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AIW: Arbeitskreis Industrie und Wirtschaft

AIW 2: AIW Industrietag 2

AIW 2.2: Invited Talk

Wednesday, April 2, 2014, 14:45–15:30, DÜL

An innovation is the conversion of a new idea into a market opportunity — •Khaled Karrai — attocube systems AG

It is a permanent challenge for high-tech companies to remain at a high level of innovativeness and continuously address new market opportunities; why is it so? C. M. Christensen, a world famous expert on innovation, argues that one central reason why it is so difficult to pursue disruptive innovation is the competition between sustained innovation and disruptive innovation strategies pursued in a company [1]. Sustained innovation strategies pursue the continuous incremental improvement of a product line and generally yield rapid tangible results aligned with the short terms financial goals of the organization; they are generally pursued as deliberate strategies from the management. They are transparent to all levels of the organization, and because they are in line with existing processes and values, they are easily accepted and implemented at all levels of the organization, and this is why they get all the resources necessary to their completion. The crucial point to understand is that although they are very attractive to manage, sustained innovation strategies are not necessarily a viable way to build new revenue streams. In contrast, disruptive innovations open up new markets and are powerful revenue streams generators. Systematic disruptive innovation strategies however cannot be easily framed into a clearly formulated deliberate plan with a predicable fast growth. Instead, disruptive innovation strategies emerge as they unravel and require frequent corrective measures. Because they require corrective measures, they are difficult to communicate and difficult to implement. The two types of strategies are definitely asymmetric, and require entirely different management approaches. Sustained innovation project plans are often linear and have a short time span yielding tangible results. Disruptive innovation plans follow sinuous, frequently looping paths and have long time-reach and not immediately tangible results. In short, it is extremely challenging to get a disruptive innovation aligned with the resource allocation processes and established values of the company. In this presentation I will discuss few examples we experienced in attocube systems AG that illustrates how disruptive innovation approaches where and are successfully opening up to new markets.

[1] C. M. Christensen: The Innovator's Solution (2003), Harvard Business School Publishing Corporation