Blog for the Strategic Innovation MBA Course at Vanderbilt University
Industry Innovation Constraints
How could you measure innovation at the industry level of anlaysis? By your measure, what are the most innovative industries today? What industries do you think will continue to be innovative in our life-times? Why?
I'm not exactly sure what measure I would use across industries, because it makes more sense to me to have industry specific metrics. Yet, I understand the need/desire for the measure to allow for comparison, so given that constraint, I would probably measure innovation in a three-fold manner: by number of ideas produced internally, number of those invested in, and return on that investment. Given those measures, I think the technology industry is one of the most innovative industries today. With the multitude of products and ideas that continually come out of organizations like Apple, IBM, and GE, it's apparent that innovation is occurring, it appears to be encouraged, and I think they'll continue to master it. Additionally, I think there's a real opportunity to see innovation from a plethora of organizations (whether they currently exist or not) in the sustainability space. Most companies today are looking to reduce waste, save costs, and improve environmental impact (or so they claim), so I think the real thought leaders of my life-time will create and execute new ideas surrounding sustainability. Especially since waste management, the electricity grid, renewable energies, and feeding the people on the planet appear to be the biggest problems of our era, and they could all benefit from sustainable innovations. Just my two cents!
I vote for FMCG industry as the most innovative industry based on three measures, those are 'availability of resources', 'financial gains for innovative efforts' and 'the length of product life cycle'.
All the FMCG giants today shared the common feature of huge R&D investment in forms of both monetary and human capital. Like P&G, they take innovation as their lifeblood by paying strict attention to the indicators including ‘Annual R&D budget as a percentage of annual sales’ and ‘Total R&D headcount or budget as a percentage of sales’.
Also, return on investment measures the innovation idea in finance discipline. Financial gains is the major thrust that push all players within certain industry to pursue innovative ideas relentlessly. In an industry like FMCG where competition is at most fierce, product innovation or ‘blue-ocean policy’ might be the best way to build corporate competency so as to over satisfy customer and grab as much market share as possible
The third measure is the length of product life cycle. The shorter the cycle is, the more innovative the industry is supposed to be. Like the case with 3M, there’s an important internal metric that is ‘Percentage of sales from products introduced in the past 4 years’. It means that a company can’t cash cow one hit product forever. In other words, the players in this Industry have to be innovative enough in creating new ideas and products within short period.
I might agree that fast moving consumer goods is the most innovative industry. I'd base it on a drastic change in both the inputs and outputs of these products. From an input standpoint, the sourcing of food has changed drastically over the past 10 years due to farmland sustainability initiatives, bio-engineering, the organic movement, and processing advancements that allow you to get food within days of harvesting the plant.
From an output standpoint, in-store branding of consumer products is changing as well. The label and packaging of certain products have been relatively constant over the years, such that the consumer has been able to base his/her perception of the product simply from the outside of a can or by looking through a glass jar. However, the potential for cost-savings from reducing packaging material as well as the benefits from using more sustainable material has led to advancements whereby products currently sold in cans will soon be sold in cartons, for example. This will drastically change how consumers interact with products at the store, and result in CPGs rethinking how they will engage with customers through packaging.
I believe that the growing population, and the resulting scarcity of certain food items will demand that the FMCG industry continue to be innovative. As the environmental consequences of this industry's practices become more and more apparent, there will be drastic changes in the sourcing, and packaging of food in the short and long term.
Why do we blame the manufacturer of this product? What should be enforced are the laws we currently have in place. Instead of chasing down a company that produces a legitimate product, shouldn't law enforcement be chasing down those individuals who bought the product for those minors? When someone abuses prescription drugs and overdoses, do we chase down the pharmaceutical companies to stop producing those drugs? No. Why should this industry be any different? Just because FourLoko does not have the lobby strength Pfizer does shouldn't mean that it gets treated any differently.
I am a digital junky and love the freedom that the space has given to anyone who has a computer to tinker and innovate. The barriers to entry are extremely low; in most cases the biggest barrier is simply programming knowledge, which can be easily learned.
That being said, I can guarantee we are going to see crazy innovative ways to bring the internet and the digital world out from behind the screen and into the physical world. And sooner rather than later.
Think of it as mixing a physical product you hold in your hand with the deep informational powerhouse of online databases. Ok... That sentence doesn't make much sense written down. It is sort of how some picture frames no longer hold a physical picture in them, but instead are connected to the online world to show digital content where your physical product once was. Mmm... that explanation doesn't really do it for me either.
Probably the best way to explain what I'm trying to get at is to show you the incredible stuff a group at MIT has been working on called "SixthSense."
It starts getting super fly at 5 minutes: http://www.youtube.com/watch?v=nZ-VjUKAsao&feature=player_embedded
Right now we are a 3 screen society: TV, computer and mobile. These will continue to integrate eventually becoming extensions of each other, each pulling from the same databases to allow access to the same material (and shared in real time). And new innovative products will come out to allow us access in this digital world in the physical space.
