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1. Innovation process
Chapter 4 The innovation • Searching Scanning the (internal and external) environment for and processing
process (1): Finding innovation relevant signals about threats and opportunities for change.
• Selecting Deciding (based on a strategic view of how the enterprise can best
develop) which of these signals to respond to.
opportunites • Implementing Translating the potential in the trigger idea into something new and
launching it in an internal or external market. Making this happen is not a single
event but requires eventually acquiring the knowledge resources to enable the
innovation, executing the project under conditions of uncertainty (which require
extensive problem-solving) and launching the innovation into relevant internal or
external markets.
• Capturing value from the innovation Sustaining and growing the market and ensuring
widespread adoption and diffusion, together with ensuring that value is captured for
the innovator.
• Learning from progressing through this cycle so that the organization can build its
knowledge base and can improve the ways in which the process is managed.
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2. Innovation resources
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Futures and
forecasting Regulation Accidents
Where do innovations come from?
Design-driven
and experience Knowledge
innovation push
Recombinant
innovation
Sources of innovation Need pull
Prototyping
and
experiment
Benchmarkin Process
g/ learning improvement
from others
Crisis driven
User –led and extreme
innovation contexts
Mass Frugal
customisatio innovation
n
Figure 6.1 of the book indicates the wide range of stimuli which can begin the innovation journey
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•
•
Knowledge push
Need pull
Knowledge push innovation
• Product innovation
• Process improvement
• Crisis-driven
• Frugal innovation
• Mass customization
• User-led innovation
Sources of •
•
Prototyping
Benchmarking
innovation •
•
Recombinant innovation
Design-driven innovation
• Regulation
• Futures and forecasting
• Accidents
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Types of product innovation Disruptive innovation
New to the world products
New product lines
Line extensions
Repositionings
Cost reductions
Incremental product
improvements
Figure 6.2 of the book indicates a typical breakdown, and we could construct a similar
picture for process innovation
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Mass customization
Mass customization (continued)
Table 6.1 of the book summarises options in customization (after Mintzberg and Lampel)
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Mass customization Mass customization
(continued) (continued)
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Design driven innovation
3. Looking for innovation opportunities
Radical
change
Technology push
Technology
Design-driven
Market pull
(user centred)
Incremental
change
Incremental Radical
change change
Meaning
Source: Based on R. Verganti (2009) Design-Driven Innovation. Harvard Business School Press
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Mind map A framework for thinking about search
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• - The reality is that innovation is never a
- Innovation can happen along a spectrum running
simple matter of push or pull but rather from incremental (‘do what we do, but better’)
their interaction; as Chris Freeman, one through to radical (‘do something completely
of the pioneers of innovation research different’).
said, ‘necessity may be the mother of
invention but procreation needs a • - We’ve also seen that there is a pattern of what
partner!’. could be termed ‘punctuated equilibrium’ with
innovation – most of the time innovation is about
Incremental
Push or • - There is a risk in focusing on either of
exploiting and elaborating, creating variations on
a theme within an established technical, market
the ‘pure’ forms of push or pull sources. or radical or regulatory trajectory.
pull? If we put all our eggs in one basket we
risk being excellent at invention but innovation? • - Occasionally there is a breakthrough which
creates a new trajectory –and the cycle repeats
without turning our ideas into successful itself.
innovations –a fate shared by too many
would-be entrepreneurs. • - This suggests that much of our attention in
searching for innovation triggers will be around
incremental improvement innovation.
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Exploit or explore? • - On the one hand firms need to deploy
knowledge resources and other assets to secure
returns and a ‘safe’ way of doing so is to harvest a
steady flow of benefits derived from ‘doing what
we do better’. This has been termed ‘exploitation’
by innovation researchers, and it essentially
involves ‘the use and development of things
already known’.
• - The trouble is that in an uncertain environment
Exploit/explore? the potential to secure and defend a competitive
position depends on ‘doing something different’,
i.e. radical product or process innovation rather
than imitations and variants of what others are
also offering. This kind of search had been term
‘exploration’ and is the kind which involves ‘long
jumps or re-orientations that enable a firm to
adopt new attributes and attain new knowledge
outside its domain’.
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Who?
Another influence on our choice of search approach is around
timing – at different stages in the product or industry life cycle
the emphasis may be more or less on push or pull.
Mature industries will require a very different approach to new
industries.
Another important influence on the timing question is around
diffusion – the adoption and elaboration of innovation over
When?
KNOWLEDGE NETWORKS KNOWLEDGE CONNECTORS KNOWLEDGE FLOW KNOWLEDGE
time. CONCENTRATION
Understanding diffusion processes and the influential factors is
important because it helps us understand where and when
different kinds of triggers are picked up.
Lead users and early adopters are likely to be important sources
of ideas and variations which can help shape an innovation in its
early life, whereas the early and late majority will be more a
source of incremental improvement ideas.
KNOWLEDGE KNOWLEDGE
ARCHITECTURE TRANSFORMATION,
ARTICULATION AND
ASSIMILATION
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• Firms can be radical innovators but still be ‘upstaged’ by
developments outside their search trajectory. The problem is
that search behaviour is essentially bounded exploration and
raises a number of challenges:
A key problem in searching for innovation opportunities is not
• - When there is a shift to a new mind-set – cognitive frame -
just that such firms fail to get the balance between exploit and
explore right but also because there are choices to be made Where? established players may have problems because of the
reorganization of their thinking which is required.
about the overall direction of search.
The
Where to Search space is not one-dimensional.
