INNOVATION
BUSINESS MODEL |
STRENGTHS |
WEAKNESSES |
Internal R&D:
New Products for Core
Businesses |
- All IP 100% company owned
|
- Can be more research and less development
- Expensive to run with uncertain
return – 90% of cost expended
just to get to proof of concept
|
Internal “Venturing”:
Protected Funding
for Innovation |
- Funding protected for long-term
- All IP 100% company owned
- Can create new culture in organization
|
- Still governed by corporate governance as required by Sarbanes-Oxley
- Innovation is lengthy process with large investment and uncertain returns
|
Corporate
Venture Unit:
Opportunity for “first
look” at new products
and technologies |
- Ability to invest in startups
- Wide portfolio has the potential
to spread risks
|
- Up-front investment with
uncertain return
- Culture clash often results from corporate vs. entrepreneur
|
Connect and Develop:
Source ideas
from suppliers and customers |
- Can generate a large number of new ideas
|
- Requires R&D/internal resources to execute
|
Venadar
Outsourcing Model:
Breakthrough
innovation at a
lower risk and high-
speed deployment
through existing
corporate platforms |
- Purchase only proven
innovative products
- No up-front capital investment
- 100% ownership of IP
- Seamless integration of
product/technology into
existing platforms
|
- Requires immediate knowledge transfer post-acquisition
- Absolute purchase price may appear higher prior to risk adjustment
|
