This document provides an in-depth analysis of Samsung's approach to innovation and how they use it to gain competitive advantage. It discusses Samsung's use of a systematic innovation process called "3T", which includes technology roadmaps, technology trees, and the TRIZ methodology, to continuously achieve technology breakthroughs. This allows Samsung to consistently outperform competitors and drive strong financial and market performance through increased patents, stock performance, and market share. Their focus on quality underpins their innovation success.
2. PREVIOUS COMPETITIVE
INTELLIGENCE REPORTS
November 2013: PREVIOUS VERSIONS OF SAMSUNG COMPETITIVE INTELLIGENCE
REPORTS ON THEIR INNOVATION CAPABILITIES
1. IS ONLY AVAILABLE VIA THE INTEL INTRANET, AND REMAINS
THE PROPERTY OF INTEL
2. PUBLISHED IN 2010 PUBLICLY AVAILABLE AT
http://www.slideshare.net/rplatt/systematic-corporate-innovation-methods-overview
THE 2ND REVISION CONTAINS INFORMATION ON PRODUCTS THAT EMPLOYED SAMSUNG’S UNIQUE
APPLICATION OF THE TRIZ METHODOLOGY.
THIS 3RD VERSION IS AN IN DEPTH ANALYSIS ON THE ACTUAL APPROACH THAT SAMSUNG USES AND HOW
THEY USE IT TO GAIN COMPETITIVE ADVANTAGE IN THE MARKETPLACE
Revision History:
Confidential | The Strategy + Innovation Group
2
3. MANAGING INNOVATION
INTELLIGENTLY
“Superior results, in most cases, seem to be
a function of the quality of an organization’s
innovation process — the bets it makes and
how it pursues them — rather than the
magnitude of its innovation spending”
- Strategy Week
Copyright Protected | Property of the Strategy + Innovation Group
6. TOP 5 COMPLAINTS ABOUT
CORPORATE INNOVATION
1. “Companies invest too much on incremental improvement
and not enough in true innovation”
2. “The best ideas come from outside the company and not
from within”
3. “Companies let fatally flawed ideas drag on too long before
killing them” (intentional internal mortality rate is <10%)
4. “Innovation budgets are NOT directed by the most
promising projects but the ones with Key Sponsorship”
5. “Innovations are NOT prioritized, and resource allocation
doesn’t match priority when when they are”
Source: Anthony Carter Motorola Corporate Innovation Champion - Innovation Conference Chicago (2007)
Confidential | The Strategy + Innovation Group
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7. WHY INNOVATION FAILS
▪CREATING A HIGH-POTENTIAL INNOVATION IS NOT ENOUGH;
• ACTIONS TAKEN TO COMMERCIALIZE INNOVATION CRITICALLY IMPACT THE
ULTIMATE VALUE CREATED
▪MANY INNOVATIONS ARE INHERENTLY SHAPEABLE, BUT PRESSURES
TEND TO FORCE THEM TOWARDS LARGER, MORE DEMANDING
OPPORTUNITIES EVEN WHEN NOT APPROPRIATE
▪IMPATIENCE FOR GROWTH, LEADS TO:
• MOVES AWAY FROM HIGH-POTENTIAL DISRUPTIVE FOOTHOLDS TO TARGETING
DEMANDING, COMPLICATED AND COMPLEX OPPORTUNITIES
• EARLY TECHNOLOGICAL LOCK-IN, CAN MAKE IT HARD TO ADAPT TO MARKET
SIGNALS
• WORKING ON TECHNOLOGIES THAT HAVE HIGH DEGREES OF UNCERTAINTY AND
UNKNOWNS
Confidential | The Strategy + Innovation Group
Source: Anthony Carter Motorola Corporate Innovation Champion - Innovation Conference Chicago (2007) 7
8. POLITICALLY INCORRECT REASONS
(BUT NO LESS TRUE)
▪ORGANIZATIONAL / PERSONAL BIASES
• HIPPOS (HIGHLY PAID PERSON WITH AN OPINION) , NIH, STATUS QUO
PREFERENCE, POLITICAL DECISIONS INSTEAD OF DATA DRIVEN, SILOING
▪PREJUDICES (A.K.A. PSYCHOLOGICAL INERTIA)
• TESTING ONLY KNOWN HYPOTHESES
▪ORGANIZATIONAL DYSFUNCTION
• TOXIC ENVIRONMENT, TOXIC BOSSES / COLLEAGUES, DYSFUNCTION
BECOMES SYSTEMIC TO THE ORGANIZATION (PART OF THE CULTURE)
▪IGNORANCE OF SYSTEMATIC INNOVATION METHODS
▪NO INNOVATION MANAGEMENT PROCESS
Confidential | The Strategy + Innovation Group
Source: Richard Platt ex-Intel Corporate Innovation Champion from 10 year study of obstacles to corporate
innovation (2012) 8
9. WHY INNOVATION FAILS
▪INSUFFICIENT TIME OR FOCUS ON IDENTIFYING THE RIGHT
CUSTOMERS
▪INSUFFICIENT ORGANIZATIONAL SEPARATION
• COMPANY CULTURE / VALUES
• ONLY LARGE OPPORTUNITIES GET PRIORITIZED
• APPLY RIGOR OF NORMAL PROCESSES AND DISCIPLINE TOO EARLY
• FAILURE (EXPERIMENTATION) NOT ENCOURAGED
▪UNREALISTIC EXPECTATIONS
▪ LEADS TO CHANGE IN PLANS, PREMATURELY
▪ LACK OF KNOWLEDGE IN HOW INNOVATION WORKS OR IS MANAGED
Confidential | The Strategy + Innovation Group
Source: Anthony Carter Motorola Corporate Innovation Champion - Innovation Conference Chicago (2007) 9
10. “INNOVATION MANAGEMENT BREAKDOWN” IS
THE #1 REASON FOR GROWTH SLOWDOWN
Source: Corporate Executive Board
Confidential | The Strategy + Innovation Group
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11. THE HYPE CYCLE AND FAILURE
THE REAL REASON A LOT OF INNOVATION STRATEGIES
FAIL ISN’T BECAUSE OF A DEARTH OF GOOD IDEAS OR TALENT,
IT’S BECAUSE OF 5 THINGS INHERENT IN A LOT OF
ORGANIZATIONS. IN DESCENDING ORDER OF IMPORTANCE.
