UN ESCAP

Innovation Task Force

© VERLION 2015

DesigningEffective

Innovation

United Nations ESCAPInnovation & Competitiveness Task Force

UNCC Bangkok, November 1, 2015

Maggie Gorse

UN ESCAP

Innovation Task Force

© VERLION 2015

Some ideas for the Task Force –How can we have Impact ?

Innovation Design for more Effective Discovery

Business Innovation Transforms Competitiveness

Networks, Ecosystems & Grass Roots Innovation

Engage CSR to overcome Infrastructure Handicaps

UN ESCAP

Innovation Task Force

© VERLION 2015

Innovation’s “Path to Impact”

Discovery Product /Service

Access

FundingTalent

IncubatorsMentorsEnablers

Etc

CapitalEquipmtLogisticsSuppliersEnablers

Etc

DistributorsAds

SupportPaymentEnablers

Etc

MonetizedEducated

Mobile &/orConnected

EnabledEtc

Customer

UN ESCAP

Innovation Task Force

© VERLION 2015

Innovation Design for more Effective Discovery

Business Innovation Transforms Competitiveness

Networks, Ecosystems & Grass Roots Innovation

Engage CSR to overcome Infrastructure Handicaps

Some ideas for the Task Force –How can we have Impact ?

UN ESCAP

Innovation Task Force

© VERLION 2015

CostR&D

Selling

G&A

Profit

Big PharmaPrice = 100

CostSelling

G&A

Profit

GenericsPrice = 20

Pharmaceuticals Patents Expire

Patent Rights Expiration

UN ESCAP

Innovation Task Force

© VERLION 2015

The Road to Survival = Innovation

Tufts University Study: Successful New Drug Discovery

Requires circa $ 1 Billion and 10 to 15 years in R&D

$2 Billion

$500 million

Industry Response: 1994 to early 2000’s Massive Mergers to reach Critical R&D Budgets

Resultwas…

FewerFDA Approvals

1996 2001

BiggerR&D Budgets

1996 2001

Sources: Company Anual reports and ParexelPharma

UN ESCAP

Innovation Task Force

© VERLION 2015

Why Didn’t More R&D ResourcesProduce More R&D Results?

Risk Design is more important to Success than

More Money or Size

Innovation Is a Game of Chance (Risk)

To Win, you need bothSkill and Probabilities

UN ESCAP

Innovation Task Force

© VERLION 2015

Can Money Buy Success?

Source: http://www.nature.com/clpt/journal/v87/n3/fig_tab/clpt2009293f2.htmlNew Drug Approvals provided by Tufts University, Expenditures provided by

and converted to constant $ by Tufts

UN ESCAP

Innovation Task Force

© VERLION 2015

Big Pharma Reduces R&D Budget,Uses New R&D Design for Innovation

Big Pharma

R&D

IN

Independents

Universities

Governments

$

$$Out

Clinical Test

FDA Approv

Marketing

DistributionSmall Biotechs $

UN ESCAP

Innovation Task Force

© VERLION 2015

A Lesson in Risk Design

More money on own cards does not increase chance of winning

Venture Capitalist

Shared Risk,Shared Reward.

Same Money, More Chances to Win

« ProprietaryTechnology »

with Copyright

UN ESCAP

Innovation Task Force

© VERLION 2015

3000

GE Gives Access to All Patentson Quirky

Collaborative Innovation Site

Submits Innovation Idea

Comment & Vote

Comment & Vote

$$$$$$$$

$$

$$

Sources: http://money.cnn.com/2013/04/12/technology/innovation/quirky-general-electric/index.htmlhttp://techonomy.com/2012/09/with-68-million-from-andreessen-horowitz-and-kleiner-perkins-quirky-aims-to-disrupt-consumer-

Quirky & GE launch"Wink” initiative for inventors:

create app-enabled products, instantly

connected with internet.

GE emphasizes importance of

connecting with a community of entrepreneurs

to push forward innovation.

UN ESCAP

Innovation Task Force

© VERLION 2015

Sun Jifa, farmer in Jilin province, lost his forearms 32 years ago – instructed his nephews to build these prosthetic forearms from scrap metal, plastic and rubber. Sun & nephews have sold 300 prosthetic limbs for people in needfor 3000 RMB each. September, 2012 (Reuters/Sheng Li)

Noah's Ark of China, six-ton “survival” ball by Chinese inventor Yang Zongfu, in Yiwu, Zhejiang province. Yang spent 2 years &1.5 million RMB to build 4m diameter vessel, capable of housing 3 people with enough

food to live 10 months, protected from external heat, water & impact.

August, 2012. (Reuters/China Daily)

May 2013 report in « The Atlantic »:China Has Broad & Rich Talent for Innovation

UN ESCAP

Innovation Task Force

© VERLION 2015

Innovation’s “Path to Impact”

Discovery Product /Service

Access Customer

1. « Innovate » Innovation Design

2. Enable Grass Roots Discovery

3. Eco-system of Networks

UN ESCAP

Innovation Task Force

© VERLION 2015

Innovation Design for more Effective Discovery

Business Innovation Transforms Competitiveness

Networks, Ecosystems & Grass Roots Innovation

Engage CSR to overcome Infrastructure Handicaps

Some ideas for the Task Force –How can we have Impact ?

