Summary: Strategic Management
Of Technological Innovation V2
Latest Update.
CHAPTER 1: INTRODUCTION ..................................................................................................................... 2
CHAPTER 2 SOURCES OF INNOVATION ..................................................................................................... 3
CHAPTER 3 TYPES AND PATTERNS OF INNOVATION ................................................................................. 7
CHAPTER 4 STANDARDS BATTLES AND DESIGN DOMINANCE .................................................................10
CHAPTER 5 TIMING OF ENTRY.................................................................................................................14
CHAPTER 6 DEFINING THE ORGANIZATION’S STRATEGIC DIRECTION .....................................................18
CHAPTER 7 CHOOSING INNOVATION PROJECTS ..................................................................................... 22
CHAPTER 8 COLLABORATION STRATEGIES ..............................................................................................28
CHAPTER 9 PROTECTING INNOVATION ................................................................................................... 32
CHAPTER 10: ORGANIZING FOR INNOVATION ........................................................................................37
CHAPTER 11: MANAGING THE NEW PRODUCT DEVELOPMENT PROCESS ..............................................41
CHAPTER 13 CRAFTING A DEPLOYMENT STRATEGY................................................................................45
1
,CHAPTER 1: INTRODUCTION
THE IMPORTANCE OF TECHNOLOGICAL INNOVATION
- TECHNOLOGICAL INNOVATION: THE ACT OF INTRODUCING A NEW DEVICE, METHOD, OR MATERIAL
FOR APPLICATION TO COMMERCIAL OR PRACTICAL OBJECTIVES.
- THE INCREASING IMPORTANCE OF INNOVATION IS DUE IN PART TO THE GLOBALIZATION OF
MARKETS. INTRODUCING NEW PRODUCTS HELPS FIRMS PROTECT THEIR MARGINS (STAY
DIFFERENTIATED), WHILE INVESTING IN PROCESS INNOVATION HELPS FIRMS LOWER THEIR COSTS.
THE IMPACT OF TECHNOLOGICAL INNOVATION ON SOCIETY
- INNOVATION ENABLES A WIDER RANGE OF GOODS AND SERVICES TO BE DELIVERED TO PEOPLE
WORLDWIDE.
- GROSS DOMESTIC PRODUCT (GDP): THE TOTAL ANNUAL OUTPUT OF AN ECONOMIC AS MEASURED
BY ITS FINAL PURCHASE PRICE. >TECHNOLOGICAL INNOVATION INCREASED THE AMOUNT OF
OUTPUT ACHIEVABLE FROM A GIVEN QUANTITY OF LABOUR OR CAPITAL. NEXT TO THIS, GDP
GROWTH FROM GROWTH IN LABOUR AND CAPITAL INPUTS.
- TECHNOLOGICAL INNOVATION: THE CREATION OF NEW KNOWLEDGE THAT IS APPLIED TO PRACTICAL
PROBLEMS.
INNOVATION BY INDUSTRY: THE IMPORTANCE OF STRATEGY
- THE MAJORITY OF EFFORT AND MONEY INVESTED IN TECHNOLOGICAL INNOVATION COMES FROM
INDUSTRIAL FIRMS.
THE INNOVATION FUNNEL
- MANY POTENTIAL NEW PRODUCT IDEAS GO IN THE WIDE END, BUT VERY FEW MAKING IT
THROUGH THE DEVELOPMENT PROCESS.
THE STRATEGIC MANAGEMENT OF TECHNOLOGICAL INNOVATION
- A FIRM’S INNOVATION PROJECTS SHOULD ALIGN WITH ITS RESOURCES AND OBJECTIVES,
LEVERAGING ITS CORE COMPETENCIES AND HELPING IT ACHIEVE ITS STRATEGIC INTENT.
- A FIRM’S ORGANIZATIONAL STRUCTURE AND CONTROL SYSTEM SHOULD ENCOURAGE THE
GENERATION OF INNOVATIVE IDEAS WHILE ALSO ENSURING EFFICIENT IMPLEMENTATION.