Simply, whether the idea/product/service is widely accepted and profitable. A lot industries fall in this measurement but I think information technology is the most innovative industry and will continue be innovative for a very long time. The most innovative company came to my mind is Google. It actually comes to be part of one's life and it still explores more and more valuable services. Google's android mobile phone is also very popular among smartphone users. The most important thing is that they pick up whatever project they think would make people's life easier and happier, and when you were thinking this might be a great idea, they are already doing it, maybe just one engineer was doing it but very quickly it came out release 1.0 and then 2.0. This simple concept proved to be very successful.
Honestly, I don't think there is a great way to measure innovation. Maybe the best is some type of combination of idea generation and new product success. For example, you could measure (kind of like Japan) how many ideas are generated from employees. But then you would take it to the next level and measure the success (in sales) of new products.
I think any type of tech company has to be innovative in its industry. The fast-paced, ever-changing industry demands new products and changes to products. It's a dog eat dog world and companies have to stay on top of innovation to survive.
As for the future, I'm really interested to see how the automotive industry takes on innovation. We've all very familiar with the Nissan Leaf, but I'm curious how the market will be effected. Will all cars become electric? Or something else? I think it's inevitable for us to break our dependence on oil. I also think it's inevitable for the car companies to change.
Incremental innovation can be measured by if the new product is cheaper, thinner, faster or has more features. For disruptive innovation to be truly innovative it has to be able to change social behavior.
According to me the most innovative industry today is High-Tech and will continue to be so in the coming years. The High-Tech industry is responsible for making other industries innovative by providing them products and services that optimize their processes, add features to the their products, make their products faster etc.
For example, in the coming years, as the size of the microchips reduces further and they become cheaper, and more powerful and prevalent, these chips will add value and transform many products and services. For instance, imagine the impact on the health-care industry when we start integrating technology with the human body on a mass scale. Not only will the future humans be much smarter but also these chips will increase the human life expectancy by informing people much before they fall sick so they can take preventive measures. The next disruptive innovation is likely going to be the widespread adoption of human technology integration (cyborgs). (Video: http://www.youtube.com/watch?v=urVXWUD8Q3Y)
Each industry has different metrics that measure innovation. For example, in the fashion industry, the new trends are designer driven - an artistic expression; in the architecture industry, innovation is measured by the marriage of function and form, and to a large part, society and psychology; in the technology industry, it's largely measured by the level at which integration is achieved.
I see the tech industry as being the most innovative. It seems to be changing and developing more rapidly - and in turn, driving other industries. On the flip side, I think industries that manufacture and sell daily necessities continually have to reinvent their products due to fierce competition. Innovations are essential to come up with something new and relevant that will outsell their competitor.
In our lifetimes, we'll be surprised by what industries will continue to be innovative, and others that will fade in and fade out. My grandparents never foresaw the internet and it has revolutionized life beyond imagination. Their grandparents never would have imagined an automobile, let alone a plane. I see technology continuing to be a driver that will have a growing hand in all the other industries. The world is becoming ever more global and smaller... so anything that can further that progression will be on the cutting edge of innovative thinking.
I think it’s an interesting thought exercise to look at the industries that are either the less innovative or at least most resistant to (and desperately in need of) innovation, and my favorite is the transportation industry. Transportation (trucks, trains, barges, cargo ships, airplanes) as a whole produces on the order of 15% of all greenhouse gas emissions and is vital to the world’s commerce. There is definitely some innovation going on, around electric cars and high-speed trains, but when you look at the big movers, like cargo ships and trains, the technology hasn’t changed dramatically in the last 50 years.
I think a lot of that is due to the monopolistic nature of those sectors (thanks Cornelius Vanderbilt), but with the movement toward faster delivery, we aren’t going to be able solve all our delivery challenges by sticking stuff on airplanes. Everyone else is going to have to catch up.
Right now, most of the innovation in the train and ship space is being pushed by environmental regulations around air and water quality. But I think there is tremendous potential to innovate ways to move things across water and land faster, and capture back some of that marketshare without building regulation.
I agree that there seems to be a great deal of innovation in the technology space. I also realize that my perception of this could be affected by an availability bias (I think that's what my LTO prof called it!) because as a consumer I see, try and purchase many of these innovations. I realize that I may be very naive to huge amounts of innovation that takes place in industries I have no contact with.
One industry that I recently interacted with in which there is a great deal of room for innovation is the food/nutrition industry. For Project Pyramid, a group of Owen students worked in Guatemala to make a food product that was inexpensive, high in protein and available locally. I think there is huge potential here...in developed and underdeveloped countries.
