BMW Identifying Market Opportunities

A critical factor in BMW’s success is its ability to gather new ideas, pick the best ones and implement them swiftly through an integrated innovation process. The BMW innovation process has three stages. The first stage is innovation research and this is accomplished through technology exploration and their virtual innovation agency. The second stage is management which translates these new ideas to opportunities and the third stage is innovation transfer, where the opportunities are translated to concepts. The focus here is on the first two stages where ideas are generated and translated into market opportunities.

Idea Generation
Satellites
BMW has different satellites around the world that are strategically placed to ensure that BMW is quick to identify new technologies and market trends. BMW’s aim is to understand market opportunities by participating in them rather than by simply reviewing market research. For example, the Palo Alto Center is strategically placed in one of the most high tech regions in the world and engineers working there have access to the geniuses who are developing advanced hardware and software developments, and work with these contacts to create new automobile component products.
Competition
Each year, 10 BMW employees are selected to travelto Palo Alto to unearth the next breakthrough in automotive innovation. Cross-functional teams of three, have 90 days to identify, explore, and develop new projects.
Virtual Innovation Agency
BMW gathers ideas from external sources through Virtual Innovation Agency (VIA), which is an Internet portal created for developing new relationships with potential external innovators who may be individuals, small companies, or large companies from other business centers and research centers. Those who have ideas that could can enter them on the website. If BMW is interested in implementing the idea appropriate personnel contacts are provided. The innovator is then reimbursed for his idea.
Opportunity Generation
Structure
BMW uses six, innovation areas for opportunity identification. This set of areas is a center for defining market opportunities and managing ideas and each area is focused on a particular customer-driven need. The fields are as follows: experience dynamics, convenience and service, safety and security, concept cars and experimental vehicles, aesthetics and value and environmental acceptability. Each innovation area is coupled with an element of the company’s business strategy that is established by an innovation strategy board consisting of BMW board members, corporate strategists, and innovation managers. For each field, there is an Innovation Field Manager(IFM) and an Innovation Field Council (IFC) and it is the council’s role to interpret the directives of the innovation strategy board into needs and opportunities for new products and components. The overarching aim of these areas is to provide focus and decision traction to prioritize ideas and opportunity areas.
Feedback Loop
The innovation team in Munich manages the innovation portfolio. This portfolio tracks ideas from generation through completed projects and then monitors the projects’ results once they are implemented. This helps BMW to track performance of its process.
What makes BMW excel ?
BMW excels for the following major reasons. They have access to a huge pool of ideas both within the company and external to the company and they make sure that the culture and processes that they provide, foster continued idea generation. Their process ensures that ideas that align with their strategy and with particular customer needs are categorized and filtered. Also, the feeback loop tracks performance of the process and allows BMW to make continuous tweaks to the process.
References
D a v i d S u t h e r l a n d , J o c h e n H a r t m a n n , M a r k u s S e i d e l, From Roadmap to Roadway: Managing Innovation at BMW