Ladies and gentlemen, welcome to the innovation masterclass. My name is Ross may not and I'm a fellow of the Chartered Institute of Management Accountants here in the UK. Our agenda for today. Firstly, we have the definition of innovation. Secondly, why organizations need to innovate the four main areas for innovation in business, product and market innovation, process innovation, workplace innovation, business model innovation, a four step model to boost innovation, the global trends affecting business and finally, the test your knowledge section. So let's get started with a definition of innovation.
What is innovation? The definition in the Oxford English Dictionary is that innovation is to make changes in something established, especially by introducing new methods, ideas or products. The definition that a colleague of mine used recently is doing things better, and doing better things, which is rather more to the point I feel. Why do we need to innovate? Well, markets are changing much more rapidly than they have in the past. And our current ways of doing business will soon be history.
For example, McKinsey have estimated that there will be 3 billion more customers economically active by 2030. Most of these being in Asia or in Africa. devices are becoming increasingly connected on the internet, called the Internet of Things. And the pace of technological change is faster than ever. We seem to be on the verge of a new industrial revolution. And if you don't think that's a threat, or an opportunity for your organization, perhaps you need to think back to 1825.
And the quarterly review from March 18 25 said What can be more palpably observed The prospect held out of locomotives traveling twice as fast as stage coaches. And we know how that turned out. But I hear you say things are ticking along nicely. Well, things were ticking along nicely for Nokia once upon a time, not that many years ago. They were the king of the world for mobile phones. their annual revenue grew from 6.5 billion euros in 1996 to 31 billion euros in 2001. their market share was nearly 31%, twice that of any competitor, but by 2012 the share price has slipped below $2 from $56 at its peak in 2000. the share price is currently sitting at about $5 What changed?
Well, Frank nuovo the former head of design, at Nakia said Nakia was just a very big company that started to maintain its position more than to innovate for new opportunities, all of the opportunities were in front of them. And Nakia was working on them. But the key word is sense of urgency. While things were in play, there was a real sense of saying, we will get to that eventually. The fact is, there is a tsunami of change coming for us. AI, machine learning, big data, the Internet of Things.
3D printing, robotics. Business, as usual, is no longer sustainable. So how can we innovate and what areas can we innovate in? Were other four areas that I'm going to talk about in this session. They are product and market innovation, business process innovation, workplace innovation, and business model innovation.