Creating An Innovation Environment
INTRO
Turning things upside down by exploiting opportunity is another approach that can be part of your innovation efforts. For example, Galeries Lafayette set up a working group of startups to rival its classic merchandising system and to annoy itself. The task of the startups was to use digital technologies to produce products, services and business models that would disturb Galeries Lafayette. He then turned this working group into a structured startup accelerator program called Plug'n Play. Of course, it is not easy to manage such a dynamic innovation environment where the stakeholders are diverse and numerous, and to gain commercial benefits from this great synergy. Another important point to remember is the commercial agreements you will make with your business partners and innovation stakeholders. Every detailed and binding contract you make will bind you as well as the other party. For this reason, we recommend that you prepare your cooperation agreements simply and plainly.
Finally, we can say this about adaptive ecosystems: Adaptive ecosystems work best in growing industries. Central ecosystems work more healthily in sectors that are established and have reached a certain size. Therefore, the fact that we spend more time on adaptive ecosystems in this chapter should not mean that central ecosystems are bad or adaptive systems are better.
On the other hand, a remarkable point is that 50% or more of their income comes from digital products and services; Observing that their revenue increases are 32% and their profitability is 27% higher than other industry players. For this reason, it is becoming more and more important for a company to offer digital products and services. Companies that offer this product and service delivery process through digital ecosystems are in a very advantageous position and have created their own sheltered castles. These digital ecosystems basically have 2 goals; (1) to learn more about customers and users, and (2) to market more products and services in the digital ecosystem.
No company can remain indifferent to this commercial advantage created by digital ecosystems. For example, Sydney-based Commonwealth Bank of Australia, in its efforts to increase home loan sales, has realized that the main focus of its potential customers is not to find a home loan, but to own a home. The bank developed its own online real estate application and started receiving applications from home loan applicants. The bank measured the ROI of this online real estate application as 109%.
ROI - RETURN ON INVESTMENT
ROI is a performance measure used to evaluate the efficiency or profitability of an investment or to compare the efficiency of a number of different investments. ROI attempts to directly measure the amount of return on a given investment relative to the cost of the investment.
- Return on Investment (ROI) is a popular profitability metric used to evaluate how well an investment is performing.
- ROI is expressed as a percentage and is calculated by dividing the net profit (or loss) of an investment by its initial cost or expense.
- ROI can be used to make apples-to-apples comparisons and rank investments in different projects or assets.
- ROI does not take into account the holding period or the passage of time and therefore may miss the opportunity costs of investing elsewhere.
HOW IS ROI MEASURED - RETURN ON INVESTMENT?
ROI is calculated by subtracting the initial value of the investment from the final value of the investment (equal to the net return), and then dividing this new number (net return) by the cost of the investment. ROI is relatively easy to calculate and understand, and its simplicity means it is a standardized, universal measure of profitability. One disadvantage of ROI is that it does not take into account how long an investment is held; therefore, a profitability measure that includes the holding period may be more useful to an investor looking to compare potential investments.
MURAT LEVENT DEMIRCAN
Innovation in Digital Ecosystems 1: Digital Ecosystems
Innovation in Digital Ecosystems 2: Bat Signals
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