Agile PLM - The CIO's Guide to Oracle Products and Solutions - page 15

PLM RELATED TO INNOVATION MANAGEMENT
Product life-cycle management is very closely aligned to innovation manage-
ment. Ideas for products and services have to come from somewhere. Thus, it
is the senior manager's responsibility to ensure that innovation is promoted
and managed. In this last section of this chapter, we will run through tech-
niques that can be used to get those ideas into the product pipeline.
Peter Drucker (2002), a well-known pundit in the field of business,
wrote a topic on innovation and entrepreneurship more than 20 years ago.
Drucker identified seven sources of innovation—four internal to the com-
pany and three external:
1. Unexpected occurrences (internal) : Drucker considers unexpected
successes and failures to be excellent sources of innovation because
most businesses usually ignore them. IBM's first accounting
machines, ignored by banks but later sold to libraries, is an example.
2. Incongruities (internal) : The disconnect between expectations and
results often provides opportunities for innovation. The growing
market for the steel industry, coupled with falling profit margins,
enabled the invention of the minimill.
3. Process needs (internal) : Modern advertising permitted the newspa-
per industry to distribute newspapers at a very low cost, increasing
readership (process need) dramatically.
4. Industry and market changes (internal) : Deregulation of the telecom-
munications industry created havoc in the industry but provided
ample opportunity for innovation.
5. Demographic changes (external) : Japanese businesses surveyed
changing demographics and made the determination that the
number of people available for blue-collar work is decreasing. As a
result, they have taken a leadership position in the area of robotics.
However, they are not stopping at robotics for manufacturing.
6. Changes in perception (external) : Although Americans are healthier
than ever before, according to Drucker they worry more about their
health. This change in perception has been exploited for innovative
opportunity. An example is the proliferation of web-based health
sites, such as webmd.com.