- A FIRM’S NEW PRODUCT DEVELOPMENT PROCESS SHOULD MAXIMIZE THE LIKELIHOOD OF
PROJECTS BEING BOTH TECHNICALLY AND COMMERCIALLY SUCCESSFUL.
- TO ACHIEVE THE ABOVE THREE THINGS, A FIRM NEEDS:
1. AN IN-DEPTH UNDERSTANDING OF THE DYNAMICS OF INNOVATION
2. A WELL-CRAFTED INNOVATION STRATEGY
3. WELL-DESIGNED PROCESS FOR IMPLEMENTING THE INNOVATION STRATEGY.
2
,CHAPTER 2 SOURCES OF INNOVATION
OVERVIEW
INNOVATION (THE PRACTICAL IMPLEMENTATION OF AN IDEA INTO A PROCESS OR PRODUCT) CAN
ARISE FROM MANY DIFFERENT SOURCES. INDIVIDUALS WHO HAVE THEIR OWN NEEDS,
RESEARCHERS ON UNIVERSITIES, GOVERNMENT LABORATORIES AND NON-PROFIT ORGANIZATIONS.
FIRMS ARE A PRIMARY SOURCE OF INNOVATION, SINCE THEY HAVE RESOURCES AND MANAGEMENT
TO ALLOCATE THESE RESOURCES. BESIDES THAT THEY HAVE STRONG INCENTIVES TO INNOVATE,
SUCH AS COMPETITION.
ONE OF THE MOST POWERFUL SOURCES OF INNOVATION ARE NOT THE INDIVIDUALS BUT THE
NETWORK BETWEEN THESE ACTORS. THE SOURCES OF INNOVATION CAN BE SEEN AS A SYSTEM OF
INNOVATION.
CREATIVITY
INNOVATION START WITH IDEAS (SOMETHING IMAGINED OR PICTURES IN THE MIND. THE ABILITY
TO CREATE NEW IDEAS IS CALLED CREATIVITY. IT IS DEFINED AS THE ABILITY TO PRODUCE NOVEL
(DIFFERENT FROM OTHER, NOT THE LOGICAL NEXT STEP) AND USEFUL WORK. HOW NOVEL A
PRODUCT IS, IS A FUNCTION OF THE DEVIATION FROM PREVIOUS WORK, AND THE AUDIENCE PRIOR
EXPERIENCES.
INDIVIDUAL CREATIVITY
THE CREATIVITY OF AN INDIVIDUAL IS THE FUNCTION OF HIS/HERS: INTELLIGENCE, KNOWLEDGE, STYLE
OF THINKING, PERSONALITY, MOTIVATION AND ENVIRONMENT.
THE INTELLECTUAL ABILITIES INCLUDE: THE WAYS TO LOOK AT A PROBLEM, THE ABILITY TO SEE
WHAT TO PURSUIT OR NOT AND THE ABILITY TO ARTICULATE THOSE IDEAS TO OTHERS TO CONVINCE
THEM THAT THEY ARE WORTH GOING FOR. KNOWLEDGE IS DOUBLE-EDGED, LACK OF KNOWLEDGE
MAKES THAT IT IS HARD TO CONTRIBUTE, HOWEVER IT CAN ALSO LIMIT IN CREATIVE THINKING.
REFERRING TO OWN SKILLS, INTRINSIC MOTIVATION, SELF-EFFICACY, TOLERANCE FOR AMBIGUITY,
TAKING RISK, AND WILLINGNESS TO OVERCOME OBSTACLES PLAY A ROLE.
ORGANIZATIONAL CREATIVITY
THE CREATIVITY OF AN ORGANIZATION IS A FUNCTION OF THE CREATIVITY OF THE INDIVIDUALS,
AND THE PROCESSES AND CONTEXT IN WHICH THESE INDIVIDUALS INTERACT AND BEHAVE. IT IS NOT
SIMPLY THE SUM OF ALL INDIVIDUALS. ONE WAY TO TAP CREATIVITY IS THE SUGGESTION BOX.