I agree with Elizabeth, in that metrics should probably be tracked within an industry as opposed to across industries. That being said, I think it would be incredibly challenging to do that. The ones Elizabeth listed, for instance, seem as though they would be information that a lot of companies would like to keep close to the vest and not necessarily report on (unless of course, they want bragging rights). Perhaps the best way to measure the innovation is consumer adoption. In many cases, consumer adoption means that change is happening so that may be the best way to measure it. I hesitate going strictly with that measure, however, because sometimes a lot of innovative changes are occuring within a small group of people, and I would not want those industries to lose out just because they're operating in a smaller population base than some of the larger ones.
As may have mentioned above, I think the electronics/technology industry is quite innovative today. I would also argue that the medical devices industry is one of the most innovative today. I think the medical devices space will continue to grow at a fast pace, particularly in the US, because of the political changes that are in progress. It is a "hot" market with a lot of attention, and I think that will fuel the innovation.
I don’t think you can measure innovation at such a general level. I think each industry would have its own specific benchmarks and required analysis to measure innovation. For example, how could you measure the innovation in coal mining to medical surgery? They are completely different and any metrics that would encompass both would be far too generic to offer any real insight into the innovation within that industry. I think the most innovative industry today is within healthcare and specifically medical devices. As technology has improved and our understanding on how to provide effective and efficient healthcare has grown, overall patient safety and care has improved greatly. There are many benchmarks within healthcare to measure the effects of innovations, length of stay, recovery time, rates of infection, etc. I think health care will continue to be the most innovative industry in our life times as we continue to improve and apply new technologies, new treatments and new understandings of medicine and the body.
Innovation analysis at the industries seems to be the acceptance of those innovations. A point of reference allows us to consider the degree to which the innovations have changed the industry. Adoption of those changes are a clear measure to whether the industry was actually able to be receptive to innovation or simply paid it lip service.
With that in mind, I see the way that we interact with each other through the internet, social media, and consumer electronics as the most innovative industry. I think that industry will continue to make incremental changes for many years to come.
I also believe that the industry that will experience the greatest amount of innovation to come will be in the health care industry. While this industry can be exceptionally difficult industry to experience success. I believe there is a renewed appetite for innovation in health care, and the greatest opportunity for disruptive innovation.
How could you measure innovation at the industry level of analysis? By your measure, what are the most innovative industries today? What industries do you think will continue to be innovative in our life-times? Why? Innovation at the industry level can be measured by the industry’s ability to keep itself current. How well is the industry adjusting to new technology, environmental concerns. changing societal constraints? The most innovative industries today are the packaged food industries, videogame industry, and car industries. Of these, I see the car industry as the industry that will continue to be innovative. Though I am by no means a tree hugging hippie, even I can see that gas guzzlers are a thing of the past and the car company that somehow manages to invest in a cleaner future without forcing us to give up the things we love (speed, convenience, sex appeal etc.) will be king. So far, the industry has made huge strides in this direction; and if they continue to do so, because transportation is such a basic human need, the car industry will be around for many many moons to come.
You could measure innovation at the industry level based on the amount of new product launches and product innovations over a given period of time. A truly innovative industry will continue to compete with its competitors and strive to release the best and most innovative product offerings.
This is very apparent in the food and automotive industry. Food companies are constantly testing new products and looking to gain market share in a new or existing product category. Innovative food companies have created the double stuff oreo, vitamin water, dunkaroos, activia, cocoa puffs, and crystal lite to name a few.
Automotive industry is also the most innovative today and will continue to be innovative throughout our life times. Automotive companies are constantly releasing safer, quicker, more efficient, and more reliable vehicles. This is due to improvements in the manufacturing processes and an emphasis on lowering emissions and maximizing efficiency. In addition, the autmotive industry is looking to the future and releasing electric and hydrogen powered vehicles. These vehicles will have zero emissions and over time will greatly reduce the worlds reliance on petroleum. Automotive companies are also currently testing a system that will allow vehicles to communicate with one another so that accidents will be a thing of the past. This and vehicles which drive themselves will most likely be released in our lifetime. The high level of competition and government emissions/mpg mandates guarantees that the automotive industry will continue to be innovative and never rest on its laurels.
I think the only way to measure an industry's level of innovation is its ability to recognize and adopt to changes in needs. Speed of adoption would not work, since the adoption could be slow but once adopted, it could have a tremendous value for those that use the innovation. The amount of adoption would be weak, too, since there could be very few people who use the innovation, but, again, the value is tremendous.
I think the energies industry has been and will remain innovative. Efficiencies have come a long way since the day of the steam engine. The industry has a black eye, but the issue at hand is not the companies, but the end users. Outside pressures will continue to push innovation in the industry as well as the opportunity for cost advantages.
