From business as usual markets to permanent innovative markets… how to size those markets and design within them?

In the following blogpost, we explore what are the main differences between observing existing market VS foresighting innovative markets and playing within those, which by definition face higher uncertainties. We provide a new way to envision market explorations as companies now regularly face high intensity innovation economy

Companies are facing strong changes due to GAFA’S expansions of their activities as well as truly disruptive newcomers. Among them, deep-techs startups, a wave of startups with a strong IP (be it on science, materials, biology) are getting tech straight from the labs to markets, with useful applications. And they are provoking mutations of most industries’ value chains along the way.

Their impact is now being recognized at the market scale, some well known industries have started to include them in their analysis. If detected early and included in your ecosystem, such deep-techs could be a strong opportunity to rethink the way you create value. Contrary to digital startups, they won’t intermediate established relations with customers and quickly capture value right away, but rather build on “decades old” expertise with the most collaborative players of your industry.

We believe and proved with our clients and partners that Companies and their ecosystems are a continuum of capabilities and knowledge to be leveraged to create value in the most efficient path possible… keeping in mind both companies and ecosystem will mutate according to the degree of innovativeness you aim for in your products and offers.

That’s what we have been doing with our partners Hello Tomorrow; helping representative sets of industry stakeholders to explore such value creation opportunities. And foresee which value can be created to better align collaborations along the way (wedesigntomorrow.io programs).

So, good news, either you are a first entry player or a follower, those deep tech startups, with such agility to deliver new innovations and re-orchestrate value in any given industries you are in, gives you opportunities to test and learn with them. And develop your tomorrow core business activities…

What can be observed can be measured … But how to observe the right parameters ?

Any action is based out of sized value, and in that case, value is hard to observe. In innovative market contexts or in markets in highly intensive innovation contexts, things can get blury and our human focus only goes that far.

In a known experiment, cognitive psychologist Daniel Simons explores the “sustained inattentional blindness” by inviting observers to focus on one specific part of a picture or a movie where actions occurs while introducing a weird element that half of participants manage to spot, too focused on first task at end. Try to count how many times the white shirts team throw the ball at each others …

If you imagine how much cognitive efforts are required visually to assess such a simple situation where only one parameter change occurs, what does it teach us when looking at existing or upcoming innovative markets? That you will have blind spots, no matter what and you can derisk those blind spots by knowing they are built in your frame of observation. This will be true either on an excel spreadsheet, or a visual representation, because your focus will wander with a given focal point. So, what could be the potential blind spots that could be avoided, either by designing the right observation (with the right knowledge) or a better way to represent that information?

First, how big should be the “frame” of your innovative market assessment or design?

Framing the problem is half the answer as we say. In the case of economic studies relating to innovative market or historical markets facing high innovation intensity, what scale should we look at, for which observation capabilities? We suggest the upcoming framework to spark discussion among your colleagues and decision makers, based on our approach that mix management science and design, rather than classical economics.

At the Sector scale (Group of industries and markets that share common attributes, usually each a unique characteristics and a different profile ) to anticipate the organisation & ecosystem mutation (ex capability or supply chain mutation).

At the Industry scale (Any general business activity or commercial enterprise
that can be isolated from others, frequently named after its primary product)
to assess offers and product dominant design mutations.

At the market scale (Group(s) of customers who require the products and services provided by an industry ) to assess value creation and capture strategies of those new product/offers dominant designs

At the Market segment scale (whole available market divided into smaller groups) confirm historical market segment categories can be addressed or build new ones (reinforce existing stakeholder knowledge and new knowledge on new potential stakeholders)

Then once you picked the right frame… How to make your organisation and stakeholders share your same new collective imaginary (new dominant design of offers/products, new categories…) of those innovative markets ?

Know the degree of disruption of your innovation (or others’) dissociating their core projects features (be it products, offers, processes…)

Know your innovation (or others’) impact on your ecosystem or those you want to get in (eg a new market segment, a new ecosystem of suppliers…)

Adopt a common way to represent such mutation
(following example is at the industry scale)

Extracts, blended learning program EDF & WDS, Managing breakthrough and incremental innovation project for value creation

Often mis-regarded in building and capturing value are all the type of values that are not financial.

In our model, ecosystems of value are made up of stakeholders which are qualified by importance and flows that are characterized by the underlying activity:

Left: adapted from Mitchell’s work on Stakeholder’s importance — Right: WDS Value flow model

linear value chains are becoming value ecosystems with many stakeholders taking part in the technological solutions or service life cycle:

Extracts, blended learning program EDF & WDS, Managing breakthrough and incremental innovation project for value creation

And if you want to go further, try out our Software ECOS, team up with us to explore the value and mutation of your industry and market through we design tomorrow together with Hello Tomorrow and build such skills by following the EDF x WDS blended training !