5. TURNOVER COUPLED WITH LEADERSHIP VACUUM
4. RED TAPE/POLITICS/HIDDEN AGENDAS
3. LACK OF BELIEF OR BUY IN FROM LEADERSHIP
2. POOR PLANNING AND BAD EXECUTION
1. CULTURE (IF IT EATS STRATEGY IT EATS INNOVATION TOO)
Source: http://directmarketingobservations.com/2011/08/05/why-digital-strategies-fail/
Confidential | The Strategy + Innovation Group
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12. RITA GUNTHER-MCGRATH ON
“SEEING INNOVATION IN STRATEGIC
TERMS”
Confidential | The Strategy + Innovation Group
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“CORPORATIONS TEND TO HAVE A NARROW DEFINITION OF INNOVATION”
THEY MISTAKE INVENTION FOR INNOVATION - INNOVATION IS
SOMETHING NEW THAT CREATES VALUE:
• WAYS OF WORKING (PARADIGM)
• SYSTEM PROCESSES (PROCESS)
• BUSINESS MODELS (POSITION)
• PRODUCTS / SERVICES (PRODUCT)
• AND THEN THERE IS THE COMBINATION OF THE ABOVE
13. CLEAR EXAMPLE ON INNOVATIVELY
DISRUPTIVE
Confidential | The Strategy + Innovation Group
Napster
iPod +
iTunes
COMPARISON BETWEEN BUSINESS MODEL
EVOLUTIONARY TRENDS OF NAPSTER AND APPLE
13
14. 14
1. INNOVATION IS THE CONVERSION OF KNOWLEDGE INTO NEW
PRODUCT AND/OR SERVICE THAT PROFITABLY MEETS THE NEEDS
OF CUSTOMERS
• IN BUSINESS TERMS: IF IT DOESN’T GET TO MARKET AND
DOESN’T MONETIZE IT’S JUST AN INVENTION
• IN NON-PROFIT TERMS: AN INNOVATION MUST SERVE;
ADMINISTRATORS, END-USERS, CUSTOMERS, SPONSORS AND
DONORS
CORPORATE SUSTAINABILITY: INNOVATION
SUCCESS AND SURVIVAL - KEY: #1
Societal
Need
Confidential | The Strategy + Innovation Group
15. 15
2. IT IS NOT A ONE-OFF EVENT, BUT A CONTINUING
RESPONSE TO CHANGING CIRCUMSTANCES, IT’S THE
STORY OF EVOLUTION, “ADAPT OR DIE”
• INNOVATION IS ABOUT CHALLENGING THE STATUS QUO WITH A BETTER
SOLUTION
• CREATING NEW HYPOTHESES ON HOW TO MEET A CUSTOMER NEED
(THE JTBD)
CORPORATE SUSTAINABILITY: INNOVATION
SUCCESS AND SURVIVAL - KEY: #2
Creativity
Confidential | The Strategy + Innovation Group
16. Effects of implementing an ICMM
• Managed Process for Innovation
• Increase in Customer Loyalty
• Increase in Quality
• Increase in Predictability
• Increase in Profitability
• Decrease in Risk
Level -3: Undermining
Level -2: Contemptuous
Level -1: Obstructive
Level 0: Negligent
Level 1: Initial
Level 2: Defined
Level 3: Implemented
Level 4: Managed
Level 5: Adaptive
Risk
Profit
ICMM helps to
combat Bias
Prejudice and
Organizational
Dysfunction
INNOVATION CAPABILITY MATURITY
MODEL INDEX
Confidential | The Strategy + Innovation Group
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17. Level 1: Initial – Hero Stage
Level 2: Repeatable -
Project Management
Level 3: Implemented –
Engineered Process
Level 4: Managed –
Product & Process
Quality
Level 5: Adaptive –
Innovation Management
& Defect Prevention
Project
Risk
Productivity
and
Quality
Disciplined
Standard, Consistent
Predictable
Continuously
Improving
Beginning of a system
Good system
Excellent system
World Class system
Confidential | The Strategy + Innovation Group
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Occasional
Innovation
Frequent
Innovation
Innovation
Culture
Permanent
Innovation
Time
INNOVATION CAPABILITY MATURITY
MODEL INDEX
18. The Corporate
Innovators
▪ FEW COMPANIES IN HIGH TECH ACTUALLY
KNOW HOW TO INNOVATE SYSTEMATICALLY
AND SYSTEMICALLY BUT THOSE THAT DO,
DRIVE THEIR STRATEGIES ACCORDINGLY
▪ THEY USE METHODS, POLICIES, TRAINING AND
RULES TO GUIDE ORGANIZATIONAL BEHAVIOR
AND ACTIONS (THE CULTURE)
▪ THEY SEEK TO WIN AGAINST COMPETITORS
AND SOME ARE VERY AGGRESSIVE
Confidential | The Strategy + Innovation Group
23. Key Question: “How is Samsung able to CONSISTENTLY do this?”
SAMSUNG STOCK PERFORMANCE
1053% Increase
Confidential | The Strategy + Innovation Group
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24. METRICS: PATENTS ISSUED AND APPLICATIONS
0
500
1000
1500
2000
2500
3000
# ofPatents
1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Year
Samsung Electronics Co Ltd Patents Issued & Applied For
PatentApplications
Patents Issued
Key Question: What did Samsung do in ‘97 and ‘01 to increase patent
submissions?
~2x jump
~2X Jump in
2 years
Patent Metrics:
Submissions are a
leading indicator of
innovativeness.
Patents are a
lagging indicator
~600% Jump in 6 years
Source: www.uspto.gov
Confidential | The Strategy + Innovation Group
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25. ▪EARLY SAMSUNG WAS CONSIDERED A “COPY CAT” WHO MADE
MARGINAL PRODUCTS, CERTAINLY NOT AS AN INNOVATOR OR
RECOGNIZABLE AS A QUALITY BRAND
▪“WAKEUP” CALL CAME IN 1995 WHEN THE VP OF THE
SAMSUNG CELL PHONE DIVISION WAS SO ASHAMED OF THE
ABYSMALLY POOR CELL PHONES THAT HE’D GIVEN AWAY TO
FRIENDS, THEY HELD A BONFIRE BURNING ALL CELL PHONES IN
INVENTORY, THEN BULLDOZED THE ASHES
▪SAMSUNG COMMITTED THEMSELVES TO IMPROVING THE
QUALITY OF THEIR PRODUCTS, THUS BEGAN THEIR JOURNEY
BONFIRE IN THE PARKING LOT
Confidential | The Strategy + Innovation Group
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26. IN-DEPTH ARTICLES ON SAMSUNG’S RISE
“How Samsung Became the World's No. 1 Smartphone
Maker”
(http://www.businessweek.com/printer/articles/105080-how-samsung-became-the-worlds-no-dot-1-
smartphone-maker)
“Behind Samsung's push to rule the world”
(http://www.cnet.com/news/behind-samsungs-push-to-rule-the-world/)
“Lessons From Samsung's Chairman Lee: Sometimes It
Takes A Match”
(http://readwrite.com/2013/03/28/lessons-from-samsungs-chairman-lee#awesm=~oCb5LqfTnCXSHj_)
Confidential | The Strategy + Innovation Group
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28. WHY IS THIS IMPORTANT?
▪COST INEFFICIENCIES OF QUALITY ARE MEASURED BY THE
COST OF NOT CREATING A HIGH-QUALITY PRODUCT OR
SERVICE.
▪WHEN A COMPANY MISSES THE HIGH-QUALITY MARK,
THERE ARE CASCADES OF RESULTS THAT CAN BE MISSED
EASILY IF NO ONE IS FOCUSING IN ON, OR AWARE OF, THE
AREAS WHERE THE EFFECTS WILL BE FELT MOST.
▪PERFECTED QUALITY SUPPORTS A HEALTHY PROFIT, AND
DOES NOT HAVE UNINTENDED COSTS ATTACHED - WHILE
FALLING SHORT OF QUALITY CAN SET A CASCADE OF
EXPENSES INTO MOTION.
28
Confidential | The Strategy + Innovation Group
29. Designed in
Quality
Problems
70-80%
Manufacturing
Defects 20-30%
MANY RECOGNIZE COSTS SURGE WHEN A COMPANY HAS TO MOVE TO
RECTIFY DELIVERY OF POOR QUALITY TO THEM FROM SUPPLIERS OR EVEN
FROM THEMSELVES TO THEIR CUSTOMERS
MOST PROBLEMS ARE DESIGNED IN
29
Confidential | The Strategy + Innovation Group
Relative Cost and/or Difficulty
to Correct a Problem
30. COST OF “NOT GETTING IT RIGHT”
TO THE MARKET
NOT DELIVERING A PRODUCT TO MARKET THAT FITS ACTUAL WANTS AND NEEDS
IS TYPICALLY UNRECOGNIZED AS A “COST OF POOR QUALITY” IN DESIGN
▪ COSTS OF LABOR TO AMEND THE PROBLEM (NEXT GEN REDESIGN COSTS AND RECALL
COSTS)
▪ COSTS OF ADDITIONAL MATERIALS NEEDED (MORE MATERIAL EXPENDITURE THAN
ORIGINALLY BUDGETED)
▪ COSTS OF ADDITIONAL UTILITIES USED (TO BUILD ANOTHER PRODUCT THAT ISN’T WHAT THE
MARKET WANTS / NEEDS)
▪ COSTS OF LOST OPPORTUNITIES (LOSE CUSTOMERS BECAUSE YOUR COMPANY IS VIEWED
AS INCOMPETENT / INCAPABLE – SEE BLACKBERRY)
▪ LOSS OF SALES/REVENUE (PROFIT MARGIN DECREASE)
▪ POTENTIAL LOSSES OF MARKET SHARES (ANALYSTS POV AND FORECASTS AREN’T HIT)
▪ LOWERED SERVICE LEVELS TO CUSTOMERS (DISAPPOINTMENT BY CUSTOMERS ONLY
PUSHES THEM TO ANOTHER PROVIDER)
30
Confidential | The Strategy + Innovation Group
31. PROCESS APPROACH TO
INNOVATION STRATEGY AT
PRODUCT & TECHNOLOGY LEVELS
31Source: www.osaka-gu.ac.jp/php/nakagawa/TRIZ/eTRIZ/elinksref/eNews2003/eJapanIM-UGM031209.html
SAMSUNG ADDRESSES GAPS FOUND IN R&D ACTIVITIES EFFECTIVENESS AND
IMPLEMENTED WHAT THEY CALL A “3T” APPROACH - USING WHAT GE HAD DONE
WITH SIX SIGMA AND ANALYZED IT FOR GAPS APPLYING IT 1ST IN R&D
GOAL: TO USE A STANDARDIZED AND RIGOROUS PROCESS TO GET “TECHNOLOGY
BREAKTHROUGHS”, CONTINUOUSLY AND REPEATEDLY
▪ T1 -TECHNOLOGY ROADMAPS: – Process establishing an integrated
strategy
▪ T2 - TECHNOLOGY TREE: Process establishing the Action Plan to the
individual contributor level
▪ T3 - TRIZ: Process and methodology to generate conceptual solutions.
