Strategic
Management of
Technological
Innovation
Sixth Edition
,Brief Contents
Preface vi
1 Introduction 1
PART ONE
Industry Dynamics of Technological Innovation 13
2 Sources of Innovation 15
3 Types and Patterns of Innovation 43
4 Standards Battles, Modularity, and Platform Competition 67
5 Timing of Entry 95
PART TWO
Formulating Technological Innovation Strategy 113
6 Defining the Organization’s Strategic Direction 115
7 Choosing Innovation Projects 141
Collaboration Strategies 167
Protecting Innovation 197
PART THREE
Implementing Technological Innovation Strategy 223
10 Organizing for Innovation 225
11 Managing the New Product Development Process 249
12 Managing New Product Development Teams 277
13 Crafting a Deployment Strategy 297
INDEX 327
xiii
,Contents
Chapter 1 Universities and Government-Funded
Introduction 1 Research 30
Private Nonprofit Organizations 32
The Importance of Technological Innovation in Collaborative Networks 32
Innovation 1 Technology Clusters 33
The Impact of Technological Technological Spillovers 36
Innovation on Society 2 Summary of Chapter 37
Innovation by Industry: The Importance of Discussion Questions 38
Strategy 4 Suggested Further Reading 38
The Innovation Funnel 4 Endnotes 39
The Strategic Management of Technological
Innovation 6 Chapter 3
Summary of Chapter 9 Types and Patterns of Innovation 43
Discussion Questions 10
Suggested Further Reading 10 Innovating in India: The Chotukool Project 43
Endnotes 10 Overview 46
Types of Innovation 46
Product Innovation versus Process
PART ONE Innovation 46
INDUSTRY DYNAMICS Radical Innovation versus Incremental
OF TECHNOLOGICAL Innovation 47
INNOVATION 13 Competence-Enhancing Innovation versus
Competence-Destroying Innovation 48
Architectural Innovation versus Component
Chapter 2
Innovation 49
Sources of Innovation 15 Using the Dimensions 50
The Rise of “Clean Meat” 15 Technology S-Curves 50
Overview 19 S-Curves in Technological Improvement 50 S-
Creativity 20 Curves in Technology Diffusion 53 S-Curves
Individual Creativity 20 as a Prescriptive Tool 54 Limitations of S-
Organizational Creativity 22 Curve Model as a Prescriptive Tool 55
Translating Creativity Into Innovation 24
The Inventor 24 Technology Cycles 56
Innovation by Users 26 Summary of Chapter 62
Research and Development by Firms 27 Discussion Questions 63
Firm Linkages with Customers, Suppliers, Suggested Further Reading 63
Competitors, and Complementors 28 Endnotes 64
xiv
, Contents xv
Chapter 4 Strategies to Improve Timing Options 108
Standards Battles, Modularity, Summary of Chapter 108
Discussion Questions 109
and Platform Competition 67 Suggested Further Reading 109
A Battle for Dominance in Mobile Endnotes 110
Payments 67
Overview 71
PART TWO
Why Dominant Designs Are Selected 71
Learning Effects 72 FORMULATING TECHNOLOGICAL
Network Externalities 73 INNOVATION STRATEGY 113
Government Regulation 76
The Result: Winner-Take-All Markets 76 Chapter 6
Multiple Dimensions of Value 77 Defining the Organization’s Strategic
A Technology’s Stand-Alone Value 78
Network Externality Value 78 Direction 115
Competing for Design Dominance Tesla, Inc. in 2018 115
in Markets with Network Externalities 83 Overview 123
Modularity and Platform Competition 87 Assessing the Firm’s Current
Modularity 87 Position 123
Platform Ecosystems 89 External Analysis 123
Summary of Chapter 91 Internal Analysis 127
Discussion Questions 92 Identifying Core Competencies and Dynamic
Suggested Further Reading 92 Capabilities 131
Endnotes 93 Core Competencies 131
The Risk of Core Rigidities 132
Chapter 5 Dynamic Capabilities 133
Timing of Entry 95 Strategic Intent 133
Summary of Chapter 137
UberAIR 95 Discussion Questions 138
Overview 98 Suggested Further Reading 139
First-Mover Advantages 98 Endnotes 139
Brand Loyalty and Technological
Leadership 98 Chapter 7
Preemption of Scarce Assets 99
Choosing Innovation Projects 141
Exploiting Buyer Switching Costs 99
Reaping Increasing Returns Advantages 100 Where Should We Focus Our
First-Mover Disadvantages 100 Innovation Efforts? An Exercise 141
Research and Development Expenses 101 Overview 146
Undeveloped Supply and Distribution The Development Budget 146
Channels 101 Quantitative Methods For Choosing
Immature Enabling Technologies and Projects 149
Complements 101 Discounted Cash Flow Methods 149
Uncertainty of Customer Requirements 102 Real Options 152
Factors Influencing Optimal Timing of Disadvantages of Quantitative
Entry 104 Methods 154
