VALUE CREATION OF TECHNOLOGIES FOR COMPETITIVE ADVANTAGE OF

BUSINESS INDUSTRIES

SHRIRAM INSTITUTE FOR INDUSTRIAL RESEARCH19, UNIVERSITY ROAD, DELHI-110 007

Email : sridlhi@vsnl.com Website : www.shriraminstitute.org

Presented by :Dr. R.K. KHANDAL

1. Defining value creation

2. Components responsible for value creation

3. Value creation of technologies

4. Value creation of technology for competitive edge and business growth

5. Path Forward

Outline of the Presentation

1. Defining Value Creation

Defining value Defining value creation Value creation Value creation: Concept for

competitiveness

Defining Value

Determines

Service

Demand

Product

Profit and Loss

To do With

Purpose

Affordability

Viability or Business

Application

Keyword

Worth

Utility

Price

Cost

Creates demand and serves as a driving force for development

Varies with the product and its applications Important for the viability of any venture

Value : DefinitionKeyword

Worth

Utility

Price

Cost

Defining Value Creation

Determines

Innovation

Value addition

Improvisation

To do With

Uniqueness

Upgradation

Cost reduction

Keyword

Novel

Modification

Efficiency A novel approach always results in innovation

whereas modifications and efficient ways would bring value addition and improvisation respectively

Value addition and improvisation are a form of value creation

Value Creation : Definition

Onus of value creation therefore, rests with the producer of the product; consumer of course is the driving force!

Perception of the Stakeholders

Inputs

How much profitable?

Value Creation

Does it serve the purpose?

Producer Consumer Regulator

Worth

Utility

Price

Cost

Specialty Application?

Realise max. through technical advantage

Minimum

Multi Utility?

Best quality Minimum price

Not Concerned

Within Norms

Not concerned

Environment Impact

Meets the stipulated Norms

Parameter

Concept of Value Creation & Approach

Approach Process

Technology Green Route

While the aim is to bring improvements without adversely affecting the environment and ecology, the innovative approaches ensure sustainability

Competitive advantage lasts longer if, sustainability is assured

Domain Quality Life cycle

Product (Materials)

Value Creation : Concept to Gain Competitiveness

Synergy Control Devices

Performance Safety

Application(Devices)

Renewable Innovation

Resources Technology

Process(Know-How)

Sustainability Preservation

Biodegradability

Damage Control

Environment(Ecology)

2. Components Responsible for Value Creation

Components Responsible for Value Creation

Society value creation - Sustainability Value Creation: Steps and Growth �

Components Responsible for Value Creation

People Process Technology

Knowledge

Culture

Skill Experience Leadership Capability Attitude

Adaptable Flexible Reproducibl

e Measurable Environmen

t-Friendly

Innovative Integrated Sustainable Diffusible State-of-the

art

Research Expertise Communi-

cation Applicatio

n Training

Values Discipline Convention

s Methods Beliefs

The role played by each component of value creation is crucial as well as essential

Value creation is necessary for growth and sustainability

Component

Indicators

SOCIETYVALUE

CREATION

Value creation is important for the growth of the society Societal interests must be kept in mind while achieving

value creation to ensure sustainability

ResearchEducation

Society - Value Creation - Sustainability

Technology

SUSTAINABILITY

SOCIETY VALUE CREATION

Education

Culture

Technology

Conventions

Values

SUSTAINABILITY

Tie-ups

Planning

GRO

WTH

Resource

Supply Chain

Training

Systems

Efficiency

Strategy

Controls

Optimization

Efficiency

Product Quality

Human Resources

Resource Utilization

Value Creation : Steps & GrowthProcess Controls

Product Utilization

Technology Edge

Performance

Value Addition

Cost-effective

Specialty use

Unique

Innovation

High end

State-of-the art

Management

Process Product TechnologyValue Creation Steps

3. Value Creation of Technologies

Value creationTechnology Innovation and

CompetitivenessInnovation is not a: !Innovation is: !Understanding Innovation cycle Value creation of technologies

Ordinary

Value CreationExtraordinary Alternatives Renewable

Value creation is necessary at every step, in all domains and by all means

Level of value creation determines the gains: ordinary or extraordinary

Step Management Planning

Resource Utilization

Value Creation of Technology

Creative Approach

Regimental Management

Green Route Optimization & Control

Process

Specialty Quality & Cost reduction

Product

Breakthrough innovation

Incremental innovation

Technology

Value creation scale would determine the gains Innovation is the key for the ultimate value creation

Technology

Inputs

Conversion efficiency

Green route

Value Creation of Technology

Quality

Biodegradability

Life-cycle

Non-Hazardous

By-products

Waste product reduction

Process Product

Uses

Performance

Applications

Cost-effectiveness

Safety

Value Creation Scale

Raw materials

Renewable

Alternatives

Sustainability

Value advantage

Reuse

Recycle

INNOVATION

NextDifferentShift

Change is important for value creation and competitiveness

Innovation means bringing a change for sustainability

BetterImprovedAlternative

Competency

GrowthOptions

Global Competitiveness

LeadershipSelf RelianceSustainability

Technology Innovation and Competitiveness

Value Creation

Tool for exploitation of resources Short-cut Profit driven venture Merger and acquisition

Innovation cannot be a slave of any authority; it is a master!

Innovation will always result in value creation

Innovation is Not A :

Seed or fruit, innovation always creates value

Appreciated

A New Idea

A New Product

A New Method

Unheard before

Unseen before

Not tried before

NECESSARILY NOT NECESSARILY

Creative Education driven Novel Technology driven Non conventional

Unknown Unplanned Cannot be planned Instant Accidental

Diffusible Seed Fruit

Innovation Is :

An act which is so simple, yet unassuming, so unique yet quite familiar and so ordinary yet extraordinary

Maximum output from minimum inputs is the key criteria for assessing an innovation

Real innovation means “high impact with mild force”; high level of value creation

Innovation Is :

Plant

INNOVATION CYCLE Fruit

Seed

Seedling

Idea

Product

Diffusion

Innovation

Development

Research

Marketing

Understanding Innovation Cycle

For, value creation of technologies, the industries have to appreciate the innovation cycle and its components

Production

By ThroughTake up Promote Propagate

• Technologies • Improved technology• Modified process

With

New Products• Sustainable raw

material• Globally acceptable• Different

• Marketing• Diffusion• Customer

feedback

New Processes• Cost-effective• Modified• Alternate

• Effective & Efficient

• Changed

Application• New areas• New dimensions• New vision

• Marketing• Promotion• Customer

feedback

Marketing • Technical backup• Technical assistance

• New strategy• Penetration

Value Creation of Technologies

New Ideas

4. Value Creation of Technology for Competitive Edge and Business

Growth

The competitive edge to beat competition and to avoid risk factors for sustainable growth comes from value creation through innovation

Business Growth

Types

Value Addition

Value Creation - Competitive Edge - Business Growth

Short-term

Achieved by value creation

through

Survival

Competition

Risk Factor

Incremental

Diversification

Research & Development

Innovation

Medium-term

Long-term

Sustainable

Regulatory Changes

Insignificant

Merger & AcquisitionSignificant

Substantial

All Inclusive

5. Path Forward

Factors & Components Leading to Innovation

Importance for Value Creation

Understanding Innovation

Nurturing the Components of Innovation

Path Forward

Provides CompetitivenessValue Creation at every step

Maximum Advantage for Business Growth

Value Creation of Technology

Key for SurvivalBusiness Growth through Competitiveness

THANK YOU