Confidential | The Strategy + Innovation Group
35. SAMSUNG STANDARD DESIGN FOR SIX SIGMA (SS DFSS) PROCESS
TIGHTLY COUPLES STRATEGY, CONCEPT ENGINEERING AND
TECHNOLOGY DEVELOPMENT
35Source: www.osaka-gu.ac.jp/php/nakagawa/TRIZ/eTRIZ/elinksref/eNews2003/eJapanIM-UGM031209.html
• SS DFSS IS A 2ND GENERATION 6 SIGMA METHODOLOGY
• ABLE TO INCREASE SPEED OF PRODUCT DEVELOPMENT. –
SPECIFICALLY CELL PHONE NPD CYCLE WENT FROM 16 TO
5 MONTHS
• SS DFSS IS BASED OFF OF GE DFSS + TECHNOLOGY
ROADMAP + TRIZ + SYSTEMATIC TECHNOLOGY
MANAGEMENT TOOL (TECHNOLOGY TREE)
Confidential | The Strategy + Innovation Group
STANDARD DFSS DETAILS
36. 36
Source: www.osaka-gu.ac.jp/php/nakagawa/TRIZ/eTRIZ/elinksref/eNews2003/eJapanIM-UGM031209.html
*Note: conversation with Samsung Engineer at Malaysian innovation conference in 2006
▪ SAMSUNG IS ABLE TO LEAP UP AND ACROSS THE S-CURVE
OF PRODUCT DESIGN AND PROCESS PERFORMANCE BY
USING TRIZ TO GET BREAKTHROUGHS AND
IMPROVEMENTS
▪ SAMSUNG REQUIRES ALL PATENT FILINGS BY ENGINEERS
TO RESOLVE A MINIMUM OF 2 CONTRADICTIONS IN A
DESIGN PER PATENT SUBMISSION*
▪ SYSTEMATIC TECHNOLOGY MANAGEMENT TOOL THEY
CALL TECHNOLOGY TREE IS USED TO INCREASE INTERNAL
PROCESS DEVELOPMENT SPEED
Confidential | The Strategy + Innovation Group
STANDARD DFSS DETAILS
38. 4TH GENERATION R&D: “TRIZ IS A REVOLUTIONARY CONCEPT THAT
EMPHASIZES THE DEVELOPMENT OF VALUE-INNOVATED MARKET-DOMINANT
PRODUCTS. THE MAIN FOCUS IS TO IDENTIFY THE POTENTIAL CUSTOMER
NEEDS AND THEN EVALUATE THE R&D FROM THE BUSINESS DEVELOPMENT
POINT OF VIEW. THE SAIT FOCUSES ON ESTABLISHING 4G RESEARCH AND
INNOVATION SYSTEMS BY (IMPLEMENTING) CONDUCTING R&BD (RESEARCH
& BUSINESS DEVELOPMENT) FOR BOTH TECHNOLOGICAL INNOVATION AND
VALUE INNOVATION.”
SIX SIGMA FOR RESEARCH IN INNOVATION: “COMMITTED TO DOING THE
RIGHT THINGS THE RIGHT WAY, SAIT INTEGRATES SS DFSS WITH
RESEARCH. WHILE SIX SIGMA IS COMMONLY KNOWN AS A METHODOLOGY
FOR IMPROVED EFFICIENCY IN MANUFACTURING INDUSTRIES, SAIT APPLIES
SIX SIGMA INNOVATION TO R&D TO ENHANCE RESEARCH PRODUCTIVITY AND
CREATE CUSTOMER VALUE WITH RIGHT R&D”
38
Source:4th Japanese IMC Users Conference. 9-10-03 www.osaka-gu.ac.jp/php/nakagawa/TRIZ/eTRIZ/elinksref/eNews2003/eJapanIM-UGM031209.html
Source: (SAIT website) www.sait.samsung.co.kr/sait/src/saitEnIndex.html
R&D AND QUALITY STRATEGY
Confidential | The Strategy + Innovation Group
39. RESOURCES DEPLOYED
SAIT (Samsung Advanced Institute of Technology)
50 Full-Time TRIZ experts (Russian & Korean)
▪ 6 full-time Russian TRIZ experts known
Source: Fortune article on Samsung Value Improvement Program
Key Messages:
▪ Brought in TRIZ experts to build
expertise, training & infrastructure
to deploy TRIZ
▪ TRIZ now part of "Basic
Technology training“ - considered
essential engineering skill
Samsung Group of TRIZ specialists and SAIT CEO
Mr. Wook Sun – 2002
Source: http://shpackovsky.narod.ru/consulting_en.html
TRIZ*
(Starting
in 2000)
39
Confidential | The Strategy + Innovation Group
41. EARLY WARNING TECHNIQUE:
“TRIZ has an important role in the organization and
management of SAIT’s (Samsung Advanced Institute of
Technology) R&D.”…
“SAIT uses it (TRIZ) to keep track of areas in which patent
portfolios are building up.”
It is SAIT’s job to identify and explore the potentially disruptive
technologies – “biotechnology and nanotechnology are
strong candidates.”
- Dr. Rim Kwan (former) President of Samsung Advanced Institute of Technology
41
Source: Interview with the President of SAIT, Dr. Rim, Kwan. Oct 2001
www.iee.org/OnComms/sector/management/PN_Article.cfm?objectID=71C08614-5EA0-4A92-8646785621F535C9&method=download
DISRUPTIVE STRATEGIES:
SAMSUNG ADVANCED INSTITUTE
OF TECHNOLOGY SAIT
Confidential | The Strategy + Innovation Group
42. GAP IDENTIFIED IN NEW TECHNOLOGY DEPLOYMENT PLANNING:
▪DURING PLANNING MARKET RESEARCH / BIZ PLAN DIDN’T INCLUDE OR
UNDERSTAND SPECIFIC TECHNOLOGY STRATEGY OR ISSUES FOR
HVM AND R&D, NOR THE OPPORTUNITY THAT NEW TECHNOLOGY
THAT CAN ACTUALLY DRIVE THE MARKET (KNOWN AS TECHNOLOGY
HISTORY), ALL OF WHICH CAN IMPACT PLANS AND OUTCOMES.