I was initially thinking that innovative industries are those with the least amount of regulation/government intervention and that the most innovative companies are those without the governmental demands, but then I thought about it and not so sure. Healthcare and Education are not very innovative, but I would think that our military and defense are hugely innovative. There is, however, something about speed to market, consumer adoption, perceived increase in benefit, and frequency of innovation which is how we could measure innovation at an industry level. This would lead me to think that those industries which are most nimble are the most innovative. To list another industry which I believe to be innovative – the toy industry. There is a significant amount of investment in R&D, it’s very creative, with short product development cycles, and short product lifecycles. It is constantly evolving to meet and exceed the demands of its consumers – continuous learning kids.
I don't know if you can necessarily measure innovation based on consumer adoption. As we saw in our previous blogs, there are many products that have been extremely innovative but that have failed miserably in the market.
I think an industry that has been extremely innovative in the past and will continue to be innovative is the transportation industry. This includes the automobile industry, which has clearly been innovative, as well as airlines, shipping, and train transportation. The Segway could also be included in this. I think the futuristic ideal of flying cars and the "Jetsons" reality has helped to push this. Not only are companies trying to come up with new ways of transporting people and goods, both to reduce cost and excite consumers, they are also attempting innovations to make these forms of transportation more environmentally friendly.
I find it extremely difficult to measure innovation at an industry level. I don't know if we are even aware of all the innovations that are happening inside each industry.
Most of us believe the technology industry to be innovative because it is in the spotlight all the time.
Does this attention come from being innovative, or does the attention drive the innovation? Seems like a chicken and egg issue here.
I believe high competition coupled with high customer demand (and therefore profitability) forces the industry to be innovative. So is this a good measure for innovation?
In order to measure industry innovation constraints I would look at the number of new products or processes introduces by the industry as a whole. For example, large construction compnaies are not very innovative. They have proven processes and machinery that perform specific jobs well. There is rarely innovation in this industry. I agree that the tech industry is innovative. However, I have to say that the most innovative industry is the consumer packaged goods industry. New products are frequently introduced and very few are actually adopted.
Like many people have stated, I believe the most innovative industry is technology. The reason for that is first there are low barriers to entry. Second, there are very large rewards for creating game changing improvements. With incentives properly aligned and pretty much everyone having a computer I believe that tech will continue to be the most innovative industry.
Outside of tech, I'd look at healthcare/pharma as industry that will grow. People will always want to improve their lives and willing to pay for it, so I'd expect continued growth.
I think that the most innovative industry right now is technology. I worked at Verizon Wireless over the summer and in the mobile phone sector alone, I saw amazing improvements within a span of 2 months. This related to all divisions--the marketing, the communications technology, the device itself, there was never a dull moment because I was constantly learning about something new. I measure innovation in a couple different ways. First by seeing how many new products or services an industry produces within a given time frame. Another way to measure it would be the different usages the industry finds from a certain product or service. For example, the cell phone has been around for awhile, but to make it a touch screen or to make it a mobile PC is something that has changed the way we use our phones. In my lifetime, I think the technology industry will continue to grow, as will the 'green' industry.
Innovation, to me, is very industry-specific and largely perception-based. When I think about innovative industries, I most immediately think about technology companies because of the tangible nature of their products but has the social media industry really had a long enough run to merit being considered innovative? Probably not, but I still perceive them as innovative and so the notion persists accordingly. So I feel like the better question is which industry would succeed in convincing us of their "innovativeness"
Measuring innovation at the industry level seems simple when you look at industries that are generally innovative (technology for example). I guess you could look at how many new products are introduced each year, how successful each product/industry is, and how much continued demand is put on the industry. I also agree with Beeland. Measuring an industry based on their reaction time to needs would be a very good way to measure innovation within an industry.
By my measure I would say technology is the most innovative industry today. Just as my current year-old computer is outdated, technology is always advancing. With such a fast past industry demand, technology has to continuously be innovative.
Technology, healthcare, and sustainability will be continuously improving throughout my lifetime. They have been some of the fastest growing industries and I don’t see that slowing down as demand is continually rising. This demand not only comes from developed countries, but also developing countries and that will play a large part in this growth.
Energy and clean technology will be continue to be innovative in our life-times. Some industries are innovative to fulfill the end-user's desire. Energy and clean technology will continue to be innovative because of need. While there are several alternative energies like wind and solar, they do not compare to the availability and inexpensive price of gasoline. However, there is a tremendous increase in demand for energy from China and India. The increased competition for energy, and likely increase in oil prices, will force us to re-evaluate alternative energy sources. We may see innovations on current energy sources or we may see the development a new sources of energy that haven't been conceived yet. Interestingly, China recently overtook the US to become the biggest investor in green technology. They have such need given the size of their country and rapid growth. Investments made by private and public investors will fuel this growth in a race for sustainable energy.
I'm not exactly sure what measure I would use across industries, because it makes more sense to me to have industry specific metrics. Yet, I understand the need/desire for the measure to allow for comparison, so given that constraint, I would probably measure innovation in a three-fold manner: by number of ideas produced internally, number of those invested in, and return on that investment.
