TITEL
Innovation in times of crisis
SPREKER
Rick Harwig, CTO, Philips
TAAL
Nederlands of Engels
ABSTRACT
Contrary to the stock exchange crash in 1929, governments around the world have taken measures to counter the impact of today’s credit crunch. Of course we should have asked ourselves earlier what the new economic dependencies between countries, (bi-)regional companies and the occasional global companies actually are. Over the last thirty years, we have witnessed the rise of intangible and ill-defined value creation mechanisms: compared to the growth rate of the actual global GDP over this period, the growth rate of exports was twice as large, and the growth rate of financial transactions between countries was even more than four times larger.
The current economic developments will force all players in business and social activities to rethink their approach to local, regional and global markets. Currently, emerging markets are leading to restore growth in their territories by local stimulation. In mature markets, governments have taken actions to stabilize their economies by improving tangible and intangible infrastructures.
Companies have prepared to operate structurally on a considerable lower break-even point to cope with today’s abrupt changes. Additionally, they need to consider fundamental changes to the product portfolio to adapt fit, range or reach of offers to customers. Focus and balance of roadmap, adjacent, and break-away innovation are changed too. It is an unanswered question whether embedded systems have the right competitive advantage in the move towards more customer-centric market innovation. A shift of the existing paradigm towards service-driven rather than product-driven businesses seems to favor systems that are not stand-alone, but connected and networked. Technically this requires the connection of embedded systems architectures and approaches with ICT and service management: a connection of physical and virtual worlds, solving real needs for very diverse users, both on an individual and institutional basis.
The changing nature of our approach to innovation, means to focus and balance activities and differences between the product creation and business creation processes will be discussed, as well as examples and progress in open innovation at Philips. These changes are driven by the need to progressively become a health and well-being company beyond the traditional product company.