NOWADAYS SOME FIRMS HAVE VERY LARGE WAYS TO DEAL WITH THESE TAPPED IDEAS OFTEN
BASED ON THE INTRANET OF AN ORGANIZATION.
THE SUGGESTIONS ARE ONLY ONE FIRST STEP, MANY COMPANIES HAVE CREATIVITY TRAINING
PROGRAMS. THIS MUST GIVE EMPLOYEES THE SIGN THAT THERE IS WORKED WITH THEIR IDEAS.
REWARDING SOMETIMES IS BASED ON THE WRONG MOTIVATION, SO NOT LEADING TO MORE
CREATIVITY.
TRANSLATING CREATIVITY INTO INNOVATION
INNOVATION IS MORE THAN ONLY CREATING IDEAS, IT IS IMPLEMENTING THESE IDEAS INTO
PRODUCTS OR PROCESSES. THEREFORE IDEAS NEED TO BE COMBINED WITH RESOURCES AND
EXPERTISE.
THE INVENTOR
RESEARCH SUGGEST THAT SUCCESSFUL INVENTOR HAVE THE FOLLOWING TRAITS:
- MASTERED BASIC TOOLS AND OPERATIONS OF MORE THAN ONE FIELD THEY ARE WORKING IN
- CURIOS AND MORE INTERESTED IN PROBLEMS THAN SOLUTION
-QUESTION THE ASSUMPTIONS MADE IN EARLIER WORK
- SENSE THAT KNOWLEDGE IS UNIFIED, GLOBAL SOLUTION, AND GENERALISTS
3
, INNOVATION BY USERS
INNOVATION OFTEN COME WITH THOSE WHO SOLVE OWN NEEDS. THEY UNDERSTAND THE UNMET
NEEDS AND HAVE AN INCENTIVE TO SOLVE THEM. USERS ARE OFTEN NOT MOTIVATED BY MAKING
PROFITS OUT OF THE SOLUTIONS. THEY MAY IMPROVE PRODUCTS THEMSELVES OR SUGGEST IT TO
MANUFACTURES.
4
Of Technological Innovation V2
Latest Update.
CHAPTER 1: INTRODUCTION ..................................................................................................................... 2
CHAPTER 2 SOURCES OF INNOVATION ..................................................................................................... 3
CHAPTER 3 TYPES AND PATTERNS OF INNOVATION ................................................................................. 7
CHAPTER 4 STANDARDS BATTLES AND DESIGN DOMINANCE .................................................................10
CHAPTER 5 TIMING OF ENTRY.................................................................................................................14
CHAPTER 6 DEFINING THE ORGANIZATION’S STRATEGIC DIRECTION .....................................................18
CHAPTER 7 CHOOSING INNOVATION PROJECTS ..................................................................................... 22
CHAPTER 8 COLLABORATION STRATEGIES ..............................................................................................28
CHAPTER 9 PROTECTING INNOVATION ................................................................................................... 32
CHAPTER 10: ORGANIZING FOR INNOVATION ........................................................................................37
CHAPTER 11: MANAGING THE NEW PRODUCT DEVELOPMENT PROCESS ..............................................41
CHAPTER 13 CRAFTING A DEPLOYMENT STRATEGY................................................................................45
1
,CHAPTER 1: INTRODUCTION
THE IMPORTANCE OF TECHNOLOGICAL INNOVATION
- TECHNOLOGICAL INNOVATION: THE ACT OF INTRODUCING A NEW DEVICE, METHOD, OR MATERIAL
FOR APPLICATION TO COMMERCIAL OR PRACTICAL OBJECTIVES.
- THE INCREASING IMPORTANCE OF INNOVATION IS DUE IN PART TO THE GLOBALIZATION OF
MARKETS. INTRODUCING NEW PRODUCTS HELPS FIRMS PROTECT THEIR MARGINS (STAY
DIFFERENTIATED), WHILE INVESTING IN PROCESS INNOVATION HELPS FIRMS LOWER THEIR COSTS.