ReplyDeleteGiven those measures, I think the technology industry is one of the most innovative industries today. With the multitude of products and ideas that continually come out of organizations like Apple, IBM, and GE, it's apparent that innovation is occurring, it appears to be encouraged, and I think they'll continue to master it.
Additionally, I think there's a real opportunity to see innovation from a plethora of organizations (whether they currently exist or not) in the sustainability space. Most companies today are looking to reduce waste, save costs, and improve environmental impact (or so they claim), so I think the real thought leaders of my life-time will create and execute new ideas surrounding sustainability. Especially since waste management, the electricity grid, renewable energies, and feeding the people on the planet appear to be the biggest problems of our era, and they could all benefit from sustainable innovations. Just my two cents!
I vote for FMCG industry as the most innovative industry based on three measures, those are 'availability of resources', 'financial gains for innovative efforts' and 'the length of product life cycle'.
ReplyDeleteAll the FMCG giants today shared the common feature of huge R&D investment in forms of both monetary and human capital. Like P&G, they take innovation as their lifeblood by paying strict attention to the indicators including ‘Annual R&D budget as a percentage of annual sales’ and ‘Total R&D headcount or budget as a percentage of sales’.
Also, return on investment measures the innovation idea in finance discipline. Financial gains is the major thrust that push all players within certain industry to pursue innovative ideas relentlessly. In an industry like FMCG where competition is at most fierce, product innovation or ‘blue-ocean policy’ might be the best way to build corporate competency so as to over satisfy customer and grab as much market share as possible
The third measure is the length of product life cycle. The shorter the cycle is, the more innovative the industry is supposed to be. Like the case with 3M, there’s an important internal metric that is ‘Percentage of sales from products introduced in the past 4 years’. It means that a company can’t cash cow one hit product forever. In other words, the players in this Industry have to be innovative enough in creating new ideas and products within short period.
I might agree that fast moving consumer goods is the most innovative industry. I'd base it on a drastic change in both the inputs and outputs of these products. From an input standpoint, the sourcing of food has changed drastically over the past 10 years due to farmland sustainability initiatives, bio-engineering, the organic movement, and processing advancements that allow you to get food within days of harvesting the plant.
ReplyDeleteFrom an output standpoint, in-store branding of consumer products is changing as well. The label and packaging of certain products have been relatively constant over the years, such that the consumer has been able to base his/her perception of the product simply from the outside of a can or by looking through a glass jar. However, the potential for cost-savings from reducing packaging material as well as the benefits from using more sustainable material has led to advancements whereby products currently sold in cans will soon be sold in cartons, for example. This will drastically change how consumers interact with products at the store, and result in CPGs rethinking how they will engage with customers through packaging.
I believe that the growing population, and the resulting scarcity of certain food items will demand that the FMCG industry continue to be innovative. As the environmental consequences of this industry's practices become more and more apparent, there will be drastic changes in the sourcing, and packaging of food in the short and long term.
Why do we blame the manufacturer of this product? What should be enforced are the laws we currently have in place. Instead of chasing down a company that produces a legitimate product, shouldn't law enforcement be chasing down those individuals who bought the product for those minors? When someone abuses prescription drugs and overdoses, do we chase down the pharmaceutical companies to stop producing those drugs? No. Why should this industry be any different? Just because FourLoko does not have the lobby strength Pfizer does shouldn't mean that it gets treated any differently.
ReplyDeleteI am a digital junky and love the freedom that the space has given to anyone who has a computer to tinker and innovate. The barriers to entry are extremely low; in most cases the biggest barrier is simply programming knowledge, which can be easily learned.
ReplyDeleteThat being said, I can guarantee we are going to see crazy innovative ways to bring the internet and the digital world out from behind the screen and into the physical world. And sooner rather than later.
Think of it as mixing a physical product you hold in your hand with the deep informational powerhouse of online databases. Ok... That sentence doesn't make much sense written down. It is sort of how some picture frames no longer hold a physical picture in them, but instead are connected to the online world to show digital content where your physical product once was. Mmm... that explanation doesn't really do it for me either.
Probably the best way to explain what I'm trying to get at is to show you the incredible stuff a group at MIT has been working on called "SixthSense."
It starts getting super fly at 5 minutes:
http://www.youtube.com/watch?v=nZ-VjUKAsao&feature=player_embedded
Right now we are a 3 screen society: TV, computer and mobile. These will continue to integrate eventually becoming extensions of each other, each pulling from the same databases to allow access to the same material (and shared in real time). And new innovative products will come out to allow us access in this digital world in the physical space.
