INTF 355 International Technology Management Course Book: Paul Trott, Innovation Management and New Product Development, 5. th Ed Learning objectives and Some Discussion Questions for Mid Term Exam • Recognise the importance of innovation • Explain the meaning and nature of innovation management • Provide an introduction to a management approach to innovation • Appreciate the complex nature of the management of innovation within organisations • Describe the changing views of innovation over time • Recognise the role of key individuals within the process • Recognise the need to view innovation as a management process.
Discussion questions A number of chapters have several Pause for thought questions to help the student reflect on what they have just read to check their understanding. Examples: Not all firms develop innovative new products, but they still seem to survive. Do they thrive? This question attempts to get the students to recognise that while innovation is important it is possible to survive especially in the short term by focusing on traditional concerns such as minimising costs and generating sales.
In the longer term, however, few firms will survive for long without the need to change; and that means introducing new ways of working and new products and services. If two different firms, similar in size, operating in the same industry spend the same on R&D, will their level of innovation be the same? This question simply tries to get the students to recognise that while R&D expenditure is important, innovation performance is dependent on many factors, as the chapters in this book will show. Questions for discussion/assignments Ch. 1 1. Many innovations today are associated with companies as opposed to individuals.
Why is this, and what does it tell us? Students are required to examine differences between innovations in the eighteenth and nineteenth centuries with innovations today. The role of the organisation and the multinational firm is now significant. Discuss issues such as: • depth of knowledge required in significant innovations of twentieth century • the ability to make linkages between advanced technology groups • global markets • expanding knowledge base of businesses and societies • huge level of resources required for R&D, marketing and distribution, etc. . What is wrong with the popular view of innovation in which eccentric scientists develop new products? Quite simply it is damaging to the reputation of science and scientists in particular. One can understand why it is popular with film makers and Tabloid Press editors and that is because much of science is not understood and also because people live in hope that scientists can do anything. The truth is very different, and virtually all scientific progress is slow and takes many years of many people’s considerable efforts.
Progress is also largely down to teamwork, with considerable size groups of scientists often working on particular projects. 3. Explain how organisational heritage influences the innovation process. Organisational heritage represents the body of knowledge built up over time by an organisation. Often referred to as organisational knowledge. Some firms have developed considerable expertise in a variety of areas (e. g. Honda in precision engine manufacture and Rolls Royce in aero engine manufacture). This knowledge necessarily influences the future strategic direction that a firm may take.
This concept will discussed further under “Managing organisatioban knowledge”. 4. What is the difference between an unsuccessful innovation and an invention? To help students the distinction needs to be clear: Inventions include ideas, product prototypes and patents. Innovations must involve the processes of commercial exploitation. That is, marketing, sales and distribution effort. If these activities do not occur then a significant part of the innovation process has not occurred and hence it is not an innovation. Eventual success, or not, does not alter its classification. Questions for discussion/assignments Ch. 1. Discuss the tangible features that it is necessary for the state to put in place to foster innovation. In the case of Turkey the key missing ingredient is a fair competitive trading environment and stable economic conditions. In addition there are other conditions that all states need to ensure are in place, such as competition regulation, intellectual property laws that are upheld and enforced, an effective infrastructure to support businesses, access to finance, the provision of a skilled and educated workforce. 2. How can the state encourage entrepreneurs and businesses to invest in longer time-horizons?
Governments can provide tax benefits, but this can only work when a stable economic environment is in place. Turkey is struggling to get its economy in order. In 2002 the poor health of the Prime Minister added to political and economic uncertainty. The most effective way to encourage long-term investment is to convince investors that it is financially advantageous so to do. Investors have to believe that there are potential rewards to be had from parting with their money. The role of the Turkish stock market will play a crucial role here. 3. Explain Schumpeter’s view of entrepreneurial behaviour and economic growth.
For Schumpeter it was the system: the capitalist system that provides the motivation for developing new products and the new methods of production. It is this engine that drives economies forward. The system is dependent on may factors and the state has a considerable role to play in ensuring the infrastructures are in place to facilitate trade and the protection of intellectual property for example. It is because the capitalist system provides the potential for such enormous rewards (Bill Gates, James Dyson, etc. ) that ensures the system thrives. 4. Discuss the evidence for the fifth Kondratieff wave of growth. Page 55) The fifth wave is based on computers and telecommunications industries and took place in the 1980s and 1990s. The argument is that there has been a revolution in communication and information and this has spawned a significant wave of economic growth. . Managing innovation within firms (Ch. 3) Learning objectives 1. Identify the main trends in the development of the management of organisations 2. Explain the dilemma facing all organisations concerning the need for creativity and stability 3. Recognise the difficulties of managing uncertainty 4.
Identify the activities performed by key individuals in the management of innovation 5. Recognise the relationship between the activities performed and the organisational environment in promoting innovation . Discussion questions If we know what organisational characteristics are required for innovation why are not all firms innovative? One could argue along similar lines why are not all children well behaved or why don’t all football teams play well? The answers to these last two will provide similar answers to that for innovation. There are so many factors that need to be in place that it is extremely difficult.
Partly it is changes in the environment that cause instability and uncertainty and mostly it is that innovation is a management process that is managed by people. To resolve the innovation dilemma, why don’t firms simply separate the creative side of their business from the operational side? In many ways firms try to do this by establishing functions: Research & development; Marketing; Production. But this is only part of the solution, as the next chapter will illustrate. Many innovations are linked to the operations of the firm, hence one cannot completely separate the creative activities from the operational activities.
