Innovation Management: An Introduction1. The Importance of Innovation:

Companies must be able to adapt and evolve if they wish to survive. Businesses operate with the knowledge that their

competitors will inevitably come to the market with a product that changes the basis of competition. The ability to change and

adapt is essential to survival. To-day, the idea of innovation is widely accepted. It has become part of business culture- so much it verges on becoming cliché.

2. The Study of Innovation:Innovation has long been argued to be the engine of growth. Itis important to note that it can also provide growth almost regardless of the condition of the economy.A brief analysis of economic history has shown that industrial technological innovations have led to substantial benefits for the innovating company and the innovating country.There has been a need to understand how science and technology affect the economic system.

A feature of this studies was that they adopted a cross-discipline approach, incorporating economics, organizational behavior and business and management.The studies looked at:

• the generation of new knowledge• application of this knowledge in the development of products and processes• commercial exploitation of these products and services in terms of financial income generation

3. Overview of the Innovation Process:It includes an economic perspective. A business managementstrategy perspective and organizational behavior whichattempts to look at the internal activities. (Refer the figure)

4. Individuals in the Innovation Process:Individuals is a key component of the innovation process.Within organizations it is individuals who define problems,have ideas and perform creative linkages and associations that lead to innovations.

General overview of the innovation process Other firms

Interaction The firm’s innovating

architecture Technology and product effects

The firm’s Individuals functions

Interaction

Knowledge and technology providers MICRO ENVIRONMENT

MACRO ENVIRONMENT Effects

5. Definition of Innovation:Inventions are new discoveries, new ways of doing things, and that products are the eventual outputs from theinventions, that process from new discovery to eventual product is the innovation process.

6. Entrepreneurship:It is the process of planning; organizing, operating, andassuming the risk of a business venture. It is the analysis ofthe role of the individual entrepreneur that distinguishesthe study of entrepreneurship from that of innovation management.

7. Innovation and Invention:Innovation is not a single action but a total process of interrelated sub processes. It is not just the conception of anew idea, nor the invention of a new device, nor the development of a new market. The process is all thesethings acting in an integrated fashion.

If the idea seems new and different to the individual, it is an innovation. The following simple equation helps to show therelationship between the two terms:

Innovation= theoretical conception + technical invention + commercial exploitation

Innovation is the management of all the activities involved in the process of idea generation, technology development, manufacturing and marketing of a new or improved productor manufacturing process or equipment

Creativity : the thinking of novel and appropriate ideas.Innovation : the successful implementation of those ideas

within an organization.

8. Different types of Innovations:1) Product innovation2) Process innovation3) Organizational innovation4) Management innovation5) Production innovation6) Commercial/marketing innovation7) Service innovation

9. Technology and science:*Science can be defined as systemic and formulated knowledge. *Technology is often seen as being the application of science.*Technology is knowledge applied to products or production processes. It is important to note that technology cannot be

purchased off the shelf. It is embedded in knowledge and skills.

10. Conceptual Framework of Innovation:

Creation of new Technology development Consumers express knowledge, dominated dominated by organizations their needs and by universities and wants through the large science-based consumption of organizations products

Science and technology Technological Needs of the base development the market

11. Models of Innovation: 1. Linear Models

Technology pushResearch and Manufacturing Marketing UserDevelopment

Market pull Marketing Research and Manufacturing User

DevelopmentThere are two basic variations of this model for product innovation. First, and most crudely, there is the technology driven model often referred to as ‘technology push’. Due to certain limitations, the second model, the ‘market pull’model of innovation was evolved. The customer –needmodel emphasizes the role of marketing as an initiator of new ideas from close interactions with customers. This, in turn, are conveyed to R&D for design and engineering and then to manufacturing for production.

2.Simultaneous coupling model

Manufacturing

Research and Marketing Development

The model suggests that it is the result of the simultaneous coupling of the knowledge within all three functions thatwill foster innovation. Furthermore, the point of commencement is not known in advance.3. Interactive model of innovation The model develops the above idea and links together the technology-push and market-pull models. It emphasizes that innovations occur as the result of the interaction of themarket place, the science base and the organization’scapabilities.

Latest sciences and technology Advances in society TECHNOLOGY

PUSH

Idea R&D Manufacturing Marketing Commercial

product

MARKET PULL Needs in society and

the marketplace

12. Innovation as a management processa) A response to either a need or an opportunity b) A creative effort that if successful results in the introduction of noveltyc) The need for further changes

13. Innovation Management Framework External inputs: macro factors competition

Organization and business strategy

R&D Organization’s Marketing knowledge base

accumulates External inputs: knowledge External inputs: science and tech. over societal needs, dev., competitors, time competitors, suppliers, customers, distributors, university depts. customers

strategic alliances

Innovation is extremely complex and involves the effective management of different activities. It is precisely how the process is managed that needs to be examined.A framework presented in the figure above helps to illustrate innovation as a management process. It identifies three main functions: marketing, research and manufacturing and business planning. Historical studies have identified these functions as the most influential in the innovation process.

14. Organizational HeritageThe center of the framework is represented as organizational heritage, some-times referred to as organizational knowledge base. It represented a combination of the organization’s knowledge base and the organization’s unique architecture. It represents for many firms a powerful competitive advantage that enables them to compete with other firms. This framework is used as a navigational map to help guide this complex field of study.