I3 DATA - Innovating with Performance: The Launch of a Startup Driven by Research, Development & Innovation
Also available at Epub
Summary
This case offers a deep insight into the Research, Development and Innovation (RD&I) cycle in action, highlighting the trajectory of the Performance Management (GpP) Research Group at the University of Brasília (UnB) and the idealization of the Startup i3Data that led to the creation of the i3 Performance and i3 Business platforms, aimed at transforming a vast amount of data into valuable information for the market. The case focuses on the critical decision to position i3Data in the competitive management software market, characterized by large leading companies and an increase in small and medium-sized competitors. The case is an invitation to understand the importance of applied research, development of practical solutions and differentiation strategies in the competitive business environment. Readers will be challenged to consider i3Data's positioning strategy and possible approaches to differentiate itself in the market. It can be used in disciplines of entrepreneurship, innovation, strategic management, marketing, and applied research. The case is suitable for intermediate levels of education, offering Insights valuable for students, professors and those interested in exploring the world of innovation and startups in the context of RD&I.
Keywords: Research, Development, Innovation, Strategic Positioning, Software of Management, Startups
Abstract
This case provides a comprehensive view of the Research, Development, and Innovation (RD&I) cycle in action, highlighting the journey of the Research Group in Performance Management (GpP) at the University of Brasília (UnB) and the conception of the i3Data startup, leading to the creation of the i3 Performance and i3 Business platforms. These platforms aim to transform a vast amount of data into valuable insights for the market. The case centers on the critical decision of positioning i3Data in the competitive management software market, characterized by dominant large companies and a growing number of small to medium-sized competitors. This case invites readers to grasp the significance of applied research, practical solution development, and differentiation strategies in a competitive business environment. It challenges readers to contemplate i3Data's positioning strategy and potential approaches to stand out in the market. Suitable for entrepreneurship, innovation, strategic management, marketing, and applied research courses, this case targets intermediate-level students, offering valuable insights for those interested in exploring the world of innovation and startups within the context of RD&I.
Keywords: Research, Development, Innovation, Strategic Positioning, Management Software, Startups
Research, Development and Innovation: the Performance Management (GpP) Research Group
The Performance Management (GpP) Research Group of the University of Brasília (UnB), led by Professor Alexandre Maduro Abreu, was created in 2014 with the objective of studying efficiency in public and private organizations and investigating what would be the determining factors for one organization to be more efficient than another.
From its foundation, the group began to attract students from the Department of Management, especially those technology enthusiasts who saw performance management as an essential tool for any organization, and those passionate about Innovation.
The research group, composed of diverse students with different interests over time, has worked collaboratively to conduct cutting-edge research and shape the future of science, technology, and innovation, under the guidance of Professor Alexandre Maduro, a researcher renowned for his ability to think innovatively and committed to ethics in science, who led the team to achieve the best in their research and certificates by CNPq/UnB.
The professor established the RD&I (Research, Development and Innovation) Cycle as one of the foundations of his research group. The method is based on the idea that applied research should not be a mere theoretical exercise, but rather a practical and oriented approach to solving real-world problems. In an increasingly competitive and constantly evolving market, applied research plays a key role in creating practical solutions to real challenges faced by organizations.
The RD&I Cycle begins with Research, which involves identifying problems, collecting data, and in-depth analysis to understand the underlying issues. This phase aims to create a solid foundation of knowledge that will serve as a starting point for future actions. Next comes Development, which focuses on turning these findings into concrete solutions. This may involve creating new models, methodologies, or products.
Finally, Innovation is the final stage of the cycle, in which the developed solutions are implemented and taken to the market. Innovation is the tangible result of applied research and development, enabling organizations to excel, adapt to change, and thrive in a dynamic business environment.
The RD&I Cycle approach reflects the philosophy of the professor and his research group that research should be a driving force for change and improvement, connecting the academic world to the business world and producing practical results that benefit society as a whole.
Researching: the idealization of i3Data
Alongside Professor Maduro, GpP began to carry out Applied Research, a type of research that has the obligation to meet practical demands and is useful for finding solutions to everyday problems in order to generate new knowledge for the development or improvement of products, processes and systems (Thiollent, 2009, p.36).
Fitting into the Research part of the RD&I Cycle, the objective of GpP was to understand the real expectations of managers in relation to organizational efficiency to lead companies to success. For this, interviews were conducted that pointed out the main deficiency of organizations was that, despite having a large amount of organizational data and analysis available, no methodology, management model or platform available on the market are capable of generating enough knowledge for managers to act assertively and make the best decisions for their companies. It was a gap that GpP was determined to fill.
