Ritsuko Ozaki and Mark Dodgson
This chapter argues it is important for effective innovation management to understand how innovations are consumed. The diffusion of innovation depends on the fit between innovation and consumers’ circumstances and underlying values. Investigation as to how socially contextual and emotional factors, as well as more rational factors such as costs, utility, and technical functionalities, affect innovation adoption decisions is crucial. By using the example of Josiah Wedgwood, the chapter shows how innovation is affected by the broader social and cultural changes that influence patterns of consumption. It uses the examples of hybrid vehicles and green electricity tariffs to reveal the complexities in decisions to consume innovation, understanding of which better informs value propositions from innovation.
Candace Jones, Mark Lorenzen, and Jonathan Sapsed
Creative industries experience a variety of changes, which are driven by differing forces. However this variety may be understood by considering two dimensions: semiotic codes; the signifiers of symbolic value that consumers derive from products, and the material base; the formats, fabrics, and physical human activities underpinning these products. We characterize four types of change, based on high and low change combinations with semiotic codes and the material base: Preserve, Ideate, Transform, and Recreate. This framework is applied to a range of creative industries, from mature sectors like museums, architecture, and fashion, through the many transitions of film production, to contemporary digital advertising and online content creation. We show how each of the change types appear to have different drivers related to public policy, demand, technology, and globalization, offering an alternative classification framework to guide creative industries scholars, practitioners, and policy-makers.
Jan Fagerberg and Manuel M. Godinho
“Catch-up” relates to the ability of a single country to narrow the gap in productivity and income vis-à-vis a leader country, while “convergence” refers to a trend towards a reduction of the overall differences in productivity and income in the world as a whole. Successful catch-up has historically been associated not merely with the adoption of existing techniques in established industries, but also with innovation, particularly of the organizational kind, and with inroads into nascent industries. This article discusses some of the perspectives that have emerged in the catching up literature. It extends the perspective to the most recent decades, compares cases of successful catch-up to less successful ones, and considers the lessons that may be drawn. Finally, it raises the question of what present day developing countries can learn, particularly with respect to policy, from the literature on innovation and catching up.
Bronwyn H. Hall
In the study of innovation, the word diffusion is commonly used to describe the process by which individuals and firms in a society/economy adopt a new technology, or replace an older technology with a newer. But diffusion is not only the means by which innovations become useful by being spread throughout a population, it is also an intrinsic part of the innovation process, as learning, imitation, and feedback effects which arise during the spread of a new technology enhance the original innovation. This article provides an historical and comparative perspective on diffusion that looks at the broad determinants: economic, social, and institutional. The ways in which the different social scientific disciplines think about diffusion is discussed and a framework is presented for studying its determinants. Some of the empirical evidence on these determinants is reviewed, and a range of examples are also given.
This article is concerned with innovation processes within firms, focusing mainly on innovation within large corporations in advanced countries. It draws on empirical studies of innovation processes, bearing in mind the difficulties for generalization posed by the highly contingent nature of innovation. It presents a short introduction to the many theories and empirical studies of innovation and suggests a simple framework for disaggregating the many innovation activities which take place at the firm level. Three broad, overlapping subprocesses of innovation are identified: the production of knowledge; the transformation of knowledge into artifacts—which mean products, systems, processes, and service; and the continuous matching of the latter to market needs and demands. This article examines key aspects of each of these three subprocesses, showing how each has evolved historically and why they pose such difficult problems for innovation-related managers, entrepreneurs, researchers, and workers.
This chapter reviews the economic characteristics of information and knowledge and their implications for innovation management. It discusses legal and competitive strategies to control and benefit from intellectual assets and surveys associated societal and technological trends. Many of the issues are found to be particularly topical in the context of information and communication technology (ICT) industries. Here, content suppliers need to develop business models that address the weakening of legal protection, or appropriability, of information, and new hardware and software technologies need to be strategically positioned with respect to the intellectual property rights landscape where licensing negotiations and litigation can determine success or failure of innovations. These strategic innovation challenges are exceptionally complex if interoperability standards are essential for the growth of the product or service system.
Dorothy Leonard and Michelle Barton
Knowledge bears a paradoxical relationship to creativity and innovation: it is essential to both, and yet (under certain circumstances) is inimical to both. That is, knowledge both gives birth to innovative ideas and can also kill them. This article examines the management of that paradox at three levels: organizational, group, and individual. At the organizational level, knowledge is the basis for both core capabilities and core rigidities. At the group level, team composition and norms can influence how knowledge and expertise is utilized to either enhance or inhibit innovation. And at the individual level, expertise enables intuitive leaps of creativity but is also subject to cognitive biases that stifle innovation. This article suggests ways of countering the negative effects of knowledge and capitalizing on its power to create and inspire.
The purpose of this article is to survey this complex field of alliances and networks designed to help produce innovation, without claiming to be exhaustive. Here, the emphasis is placed on a coherent causal analysis that integrates at least some of the many factors that have been found to play a role in innovation and learning in inter-organizational relationships. In particular, this article looks at two issues: competence, which is clearly central in innovation and learning (which is all about developing competence), and governance, i.e. the management of relational risks. This article employs multiple perspectives, from economics, sociology, and cognitive science. Economics aids in dealing with considerations of efficiency; sociology for interaction, and cognitive science because learning is, after all, the central issue.
Ella Miron-Spektor and Miriam Erez
This chapter contributes to the research and practice of creativity by increasing awareness of the inherently paradoxical nature of creativity, and offering strategies for managing the paradox. The authors’ framework delineates contradictory yet interrelated creativity outcomes, processes and identities of individuals, leaders, and groups. They highlight the paradox of creativity from multiple perspectives and suggest that when engaging in creativity, people experience paradoxical thoughts, processes, goals, identities, and perspectives. Creative people need to be generative and evaluative, flexible and persistent, passionate and disciplined, and learning and performance orientated. Drawing from related research on innovation management, attention control, and goal setting, we discuss strategies for achieving both novelty and usefulness including using paradoxical frames, task switching, pursuing contradictory goals, and gaining experience in different cultural contexts that stress different aspects of the creative process.