T1 NEW CAPABILITY: COMPREHENSIVE INTEGRATED
BUSINESS AND TECHNOLOGY DEVELOPMENT STRATEGY
42
Source: www.osaka-gu.ac.jp/php/nakagawa/TRIZ/eTRIZ/elinksref/eNews2003/eJapanIM-UGM031209.html
ASKED THE QUESTION
OF HOW TO REINFORCE
STRATEGY
Confidential | The Strategy + Innovation Group
44. INNOVATION PROCESS
ACTION PLAN
▪ TECHNOLOGY TREE COMBINES WITH QFD (QUALITY FUNCTION
DEPLOYMENT)
▪ SAMSUNG RECOGNIZES THAT ENGINEERS MAY NOT KNOW
EVERYTHING THEY NEED TO BE SUCCESSFUL
• CTQ (CRITICAL TO QUALITY CHARACTERISTICS) FUNNELS INFORMATION ON
CUSTOMER NEEDS AND TECHNOLOGY SPECS BETWEEN MARKETING,
RESEARCH AND HVM ENGINEERS
44
T2 TECHNOLOGY TREE: PROCESS TO ESTABLISH THE ACTION
PLAN: HIERARCHY OF INFORMATION AND BREAKOUT OF TASKS
BETWEEN THE MARKETING, R&D, TD AND HVM DOWN TO THE
INDIVIDUAL LEVEL
Source: www.osaka-gu.ac.jp/php/nakagawa/TRIZ/eTRIZ/elinksref/eNews2003/eJapanIM-UGM031209.html
Key Message:
Result is a concrete action plan between the different disciplines & groups
Confidential | The Strategy + Innovation Group
45. INNOVATION STRUCTURE – T2
Source: www.osaka-gu.ac.jp/php/nakagawa/TRIZ/eTRIZ/elinksref/eNews2003/eJapanIM-UGM031209.html
45
Confidential | The Strategy + Innovation Group
46. ▪ SAMSUNG RECOGNIZED NEED FOR IDEA / CONCEPT GENERATION
METHODS AND FOR COMPOSING PARTIAL CONCEPTS INTO SOLUTIONS.
• EXISTING METHODS: BRAINSTORMING, SIX THINKING HATS TRIGGER IDEA
SHARING & DISCUSSION, BUT INSUFFICIENT FOR CONCEPT GENERATION.
▪ TRIZ IS A METHODOLOGY WITH TOOLSETS FOR CONCEPT
GENERATION; PUGH CONCEPT METHOD IS USED TO SELECT
CONCEPTS AND COMBINE PARTIAL CONCEPTS
46
T3 TRIZ: Process and methodology to generate conceptual
solutions.
Source: www.osaka-gu.ac.jp/php/nakagawa/TRIZ/eTRIZ/elinksref/eNews2003/eJapanIM-UGM031209.html
Key Message:
Concept generation incorporated into Quality for R&D process and strategy
Confidential | The Strategy + Innovation Group
CLOSING THE USUAL
WEAK POINTS OF DFSS
48. SAMSUNG’S USE OF TRIZ ACROSS THE CHEABOL
48
Source: http://www.koreatrizcon.kr/files/O-5%28Full%29.pdf
Confidential | The Strategy + Innovation Group
50. DISPLAY DIVISION (SMD)
▪ 7/2/12: SAMSUNG CONSOLIDATED THEIR DISPLAY MANUFACTURING BUSINESS BY
COMBINING THE ENTITY ONCE KNOWN AS SAMSUNG MOBILE DISPLAY (SMD) WITH THE
COMPANY’S S-LCD UNIT TO CREATE THE SINGULAR ENTITY SAMSUNG DISPLAY.
▪ THE MERGER MAKES SAMSUNG DISPLAY THE LARGEST MANUFACTURER OF DISPLAY
GLASS IN THE WORLD WITH 39,000 EMPLOYEES AND 7 FACTORIES NOW SET TO FOCUS
ON LCD AND OLED PRODUCTION.
Source: http://phandroid.com/2012/07/02/samsung-display-born-of-samsungs-mobile-display-and-s-lcd-units/
http://www.asymco.com/2012/12/03/samsung-electronics-product-line-revenues-and-operating-income-in-context/
Confidential | The Strategy + Innovation Group
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51. TECHNOLOGY PREDICTION
BASED ON “TREND OF EVOLUTION” LINES
▪Systems progress on S-
Curve of key parameters
▪Components and the
interactions between them
evolve along certain lines
▪Evolution also occurs
between system and
super-system
▪Evolution Analysis help
predict “future stages”
TS0
Main
parameter
Time
E v o l u t I o n o f TS*
TSn
TS1
TS2
TS3
Key Takeaway: Understanding these trends is key to faster time to market as
you look at the necessary technologies providing functionality you need
Confidential | The Strategy + Innovation Group
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52. triztrainer@nm.ruNikolay Shpakovsky, PhD.
TREND OF TECHNOLOGY EVOLUTION
THESE TRENDS REFLECT THE GENERAL DIRECTION OF DEVELOPMENT OF TECHNICAL
SYSTEM’S PARTS IN ACCORDANCE WITH LAWS OF TECHNOLOGY EVOLUTION
INCREASING DEGREE OF SEGMENTATION OF OBJECTS, ACTION, SURFACE, SPACE ETC.
1
2
3
INCREASING THE DEGREE OF DYNAMIZATION OF OBJECTS, ACTION, SURFACE, SPACE, ETC.
COMPLICATING THE GEOMETRICAL SHAPE OF SYSTEMS AND OBJECTS
INCREASING CONTROLLABILITY OF PARTS OF SYSTEM
COORDINATING THE SHAPES, SIZES, MATERIALS AND LOCATIONS OF OBJECTS AND SYSTEMS
RHYTHM AND ACTION HARMONIZATION
4
5
6
7
INTRODUCING NEW OBJECT AND SUBSTANCE INTO THE SYSTEM AND REMOVING THEM
The 1st Russian TRIZ Master who worked for Samsung and set up it’s
processes on how to use TRIZ effectively for them, took them 3 years,
and 100’s of people involved
53. 53
TRANSITION PATTERNS
1 ADDITIVES: MODIFY SYSTEM BY ADDING TO THE INTERACTION BETWEEN TWO COMPONENTS
DESCRIPTION OF SEQUENCE OF STEPS TO DEVELOPING OF SYSTEM IN ACCORDANCE WITH
TRENDS OF TECHNOLOGY EVOLUTION.
DYNAMIZATION: CHANGE THE ACTION BY MODIFYING THE DEGREES OF FREEDOM BETWEEN
THE INTERACTING COMPONENTS
2
Key Message: Understanding these trends helps an organization better prepare
for shifts in technology and allocation of resources
Confidential | The Strategy + Innovation Group
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55. triztrainer@nm.ruNikolay Shpakovsky, PhD.
Bendy display of
Liquid Crystal Institute
Real sample of “Universal Display”
Scheme
Computer
Display with ability to convolve
DYNAMIZATION (FROM RIGID DISPLAY TO FLEXIBLE DISPLAY)
DISPLAY EVOLUTION TV, Phone and Computer Display
56. DISPLAY DIVISION IS USING THE TREND
OF EVOLUTION OF DISPLAYS
SAMSUNG DISPLAY DIVISION R&D DIRECTION (2012)
▪SEES 4K AS AN INTERMEDIATE STEP TOWARDS 8K
RESOLUTION IN THE NEAR FUTURE.
▪EXPECTS 56 % OF ALL TVS SOLD IN 2018 TO BE
LARGER THAN 48”
▪EXPECTS 25 % OF TVS SOLD IN 2018 TO FEATURE
ULTRA HD RESOLUTION.
▪SAYS THAT THE “ADVANCED R&D” DIVISION IS
CURRENTLY RESEARCHING HOLOGRAPHIC DISPLAYS.
Source: http://www.flatpanelshd.com/news.php?subaction=showfull&id=1383821743
Confidential | The Strategy + Innovation Group
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57. FOLDABLE, BENDABLE AND CURVED
DISPLAYS
EXECUTION HAS BEEN TOUGH FOR SAMSUNG DISPLAY:
▪ BENDABLE DISPLAYS ARE TARGETED FOR 2014
▪ CURVED SCREENS PROVIDE A HIGHER QUALITY VIEW, BESIDES BEING ABLE TO
WRAP AROUND YOUR WRIST IN WEARABLE APPLICATIONS, ALSO TARGETED
FOR 2014
▪ FOLDABLE DISPLAYS HAVE BEEN TOUTED SINCE 2011, HOWEVER RECENT
REPORTS PUT THOSE ONLY READY FOR MARKET IN 2016
▪ 4K (HIGH RESOLUTION IMAGE) PHONES NOT EXPECTED UNTIL - AT THE
EARLIEST – 2015
▪ SAMSUNG EXPECTS 40 % OF ALL SMARTPHONES IN 2016 TO FEATURE A
FLEXIBLE OLED DISPLAY OF SOME KIND.