You can find out more about SixthSense at: http://www.pranavmistry.com/projects/sixthsense/
ReplyDeleteSimply, whether the idea/product/service is widely accepted and profitable. A lot industries fall in this measurement but I think information technology is the most innovative industry and will continue be innovative for a very long time. The most innovative company came to my mind is Google. It actually comes to be part of one's life and it still explores more and more valuable services. Google's android mobile phone is also very popular among smartphone users. The most important thing is that they pick up whatever project they think would make people's life easier and happier, and when you were thinking this might be a great idea, they are already doing it, maybe just one engineer was doing it but very quickly it came out release 1.0 and then 2.0. This simple concept proved to be very successful.
ReplyDeleteHonestly, I don't think there is a great way to measure innovation. Maybe the best is some type of combination of idea generation and new product success. For example, you could measure (kind of like Japan) how many ideas are generated from employees. But then you would take it to the next level and measure the success (in sales) of new products.
ReplyDeleteI think any type of tech company has to be innovative in its industry. The fast-paced, ever-changing industry demands new products and changes to products. It's a dog eat dog world and companies have to stay on top of innovation to survive.
As for the future, I'm really interested to see how the automotive industry takes on innovation. We've all very familiar with the Nissan Leaf, but I'm curious how the market will be effected. Will all cars become electric? Or something else? I think it's inevitable for us to break our dependence on oil. I also think it's inevitable for the car companies to change.
Incremental innovation can be measured by if the new product is cheaper, thinner, faster or has more features. For disruptive innovation to be truly innovative it has to be able to change social behavior.
ReplyDeleteAccording to me the most innovative industry today is High-Tech and will continue to be so in the coming years. The High-Tech industry is responsible for making other industries innovative by providing them products and services that optimize their processes, add features to the their products, make their products faster etc.
For example, in the coming years, as the size of the microchips reduces further and they become cheaper, and more powerful and prevalent, these chips will add value and transform many products and services. For instance, imagine the impact on the health-care industry when we start integrating technology with the human body on a mass scale. Not only will the future humans be much smarter but also these chips will increase the human life expectancy by informing people much before they fall sick so they can take preventive measures. The next disruptive innovation is likely going to be the widespread adoption of human technology integration (cyborgs). (Video: http://www.youtube.com/watch?v=urVXWUD8Q3Y)
Each industry has different metrics that measure innovation. For example, in the fashion industry, the new trends are designer driven - an artistic expression; in the architecture industry, innovation is measured by the marriage of function and form, and to a large part, society and psychology; in the technology industry, it's largely measured by the level at which integration is achieved.
ReplyDeleteI see the tech industry as being the most innovative. It seems to be changing and developing more rapidly - and in turn, driving other industries. On the flip side, I think industries that manufacture and sell daily necessities continually have to reinvent their products due to fierce competition. Innovations are essential to come up with something new and relevant that will outsell their competitor.
In our lifetimes, we'll be surprised by what industries will continue to be innovative, and others that will fade in and fade out. My grandparents never foresaw the internet and it has revolutionized life beyond imagination. Their grandparents never would have imagined an automobile, let alone a plane. I see technology continuing to be a driver that will have a growing hand in all the other industries. The world is becoming ever more global and smaller... so anything that can further that progression will be on the cutting edge of innovative thinking.
I think it’s an interesting thought exercise to look at the industries that are either the less innovative or at least most resistant to (and desperately in need of) innovation, and my favorite is the transportation industry. Transportation (trucks, trains, barges, cargo ships, airplanes) as a whole produces on the order of 15% of all greenhouse gas emissions and is vital to the world’s commerce. There is definitely some innovation going on, around electric cars and high-speed trains, but when you look at the big movers, like cargo ships and trains, the technology hasn’t changed dramatically in the last 50 years.
ReplyDeleteI think a lot of that is due to the monopolistic nature of those sectors (thanks Cornelius Vanderbilt), but with the movement toward faster delivery, we aren’t going to be able solve all our delivery challenges by sticking stuff on airplanes. Everyone else is going to have to catch up.
Right now, most of the innovation in the train and ship space is being pushed by environmental regulations around air and water quality. But I think there is tremendous potential to innovate ways to move things across water and land faster, and capture back some of that marketshare without building regulation.
I agree that there seems to be a great deal of innovation in the technology space. I also realize that my perception of this could be affected by an availability bias (I think that's what my LTO prof called it!) because as a consumer I see, try and purchase many of these innovations. I realize that I may be very naive to huge amounts of innovation that takes place in industries I have no contact with.
ReplyDeleteOne industry that I recently interacted with in which there is a great deal of room for innovation is the food/nutrition industry. For Project Pyramid, a group of Owen students worked in Guatemala to make a food product that was inexpensive, high in protein and available locally. I think there is huge potential here...in developed and underdeveloped countries.