The research carried out with real companies generated several important findings about organizational efficiency, which yielded several articles and dissertations. However, in the course of the research, the group understood from research on municipal management in Elementary School, through the research of an efficiency study map, they were able to realize that although some municipalities were efficient, they still had a low index and degree of development and proficiency, despite having a better allocation of resources, This did not indicate that the teaching was of quality. Thus, the efficiency model was not enough to analyze a system that was being evaluated, such as an organization, teaching, among other units. Also, a methodology was developed based on the concepts of efficiency and effectiveness or performance, where from this algorithms were created to calculate and estimate efficiency, considering the transformation of multiple inputs into products, as well as calculate the combined performance of multiple results and when applied in the private market it was already clear that it was necessary to work with these measures.
Thus, performance is the execution, the fulfillment of activities, and performance is the result of the fulfillment of the activity. Even considered synonymous, in the corporate world they have different meanings, so performance is the comparison between the desired and the legitimized result in relation to the past, and it is static. When this concept is applied to performance, it is dynamic and in relation to the future.
Faced with this paradigm, the researchers realized that it was necessary to study other variables besides efficiency. Thus, the group began to research about the Organizational performance that, when analyzed with the Organizational Efficiency , is the metric called Organizational performance . From this combination, it is possible to better measure the use of resources and the results achieved by the companies participating in the surveys.
Performance Management represents an innovative theoretical and methodological model, transcending the mere generation of data and insights by effectively addressing the fundamental challenges highlighted by the managers of companies participating in the surveys. One of its central premises is the concept of the performance cycle, from which it becomes possible to carry out several crucial analyses for organizational improvement.
This cycle encompasses the ability to estimate the maximum performance achievable by the organization, evaluate the company's current performance, identify the performance gap (the distance between current performance and the maximum possible performance), point out specific actions to achieve maximum performance, and outline the performance trajectory, that is, the steps to be followed to reach the peak of performance. By adopting this approach, Performance Management offers a comprehensive framework that not only evaluates but also guides organizations in the ongoing pursuit of operational excellence and effectiveness.
The theoretical, conceptual and methodological framework of the Performance Management led the researchers to conclude that the model could be applied in practice. To do so, it would be necessary to set up a company that would develop and take this model to other organizations. And that's how the Startup came about I3 DATA , a Science, Technology and Innovation company whose purpose is develop an intelligence capable of transforming a large volume of data about efficiency and performance into information about performance and fostering innovation in the market.
Developing: the creation of the i3 Data platform and its products
Startup I3 DATA is an initiative that was born in the environment of the Department of Administration of the University of Brasília and is part of the Development process of the RD&I Cycle.
Based on research developed by GpP, it was time for the i3 Data team to develop a tool and test the Performance Management model in business practice. Thus, to become a useful innovation for companies, the Performance Management methodology has undergone concept tests and has been validated through application in a Wholesaler, Distributor and Supermarket system.
So, the model was designed to be embedded on a platform with advanced technologies. Thus, the i3 Performance platform emerged, marketed by i3 DATA and customized for different segments: financial, wholesale, distributor, supermarket and industry, where it is based on the measurement of Efficiency, Performance and Performance, comparison with benchmarks, prediction of results and other organizational KPIs. Where the platform can be customized according to the needs of each client, such as:
Workforce Performance: Compare your teams; Discover and provide essential information for your teams to improve performance.
Market Performance: Comparison with competitors; know the level of efficiency, performance and performance of your competitors, and the adjustments needed to achieve them; surpass them and maintain market leadership.
Product Performance: Compare the product mix and identify the best cost/benefit ratio and sales performance of each product. Manage product performance.
Organizational Performance: Compare performance over time. The methodology allows you to learn from the organizational trajectory. Obtain real parameters to reduce costs and increase results, achieving maximum efficiency and organizational performance; Intelligent analysis with forecasts of your sales (results, customers and products), costs, expenses and much more.
Sales force performance: Compare the level of efficiency and performance of the sales force from the Performance Quadrant. Know the cost adjustments and results necessary for each salesperson to have maximum performance. Analysis of customers, products and sales individually and grouped; Predictions of future results and make your team perform at its best.
Branch Performance: Compare performance across your branches/units. Discover best practices among them and share them with the entire organization, raising the bar for efficiency and overall performance.