▪ SAMSUNG MENTIONS STRETCHABLE DISPLAYS AS THE NEXT STEP AFTER
FOLDABLE DISPLAYS
Source: http://www.flatpanelshd.com/news.php?subaction=showfull&id=1383821743
Confidential | The Strategy + Innovation Group
57
58. HOW SAMSUNG CLASSIFIES TRIZ PROJECTS
SPECIFICALLY:
▪ 40% OF SAMSUNG NEW
PRODUCT DEVELOPMENT USES
TRIZ TO GAIN COMPETITIVE
ADVANTAGE IN DESIGN
▪ 60% USE OF TRIZ ON
MANUFACTURING AND DESIGN
DEFECTS AND ISSUES
▪ USING TRIZ TO CONSTRUCT
PATENT FENCES
▪ USING TRIZ ON
MANUFACTURING EQUIPMENT
IMPROVEMENTS – MAKING THE
COMPETITION PAY ROYALTIES ON
THEIR SOLUTIONS
Source: http://www.koreatrizcon.kr/files/O-5%28Full%29.pdf
Confidential | The Strategy + Innovation Group
58
59. SAMSUNG DISPLAY DIVISION CEO AND
MANAGING DIRECTOR USES TRIZ
59
▪ FUNDAMENTAL
UNDERSTANDING OF TRIZ
IS REQUIRED BY ALL
EMPLOYEES. CEO,
DIRECTORS AND
ENGINEERS ARE REQUIRED
TO UNDERSTAND
CLASSICAL TRIZ
▪ TRIZ IS AT THE HEART OF
THE DIVISION’S
COMPETITIVE STRATEGY,
AND THEY ONLY PROMOTE
THOSE WHO KNOW HOW TO
USE IT
Source: http://www.koreatrizcon.kr/files/O-5%28Full%29.pdf
Confidential | The Strategy + Innovation Group
60. 60
SAMSUNG BU TRIZ EDUCATION
Source: http://www.koreatrizcon.kr/files/O-5%28Full%29.pdf
Confidential | The Strategy + Innovation Group
61. SAMSUNG BUSINESS UNIT
RESULTS: SMD 2009
61
Source: http://www.koreatrizcon.kr/files/O-5%28Full%29.pdf
IN ONE YEAR:
▪ 48 PROJECTS WITH 50 PATENTS
▪ INTEGRATING USE OF TRIZ ACROSS MULTIPLE ORGANIZATIONS (TYPICALLY
SILOES IN OTHER FIRMS)
▪ INCREASED # OF USERS 3.5X AND THEIR COMPETENCY TO LEVEL 2 AND 3
▪ LEVERAGED TRIZ BKM’s FROM OTHER SAMSUNG DIVISIONS
▪ X-POLLINATED SUPPORT TOOLS FROM OTHER SAMSUNG DIVISIONS TO SEED
CULTURE OF INNOVATION USING TRIZ METHODS ENABLING GREATER
COORDINATION WITH R&D, CAE, AND THE ANALYSIS AND MANUFACTURING
TECHNIQUE DIVISION
▪ USED A SAMSUNG A SPECIFICALLY DESIGNED VERSION OF “HOW TO USE”
TRIZ METHODOLOGY (BY NIKOLAI SHAPOVSKY ) CALLED OSTM-TRIZ
▪ INTRODUCED TRIZ BASED SOFTWARE FOR ENGINEERS TO USE
▪ HELD THEIR 1ST TRIZ FESTIVAL, A COMMON PRACTICE IN OTHER DIVISIONS
Confidential | The Strategy + Innovation Group
62. BUILDING A ‘CREATIVE
ELITE’ CULTURE
62
VERY CLEAR ON WHAT THAT IS, AND
HOW THEY’RE GOING TO ACHIEVE IT
IN THIS SPECIFIC SAMSUNG BU,
SMD, IN A 1 YEAR PERIOD OF
THE 38 TRAINED IN TRIZ, 20
ACHIEVED LEVEL 3 TRIZ
EXPERT STATUS
Source: http://www.koreatrizcon.kr/files/O-5%28Full%29.pdf
Source: http://www.koreatrizcon.kr/files/O-5%28Full%29.pdf
Confidential | The Strategy + Innovation Group
64. A CORE COMPETENCY
IN INNOVATION
▪ SAMSUNG CONSCIOUSLY DEVELOPED A CORE COMPETENCY IN INNOVATION –
TOOK THEM YEARS & INVESTMENT TO CREATE
• SIGNIFICANT GAINS THAT ARE HARD TO REFUTE OR CHALLENGE
• SKILL SET DEVELOPMENT OF TECHNICAL PERSONNEL AND LEADERSHIP SEEN AS KEY
• CONTINUALLY EXPANDING THEIR CORE COMPETENCY IN INNOVATION
▪ SAMSUNG’S CORPORATE INNOVATION CULTURE (A.K.A. THE WAY THEY DO
THINGS) WAS CREATED FROM THE GROUND UP WHERE ONE DID NOT EXIST
BEFORE
• THE INNOVATION CULTURE NOW DRIVES IT’S COMPETENCY IS SUSTAINABLE VIA A
PROCESS WITH INVENTIVE METHODS
▪ SAMSUNG’S PRODUCT LIFE CYCLE OF ~5 MONTHS FOR ELECTRONICS IS A
SIGNIFICANT ADVANTAGE OVER COMPETITORS
▪ COMPARATIVELY SPEAKING THEY’RE “BEST IN CLASS” IN COMPARISON TO
OTHER CORPORATE INNOVATION PROGRAMS
• SAMSUNG USES TRIZ AS AN “ENABLING PROCESS” INNOVATION TYPE
64
Confidential | The Strategy + Innovation Group
66. This material MAY NOT be distributed to
others, copied or reproduced without
the express consent of the author
66
CAPABILITIES TO
DELIVER VALUE
MULTI-LAYERED FORTRESS OF
COMPETITIVE ADVANTAGE
1. Process Technology
2. CPU Design
3. Fab Capacity
4. Brand/Eco System
Source: Intel
Confidential | The Strategy + Innovation Group
67. This material MAY NOT be distributed to
others, copied or reproduced without
the express consent of the author 67
COST
REDUCTION ENGINE
PAST PRESENT FUTURE
YEAR
Wafer Size
Equipment
Yield
Technology
Manufacturing Cost
25-30% / Year
Improvement
Source: Intel
Confidential | The Strategy + Innovation Group
68. MOORE’S LAW ROUGHLY
STATED (TODAY)
MOORE’S LAW:
THAT THE NUMBER OF
COMPONENTS PER CHIP
DOUBLES (ROUGHLY)
EVERY 24 MONTHS
68Source: Intel
Confidential | The Strategy + Innovation Group
69. MOORE’S LAW CLARIFIED
THE PAPER THAT GORDON WROTE, DID NOT REFER TO A LAW, BUT
RATHER TO THE LACK OF FUNDAMENTAL RESTRICTIONS TO THE
DOUBLING OF THE SPEED EVERY YEAR.
IN 1975 GORDON ADMITTED THAT IT WAS THE ADVANCES (TABLE
BELOW) THAT ALLOWED HIS PROJECTION TO MATERIALIZE.