Innovation rarely involves dealing with a single technology or
market but rather a bundle of knowledge which is brought innovation
• This is not simply a change of personal or even group mind-
set –the consequence of following a particular mind-set is that
search? together into a configuration. artefacts and routines come into place which block further
Successful innovation management requires that we can get
hold of and use knowledge about components but also about treasure change and reinforce the status quo.
how those can be put together – what they termed the
architecture of an innovation. hunt • - Architectural - as opposed to component innovation –
requires letting go of existing networks and building new ones.
• - The new frame may not necessarily involve radical change in
technology or markets but rather a rearrangement of the
existing elements.
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A map of innovation search space Sources of innovation
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Information sources for innovation Increasing collaboration in innovation
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The open innovation model • - One more broad strategic point concerns the question of where,
• when and how organizations make use of external knowledge to grow.
• The reality is, of course, that they differ widely in their ability to make
use of such trigger signals – and the measure of this ability to find and use
new knowledge has been termed ‘absorptive capacity’(AC).
• It is an important construct because it shifts our attention to how well
firms are equipped to search out, select and implement knowledge.
Absorptive • AC is essentially about accumulated learning and embedding of
capacity capabilities –search, acquire, assimilate, etc. –in the form of routines
(structures, processes, policies and procedures) which allow organizations
to repeat the trick.
• Firms differ in their levels of AC and this places emphasis on how they
develop and establish and reinforce these routines.
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- Search strategies include:
- One area which has seen growing activity addresses a
fundamental knowledge management issue which is well
expressed in the statement – if only xxx (insert the name of
any large organization) knew what it knows!’ In other
words how can organizations tap into the rich knowledge
• - Sending out scouts
(and potential innovation triggers) within its existing
structures and amongst its workforce?
• - Exploring multiple futures
Managing - Much of the knowledge lies in the experience and ideas of
Enabling • - Innovation markets
internal ‘ordinary’ employees. Increasingly organizations are trying
to tap into such knowledge as a source of innovation via external • - Working with active users
connections
various forms of what can be termed ‘high involvement
innovation’ systems such as suggestion schemes, problem connections • - ‘Deep diving’
solving groups and innovation ‘jams’.
• - Probe and learn
• - There has also been an explosion in the use of internal
online platforms to encourage and enable idea submission,
• - Corporate venturing
development and acceleration.
• - Use brokers and bridges
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- Within this broad framework firms deploy a
range of approaches to organizing and Challenges in innovation search
managing the search process.
• - R&D units can be structured to enable a
balance between applied research
Enabling (supporting the ‘exploit’ type of search) and
more wide-ranging, ‘blue sky’ activities
search for (which facilitate the ‘explore’ side of the
equation).
innovation
- Choice of techniques and structures
depends on a variety of strategic factors like
those explored above – balancing their costs
and risks against the quality and quantity of
knowledge they bring in.
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• In this chapter we have been concerned not so much with
Videos
the many sources of innovation as with how to mobilise
effective search strategies to explore these systematically.
• - We have also developed an understanding of the different • There are several videos
kinds of opportunity being sought in terms of incremental
or radical change.
which can help explore
and present the key
• - The different search needs at different stages of the
themes of the chapter:
Summary •
innovation process
the different players involved in the search process, and in
• Search strategies
particular the growing engagement of more people inside
and outside the organization.
• Tools for innovation search
• - Local search aiming to exploit existing knowledge through
to radical and beyond into new frames.
• - Mechanisms for enabling search.
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• Interview with Michael Bartl of Hyve, talking about the Managing internal knowledge
use of ‘netnography’ in the search for new innovation
opportunities
connections
• Interview with Emma Taylor talking about mobilizing
employees as a source of innovation
• Series of films about a start-up, Tidewave, and its Follow the link below to watch a video of Francisco Pinheiro,
journey to scale
Strategic Innovation Manager with Atos, discussing the
• Interview with Pedro Oliveira talking about the Patient
Innovation platform, a way of mobilizing user innovators
challenges of getting innovative ideas from employees via
in the healthcare space internal online platforms in the company
Videos • Interviews with doctors from the Torbay Hospital in the
UK talking about their approaches to finding process
innovation opportunities
• Interview (audio) with Helen King of the Irish Food [Link]
Board talking about their use of futures methods to
search for innovation opportunities innovators-media-library/
• Interview with Lynne Maher, (audio) UK National Health
Service talking about user experience as a source of
innovation
• Eric von Hippel talking about user innovation methods
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Media: Managing internal knowledge
Videos
connections
Follow the link below to watch a video of an interview with Follow the link below to watch a video interview with John Neill,
Hugh Chapman , managing director of Veeder-Root, discussing chief executive of Unipart, about the logistics group’s methods
employee involvement in innovation and how it can contribute for improving productivity, including a ‘university’ and ‘faculties
to sustained successful performance on the floor’ for continuous training and monitoring.
[Link] [Link]
innovators-media-library/ 6cd10a77065f
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Managing internal knowledge
connections
• There are several podcasts Follow the link below to hear a podcast on how seller feedback
and blogs picking up key has allowed companies like ebay to grow in the way they have
themes around managing
Blogs and innovation as a process and
[Link]
podcasts some of the key variables:
• Tim Craft
• David Overton
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Media: Extending external connections Media: Extending external connections
Follow the link below to hear an interview with Perry Chen, Follow the link below to hear a podcast on how market
principal founder of the crowdfunding platform, Kickstarter. research marked a shift from a producer-led to a consumer-
led approach to business
[Link]
radio/how-i-built-this/e/50961272 [Link]
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