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Chapter 1 Innovation Management : An Introduction. Fatih ARSLAN Zeynep ÖNCÜ Şeyma YILMAZ Çağatay YILMAZLAR. Very compatitive business market “The ability to change and adapt is essential to survive”. What should we do to adapt this changes?. Being innovative .
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Chapter 1InnovationManagement: An Introduction Fatih ARSLAN Zeynep ÖNCÜ Şeyma YILMAZ Çağatay YILMAZLAR
Very compatitive business market • “The ability to change and adapt is essential to survive”
What should we do to adapt this changes? • Being innovative Innovation is necessary to survive “…not toinnovate is todie.” Christopher Freeman (1982)
What is innovation? • Innovation is not a single action but a total process of interrelated sub processes. • It is not just the conception of a new idea, nor the invention of a new device, nor the development of a new market.
Table 2:Nineteenth-century economic development fuelled by technological innovations
Innovation: yes, but how? • selecting and successfully implementing the best ideas
Can wemanageinnovation? • Innovation is not a one-step activity, rather than affecting entire organization. • the most important issue is to manage the associated exchanges.
Effect of innovation in theeconomicgrowth • Acceleration in economic growth was the result of technological progress. • According to the Schumpeter ; competition posed by new products was far more important than marginal changes in the prices of existing products.
Theneedtoviewinnovation in anorganisationalcontext • Theexpansion in manufacturingactivitieswassimultaneouslymatchedby an expansion in administrativeactivities. Thisrepresentedthebeginnings of thedevelopment of thediversifiedfunctionalenterprise. • Unfortunately, many of thestudies of innovationhavetreated it as an artefactthat is somehowdetachedfromknowledgeandskillsand not embedded in know-how
Thisinevitablyleadsto a simplifiedunderstanding, if not a misunderstanding, of whatconstitutesinnovation. • Thissectionshowswhyinnovationneedsto be viewed in thecontext of organisationsand as a processwithinorganisations
Theneedtoviewinnovation in an organisationalcontext • Individuals in theinnovationprocess • Entrepreneurship • Design • Innovationandinvention • Successfulandunsuccessfulinnovations • Differenttypes of innovations • Technologyandscience
Individuals in theinnovationprocess • Identifiesindividuals as a keycomponent of theinnovationprocess. • Creativeindividuals • Firmoperatingfunctionsandactivities • Firmsarchitectureandexternallinkages
Entrepreneurship • Thequality of being an entrepreneur. • startingnewbusinesses. • describingactivitieswithin a firmorlargeorganization. • In a study of pastandfutureresearch on thesubject of entrepreneurship, LowandMacMillan, define it as ‘theprocess of planning, organising, operating, andassumingthe risk of a businessventure.
Design • Thedefinition of designwithregardtobusinessseemsto be widening ever furtherandencompassingalmostallaspects of business. • A keyquestionhowever, is how designrelatestoresearchanddevelopment? • Design is the main component in productdevelopment.
Todaytheprocess is dominatedbycomputer software programmesthatfacilitateallaspects of theactivity; hencetheproductdevelopmentactivitiesandtheenvironments in whichdesignoccurshavechangedconsiderably.
Innovationandinvention • innovation is thefirstcousin of invention, but theyare not identicaltwinsthat can be interchanged. • Innovation is not a singleaction • Invention is theconception of the idea, whereasinnovation is thesubsequenttranslation of theinventionintotheeconomy.
innovationdepends on inventions but inventionsneedto be harnessedtocommercialactivitiesbeforethey can contributetothegrowth of an organisation. • Creativity: thethinking of novelandappropriateideas. Innovation: thesuccessfulimplementation of thoseideaswithin an organisation.
Successfulandunsuccessfulinnovations • There is often a greatdeal of confusionsurroundinginnovationsthatare not commerciallysuccessful. Kodak disk cameraSinclair C5
Commercialfailure, however, does not relegate an innovationto an invention. • Thefactthattheproductprogressedfromthedrawing board intothemarketplacemakes it an innovation – albeit an unsuccessfulone.
Differenttypes of innovations • Industrialinnovation not onlyincludesmajor (radical) innovations but alsominor(incremental) technologicaladvances. • Indeed, successfulcommercialisation of theinnovationmayinvolveconsiderablywiderorganisationalchanges. • Technologicalinnovation can be accompaniedbyadditionalmanagerialandorganisationalchanges, oftenreferredto as innovations.
Type of innovations • Productinnovation • Processinnovation • Organizationalinnovation • Managementinnovation • Productioninnovation • Commercial/marketing • Service innovation
TechnologyandScience • Weneedtoconsiderthe role playedbyscienceandtechnology in innovation. • Science can be defined as systematicandformulatedknowledge.
Technology is knowledgeappliedtoproductsorproductionprocesses. • Scienceprovides us withinformationwhichwaspreviouslyUnknownbyunlikeengineers, scientists. • Engineersand not scientistswhomaketechnology.
Humorousand popular view of inventionsandinnovations has beenreinforcedovertheyearsandcontinuestooccur in the popular press. Manyindustrialistsandacademicshavearguedthatthissimpleview of a complexphenomenon has causedimmenseharmtotheunderstanding of scienceandtechnology.
Models of innovation The literature on what ‘drives’ innovation has tended to divide into two schools of thought: • the market-based view • the resource-based view.
Innovation as a Management Process Innovation may be described as a process and involves: • a response to either a need or an opportunity that is context dependent; • a creative effort that if successful results in the introduction of novelty; • the need for further changes.
Network Models The framework emphasises the importance placed on interaction (both formal and informal) within the innovation process. Indeed, innovation has been described as an information–creation process that arises out of social interaction.
