In this module we're going to look at the factors that influence the feasibility of innovation. And feasibility is a big factor because a lot of ideas are great ideas but if they're not feasible there's no point in spending energy or recruiting resources to support them. So, let's look at the notion of innovation and feasibility. So, in order for innovations to be welcomed into marketplace, they first have to be screened for constraints and their feasibility. So, we are going to examine 12 screening factors for new innovations and how they matter and how you can screen for them. So, the first one that we're going to look at is Sales or Profit Potential. So, it's something that you need to examine about whether or not an innovation or, really, a venture idea can enter a market and produce profitable sales. This is a very fundamental one, but it's like the market feasibility of anything, associated with a business plan. So, one example might be how Apple's next generation iPad is likely to break into the market and displace sales of competitors' products. Right now, I would say with the tab from, let's see. Well, let's start this one over. I'm looking at the, what is it, the tab iPad? What is that? I can't remember the name of the producer now, all right. Market attractiveness factors are very much like looking at whether an idea produces a business plan result. And so, one example might be how Apple's next generation iPad is likely to break into the market and displace sales of, let's say the Galaxy. Tab 3, Tab 4, or Tab 7, whatever it is. And what we find is that competitors are out there always. And s, even if you have an innovation within your own product line, you have to look and see what other competitors are doing. A second factor is the Growth Potential of that idea. And so, the potential growth of a market need, you can have an innovative need that really is an improvement but if it doesn't matter very much in the marketplace it may not be worthwhile to pursue it. So, in this example, you might ask how much growth potential is there, let's say for that iPad before market demand is satisfied by a competitor. A third market attractiveness factor where you're looking at the feasibility is where you're looking at Competitor Reactivity. What we mean is you measure competitor reactivity by how quickly a competitor responds to what you're innovations are. And if a competitor can quickly respond to your new idea. You have to be aware of that and you have to know that you have to have some durability in your idea. A fourth factor is what we would call Risk Distribution. This is where a product line has diversity and can respond to a our competitor's have abandon this and so in this case, one example would be some kind of a broad product portfolio of a software manufacturer like Microsoft that has a range of products to weather economic turbulence or in newer marketplace A fifth factor is where Industry Restructuring is happening. So, where some new breakthrough happens, let's say for example in battery technology could be Tesla or it could be some other form of battery device. For instance they might allow laptops or other forms of battery reliant energy to run for longer lengths than they run. So that would be an important factor. Political or social constraints. Changing the tariff for trade restrictions can often create barriers for firms to move innovative products across boarders and compete in other marketplaces. So, one example was where Microsoft was sued by the European Union governments for operating as a software monopoly and other people in Europe really wanted to get in on action that allow that to happen. So, this is something that is going to happen on a country by country basis or maybe on the region by region basis. Another one is Market Fit Factors where you have capital availability. So, for new innovations in start-up ventures, a limited capital reduces management flexibility. One example of this occurs when emerging companies outgrow their We cover expenses with cash from the income that they generate. And this is a very common occurrence, it's called out of cash. And so, fitting to the market, sometimes you got a very needy market and then wants your innovation but you don't have enough cash to continue to get it out there. Okay, let's continue with this factor here. The next factor that we're going to look at is called Market Fit Factors. And this has a lot to do with manufacturing competence. So, a measure of the ability to rapidly prototype or create new products and gain market entry is a big factor. So, if you are in a market where you haven't made prototypes or you haven't had a history of getting into that marketplace you're going to be at a disadvantage. Another market fit factor is what we call Marketing and Distribution Channels, recognizing the ability to gain early entry and to gain rapid penetration of a market. And so, one example of this is where Federal Express has expanded its service Hhs expanded globally with relative ease and effectively using innovative operational processes. Another market factor is what we would call technological or Technical Support Capability. How well a service function supports the sales with expertise, actually carry out incremental improvements. One example of this would be found in Dell computer's service support function where customer data is actually used to modify how they provide their service operations. Market fit factor that would be termed as access to critical components could be described as reliability of critical materials supply and access of those materials to sustain your own operations. So, an example of this constraint is where a new innovations depend on off-shore supply of material or components that might not be dependable. Level of management initiative in an organization or the measure of top management support for internal ventures it's either high or it's low. One example is where Google top managers allow employees time to explore innovative opportunities as part of their regular work responsibilities. And by giving that flexibility, or managers allow that flexibility, a lot more opportunities show up. So, the takeaways of this module are that all new innovations face a hurdle to gain entry into the marketplace. And by screening those innovative opportunities in a systematic way to identify their constraints to success and their likely success that's essential for gaining market place entry.