69
Moore’s Law Variables Specific Practices
Photolithography Mfg. equipment improvements
Wafer size Miniaturization and batch volume increases
Process technology Mfg. Process improvements
Circuit / device design
cleverness
Innovation in product design
Confidential | The Strategy + Innovation Group
70. OPPORTUNITY IDENTIFIED WITHIN
MOORE’S LAW
When I originally was looking at what governed Intel’s continuing dominance
as a semiconductor manufacturer and looking for strategies to improve
margin and profitability, it dawned on me that it was the specific practices,
see below where TRIZ should be applied for maximum profitability
70
Moore’s Law Variables Specific Practices
Photolithography Mfg. equipment improvements
Wafer size Miniaturization and batch volume increases
Process technology Mfg. Process improvements
Circuit / device design
cleverness
Innovation in product design
Confidential | The Strategy + Innovation Group
71. AFTER ROBERT NOYCE, GORDON
MOORE AND ANDY GROVE
GROWTH & TECHNICAL LEADERSHIP IN SEMICONDUCTOR
PROCESS AND PRODUCT TECHNOLOGY WAS ORCHESTRATED BY
MANY BUT THREE KEY PLAYERS STANDOUT FOR WHAT THEY
DID: (ALL ARE IEEE FELLOWS AND RECIPIENTS OF THE ROBERT N. NOYCE AWARD)
1. DR. CRAIG BARRETT: FORMER COO and CEO
2. DR. SUNLIN CHOU: FORMER SENIOR VP OF R&D FOR TMG
(TECHNOLOGY AND MANUFACTURING GROUP)
3. DR. YOUSSEF EL-MANSY: FORMER VP OF LTD (LOGIC
TECHNOLOGY DEVELOPMENT)
71Source: IEE
Confidential | The Strategy + Innovation Group
72. ADOPTED A TQM APPROACH
BARRETT: DROVE SIGNIFICANT IMPROVEMENTS IN;
PROCESS CONTROL, STATISTICAL ANALYSIS AND
PROBLEM SOLVING, EMBEDDED IN WHAT IS KNOWN
TODAY AS THE INTEL 7 STEP PROBLEM SOLVING
▪IN EFFECT FINE-TUNING INTEL'S MANUFACTURING PROCESS
IMPROVING YIELDS AND DEVELOPING A HIGHER QUALITY
MATERIALS SUPPLY BASE
• ALSO FUELING ENHANCEMENTS IN QUALITY CONSCIOUSNESS ACROSS
THE ENTIRE INTEL ENTERPRISE, NOT JUST THE MANUFACTURING GROUP
▪ALSO CREDITED WITH HELPING TO SHEPHERD THE “COPY
EXACT” METHODOLOGY
72Source: IEE and Intel
Confidential | The Strategy + Innovation Group
73. CHOU AND EL MANSY: DEVELOPED AND IMPLEMENTED THE “COPY
EXACT” METHODOLOGY FOR TRANSITIONING ADVANCED TECHNOLOGIES
TO MASS PRODUCTION ENABLING THE INTRODUCTION OF INNOVATIONS
IN SEMICONDUCTOR PROCESSING:
“COPY EXACTLY” METHODOLOGY INCREASED INTEL’S ABILITY TO
STAY AHEAD OF COMPETITORS BY ROLLING OUT NEW ADVANCES BY
CAPTURING MANUFACTURING BENEFITS BY REDUCING IN-FABRICATION
DEFECTS DURING THE DEVELOPMENT STAGE.
• USING THE DEVELOPMENT SITES’ EQUIPMENT AND PROCESSES AS A BASELINE THEY
PRECISELY REPLICATED THE PROCESSES AT OTHER MANUFACTURING SITES FOR QUICK
PRODUCTION RAMPS WITH HIGH YIELDS (MEANING LOWER COST AT SCALE).
• ESTABLISHED MULTI-GENERATION TECHNOLOGY PIPELINES IN WHICH MULTIPLE TEAMS
WORKED IN PARALLEL TO MOVE INNOVATIONS SEAMLESSLY AND RAPIDLY FROM
EXPLORATORY RESEARCH THROUGH DEVELOPMENT AND INTO PRODUCTION.
73
COPY EXACT DRIVES STABLE
PROCESSES
Source: IEEE
Confidential | The Strategy + Innovation Group
74. WHAT ‘COPY EXACT’ TARGETS
BOARDS/SYSTEM’S LESS WELL KNOWN APPLICATION OF ‘COPY EXACT’:
• NPI TRANSFER CHECKLISTS: ACTED AS THE HANDSHAKE BETWEEN BU NPI PERFORMANCE
IN SYSTEMS MANUFACTURING TO THE TMG HVM SITES.
• VALOR DFM TOOL: ACTED AS A VIRTUAL PROTO-TYPING TOOL BETWEEN MANUFACTURING
ENGINEERS, DESIGN ENGINEERS AND THE NPI FACTORY, IDENTIFYING RISKS IN BUILDING
OUTSIDE THE DFM ENVELOPE
Source: Intel
Confidential | The Strategy + Innovation Group
74
75. “COPY EXACT” CODIFIED MOORE’S
LAW INTO A MANAGEMENT PROCESS
• EFFECTIVELY IMPLEMENT STRAINED SILICON, HIGH-K/METAL GATE AND TRI-
GATE TRANSISTORS. (CLEVER PRODUCT DESIGN)
• ACHIEVED AND MAINTAINED A SHORTER 2-YEAR TECHNOLOGY LIFE CYCLE,
COMPARED TO THE 3-YEAR CYCLES THAT WERE THEN PREVALENT IN THE
INDUSTRY – THEREBY SHORTENING TIME TO MARKET.
75Source: Intel
Confidential | The Strategy + Innovation Group
76. TICK TOCK DEVELOPMENT
MODEL
76Source: IEEE and Intel
Confidential | The Strategy + Innovation Group
OVERALL INTEL PRODUCT DEVELOPMENT CLOCK PACES TO
THE TICK-TOCK MODEL, NOT THE MARKET
IMPORTANT NOTE: THE TRADITIONAL ‘TICK-TOCK’ MODEL DOESN’T EQUAL THE
SPEED OF SAMSUNG’S NPD LIFE CYCLE WHICH IS 5 MONTHS FOR ELECTRONIC
DEVICES
77. MOORE’S LAW & THE LAW OF IDEALITY
This is an original analysis done in 2002 –still holds true despite the age of the graphic.
S-Curves are located at every process step change & successive product generation
Pentium® Pro
Processor
Pentium® II
Processor
Pentium® III
Processor
Pentium® 4
Processor
Intel386TM DX
Microprocessor
Intel486TM DX CPU
Microprocessor
1
10
100
1000
10000
1985 1989 1993 1995 1997 1999 2001
MIPS
$/MIPS
0.01
0.1
1
10
100
$/MIPS
Silicon Technology
1.5µ
1.0µ
Pentium®
Processor
0.8µ
0.6µ
0.4µ
0.25µ
0.18µ
0.13µ
Source: Intel
“Moore’s Law” correlates to the ‘Law of Ideality’ in TRIZ; Law of Ideality = All engineering systems,
evolve over time, providing greater performance, functionality and benefit at lower cost and have less
detrimental or negative aspects as a part of their design and manufacture.
77
Confidential | The Strategy + Innovation Group
MIPS
78. 78
ENABLED BY….
BUT GORDON LEFT OUT
ANOTHER ASPECT
Source: Intel
Confidential | The Strategy + Innovation Group
80. DIFFUSION OF INNOVATION
AND MARKET SATURATION
THE DIFFUSION (ACCEPTANCE/ADOPTION) OF A GIVEN TECHNOLOGY
ACROSS A GIVEN USER DEMOGRAPHIC OF A TECHNOLOGY
80
Confidential | The Strategy + Innovation Group
81. Confidential | The Strategy + Innovation Group
81
Example: When the elderly, like my 75yo father finally adopts the use of a PC,
(originally a non-consumer), to communicate with far away friends and family, via
Skype, email, etc… who originally disliked learning a new tool like a PC, you’ve
achieved market saturation.
He and others didn’t have a need, a Job To Be Done, until he was in retirement, had
spare time on his hands to learn something new, that helped him stay connected
with his friends and family – the JTBD.
82. A PRODUCT IS DEFINED BY THE
PROCESS THAT MAKES IT
THE PROCESS BY WHICH A PRODUCT IS
PRODUCED IS INSEPARABLE FROM ITS PROCESS,
THUS ANY IMPROVEMENT SUGGESTED OR
ENVISIONED FOR A PRODUCT HAS A DIRECT
CAUSALITY BACK TO THE PROCESSES USED TO
CREATE IT.