THE IMPACT OF TECHNOLOGICAL INNOVATION ON SOCIETY
- INNOVATION ENABLES A WIDER RANGE OF GOODS AND SERVICES TO BE DELIVERED TO PEOPLE
WORLDWIDE.
- GROSS DOMESTIC PRODUCT (GDP): THE TOTAL ANNUAL OUTPUT OF AN ECONOMIC AS MEASURED
BY ITS FINAL PURCHASE PRICE. >TECHNOLOGICAL INNOVATION INCREASED THE AMOUNT OF
OUTPUT ACHIEVABLE FROM A GIVEN QUANTITY OF LABOUR OR CAPITAL. NEXT TO THIS, GDP
GROWTH FROM GROWTH IN LABOUR AND CAPITAL INPUTS.
- TECHNOLOGICAL INNOVATION: THE CREATION OF NEW KNOWLEDGE THAT IS APPLIED TO PRACTICAL
PROBLEMS.
INNOVATION BY INDUSTRY: THE IMPORTANCE OF STRATEGY
- THE MAJORITY OF EFFORT AND MONEY INVESTED IN TECHNOLOGICAL INNOVATION COMES FROM
INDUSTRIAL FIRMS.
THE INNOVATION FUNNEL
- MANY POTENTIAL NEW PRODUCT IDEAS GO IN THE WIDE END, BUT VERY FEW MAKING IT
THROUGH THE DEVELOPMENT PROCESS.
THE STRATEGIC MANAGEMENT OF TECHNOLOGICAL INNOVATION
- A FIRM’S INNOVATION PROJECTS SHOULD ALIGN WITH ITS RESOURCES AND OBJECTIVES,
LEVERAGING ITS CORE COMPETENCIES AND HELPING IT ACHIEVE ITS STRATEGIC INTENT.
- A FIRM’S ORGANIZATIONAL STRUCTURE AND CONTROL SYSTEM SHOULD ENCOURAGE THE
GENERATION OF INNOVATIVE IDEAS WHILE ALSO ENSURING EFFICIENT IMPLEMENTATION.
- A FIRM’S NEW PRODUCT DEVELOPMENT PROCESS SHOULD MAXIMIZE THE LIKELIHOOD OF
PROJECTS BEING BOTH TECHNICALLY AND COMMERCIALLY SUCCESSFUL.
- TO ACHIEVE THE ABOVE THREE THINGS, A FIRM NEEDS:
1. AN IN-DEPTH UNDERSTANDING OF THE DYNAMICS OF INNOVATION
2. A WELL-CRAFTED INNOVATION STRATEGY
3. WELL-DESIGNED PROCESS FOR IMPLEMENTING THE INNOVATION STRATEGY.
2
,CHAPTER 2 SOURCES OF INNOVATION
OVERVIEW
INNOVATION (THE PRACTICAL IMPLEMENTATION OF AN IDEA INTO A PROCESS OR PRODUCT) CAN
ARISE FROM MANY DIFFERENT SOURCES. INDIVIDUALS WHO HAVE THEIR OWN NEEDS,
RESEARCHERS ON UNIVERSITIES, GOVERNMENT LABORATORIES AND NON-PROFIT ORGANIZATIONS.
FIRMS ARE A PRIMARY SOURCE OF INNOVATION, SINCE THEY HAVE RESOURCES AND MANAGEMENT
TO ALLOCATE THESE RESOURCES. BESIDES THAT THEY HAVE STRONG INCENTIVES TO INNOVATE,
SUCH AS COMPETITION.
ONE OF THE MOST POWERFUL SOURCES OF INNOVATION ARE NOT THE INDIVIDUALS BUT THE
NETWORK BETWEEN THESE ACTORS. THE SOURCES OF INNOVATION CAN BE SEEN AS A SYSTEM OF
INNOVATION.