I agree with Elizabeth, in that metrics should probably be tracked within an industry as opposed to across industries. That being said, I think it would be incredibly challenging to do that. The ones Elizabeth listed, for instance, seem as though they would be information that a lot of companies would like to keep close to the vest and not necessarily report on (unless of course, they want bragging rights). Perhaps the best way to measure the innovation is consumer adoption. In many cases, consumer adoption means that change is happening so that may be the best way to measure it. I hesitate going strictly with that measure, however, because sometimes a lot of innovative changes are occuring within a small group of people, and I would not want those industries to lose out just because they're operating in a smaller population base than some of the larger ones.
ReplyDeleteAs may have mentioned above, I think the electronics/technology industry is quite innovative today. I would also argue that the medical devices industry is one of the most innovative today. I think the medical devices space will continue to grow at a fast pace, particularly in the US, because of the political changes that are in progress. It is a "hot" market with a lot of attention, and I think that will fuel the innovation.
I don’t think you can measure innovation at such a general level. I think each industry would have its own specific benchmarks and required analysis to measure innovation. For example, how could you measure the innovation in coal mining to medical surgery? They are completely different and any metrics that would encompass both would be far too generic to offer any real insight into the innovation within that industry.
ReplyDeleteI think the most innovative industry today is within healthcare and specifically medical devices. As technology has improved and our understanding on how to provide effective and efficient healthcare has grown, overall patient safety and care has improved greatly. There are many benchmarks within healthcare to measure the effects of innovations, length of stay, recovery time, rates of infection, etc. I think health care will continue to be the most innovative industry in our life times as we continue to improve and apply new technologies, new treatments and new understandings of medicine and the body.
Innovation analysis at the industries seems to be the acceptance of those innovations. A point of reference allows us to consider the degree to which the innovations have changed the industry. Adoption of those changes are a clear measure to whether the industry was actually able to be receptive to innovation or simply paid it lip service.
ReplyDeleteWith that in mind, I see the way that we interact with each other through the internet, social media, and consumer electronics as the most innovative industry. I think that industry will continue to make incremental changes for many years to come.
I also believe that the industry that will experience the greatest amount of innovation to come will be in the health care industry. While this industry can be exceptionally difficult industry to experience success. I believe there is a renewed appetite for innovation in health care, and the greatest opportunity for disruptive innovation.
How could you measure innovation at the industry level of analysis? By your measure, what are the most innovative industries today? What industries do you think will continue to be innovative in our life-times? Why?
ReplyDeleteInnovation at the industry level can be measured by the industry’s ability to keep itself current. How well is the industry adjusting to new technology, environmental concerns. changing societal constraints?
The most innovative industries today are the packaged food industries, videogame industry, and car industries. Of these, I see the car industry as the industry that will continue to be innovative. Though I am by no means a tree hugging hippie, even I can see that gas guzzlers are a thing of the past and the car company that somehow manages to invest in a cleaner future without forcing us to give up the things we love (speed, convenience, sex appeal etc.) will be king. So far, the industry has made huge strides in this direction; and if they continue to do so, because transportation is such a basic human need, the car industry will be around for many many moons to come.
You could measure innovation at the industry level based on the amount of new product launches and product innovations over a given period of time. A truly innovative industry will continue to compete with its competitors and strive to release the best and most innovative product offerings.
ReplyDeleteThis is very apparent in the food and automotive industry. Food companies are constantly testing new products and looking to gain market share in a new or existing product category. Innovative food companies have created the double stuff oreo, vitamin water, dunkaroos, activia, cocoa puffs, and crystal lite to name a few.
Automotive industry is also the most innovative today and will continue to be innovative throughout our life times. Automotive companies are constantly releasing safer, quicker, more efficient, and more reliable vehicles. This is due to improvements in the manufacturing processes and an emphasis on lowering emissions and maximizing efficiency. In addition, the autmotive industry is looking to the future and releasing electric and hydrogen powered vehicles. These vehicles will have zero emissions and over time will greatly reduce the worlds reliance on petroleum. Automotive companies are also currently testing a system that will allow vehicles to communicate with one another so that accidents will be a thing of the past. This and vehicles which drive themselves will most likely be released in our lifetime. The high level of competition and government emissions/mpg mandates guarantees that the automotive industry will continue to be innovative and never rest on its laurels.
I think the only way to measure an industry's level of innovation is its ability to recognize and adopt to changes in needs. Speed of adoption would not work, since the adoption could be slow but once adopted, it could have a tremendous value for those that use the innovation. The amount of adoption would be weak, too, since there could be very few people who use the innovation, but, again, the value is tremendous.
ReplyDeleteI think the energies industry has been and will remain innovative. Efficiencies have come a long way since the day of the steam engine. The industry has a black eye, but the issue at hand is not the companies, but the end users. Outside pressures will continue to push innovation in the industry as well as the opportunity for cost advantages.
