MIST 2090 1st Edition Lecture 3 Outline of Last Lecture I This is the first actual lecture that required note taking Outline of Current Lecture II What Is Innovation III Digital Innovations IV Innovation Creative Destruction V Managing Innovation A Pivoting Current Lecture II WHAT IS INNOVATION Doing something new but in organized setting and manner Important to differentiate invention from innovation Innovation creates value out of invention Example In 1968 Spencer Silver tried to produce a glue to hold airplane parts together Glue failed for airplanes but became the stickiness that holds sticky notes together Spencer worked for 3m and patented these post it notes Innovating involves creating some form of technology system BUT you must go out and sell it in order for it to be successful People process information technology need all of these for innovation III DIGITAL INNOVATION Ex Apple s Ipod when apple first created the Ipod in 2004 their commercials were revolutionary In the commercials the words Ipod and Itunes were often shown together to show the buyer that these two systems were used in combination o Apple was particularly different from normal MP3 players because they convinced the record companies to let apple sell their single songs for 1 IV INNOVATION CREATIVE DESTRUCTION In order for something to take over something else must die Automotive destroyed the carriage system o Carriages died and cars took over These notes represent a detailed interpretation of the professor s lecture GradeBuddy is best used as a supplement to your own notes not as a substitute Joseph Shumpeter made the idea of creative destruction well known Creative destruction and S P 500 company o Companies only last 6 years on S P nowadays whereas they used to last 20 years o Companies that left recently Wendy s Radio Shack Circuit City o Companies that entered recently Netflix Amazon Attackers advantage when the new upcoming company has some sort of advantage over the older company o Example Blockbuster vs Netflix Defending against innovations involves 3 characteristics o Create innovate trade Proctor Gamble P G does this A They pivot in order to create innovate and trade successfully Ex Instagram used to be all kinds of different things when the company reduced it to only photo sharing they blew up