I3 Performance uses different analysis and prediction techniques to support the decision process of managers, in real time, where it is characterized as a disruptive innovation that will cause a rupture in the standards of management software established in the market. Being the first Performance Measurement System – PMS on the market, based on the performance management model.
Also, i3 DATA was not restricted to the i3 Performance platform. According to the GpP survey results, it was also necessary to support managers with market information. Thus, the i3 Business , based on geomarketing, which made it possible to unite data from the operation and the market, expanding the vision and generating more knowledge for decision makers to be even more assertive.
Geomarketing is a methodology that relies on location data to achieve the target audience with the right message and create business opportunities. Thus, it is possible to monitor the customer and their behavior, having the opportunity to formulate strategies to reach them at any time and place. This approach has been used since the 1950s to map companies' units and define markets by location.
i3 Business already had competitors in a specific market, with several geomarketing platforms already consolidated. However, the platform makes it possible to integrate operation data with market data, a factor that differentiates it from the competition. Thus, there were no doubts regarding its positioning and competitive strategy to be implemented to face the competition.
On the other hand, with regard to i3 Performance, a modern tool that adopts an innovative management model, i3 DATA found itself in a dilemma: How to position the product in the market and what strategies should be put into practice, considering the relationship between product, customer, promotion and price?
Innovating: i3 Performance's differentiation and positioning strategy
The scenario initially found by the startup I3DATA demonstrated that the management software market, in reality, is massified by ERPs (Enterprise Resource Planning), which are essentially process automation software, and by BI (Business Intelligence), which are management support tools, which require the hiring of specialists and parameterization according to each business, for information to be generated. However, none of these systems have an integrated management methodology.
In this market of management software, competition is fierce. There are large companies such as TOTVS, SANKHYA, SAP, among others, but small and medium-sized competing developers have also been emerging, increasing the supply of software and, consequently, putting downward pressure on sales prices. In short, large companies dominate the market, which has a huge customer base to be explored, from micro to large companies. Every organization is a potential customer.
On the other hand, management software, with some integrated management methodology, different from ERP and B.I, competition is more restricted, with a predominance of small and medium-sized companies. According to a survey conducted in 2019 by the ERP consultancy, Capterra, with small and medium-sized companies from 23 different business sectors, 44% of respondents said they use a business management system for financial control of the business, 33% use spreadsheets, 15% the company's own software and 7% control it manually. Regarding having some ERP, larger SMEs reach 73% adoption, while MEIs (individual microentrepreneurs) and microenterprises do not reach 30%. As for the intention to acquire an ERP, 45% of companies plan to adopt a new system. Of these, 69% say they want to spend between R$ 30 and R$ 70 per user per month. Regarding the industry, SMEs in the internet and information technology area are the ones that most adopt ERPs, followed by insurance companies.
These companies have less competitive power, compared to large ERP and B.I. companies. Also, the number of potential customers with an investment profile for new software with an exclusive integrated management methodology is much lower, as the acquisition value of these models is higher than the values of the other segment (ERP and B.I.), making it impossible for small companies to acquire these platforms. Restricting the number of potential customers with the right investment profile for innovative software, which incorporates unique integrated management methodologies, creates a significant challenge for small businesses.
This restriction is largely due to the acquisition value of these models, which is advantageously superior compared to other segments represented by ERP and BI. This cost disparity ends up making it impossible for smaller companies to adopt these platforms, which are often restricted by more modest budgets.
However, it is crucial to understand that the cost of acquiring an ERP is not just limited to the initial investment in technology. In addition to license acquisition, successful implementation and continuous optimization turn off the hiring of skilled experts to manage the software within the organization. This aspect adds a layer of financial complexity, requiring additional resources that, in many cases, exceed the financial limits of small businesses, directly impacting their ability to compete in an increasingly digital and integrated business environment.
In this context, companies that develop management software need strategies to differentiate themselves from the competition, whatever their segment. According to Philip Kotler, market positioning is "the action of projecting the product and the image of the organization in order to occupy a differentiated position in the choice of its target audience". In practical terms, positioning can be obtained from the formula: Segmentation + Differentiation = Positioning . Therefore, the analysis of the positioning is essential to evaluate the prominence of the company's image.
