Just an original way of teaching English, thorough Open Innovation related materials

1. English4You – Open Innovation
Floriano
floriano.bonfigli@gmail.com
1

2. Where not indicated, full reference to
Chesbrough, H. 2003. Open Innovation: The
New Imperative for Creating and Profiting from
Technology. Cambridge, MA: Harvard Business
School Press.
2

3. 3
Ref: https://www.cnews.cz/sites/default/files/styles/epc-galerie-clanek-500-nowatermark/public/oldcnews/clanky/cnews/2013/07cervenec/prvni-pocitacova-mys/prvni_pocitacova_mys.jpg

4. Who am I?
Startup founder, collabobeat.com
Startup mentor, The Hive Business Incubator
Entrepreneurship educator, ISTAO Business School
Ambassador, Hello Tomorrow Challenge
Creator, Disciplined Business Model Canvas
4

5. Who are you? 1/2
# Name Open Innovation what? Interests
01
02
03
04
05
06
07
08
09
5

6. Who are you? 2/2
# Name Open Innovation what? Interests
10
11
12
13
14
15
16
17
18
6

7. Let’s play a game - 1
I’m the God of Innovation.
I want to share with you the 3
paradigms about Innovation:
• Most innovations fail
• All innovations will not last
forever
• Companies that do not
innovate die, faster
7
Ref: http://gostica.com/wp-content/uploads/2016/05/proof-god-exists1.jpg

8. Let’s play a game - 2
You are top managers at
Facebook Inc.
We are having an important
meeting with Mark
The conversation is about the
strategy the company should
pursue to innovate
8
Ref: https://academichelp.net/wp-content/uploads/2013/07/markzuckerberg.jpg

9. Who is right?
The smart people in
the digital sector work
for our company
Not all the smart
people work for your
company
9
Let’s play a game - 3

10. Who is right?
You must use only the
technology your
company discovers
We can use technology
discovered by other
companies
10
Let’s play a game - 4

11. Who is right?
If you are the 1st to sell
the technology, you
will win the
competition
We can be 2nd and win
the competition, if we
build a better business
model
11
Let’s play a game - 5

12. Introduction
Discovery of
New
Technology
New Product
Increased
Sales and
Profits
Increased
Investment in
R&D
Innovation
Corporate
The virtuous circle
12

13. Introduction
Research
Development
Innovation
13Ref: http://bock-pm.com/wp-content/uploads/closed-open.jpg

14. 14
Let’s play a second game - 1
What
is
that?

15. 15
Let’s play a second game - 2
What
is
that?
Ref: http://lowendmac.com/wp-content/uploads/first-computer-mouse.jpg

16. 16
You work in the company
that has invented this
User Interface Device.
You are in a top
management meeting, to
decide the strategy about
this thing.
Let’s play a second game - 3
Ref: https://s-media-cache-ak0.pinimg.com/736x/5d/02/f0/5d02f0750386823f4f7df5c246d68990--bill-obrien-ma-vie.jpg

17. 17
Let’s play a second game - 5
There are 2 main opinions:
a. We’re done with this,
produce and sell it
b. We don’t think it is ready
yet, go back to do some
more R&D
Who do you agree with?
Ref: http://4.bp.blogspot.com/-zkwaS2AyEbQ/UTa_Ho2d1yI/AAAAAAAAALQ/-
LhfxQTLDvM/s320/800px-Xerox_Alto_mouse.jpg

18. 18
Suggested articles:
• http://www.newyorker.com/magazine/2
011/05/16/creation-myth
• https://www.ideo.com/case-
study/creating-the-first-usable-mouse
• http://zurb.com/blog/steve-jobs-and-
xerox-the-truth-about-inno
Ref: https://churchill.imgix.net/images/casestudies/images/Mouse_Apple_mouse_bw_copy.jpg
Ref: http://www.logodesignlove.com/images/classic/apple-
logo-rob-janoff-01.jpg

19. Discovery of
New
Technology
New Product
Increased
Sales and
Profits
Increased
Investment in
R&D
The circle has been broken
The virtuous circle
19

