Building an innovation portfolio

“We accelerate growth”

Build an Innovation Portfolio: Manage risk and achieve strategic goals!

Host: David Mason, Frost & Sullivan LtdPresenters: Brendan DUNPHY & Paul MAY

Brendan & Paul are co-developers of the ‘How to Farm Lightning: Sustainable Innovation™’ workshop series available via Frost & Sullivan Ltd.

“We accelerate growth”2

Webinar Logistics

• The webinar will last between 30 & 40 minutes

• All attendees will be on mute during the presentation

• Please enter questions in the chat window at any time

• Post webinar contact: Caroline Shirley at [email protected]


Introduction from David Mason, Sales Director at Frost & Sullivan Ltd

Frost & Sullivan Ltd & its Innovation offerings

‘How To Farm Lightning™: sustainable innovation’ program

Brendan Dunphy is a business consultant and has led Frost & Sullivan’s Innovation portfolio for almost 13 years. He has

worked as a Director of a technology lab, advised a wireless VC fund & started

several businesses

Paul May is a business consultant and author who

works widely with innovative businesses. He has developed

innovations in insurance, procurement, intellectual

property management and mobile applications.


Content

Why an innovation portfolio? Where does a portfolio sit in the innovation process? 5 Step building process with focus on Risk vs Reward Insight - Planned Miracles A case study Top 10 tips


Why an innovation portfolio?

“An innovation portfolio ensures investments are targeted to meet both short & long term business goals, match the organisation’s appetite for risk & is resilient to endure

alternative business scenarios”


Why an innovation portfolio?

PRIMARY Estimate a total cost & a

value of all innovation projects

Actively manage risk Direct investments

towards strategic goals

PRIMARY Estimate a total cost & a

value of all innovation projects

Actively manage risk Direct investments

towards strategic goals

SECONDARY Combat inertia Align investments Create strategic

resilience Identify project overlap Force transparency &

collaboration

SECONDARY Combat inertia Align investments Create strategic

resilience Identify project overlap Force transparency &

collaboration


Where does a portfolio sit in the innovation process ?

PORTFOLIO

RESEARCH, IDEA GENERATION

ETC…………….


ETC…………….

BUSINESS & INNOVATION STRATEGY

BUSINESS & INNOVATION STRATEGY


ETC…………….


ETC…………….


ETC…………….


ETC…………….


Innovation Portfolio

Take these……….

Remove these…………………….…..

Assess these……

Order these………………………….

Define these………………………….

Prioritise these…..


5 Step portfolio building process


Risk vs Reward

HighRisk

LowRisk

LowReward

HighReward


Risk vs Reward Matrix

HighRisk

LowRisk

LowReward

HighReward

P8

P7

P6

P5

P4

P3

P2P1


Project selection & ‘Planned Miracles’


Case Study (A Business Unit within an ITC) Before - a snap audit identified:

148 projects running across 5 Regions and 26 major markets & representing €-€30+ million of investment

From almost no business case, risk and ROI & little focus on achieving strategic business goals

No ground-breaking, goal-shifting or disruptive projects Most projects made business sense when viewed in isolation but not when viewed

in the context of a portfolio After

Portfolio comprised 7 strategic, 12 regional and 17 fast track projects spanning 3 to 36 months

Investment reduced to approx €25m, ROI doubled and risk reduced by 20-30% Process

Criteria applied - strategic fit, development cost, time to market, uniqueness, revenue potential, profit potential, risk assessment, sales volume, strategic impact, platform fit, IP generation, customer satisfaction & several other key metrics

3 alternative portfolios developed (pragmatic, stretch & transform) to illustrate the strategic scenarios available

Final portfolio developed was a hybrid based on ‘stretch’


Top 10 Portfolio Building Tips

1. Expect to identify gaps and overlap and be prepared to fill them - beware the “beauty-parade” and “cramming” the portfolio

2. An organisation’s business & innovation strategy or ‘risk appetite’ may not be evident – constructing alternative portfolio scenarios is a good way to drive these out

3. Use with scenario planning to make alternative strategies more tangible

4. Starting bottom-up by mapping the current ‘hidden’ portfolio is the easiest way to establish the approach

5. Ensure the criteria reflect the business strategy rather than recent history

6. Spend sufficient time assessing individual project’s against the key measures to drive-out assumptions and misunderstandings

7. Make it a cross function activity and a focus for greater collaboration & sharing

8. It’s a learning process and feedback loops into other parts of the innovation management process should be encouraged

9. Independent facilitation of the building process assessment is very valuable in compensating for inherent bias & enforcing the process

10. Formally assess the portfolio’s “fitness for purpose” at the highest possible levels in the organisation & on a regular basis to address change


Send us your questions via chat now!


What Next ?

• Follow-up email with links to the webinar recording and slides

• Up-coming public innovation portfolio workshops:

• Open Innovation to Drive Growth Masterclass – 15th July

• Pitching Your Ideas – 11 October

• Sustainable Innovation Masterclass – 27 October

• How to Farm Lighting – 30 September

• Commercialisation Business Models Masterclass – 21 September

• Getting People Behind New Ideas – 13 September

• Creating & Presenting a Compelling Business Case - 6 September

“We accelerate growth”

Build an Innovation Portfolio: Manage risk and achieve strategic goals!

Host: David Mason, Frost & Sullivan LtdPresenters: Brendan DUNPHY & Paul MAY

Brendan & Paul are co-developers of the ‘How to Farm Lightning: Sustainable Innovation™’ workshop series available via Frost & Sullivan Ltd.

Post webinar contact: Caroline Shirley at

[email protected]

Post webinar contact: Caroline Shirley at

[email protected]

Building an innovation portfolio

Business

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