Positioning strategies should be based on the differentiation of offers inserted in a specific market segment. To this end, the construction of an effective positioning identity must be based on segmentation and differentiation that meet some criteria:
The result of a good positioning is the development of an appropriate value proposition, focusing on the specific market, which proposes a convincing and saleable reason to the potential consumer. Therefore, the correct definition of the value proposition, as well as the definition of the market niche are fundamental for the effectiveness of the strategic plan.
Finding itself in this scenario, i3 DATA needed to define how to position its Performance Management model product in the market and ensure its customer base. To do so, it had the following options:
Option 1: Complementary Positioning
The first option is to position i3Performance as a complementary platform. This means that i3Performance would be presented as a tool that can be used in conjunction with existing systems, such as ERPs and B.I. Under this label of "management platform," i3Performance would become a solution that enhances the effectiveness of established management systems, such as ERP, B.I, CRM, and SALES FORCE and others. providing additional functionality and performance insights.
Option 2: Innovative Positioning as Management Software
The second option is to highlight i3Performance as an innovative management software with integrated methodology. This would imply convincing the market that ERPs and B.I. are not, in fact, comprehensive management systems. Instead, i3Performance would be marketed under a new label, such as "Performance Intelligence." The emphasis would be on its ability to provide a holistic and performance-oriented management approach, creating a niche in the management software market.
Throughout its journey, the startup I3 DATA, born out of GpP, has undergone in-depth research, innovative product development, and difficult strategic choices. However, the ultimate challenge remains: defining its future in the management software market. The decision to position i3Data as a direct competitor to ERPs and B.I., under the label of management platform, or to create a category, such as "Performance Intelligence," represents a critical choice. Competition is fierce, customers are waiting, and price pressure is real. i3Data's success depends on the differentiation strategy you choose.
Discussion questions
- As a manager, what should i3DATA take into account to insert i3Performance in the market?
- Considering Porter's generic strategies, what would be the appropriate strategy and market option to be explored to market i3Performance?
- What would you do if you were in the shoes of i3Data's managers? What does it take to ensure that the startup not only survives but also thrives in this highly competitive market?
Gallery
References
ABQuality. (n.d.). The guidelines for research, development and innovation. Recovered from https://abqualidade.org.br/as-diretrizes-para-pesquisa-desenvolvimento-e-inovacao/
AEVO. (n.d.). Research and development. Recovered from https://blog.aevo.com.br/pesquisa-e-desenvolvimento/
ANPEI. (n.d.). PDI - Research, development and innovation: understand. Retrieved from https://anpei.org.br/pdi-pesquisa-desenvolvimento-e-inovacao-entenda/
MicroLins. (n.d.). Corporate world: what is the difference between performance and performance? Retrieved from https://www.microlins.com.br/blog/mercado-de-trabalho/mundo-corporativo-qual-a-diferenca-entre-performance-e-desempenho/#:~:text=Com%20esses%20significados%2C%20entendemos%20que,os%20profissionais%20de%20Recursos%20Humanos.
Patel, N. (n.d.). Geomarketing: what it is and how to use it. Recovered from https://neilpatel.com/br/blog/geomarketing-o-que-e/
Capterra. (n.d.). ERP for small businesses. Retrieved from https://www.capterra.com.br/blog/952/erp-para-pequenas-empresas
About The Authors
Vitor Kelvin da Silva Gomes is a Business Administration student at the University of Brasília and a member of the Casoteca ADM Team. Email: vitorkelvin88@gmail.com
Dherik William Ribeiro Benjamin is a Business Administration student at the University of Brasília and a member of the Casoteca ADM Team. Email: dherikbenjamin@yahoo.com.br
Editor and co-author: Nicole Alonso Santos de Sousa is a graduate student of the Department of Administration (ADM/FACE) at the University of Brasília (UnB). She is co-coordinator of the Casoteca ADM. She has a postgraduate degree in Finance and Controllership (MBA USP/ESALQ) and a bachelor's degree in Administration (UnB). Email: nicolealonso2000@gmail.com
Publisher: Luiz Henrique Lima Rodrigues is a Business Administration student at the University of Brasília and Co-coordinator of the ADM Casoteca. Relationship Advisor at Concentro (Federation of Junior Enterprises of the Federal District). Email: luizhenriquelima305@gmail.com.
This case was written based on information provided by the company and based on other references cited. It is not the authors' intention to evaluate or judge the company in question. This text is intended exclusively for academic study and discussion, and its use or reproduction in any other form is prohibited. Copyright infringement will subject the offender to the penalties of Law No. 9,610/1998.