UN ESCAP

Innovation Task Force

© VERLION 2015

x 1 x 50

More Risk for Customer!

Strongly motivated to

fight back

50 « Enemies »

Already w/Customer

Unique, New, but

Risky Product

Reaching your Market, Risk & Value

UN ESCAP

Innovation Task Force

© VERLION 2015

x 1 x 50

Unique, New, but

Risky Product

Reduce Customer

Risk

Create

VALUE :OTA update, interactive,

etc

Make 50

« friends »

Reaching your Market, Risk & Value

UN ESCAP

Innovation Task Force

© VERLION 2015

Apple’s Business Model

Source: Gorse Analysts and http://www.wired.com/magazine/2011/04/mf_android/all/1

iOS Android

DEVICES

OS

APPs

UN ESCAP

Innovation Task Force

© VERLION 2015Source: http://www.gartner.com/newsroom/id/3061917

Apple’s Business Model

UN ESCAP

Innovation Task Force

© VERLION 2015

Source: http://www.wired.com/magazine/2011/04/mf

_android/all/1

CUMULATIVE APP DOWNLOADS

Apple’s Business Model

UN ESCAP

Innovation Task Force

© VERLION 2015

Traditional vs Value Design Business Models

Source: http://insights-on-business.com/electronics/the-xiaomi-story/

time

Collaboration on MIU OS

Wiki MIU OS Translation into 24 languages

On-line Pre-salesSocial Media Marketing

Collaborative feature updatesContinuous small batch releases Every WEEK

User generated help-line & support

Mfg SetupMfg SetupR&D Phase Mfg Setup R&D Phase

Flagship Stores

R&D Phase

< ! year

D Phase D PhaseApprox 2 years

“Design as you Build”}

time

UN ESCAP

Innovation Task Force

© VERLION 2015

Innovation’s “Path to Impact”

Discovery Product /Service

Access Customer

1. Business Creativity is «New Innovator»

2. Enable the Customer in Discovery

3. Eco-system of Networks

UN ESCAP

Innovation Task Force

© VERLION 2015

Innovation Design for more Effective Discovery

Business Innovation Transforms Competitiveness

Networks, Ecosystems & Grass Roots Innovation

Engage CSR to overcome Infrastructure Handicaps

Some ideas for the Task Force –How can we have Impact ?

UN ESCAP

Innovation Task Force

© VERLION 2015

Making DOS the Industry Standard by building the Network

Manufacturers

10’s

Consumers

100,000,000’s

DOS

Stores

100,000’s

Microsoft Success: Not Technology Innovation,

but Business Model Innovation

UN ESCAP

Innovation Task Force

© VERLION 2015Source: http://www.statista.com/statistics/268237/global-market-share-held-by-operating-systems-since-2009/

35 Years Later… Who Rules?

MacOSX

LinuxOther

iOS

UN ESCAP

Innovation Task Force

© VERLION 2015

Doing Less…… Is More

UBER The world’s largest taxi company…

… owns no vehicles

Facebook The world’s most popular media owner…

… creates no content

AlibabaThe world’s most valuable retailer…

… has no inventory

AirbnbThe world’s largest accommodation provider…

… owns no real estate

UN ESCAP

Innovation Task Force

© VERLION 2015

World Internet Usage – The Big Picture

Sources: http://www.internetworldstats.com/stats.htm 05/09 2015

UN ESCAP

Innovation Task Force

© VERLION 2015

World Internet Usage – The Big Picture

Sources: http://www.internetworldstats.com/stats.htm 05/09 2015

UN ESCAP

Innovation Task Force

© VERLION 2015

Innovation’s “Path to Impact”

Discovery Product /Service

Access Customer

1. Networks empower Grass Roots

2. Networks determine Market Access

3. Networks create powerful competitiveness

UN ESCAP

Innovation Task Force

© VERLION 2015

Innovation Design for more Effective Discovery

Business Innovation Transforms Competitiveness

Networks, Ecosystems & Grass Roots Innovation

Engage CSR to overcome Infrastructure Handicaps

Some ideas for the Task Force –How can we have Impact ?

30

TII

May 2015

OUR AMBITION: REVERSE THE TREND

# uncorrected (in billion of people)

2.6

2.4

0.0

202120202019201820172016201520142013

-10%

2.4

2.6

2.5

2050

1.5

3.2

- 54%

If we don’t act

If we create 50 million new wearers each year

Create 50 million new wearers per year by 2020Scale innovative business models that are non-dilutive & cost-

effective

UN ESCAP

Innovation Task Force

© VERLION 2015

Innovation’s “Path to Impact”

Discovery Product /Service

Access Customer

1. CSR helps disseminate innovation

2. CSR educates & monetizes the less privileged

3. CSR builds infrastructure & Networks

UN ESCAP

Innovation Task Force

© VERLION 2015

Some ideas for the Task Force –How can we have Impact ?

Innovation Design for more Effective Discovery

Business Innovation Transforms Competitiveness

Networks, Ecosystems & Grass Roots Innovation

Engage CSR to overcome Infrastructure Handicaps