20. Open Innovation - 1
An alternative way
for Creating and Profiting
from Technology
20

21. Open Innovation - 2
21
Ref: http://bock-pm.com/wp-content/uploads/closed-open.jpg

22. Closed Innovation Principles Open Innovation Principles
Most of the smart people in our field work for us Not all the smart people work for us, so owe must find and tap into
the knowledge and expertise of bright individuals outside our
company
To profit from R&D, we must discover, develop and ship
ourselves
External R&D can create significant value; internal R&D is needed to
claim some portion of that value
If we discover it, we will get it to market first We don't have to originate the research in order to profit from it
If we are the 1st to commercialize we will win Building a better business model is better than getting to market first
If we create the most and the best ideas in the industry, we will
win
If we make the best use of internal and external ideas, we will win
We should control our intellectual property (IP) so that our
competitors don't profit from our ideas
We should profit from others' use of our IP, and we should buy
others' IP whenever it advances our own business model
22
Open Innovation - 3

23. Closed Innovation Facts Open Innovation Facts
Example of industries: nuclear reactors,
mainframe computers
Example of industries: PCs, ICT, IoT, Digital
Mainly internal ideas Many external ideas
Low labor mobility High labor mobility
Little angel investing and venture capitals Hich angel investing and venture capitals
Few and week startups Numerous startups
Universities and incubators unimportant Universities and incubators important
23
Open Innovation - 4

24. Closed Innovation Game Open Innovation Gamr
Chess Poker
You know the pieces your competitor has You do not know all information in advance
You know what your competition is going
to do
You have to decide whether to spend
additional money to stay in the game to see
the next card
24
Open Innovation - 5

25. 25
Business Model - 1
A new technology by itself has no single objective value.
A business model is a framework to link a new technology to
its economic value and outcomes.
A poor technology plus a great business model may be more
valuable than a great thechnology plus a poor business
model.
Nowadays, there are several business model frameworks
available to study and adopt for our organizations.

26. 26
Business Model - 1
Standard de-facto to bring a
new technology to the
market

27. 1. Who is your
first customer?
8. Activities to
reduce your COCA
7. What is your Cost of Customer Acquisition?
5. What is your
core?
The Disciplined Business Model Canvas 0.9 Team:
3. Channels to
reach your
customers
6. Partners to build
your core
Build the Persona of your Very First Customer (VFC) or end
user, when they do not correspond . Define
• Name and exact age
• Working habits: job position, food at work, travel, news,
technology adopted...
• Social life: family, food, travel, apps, sports, shopping,
preferred brands...
• What is his/her main concern at work?
• What is his/her main concern in life?
• Have his/her photo eventually
The Business Model Canvas meets the Bill Aulet’s Disciplined Entrepreneurship framework. Bill is the Managing Director of the Martin Trust Center
for MIT Entrepreneurship at MIT as well as a senior lecturer at the MIT Sloan School of Management.
Follow @disciplinedcanvas on to download the .pdf canvas and to get in touch with its creator Floriano Bonfigli.
2. Quantified
Value Proposition
Imagine you have designed and printed out a brochure reporting
among other, your QVP. Now, how do you manage to attract your
very first 10 customers, hand them out your brochure and discuss
it? Where do you find them?
Actually design and print out a brochure and get outside of the
building to talk to your customers.
Define that single thing that continually makes you stronger and
your competitors will not easily duplicate. Defining your core is
not easy. However, IP, company culture, first-mover advantage
and supplier lock in are definitely not core as they do loose value
over time.
You shold take for granted that you can’t be alone in your
entrepreneurial journey. You are going to need help from various
entities. For now, focus your attention on the people external to
your organization who can help you build and maintain your
core.
The Quantified Value Proposition (QVP) converts the benefits that
your VFC gains from your solution into a tangible metric he/she
can refer to. The most tangible metrics are money or time being
saved thanks to your solution.
You should align the QVP with the top concern of the VFC you
have defined in step 1.
The Life Time Value (LTV) of an acquired customer represents your ability to monetize them and it is expresed in $ per customer. To calculate the LTV, look at the
Gross Margin that you expect to get from your VFC over the life time of you realtionship with her/him. You may start considering one year, for the sake of semplicity,
and then two and three years, at most.
The LTV considers all the revenue streams you can activate on your customer including any support, installation and servicing.
The Cost of Customer Acquisition (COCA) quantifies the typical marketing and sales expenses over a period of time, divided by the number of customers you acquire
within that period. Start witht the first year as a very initial assumption. Then, you can redefine the COCA by adding more years. Some examples of costs: sales people,
travel and entretainment, phone, computer, internet, demo units, technical sales support, website development, trade shows, real estate... Obviously, a well balanced
business model requires that COCA is significantly smaller than LTV, over the same period of time. You can assume you are on the right track when your COCA is 1/3
of your LTV.
There are several ways to reduce your COCA, below some
examples:
• Stay focused on your first customer
• Promote positive word of mouth, how?
• From direct to automated sales, how?
• Build revenue stream models your VFC can easily understand
• Reduce the cost of leads, how?
• Improve the quality of leads, how?
• Improve conversion rates, chasing deals you don’t close is
huge cost.
Now, just choose two of them, according to your understanding
and resources.
4. What is your Life Time Value (LTV) of your
Acquired Customer?
This work is licensed under the Creative Commons
Attribution-Share Alike 3.0 Unported License. To
view a copy of this license, visit
http://creativecommons.org/licenses/by-sa/3.0/ or
send a letter to Creative Commons, 171 Second
Street, Suite 300,San Francisco,California, 94105,
USA.
More focused
on
startup launch