IN EFFECT THERE ARE ALWAYS AT LEAST
TWO S-CURVES DEFINING A SYSTEM:
• THE PRODUCT (A DEMAND DRIVEN FUNCTION)
• THE PROCESS THAT BUILDS OR PRODUCES A
PRODUCT (A COST DRIVEN FUNCTION)
This material MAY NOT be distributed to others, copied or reproduced
without the express consent of the author
Copyright Protected | Property of the Strategy + Innovation Group
82
Confidential | The Strategy + Innovation Group
Danner, T.W. A Formulation of Multidimensional Growth Models for the
Assessment and Forecast of Technology Attributes. Aerospace Engineering
(Georgia Institute of Technology, 2006).
83. GETTING IN FRONT OF COMPETITORS
# of innovations in a given
product and process envelope
Low
High
Demand
Driven Cost
Driven
Product Innovation curve
Process Innovation curve
Pulling-In the development of the
Process Innovation curve to coincide
with the Product Innovation Curve
increases margin sooner, TTP (Time
To Productivity) shortens, also
shortening TTM (Time To Market), and
lowering product cost with greater
performance, reliability, and
functionality than competitors products
or processes that don’t use this
methodology
83
Confidential | The Strategy + Innovation Group
Time
84. INTEL’S LESSON ON COPQ
6 SPECIFIC COSTS LISTED – ACTUAL COSTS “PRICELESS”
1. BAD PRESS / PR: NYT ARTICLE HEADLINED “INTEL FACING A GENERAL FEAR
OF IT’S PENTIUM CHIP”
JOURNALIST LAURIE FLYNN QUOTES FLORIDA DEPUTY ATTORNEY GENERAL PETE ANTONACCI: "They’ve got to stop acting like A
rinky-dink two-person operation in a garage and start acting like the major corporation they are."
2. LEGAL COSTS: 8 PRODUCT LIABILITY LAWSUITS AND 2 SHAREHOLDER SUITS
WERE FILED AGAINST INTEL
3. LOST REVENUE: IBM TEMPORARILY HALTS SHIPMENT OF ALL PC’S
CONTAINING PENTIUMS
Source: Wikipedia and http://www.emery.com/1e/pentium.htm
PENTIUM FDIV BUG WAS IN THE INTEL P5 PENTIUM FLOATING
POINT UNIT (FPU). BECAUSE OF THE BUG, THE PROCESSOR
WOULD RETURN INCORRECT RESULTS FOR MANY
CALCULATIONS USED IN MATH AND SCIENCE. INTEL BLAMED
THE PROBLEM ON A FEW MISSING ENTRIES IN THE LOOKUP
TABLE USED BY THE COMPANY
84
Confidential | The Strategy + Innovation Group
85. “FLOATING POINT” FLAW COPQ
4. NEGATIVE BRAND IMPACT: BETWEEN 11/29/94 – 12/16/94
INTEL RECEIVES THOUSANDS OF MESSAGES AND PHONE CALLS SAYING THEY MISS THE
POINT. AND BECOMES A LAUGHINGSTOCK ON THE INTERNET JOKE CIRCUIT:
• “AT INTEL, QUALITY IS JOB 0.999999998”
• “Q: KNOW HOW THE REPUBLICANS CAN CUT TAXES AND PAY THE DEFICIT AT THE SAME TIME? A: THEIR
SPREADSHEET RUNS ON A PENTIUM COMPUTER.”
• “WE ARE PENTIUM OF BORG. RESISTANCE IS FUTILE. YOU WILL BE APPROXIMATED.”
• “THE INTEL VERSION OF CASABLANCA: "ROUND OFF THE USUAL SUSPECTS."
• “Q: HOW MANY PENTIUM DESIGNERS DOES IT TAKE TO SCREW IN A LIGHT BULB? A: .99995827903, BUT THAT'S
CLOSE ENOUGH FOR NONTECHNICAL PEOPLE.”
THE SITUATION DEGRADES TO A POINT PAST ANY LOGICAL RESPONSE. PEOPLE BELIEVE
INTEL DOES NOT STAND BEHIND ITS PRODUCTS.
5. STOCK DROP: INTEL STOCK CLOSES AT $59.50, DOWN $3.25 FOR THE WEEK OF
12/16/94
6. PRODUCT RECALL COSTS: $450M WRITE DOWN IN PRE-TAX EARNINGS TO
COVER THE COST OF THE RECALL
Source: http://www.emery.com/1e/pentium.htm
Confidential | The Strategy + Innovation Group
86. SAMSUNG VS. INTEL
WHO WOULD WIN IN A HEAD-TO-HEAD COMPETITION IN THE
MARKETPLACE? SAMSUNG
Top of Mind Reasons:
1. 5 MONTH Product Life Cycle
• CAN TURN OUT MORE PRODUCTS (AND ITERATIONS) THAN INTEL, THUS PROVIDING
MORE JTBD’s TO CUSTOMERS – THINK HONDA / YAMAHA WAR OF THE 1980’S
2. SAMSUNG USING AN EMBEDDED INNOVATION AND QUALITY PROCESS – INTEL ONLY
HAS A QUALITY (TQM, LEAN SIX SIGMA), A 1ST GENERATION QUALITY APPROACH
3. SAMSUNG FOCUSED ON END USER JTBD’S MORE SO THAN INTEL HAS SHOWN IT CAN
DO.
• INTEL ACQUIRES COMPANIES WHO’VE ALREADY DEVELOPED THE JTBD’S BUT DOES
NOT HAVE THE CAPABILITY TO IDENTIFY AND EXPLOIT THEM FOR THE MARKET ON THEIR
OWN
86
Confidential | The Strategy + Innovation Group
87. SO HOW WOULD YOU
COMPETE AGAINST SUCH
INNOVATIVE AND WELL
ORCHESTRATED
COMPANIES?
87
88. THE MOST IMPORTANT INNOVATION CAPABILITIES
Source: Booz-Allen
IdeaGenerationIdeaConversion
88
Confidential | The Strategy + Innovation Group
89. IMMEDIATE FOCUS ON THE TOP 2 IN
EACH CATEGORY
IDEA GENERATION
IDEATION:
1. SEEK DEEP CONSUMER AND CUSTOMER INSIGHTS AND
ANALYTICS
2. SEEK DEEP UNDERSTANDING OF EMERGING TECHNOLOGY AND
TRENDS
3. OPEN INNOVATION / CAPTURING IDEAS AT ANY POINT IN THE
PROCESS
4. INDEPENDENT COMPETITIVE INSIGHTS FROM THE MARKETPLACE
5. SUPPLIER AND DISTRIBUTOR ENGAGEMENT IN THE IDEATION
PROCESS
89
Confidential | The Strategy + Innovation Group
90. IMMEDIATE FOCUS ON THE TOP 2 IN
EACH CATEGORY
IDEA GENERATION
PROJECT SELECTION:
1. ONGOING ASSESSMENT OF MARKET POTENTIAL
2. PROJECT FORECASTING AND RESOURCE PLANNING
3. RIGOROUS DECISION MAKING AROUND THE PORTFOLIO
4. TECHNICAL RISK ASSESSMENT / MANAGEMENT
5. STRATEGIC DISRUPTION DECISION MAKING AND
TRANSITION PLAN
90
Confidential | The Strategy + Innovation Group
91. IMMEDIATE FOCUS ON THE TOP 2 IN
EACH CATEGORY
IDEA CONVERSION
PRODUCT DEVELOPMENT:
1. ENGAGEMENT WITH CUSTOMERS ON REAL WORLD
FEASIBILITY
2. PRODUCT PLATFORM MANAGEMENT
3. DESIGN FOR SPECIFIC GOALS
4. SUPPLIER / PARTNER ENGAGEMENT IN PRODUCT
DEVELOPMENT
5. REVERSE ENGINEERING
91
Confidential | The Strategy + Innovation Group
92. IMMEDIATE FOCUS ON THE TOP 2 IN
EACH CATEGORY
IDEA CONVERSION
COMMERCIALIZATION:
1. PILOT USER SELECTION / CONTROLLED ROLL OUTS
2. PRODUCT LIFE CYCLE MANAGEMENT
3. GLOBAL ENTERPRISE PRODUCT LAUNCH
4. PRODUCTION RAMP UP
5. DIVERSE USER GROUP MANAGEMENT
92
Confidential | The Strategy + Innovation Group
93. COMPANIES LEVELS OF TRIZ DEPLOYMENT
Low Level
▪ Unilever
▪ Colgate Palmolive
▪ Philips
▪ Motorola
Medium Level
▪ Boeing
▪ Kimberly Clark
▪ ABB
▪ Whirlpool
▪ HP
▪ Delphi
High Level
▪ Samsung Electronics
▪ Samsung Electro Mechanics
▪ Samsung Adv. Inst. of Tech.
