managing and facilitating innovation

iNnovation What is it?

concerned with the new or the novel.

Distinction between innovation and invention?

Is innovation technology based? Many of the more significant innovations of the 20th century are organizational rather than technology based.

Managing and Facilitating Innovation: New Business Ideas and IPR

Some useful definitionsFritz Machlup wrote in 1962, Ought we perhaps to avoid the term innovation since it is so promiscuosly used for a variety of meanings.

Building on Schumpeters useful definition between invention andinnovation Invention implies bringing something new into being;innovation implies bringing something new into use.

Innovation has been defined as the successful introduction into an applied situation of means or ends that are new to that situation.(Mohr, 1969, quoted in Cummings and OConnell, 1978, p.34)


An innovation may therefore be a thing!

Whether artefact, product or process

or indeed service, system or infrastructure

The innovation process should also beremembered.

Need to differentiate between types of innovation and stages of adoption to facilitate developing useful theories of organizational development.Distinguish between: Product and process innovationsTechnical and organizational innovationsRadical and incremental innovations


Management of InnovationSome Important IssuesWithin an organisation

Fundamental tension between stability and creativity

Conflict between top and lower tiers?

Between strategy making and local autonomy?


Main sources and strategies for innovationInnovation is work rather than genius,and very much a matter of discipline (Peter F Drucker, 1985)

Concept of uncertainty matrix offers characteristics which reduce the risks of innovation (Alan W Pearson, ).

Knowledge creation and innovation: Four standpoints


Strategic InnovationPeter F DrukerWhat all successful entrepreneurs have is not a certain kind of personality but a commitment to the systematic practice of innovation.

All sizes of businesses engage in highly successful entrepreneurship. Hence it is an activity!! At the heart of that activity is innovation.Sources of innovation:*Within a company: Unexpected occurencesIncongruitiesProcess needsIndustry and market changes*Outside a company:Demographic changesChanges in perceptionNew knowledge


Managing Innovation:an uncertainty reduction processAlan W. PearsonInnovation means change. Such changes can be incremental or radical,evolutionary or revolutionary, enabling or disruptive. They can have different effects upon producers and users.

intuitive..tumultous processIndividual discoveries tend to be highly individualistic andserendipitous, advances chaotic and interactive, and specific outcomes unpredictable and chancy until the very last moment (Quinn, 1986).

Technological innovation is therefore a messy process!


Pearsons Uncertainty MapUncertaintyabout output

ENDSUncertainty about processMEANS


Applications engineering

Exploratory research

Technical market combination

Development engineering

Knowledge CreationFrom four standpoints:

1. Knowledge creation in the process of design, emphasizingthe role of reflective practitioner2. Nonakas framework for analysing knowledge creation as the interplay of tacit and explicit knowledge.3. Knowledge creation through experimenting and prototyping.4. Learning and innovation.


Knowledge CreationContinuous innovation

Competitive advantage

Knowledge creation as the basis of competitive advantage(Nonaka and Takeuchi, 1995)


Intellectual Capital

* In 1969 J.K.Galbraith used the term intellectual capital, defining it as more than intellect as pure intellect but rather as including some type of intellectual action (Bontis, 1996).* Thomas A.Stewart, editor of Fortune magazine, whose first article, * Brainpower (1991), acted as a catalyst for incorporating intellectual capital into managerial thought and activities.Since than it has undergone many transformations, and is now definable by thoseintangible assets that do not show up on companies financial statements, and specifically, those which can be codified, and valued and managed by a company.

Popular business writers such as Stewart(1991) define it as the combination of patents, processes, management skills, technologies, information about customers and suppliers, and experienec.

Economists define it as Tobins-q (Tobin, 1969), a broad proportional measure of market value to book value.


Intellectual Property RightsIPR is qualitatively different from most others within the intellectual capital area, notably because these rights are legally enforceable.

Exploitation of IPRDefense by companies of their knowledge against those who seek to appropriate it.


managing and facilitating innovation

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