This document summarizes a presentation on combining creativity and efficiency in service innovation. The presentation discusses: 1) What service innovation is and why it is important for economic growth and competitiveness. 2) Combining customer-driven and employee-driven innovation approaches to develop new services. 3) Using foresight and futures tools to help innovators design services to meet future customer needs. 4) The need for policy support to promote service sector innovation.

1. D r. Marja Toivonen Director, Adjunct Professor BIT (Business, Innovation, Technology) Research Centre Aalto University e-mail : [email_address] A presentation on how to combine creativity and efficiency Dutch conference on Service Innovation 2 November 2010, Schouwburg Almere Innovating customer-oriented services - a central challenge for managers

7. Customer-oriented innovation at the level of individual offerings Source: Edvardsson , 1997 the perspective of the service provider and service innovation SERVICE CONCEPT Analysis of the customer’s needs and the ways in which they are met; the content and structure of the service UNIQUE OUTCOME PERCEIVED BY THE CUSTOMER UNIQUE PROCESS WHERE THE CUSTOMER PARTICIPATES PREREQUISITES the perspective of the customer and actual service provision SERVICE SYSTEM Resources: staff, physical/ technical environment, the organisational structure; customers as a resource SERVICE PROCESS Prototype of customer processes, describes the chain of activities

8. Combining innovation and systematization 8. Launch; follow-up and evaluation; continuous improvement 7. Concretising the service for the customers (brochures etc.) 6. Developing indicators for success 5. Planning the pricing systems 4. Defining the degree of ‘standardization’ 2. Defining the basic concept for the service 3. Defining the structure, process and resources for the service 1. Starting point: identifying customer needs

10. Changing the value offering point real estate planning construction selling/ main- using development renting out taining provider of goods and services Positioning oneself in the markets – examining carefully the point where the value chains of the client and the provider meet – is essential from the viewpoint of client benefit and provider profitability. The following figure describes a typical change of the value offering point in the real estate sector.

11. Supporting the customer with solution-oriented services Modified: Mathieu 2001and Cova et al. 2000 A solution is a bundle of goods, services and information, combined in a way that provides more value than the parts alone. Solutions business is long-term oriented and aims at optimizing the total cost for the customer. Individual service A solution supporting the customer A solution which takes into account the networks of the customer

13. The central role of strategy in employee-driven innovation the strategy of the organization: creating the framework for continuous renewal through the specification and re-evaluation of the goals; inspiring innovations inducing innovativeness: openness, encouragement of idea generation loosely coupled interaction structure channeling innovativeness towards strategic goals (organizational learning) management system: Source: Sundbo 1996

14. Including foresight in innovation processes ’ Here and now’ phenomena which have impact on the service to be developed Analysis of trends: probable lines of development Analysis of weak signals: improbable phenomena which are important if realized Even a limited futures working is beneficial in the innovation context, because innovations are not created for today but for the future.

15. Working with trend cards - case: future health insurance

16. Working with trends cards in an insurance company

17. Combining design and futures tools Building a 3D model of a future health insurance service in two groups: 1) representatives of the service provider and 2) representatives of customers.

21. Thank you!