▪ Procter & Gamble
▪ Siemens
▪ LG Cable
▪ Christian Dior
▪ Dutch State Mines (DSM)
High Level Deployment includes multiple levels of support that assist
the integration of the innovation program into an organization’s way
of conducting business and streamlining operational effectiveness,
efficiency and developing a sustainable competency in innovationSource: GEN3 Partners Inc, 2005
Sys. Innov. trained companies DO NOT automatically become innovative
93
Confidential | The Strategy + Innovation Group
94. WHO HAS SUCCESSFULLY INTEGRATED
(HIGH LEVEL)
Company Integration
Adopted 6-Sigma in ‘99, then DFSS / Lean and TRIZ in ‘01 where innovation
was needed to supplement 6-Sigma/DFSS/Lean. Now trains an integrated
quality and innovation toolbox since ’07. >>11K projects using 6 Sigma &
TRIZ, constantly adapting the methods depending on problem faced and
what people need to solve – adapting the methods. see public report
Used Samsung and Intel programs as examples to follow for their own TRIZ
proliferation activities – ‘05 created an Innovation Tool Academy that crafted
job specific training to support specific jobs & roles, creating 3 different
Invention on Demand workshop tracks: Patents on Demand, Solutions on
Demand, and Innovation on Demand. These 3 program tracks are further
delineated into ‘Basic’, ‘Advanced’ and ‘Professional’ levels of training and
materials/tools. – see report
*Logos, names and brands may be claimed as the property of others.
94
Confidential | The Strategy + Innovation Group
95. WHO HAS SUCCESSFULLY INTEGRATED
(LOW-LEVEL)
Company Integration
Localized use of TRIZ by different BU/divisions, seen as an excellent tool by
some, interesting by others and some outright resistance. Organizational
mgmt. structure does not force groups to adopt/use TRIZ. Philips mgmt.
now funds an internal/externally facing innovation services division that
utilizes TRIZ methods.
As of ‘08 have an integrated set of Quality and Innovation training,
combining 6-Sigma, DFSS, Lean and TRIZ, deployed across the enterprise,
to empowering employees with a structured process for innovating.
*Logos, names and brands may be claimed as the property of others.
95
Confidential | The Strategy + Innovation Group
96. LEVELS OF DEPLOYMENT AT LARGE CORPORATIONS
Corporate:
• Commitment to make innovation a core business process
• Broad and active support of management
• Internal Systematic Innovation consulting team
• SI / TRIZ seminars for executives and mid-level mgr’s
Group:
• Middle - Management commitment
• Integration into the engineering environments
• Appointment of SI / TRIZ champions in dept.’s
• Advance methodology training for champions
Individual:
• SI / TRIZ awareness
• Basic methodology training
• Champion identification
The level of success correlates to the level of deployment
Corporate
Group
Individual
96
Confidential | The Strategy + Innovation Group
97. CONCLUSIONS
NEEDING A PROCESS FOR INNOVATION IS AN IMPERATIVE, THE
FAILURE RATES ARE AS HIGH AS 70-98% RANGE FOR MOST
COMPANIES
MOST COMPANIES DO HAVE A PROCESS LIFE CYCLE / PRODUCT
DEVELOPMENT PROCESS BUT DO NOT HAVE AN INTEGRATED
PROCESS FOR INNOVATION
• ACCORDING TO BOOZ-ALLEN’S 2012 ANALYSIS, 75% OF COMPANIES DO NOT
HAVE AN EFFECTIVE INTEGRATED IDEA GENERATION AND AN IDEA
CONVERSION PROCESS
• TOOLS AND FRAMEWORKS FOR IDEA GENERATION AND IDEA CONVERSION ARE
NEEDED TO HELP COMPANIES MANAGE THEIR CURRENT AND FUTURE
PROFITABILITY
97
Confidential | The Strategy + Innovation Group
98. DISSUADE YOURSELF IMMEDIATELY
▪ THERE ARE NO SILVER BULLETS TO EFFECTIVE INNOVATION
▪ EFFECTIVE INNOVATION AS A COMPETENCY TAKES TIME TO GET & IMPLEMENT,
HAS A PROCESS, REQUIRES TRAINING, INFRASTRUCTURE, POLICIES AND
INCENTIVES (CARROT AND STICK) TO INTEGRATE IT
• DON’T BE LULLED INTO SPECIOUS ARGUMENTS OF “THIS HOW WE DID IT IN THIS
COMPANY” – THEIR CORPORATE CULTURE IS DIFFERENT THAN YOURS
▪ YOU WILL NEED TO CUSTOMIZE YOUR IMPLEMENTATION OF AN INNOVATION
PROCESS BASED ON WHAT YOUR NEEDS ARE, NOT WHAT THEY DID AT
ANOTHER COMPANY OR INDUSTRY
• KEEP IN MIND THAT OTHER COMPANIES CLEARLY DO USE METHODS THAT GIVE THEM
BENEFITS & RESULTS THAT YOU ARE NOT GETTING TODAY
▪ TREATING INNOVATION AS SOMETHING THAT DOESN’T GET HEART’S, MIND’S
AND FUTURE EMPLOYMENT AND EMPLOYABILITY CONNECTED DOESN’T GET
RESULTS
98
Confidential | The Strategy + Innovation Group
100. 2. WHY DO SO MANY FIRMS STRUGGLE TO FIND THEIR OWN
WAY OF INNOVATION?
• NOT MANY PEOPLE TRAINED ON HOW TO DO INNOVATION, EVEN LESS KNOW
THE SCIENCE OF INNOVATION, AND WHAT THE BEST PRACTICES ARE TO USE
• NOT MANY HAVE BEEN INVOLVED IN HIGH GROWTH MARKETS OR INDUSTRIES
– NOT MUCH EXPERIENCE WITH IT
• DOING INNOVATION REQUIRES WORKING WITH A HIGH # OF ASSUMPTION TO
KNOWLEDGE RATIO – MANY ARE TYPICALLY NOT VERY GOOD AT WORKING W/
ASSUMPTIONS
• MOST EXECUTIVES MISS THAT THEY HAVE TO MOVE FROM A LOW
ASSUMPTION WORLD TO A HIGH ASSUMPTION WORLD
• COMPLETELY DIFFERENT LOGIC TO ITConfidential | The Strategy + Innovation Group
RITA GUNTHER-MCGRATH ON
“SEEING INNOVATION IN
STRATEGIC TERMS”
100
101. • NOT ENOUGH FUNDING RESOURCES
• USE THE SAME APPROACH FOR SMALL INNOVATION BETS VERSUS PROJECTS
WITH LESS KNOWN ASSUMPTIONS
WHAT IS THE FUNDING STRUCTURE FOR INNOVATION?
WHAT IS THE GOVERNANCE STRUCTURE FOR INNOVATION?
• HOW DO I GET THE RIGHT PEOPLE?
DON’T NEED A LOT OF WILD-EYED ENTREPRENEURIAL TYPES, JUST A FEW TO TAKE ON BIG
PROJECTS
WHAT’S THE REWARD FOR THEM? (TYPICALLY MOST DON’T WANT TO RUN IT) – FAILURE
RATE IS HIGH, HENCE CAREER / ORGANIZATIONAL POLITICAL RISK IS TOO HIGH TO WANT TO
CONSIDER
Confidential | The Strategy + Innovation Group
RITA GUNTHER-MCGRATH ON
“SEEING INNOVATION IN
STRATEGIC TERMS”
101