CREATIVITY
INNOVATION START WITH IDEAS (SOMETHING IMAGINED OR PICTURES IN THE MIND. THE ABILITY
TO CREATE NEW IDEAS IS CALLED CREATIVITY. IT IS DEFINED AS THE ABILITY TO PRODUCE NOVEL
(DIFFERENT FROM OTHER, NOT THE LOGICAL NEXT STEP) AND USEFUL WORK. HOW NOVEL A
PRODUCT IS, IS A FUNCTION OF THE DEVIATION FROM PREVIOUS WORK, AND THE AUDIENCE PRIOR
EXPERIENCES.
INDIVIDUAL CREATIVITY
THE CREATIVITY OF AN INDIVIDUAL IS THE FUNCTION OF HIS/HERS: INTELLIGENCE, KNOWLEDGE, STYLE
OF THINKING, PERSONALITY, MOTIVATION AND ENVIRONMENT.
THE INTELLECTUAL ABILITIES INCLUDE: THE WAYS TO LOOK AT A PROBLEM, THE ABILITY TO SEE
WHAT TO PURSUIT OR NOT AND THE ABILITY TO ARTICULATE THOSE IDEAS TO OTHERS TO CONVINCE
THEM THAT THEY ARE WORTH GOING FOR. KNOWLEDGE IS DOUBLE-EDGED, LACK OF KNOWLEDGE
MAKES THAT IT IS HARD TO CONTRIBUTE, HOWEVER IT CAN ALSO LIMIT IN CREATIVE THINKING.
REFERRING TO OWN SKILLS, INTRINSIC MOTIVATION, SELF-EFFICACY, TOLERANCE FOR AMBIGUITY,
TAKING RISK, AND WILLINGNESS TO OVERCOME OBSTACLES PLAY A ROLE.
ORGANIZATIONAL CREATIVITY
THE CREATIVITY OF AN ORGANIZATION IS A FUNCTION OF THE CREATIVITY OF THE INDIVIDUALS,
AND THE PROCESSES AND CONTEXT IN WHICH THESE INDIVIDUALS INTERACT AND BEHAVE. IT IS NOT
SIMPLY THE SUM OF ALL INDIVIDUALS. ONE WAY TO TAP CREATIVITY IS THE SUGGESTION BOX.
NOWADAYS SOME FIRMS HAVE VERY LARGE WAYS TO DEAL WITH THESE TAPPED IDEAS OFTEN
BASED ON THE INTRANET OF AN ORGANIZATION.
THE SUGGESTIONS ARE ONLY ONE FIRST STEP, MANY COMPANIES HAVE CREATIVITY TRAINING
PROGRAMS. THIS MUST GIVE EMPLOYEES THE SIGN THAT THERE IS WORKED WITH THEIR IDEAS.
REWARDING SOMETIMES IS BASED ON THE WRONG MOTIVATION, SO NOT LEADING TO MORE
CREATIVITY.
TRANSLATING CREATIVITY INTO INNOVATION
INNOVATION IS MORE THAN ONLY CREATING IDEAS, IT IS IMPLEMENTING THESE IDEAS INTO
PRODUCTS OR PROCESSES. THEREFORE IDEAS NEED TO BE COMBINED WITH RESOURCES AND
EXPERTISE.
THE INVENTOR
RESEARCH SUGGEST THAT SUCCESSFUL INVENTOR HAVE THE FOLLOWING TRAITS:
- MASTERED BASIC TOOLS AND OPERATIONS OF MORE THAN ONE FIELD THEY ARE WORKING IN
- CURIOS AND MORE INTERESTED IN PROBLEMS THAN SOLUTION
-QUESTION THE ASSUMPTIONS MADE IN EARLIER WORK
- SENSE THAT KNOWLEDGE IS UNIFIED, GLOBAL SOLUTION, AND GENERALISTS
3
, INNOVATION BY USERS
INNOVATION OFTEN COME WITH THOSE WHO SOLVE OWN NEEDS. THEY UNDERSTAND THE UNMET
NEEDS AND HAVE AN INCENTIVE TO SOLVE THEM. USERS ARE OFTEN NOT MOTIVATED BY MAKING
PROFITS OUT OF THE SOLUTIONS. THEY MAY IMPROVE PRODUCTS THEMSELVES OR SUGGEST IT TO
MANUFACTURES.
4