Management of
Technological
Innovation
Sixth Edition
,Brief Contents
Preface vi
1 Introduction 1
PART ONE
Industry Dynamics of Technological Innovation 13
2 Sources of Innovation 15
3 Types and Patterns of Innovation 43
4 Standards Battles, Modularity, and Platform Competition 67
5 Timing of Entry 95
PART TWO
Formulating Technological Innovation Strategy 113
6 Defining the Organization’s Strategic Direction 115
7 Choosing Innovation Projects 141
Collaboration Strategies 167
Protecting Innovation 197
PART THREE
Implementing Technological Innovation Strategy 223
10 Organizing for Innovation 225
11 Managing the New Product Development Process 249
12 Managing New Product Development Teams 277
13 Crafting a Deployment Strategy 297
INDEX 327
xiii
,Contents
Chapter 1 Universities and Government-Funded
Introduction 1 Research 30
Private Nonprofit Organizations 32
The Importance of Technological Innovation in Collaborative Networks 32
Innovation 1 Technology Clusters 33
The Impact of Technological Technological Spillovers 36
Innovation on Society 2 Summary of Chapter 37
Innovation by Industry: The Importance of Discussion Questions 38
Strategy 4 Suggested Further Reading 38
The Innovation Funnel 4 Endnotes 39
The Strategic Management of Technological
Innovation 6 Chapter 3
Summary of Chapter 9 Types and Patterns of Innovation 43
Discussion Questions 10
Suggested Further Reading 10 Innovating in India: The Chotukool Project 43
Endnotes 10 Overview 46
Types of Innovation 46
Product Innovation versus Process
PART ONE Innovation 46
INDUSTRY DYNAMICS Radical Innovation versus Incremental
OF TECHNOLOGICAL Innovation 47
INNOVATION 13 Competence-Enhancing Innovation versus
Competence-Destroying Innovation 48
Architectural Innovation versus Component
Chapter 2
Innovation 49
Sources of Innovation 15 Using the Dimensions 50
The Rise of “Clean Meat” 15 Technology S-Curves 50
Overview 19 S-Curves in Technological Improvement 50 S-
Creativity 20 Curves in Technology Diffusion 53 S-Curves
Individual Creativity 20 as a Prescriptive Tool 54 Limitations of S-
Organizational Creativity 22 Curve Model as a Prescriptive Tool 55
Translating Creativity Into Innovation 24
The Inventor 24 Technology Cycles 56
Innovation by Users 26 Summary of Chapter 62
Research and Development by Firms 27 Discussion Questions 63
Firm Linkages with Customers, Suppliers, Suggested Further Reading 63
Competitors, and Complementors 28 Endnotes 64
xiv
, Contents xv
Chapter 4 Strategies to Improve Timing Options 108
Standards Battles, Modularity, Summary of Chapter 108
Discussion Questions 109
and Platform Competition 67 Suggested Further Reading 109
A Battle for Dominance in Mobile Endnotes 110
Payments 67
Overview 71
PART TWO
Why Dominant Designs Are Selected 71
Learning Effects 72 FORMULATING TECHNOLOGICAL
Network Externalities 73 INNOVATION STRATEGY 113
Government Regulation 76
The Result: Winner-Take-All Markets 76 Chapter 6
Multiple Dimensions of Value 77 Defining the Organization’s Strategic
A Technology’s Stand-Alone Value 78
Network Externality Value 78 Direction 115
Competing for Design Dominance Tesla, Inc. in 2018 115
in Markets with Network Externalities 83 Overview 123
Modularity and Platform Competition 87 Assessing the Firm’s Current
Modularity 87 Position 123
Platform Ecosystems 89 External Analysis 123
Summary of Chapter 91 Internal Analysis 127
Discussion Questions 92 Identifying Core Competencies and Dynamic
Suggested Further Reading 92 Capabilities 131
Endnotes 93 Core Competencies 131
The Risk of Core Rigidities 132
Chapter 5 Dynamic Capabilities 133
Timing of Entry 95 Strategic Intent 133
Summary of Chapter 137
UberAIR 95 Discussion Questions 138
Overview 98 Suggested Further Reading 139
First-Mover Advantages 98 Endnotes 139
Brand Loyalty and Technological
Leadership 98 Chapter 7
Preemption of Scarce Assets 99
Choosing Innovation Projects 141
Exploiting Buyer Switching Costs 99
Reaping Increasing Returns Advantages 100 Where Should We Focus Our
First-Mover Disadvantages 100 Innovation Efforts? An Exercise 141
Research and Development Expenses 101 Overview 146
Undeveloped Supply and Distribution The Development Budget 146
Channels 101 Quantitative Methods For Choosing
Immature Enabling Technologies and Projects 149
Complements 101 Discounted Cash Flow Methods 149
Uncertainty of Customer Requirements 102 Real Options 152
Factors Influencing Optimal Timing of Disadvantages of Quantitative
Entry 104 Methods 154
