Page 78 - Grow from Within Mastering Corporate Entrepreneurship and Innovation

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6. Value capture. Value capture is the mechanism a company
uses to earn its share of the market value it creates. Value
capture innovation involves discovering new revenue
streams, innovative pricing mechanisms, and new ways
to get paid by customers or partners. The automotive
information site Edmunds.com has created several
innovative ways to garner revenue from its services. It
generates advertising revenues from contextual
advertising; syndication revenues by licensing its tools
and content to partners like the New York Times and AOL;
referral revenues from insurance, warranty, and
financing partners; and analytics revenues by providing
OEMs with market intelligence on customer buying
behavior. These revenue streams have significantly
increased Edmunds’s average revenues per visitor.
7. Processes. Processes represent the configuration of
business activities used to conduct internal operations.
Process innovation involves redesigning processes for
efficiency, higher quality, or faster cycle time. This might
involve redesign or relocation by decoupling a process’s
front end and back end. Indian information technology
services firms like WIPRO and Infosys have created
enormous value by perfecting the Global Delivery Model
(GDM). The GDM’s core principle is to deliver business
processes from a remote location as an outsourced
service, leveraging the highly educated and relatively
low-cost Indian knowledge workers. To enable remote
delivery, GDM breaks down each process into its
constituent elements using activity mapping. Cross-
functional teams in multiple countries are coordinated
using well-defined protocols. All activities are
documented to ensure successful, timely performance.
GDM offers companies flexibility and speed to market,