Maximilian von Zedtwitz, Sascha Friesike, and Oliver Gassmann
This article examines the importance of R&D and new product development and explores their management. It describes three central aspects of managing R&D and new product development in firms: the product development funnel, R&D portfolio management, and R&D organization. Concepts such as the ‘fuzzy front end’ are introduced. It concludes with an outlook of trends affecting the future of R&D management.
Ammon Salter and Oliver Alexy
Over the past fifty years, the literature on the nature of innovation has expanded tremendously. To help guide our understanding of this complex and evolving area, this article reviews some of the core stylized facts of innovation studies, offering insights into the sources of new products, processes, and solutions in the economic system. The article highlights the combinatorial and relational character of innovation, as well as its uneven pace and distribution over time, space, and industries. It suggests a range of issues challenging some elements long thought core to innovation studies, highlighting these as fruitful avenues for future research.
Timothy Kastelle and John Steen
Networks are fundamental to understanding and managing innovation. As Schumpeter recognized one hundred years ago, innovation arises from new connections between ideas. Mapping and encouraging these connections through network analysis is therefore one of the best tools for innovation managers. This article introduces complex network analysis and gives a working description of how to conduct a network study. This article briefly reviews the impact of social network analysis on the innovation literature and concludes with a discussion of current technical advances as well as some directions for future development in this important field.
Walter W. Powell and Stine Grodal
The goal of this article is to assess the state of scholarly research on the role of networks in the innovation process. It begins with a review of the factors that have triggered the increased salience of networks. It then turns to a discussion of the analytical leverage provided by the tools of network analysis. It next reviews a number of empirical studies of the contribution of networks to the innovative output of firms. It takes up the issue of knowledge transfer, examining how the codification of knowledge can shape what is transmitted through networks. Furthermore, this article briefly discusses the governance of networks, and then concludes with an assessment of what types of organizations and settings derive the greatest impact on innovation from participation in networks.
Stephen Shortell and Rachael Addicott
The long received wisdom in the organization design, change, and innovation literature is that “form follows function”. We question this dictum particularly for organizations facing radical, volatile changes such as those occurring in the health care sector. Drawing on examples from England, the United States and, to a lesser degree, Australia, Canada, New Zealand, and Singapore we suggest that changes in form often precede changes in function. We further suggest that they need to do so in order for the functions to be successfully executed. This is as opposed to past attempts to making functional changes without recognizing the need to first change the organizational form in which the functions are to be carried out. We also discuss the implications of this re-framing for form-function alignment and future research.
Callen Anthony and Mary Tripsas
Though much work has studied organizational identity and the management of innovation, very little work explores the connection between them. Yet we argue that these separate conversations yield implications for one another and offer a rich area for future research. By its nature, innovation is about novelty and change, while identity is rooted in stability and endurance. This contrast creates a fundamental tension, which we explore. We propose that innovative activities like technological change fall on a spectrum from identity-enhancing to identity-stretching to identity-challenging. Both identity-enhancing and identity-stretching innovations result in a mutually constitutive dynamic in which identity and innovation reinforce each other. Identity-challenging innovations, however, create organizational discord and dysfunctional dynamics unless realigned with identity. We discuss the implications of these varying states and call for future research that builds upon and extends our understanding of the relationship between identity and innovation across multiple levels of analysis.
This article seeks to understand the interaction between organization and innovation from three different but interdependent perspectives. It examines the relationship between organizational structures and innovation, drawing on the various strands of work in organizational design theories. It also looks at organizational innovation from the micro-level perspective of learning and organizational knowledge creation. It argues that organizations with different structural forms vary in their patterns of learning and knowledge creation, engendering different types of innovative capabilities. It then turns to the discussion of organizational adaptation and change, focusing on whether and how organizations can overcome inertia in the face of discontinuous technological changes and radical shifts in environmental conditions. This article concludes by discussing the limitations and gaps in the existing literature, and the areas for future research.
Tim Brady and Mike Hobday
This article focuses on the historical and practical relationship between projects and innovation and the connections between the two, often separate, fields of research. First it provides a review of the historical linkages between innovation and projects/project management, including early military projects in the 1950s and 1960s, showing how projects were used to ferment innovation outside of the conventional organizational forms, politics, and processes. Next it discusses the many ways in which the literature treats innovation, providing a clear and simple practical definition of innovation. Following this it provides a summary of different models of innovation, suggesting how the nature and function of innovation has changed over the past decades, how researchers have interpreted these changes, and how they link to the field of project management.
This article examines the importance of science and technology in business innovation. It discusses the distinction between scientific research and technology and considers the justifications for government funding and the trade-offs between private and public financing and control of research. It describes science-based industries which are more directly dependent than others upon science for innovation and growth, and highlights the importance of university–industry interactions in business innovation. This article also discusses the challenges for business managers in determining how much science to invest in and perform within the firm, and how much to try to gain through external linkages by means of spillovers, networks, and partnerships.
Michael Barratt and Bob Hinings
Service innovation in Professional Service Firms involves the development and use of new practices by professionals. In the face of increasing competition and the rapid pace of technology development service innovation is of increasing importance for these firms. Despite these developments, there has been little discussion of innovation in the Professional Service Firm (PSF) literature. The emphasis has been on change and knowledge management with little recognition as to how these are related to innovation. In this chapter, the authors review the PSF literature and recent developments on service innovation and propose future research directions around a practice perspective for exploring service innovation in professional service firms.