Implementation








Competencies and Capabilities

• We can work with management and program teams to identify current capabilities and core competencies.

• We hypothesize new capabilities and competencies that maybe required based on strategic direction and project/portfolio content. Then address each on a case-by-case basis.







5. Develop or adapt your existing Business Model and organizational design to new business development including: processes & tools, structure and staffing, competencies and capabilities, and culture.


These Principles and tools are captured in three processes that Discover, Shape, and Launch New Business Platforms

Process Input OutputBusiness Platform Discovery

Broad and incomplete concepts of potential advantaged offerings, industries where they can be applied, business models that could be used


Business Platform Shaping



Business Platform Launch


Initiated Business Platforms with key internal capabilities, critical partnerships, early stage customers, initial offerings, and development agreements in place.


Yet the literature tells us more is needed beyond Process to succeed…….

“Emphasis must shift: from ideas to execution and from leadership excellence to organizational excellence.”

Building Breakthrough Businesses Within Established Organizations, by and Vijay Govindarajan and Chris Trimble Harvard Business Review May 2005


GIG: A Holistic Approach to New Business Development

Four Elements for Effective Organizational Design

Integrated at three levels of the Organization


GIG provides tools to optimize Organizational Design

Design Element

Issues Addressed Tools

Growth Strategy • Types of Growth Desired• Goals: Size, Value, Timing• Capabilities to be Leveraged• Markets to be addressed• Business Fit Boundaries• A believable vision of how it all fits

together

Workshop format at desired level of organization

Organizational Structure

• Best Practices Organizational structure at each level of organization

• Desired linkages between levels and between current and new business development organizations

Seminar and workshop format with key leadership at desired organizational level

Job Design • New roles required for successful new business development

• Skill and Competency profiles• Training requirements

Generic Job descriptions, skill, and competency profiles for new roles provided and customized to companies specific HR practices. Training courses provided.

Business Culture • Identifying measurable behaviors required for New Business Development

• Benchmarking organization• Culture transformation activities

• Seminar on effective behaviors and supporting research

• Benchmark surveys


Portfolio View: Risk vs Return

Model PortfolioSize = NPV in MMUSD

$7.4 MM

$42.8 MM

$5.4 MM

$24.4 MM$6.5 MM

$21.4 MM

$3.7 MM

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10.0

15.0

20.0

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Value Risk

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Platform 1

Platform 6

Platform 7

Platform 2

Platform 4

Platform 3

Platform 5


GIG is capable of augmenting your organization’s capabilities by doing content work…..

OR

Building these processes into your organization by teaching the processes while doing projects with your people

Getting Started: Implementation Options


Getting Started: Some options

• Choose a project you want done• Choose a process you want to try:

Discovery or Shaping • Align a current portfolio and check the

critical uncertainties.• Pick an Organizational Design issue you

want to fix• Do some diagnostics

– Informal driven by a few leaders– Formal with cross functional leadership teams


Getting started

• Contact us:– Dave Cornelius:

[email protected] or 843-290-6020

– Dave Hatfield: [email protected] or 989-631-3332

04/13/23The Growth and Innovation Group

Confidential36