28. Do you want to be
a. the top manager of a big corporation, or
b. the founder of a startup?
28
Let’s play the last game - 1

29. 29
Business Model - 1

30. 1. Who is your
first customer?
8. Activities to
reduce your COCA
7. What is your Cost of Customer Acquisition?
5. What is your
core?
The Disciplined Business Model Canvas 0.9 Team:
3. Channels to
reach your
customers
6. Partners to build
your core
Build the Persona of your Very First Customer (VFC) or end
user, when they do not correspond . Define
• Name and exact age
• Working habits: job position, food at work, travel, news,
technology adopted...
• Social life: family, food, travel, apps, sports, shopping,
preferred brands...
• What is his/her main concern at work?
• What is his/her main concern in life?
• Have his/her photo eventually
The Business Model Canvas meets the Bill Aulet’s Disciplined Entrepreneurship framework. Bill is the Managing Director of the Martin Trust Center
for MIT Entrepreneurship at MIT as well as a senior lecturer at the MIT Sloan School of Management.
Follow @disciplinedcanvas on to download the .pdf canvas and to get in touch with its creator Floriano Bonfigli.
2. Quantified
Value Proposition
Imagine you have designed and printed out a brochure reporting
among other, your QVP. Now, how do you manage to attract your
very first 10 customers, hand them out your brochure and discuss
it? Where do you find them?
Actually design and print out a brochure and get outside of the
building to talk to your customers.
Define that single thing that continually makes you stronger and
your competitors will not easily duplicate. Defining your core is
not easy. However, IP, company culture, first-mover advantage
and supplier lock in are definitely not core as they do loose value
over time.
You shold take for granted that you can’t be alone in your
entrepreneurial journey. You are going to need help from various
entities. For now, focus your attention on the people external to
your organization who can help you build and maintain your
core.
The Quantified Value Proposition (QVP) converts the benefits that
your VFC gains from your solution into a tangible metric he/she
can refer to. The most tangible metrics are money or time being
saved thanks to your solution.
You should align the QVP with the top concern of the VFC you
have defined in step 1.
The Life Time Value (LTV) of an acquired customer represents your ability to monetize them and it is expresed in $ per customer. To calculate the LTV, look at the
Gross Margin that you expect to get from your VFC over the life time of you realtionship with her/him. You may start considering one year, for the sake of semplicity,
and then two and three years, at most.
The LTV considers all the revenue streams you can activate on your customer including any support, installation and servicing.
The Cost of Customer Acquisition (COCA) quantifies the typical marketing and sales expenses over a period of time, divided by the number of customers you acquire
within that period. Start witht the first year as a very initial assumption. Then, you can redefine the COCA by adding more years. Some examples of costs: sales people,
travel and entretainment, phone, computer, internet, demo units, technical sales support, website development, trade shows, real estate... Obviously, a well balanced
business model requires that COCA is significantly smaller than LTV, over the same period of time. You can assume you are on the right track when your COCA is 1/3
of your LTV.
There are several ways to reduce your COCA, below some
examples:
• Stay focused on your first customer
• Promote positive word of mouth, how?
• From direct to automated sales, how?
• Build revenue stream models your VFC can easily understand
• Reduce the cost of leads, how?
• Improve the quality of leads, how?
• Improve conversion rates, chasing deals you don’t close is
huge cost.
Now, just choose two of them, according to your understanding
and resources.
4. What is your Life Time Value (LTV) of your
Acquired Customer?
This work is licensed under the Creative Commons
Attribution-Share Alike 3.0 Unported License. To
view a copy of this license, visit
http://creativecommons.org/licenses/by-sa/3.0/ or
send a letter to Creative Commons, 171 Second
Street, Suite 300,San Francisco,California, 94105,
USA.

31. English4You – Open Innovation
Floriano
floriano.bonfigli@gmail.com
31