I was initially thinking that innovative industries are those with the least amount of regulation/government intervention and that the most innovative companies are those without the governmental demands, but then I thought about it and not so sure. Healthcare and Education are not very innovative, but I would think that our military and defense are hugely innovative. There is, however, something about speed to market, consumer adoption, perceived increase in benefit, and frequency of innovation which is how we could measure innovation at an industry level. This would lead me to think that those industries which are most nimble are the most innovative.
ReplyDeleteTo list another industry which I believe to be innovative – the toy industry. There is a significant amount of investment in R&D, it’s very creative, with short product development cycles, and short product lifecycles. It is constantly evolving to meet and exceed the demands of its consumers – continuous learning kids.
I don't know if you can necessarily measure innovation based on consumer adoption. As we saw in our previous blogs, there are many products that have been extremely innovative but that have failed miserably in the market.
ReplyDeleteI think an industry that has been extremely innovative in the past and will continue to be innovative is the transportation industry. This includes the automobile industry, which has clearly been innovative, as well as airlines, shipping, and train transportation. The Segway could also be included in this. I think the futuristic ideal of flying cars and the "Jetsons" reality has helped to push this. Not only are companies trying to come up with new ways of transporting people and goods, both to reduce cost and excite consumers, they are also attempting innovations to make these forms of transportation more environmentally friendly.
I find it extremely difficult to measure innovation at an industry level. I don't know if we are even aware of all the innovations that are happening inside each industry.
ReplyDeleteMost of us believe the technology industry to be innovative because it is in the spotlight all the time.
Does this attention come from being innovative, or does the attention drive the innovation? Seems like a chicken and egg issue here.
I believe high competition coupled with high customer demand (and therefore profitability) forces the industry to be innovative. So is this a good measure for innovation?
In order to measure industry innovation constraints I would look at the number of new products or processes introduces by the industry as a whole. For example, large construction compnaies are not very innovative. They have proven processes and machinery that perform specific jobs well. There is rarely innovation in this industry. I agree that the tech industry is innovative. However, I have to say that the most innovative industry is the consumer packaged goods industry. New products are frequently introduced and very few are actually adopted.
ReplyDeleteLike many people have stated, I believe the most innovative industry is technology. The reason for that is first there are low barriers to entry. Second, there are very large rewards for creating game changing improvements. With incentives properly aligned and pretty much everyone having a computer I believe that tech will continue to be the most innovative industry.
ReplyDeleteOutside of tech, I'd look at healthcare/pharma as industry that will grow. People will always want to improve their lives and willing to pay for it, so I'd expect continued growth.
I think that the most innovative industry right now is technology. I worked at Verizon Wireless over the summer and in the mobile phone sector alone, I saw amazing improvements within a span of 2 months. This related to all divisions--the marketing, the communications technology, the device itself, there was never a dull moment because I was constantly learning about something new.
ReplyDeleteI measure innovation in a couple different ways. First by seeing how many new products or services an industry produces within a given time frame. Another way to measure it would be the different usages the industry finds from a certain product or service. For example, the cell phone has been around for awhile, but to make it a touch screen or to make it a mobile PC is something that has changed the way we use our phones.
In my lifetime, I think the technology industry will continue to grow, as will the 'green' industry.
Innovation, to me, is very industry-specific and largely perception-based. When I think about innovative industries, I most immediately think about technology companies because of the tangible nature of their products but has the social media industry really had a long enough run to merit being considered innovative? Probably not, but I still perceive them as innovative and so the notion persists accordingly.
ReplyDeleteSo I feel like the better question is which industry would succeed in convincing us of their "innovativeness"
Measuring innovation at the industry level seems simple when you look at industries that are generally innovative (technology for example). I guess you could look at how many new products are introduced each year, how successful each product/industry is, and how much continued demand is put on the industry. I also agree with Beeland. Measuring an industry based on their reaction time to needs would be a very good way to measure innovation within an industry.
ReplyDeleteBy my measure I would say technology is the most innovative industry today. Just as my current year-old computer is outdated, technology is always advancing. With such a fast past industry demand, technology has to continuously be innovative.
Technology, healthcare, and sustainability will be continuously improving throughout my lifetime. They have been some of the fastest growing industries and I don’t see that slowing down as demand is continually rising. This demand not only comes from developed countries, but also developing countries and that will play a large part in this growth.
Energy and clean technology will be continue to be innovative in our life-times. Some industries are innovative to fulfill the end-user's desire. Energy and clean technology will continue to be innovative because of need. While there are several alternative energies like wind and solar, they do not compare to the availability and inexpensive price of gasoline. However, there is a tremendous increase in demand for energy from China and India. The increased competition for energy, and likely increase in oil prices, will force us to re-evaluate alternative energy sources. We may see innovations on current energy sources or we may see the development a new sources of energy that haven't been conceived yet. Interestingly, China recently overtook the US to become the biggest investor in green technology. They have such need given the size of their country and rapid growth. Investments made by private and public investors will fuel this growth in a race for sustainable energy.
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