If most new products are minor modifications of existing products why do firms continue with high risk, high cost projects? Largely because of hope. Hope that it will be their firm that delivers the next Apple ipod or the next Dyson vacuum cleaner or next new product that causes a market sensation and delivers extraordinary profits to the firm. That said, there are many firms especially small and medium sized firms that do not engage in such high risk projects. Explain how the four main schools of thought have contributed to our understanding of managing innovation within organisations.
This question refers to the early part of the chapter where the four schools of thought were reviewed. To summarise: The scientific school views the organisation as a bureaucracy where managers use scientific principles to achieve goals by organising people and machines. The Human Relations school views the organisation as a political system with numerous informal flows of communication and activity. This approach characterised mechanistic and organic organisational forms. The third school of thought fell out of the Human Relations School, that of Contingency theory.
It argues organisations exhibit a range of characteristics such as uniform versus non-uniform activities. And it is these that contribute to the organisational environment. The final school of thought is systems theory. It is similar to contingency theory except that it emphasises dynamic analysis rather than structural analysis. The attention here is on the processes that organisations perform to achieve goals. Together these different approaches with their slight differences of emphasis have led to a richer and better understanding of how innovation is undertaken within organisations Discuss the main organisational characteristics that facilitate the innovation process. TABLE 3. 2 : ORGANISATIONAL CHARACTERISTICS THAT FACILITATE THE INNOVATION PROCESS (Page 94) Organisational requirement Characterised by 1. Growth orientation A commitment to long-term growth rather than short-term profit 2. Vigilance The ability of the 2.
Vigilance The ability of the organisation to be aware of its threats and opportunities 3. Commitment to technology The willingness to invest in the long-term development 4. Acceptance of risks The willingness to include risky opportunities in a balanced portfolio 5.
Cross-functional cooperation Mutual respect among individuals and a willingness to work together across functions 6. Receptivity The ability to be aware of, to identify and to take effective advantage of externally developed technology of technology 7. Slack’ An ability to manage the innovation dilemma and provide room for creativity 8. Adaptability A readiness to accept change 9 Diverse range of skills A combination of specialisation and diversity of knowledge and skills Innovation and operations management Ch. Learning objectives • Recognise the importance of innovation in operations management • Recognise the importance of sales volume on product design • Recognise the importance of design in the process of making and delivering a product or service. • Appreciate that the nature of design is context dependent • Recognise that much innovation is not patentable • Provide an understanding of a number of approaches to design and process management • Recognise the importance of e-commerce and its impact on operations • . Teaching notes
This chapter explores the role of operations management and its influence on innovation management. Many new product ideas are based on existing products and may be developed from within the production or service operations function. Many of these ideas may be modest and incremental rather than radical, but the combined effect of many, small innovative ideas may be substantial. In considering innovation, it is necessary therefore to examine the role of operations and its management. Equally effective research and development (R&D) requires close links with the production operations.
The quality of design and management within operations are thus seen as an essential part of innovation management. Often by understanding the basics of good design, perhaps by ‘keeping things simple’ and looking at your products and services as your customers receive them, will help to deliver a continual stream of new product and service improvements. Continuous redesign of the company (e. g. Dell) and its products and service, listening to your customers, watching your competitors, and keeping aware of inventions and emerging technologies is a daunting task.
We are not just talking about fitting the various departments and functions together as a team, but creating a resonance across all the constituents of the design spectrum. Some innovations are described as ‘leading edge’ and are based upon work from within the R&D laboratories and may involve patent applications. Innovation (as we saw in Chapter 1) may also be a new application of an existing technique to a different situation. Something that is new and innovative to one company may be a tried-and-tested procedure or product to another.
Also, every innovative idea may not be suitable to patent but, to those concerned, the novelty, the ingenuity, the problems associated with its introduction, and the cost–benefit to the organisation, may be just the same. This is the main and simple message of this chapter, that many innovations are small improvements to existing products. Ch. 5 Managing intellectual property Learning objectives • Examine the different forms of protection available for a firm’s intellectual property • Identify the limitations of the patent system Explain why other firms’ patents can be a valuable resource • Identify the link between brand name and trademark • Identify when and where the areas of copyright and registered design may be useful • Explain how the patent system is supposed to balance the interests of the individual and society. The world of intellectual property changes at an alarming rate. The law, it seems, is always trying to keep up with technological changes that suddenly allow firms to operate in ways previously not considered.
This chapter explores this dynamic area of the law and illustrates why firms need to be aware of this increasingly important aspect of innovation. Intellectual property concerns the legal rights associated with creative effort or commercial reputation. The subject matter is very wide indeed. The aim of this chapter is to introduce the area of intellectual property to the managers of business and to ensure that they are aware of the variety of ways that it can affect the management of innovation and the development of new products.
The rapid advance of the Internet and electronic commerce has created a whole new set of problems concerning intellectual property rights. All these issues will be discussed in this chapter. This chapter also makes it clear that the patent system has fierce critics, largely due to the associated costs involved with defending a patent against infringement. The patent system, however, has also been highlighted as a valuable source of technological knowledge that is used by many companies.