Innovation

The purpose of the learning is for you to develop your own learning. There are a number of tasks that you should complete before you undertake the next section. You can work through this section at your own pace. It is expected that you would take up to 3 hours to complete this section.  You must complete this section before you move to the next section.

 

Task 1

Read the article “Strategic Approaches ” and then answer the question in your workbook.

This task explains 4 different approaches you might take towards acting innovatively.

 

Strategic Approaches^[i]

The purpose of a strategy is to provide a framework that details how a business might go about achieving its aims and objectives.   However, having a strategy is not just restricted to businesses.  While studying this module you probably have a strategy on how to divide your time and energy to not only to complete this module but also to undertake the many other tasks you have to complete on a daily basis.   Often people when buying a house would have a strategy in place, along with many other activities we undertake on a daily basis.

There are considerable advantages to having a strategy when looking to innovate and there are different philosophical approaches or pathways that you can take.  Understanding these pathways makes it much easier to organise your strategy and collect the resources necessary to solve the problem you face.  Whittington suggests there are 4 approaches you could consider.

A Classical Approach

This strategic approach is focused on the notion that you can use a formal approach to innovation.  In this context you believe that you should plan and structure creative activities in a prescribed method.  However, to do this you need substantial resources you can access to construct and operate focused research and development activities.  The resources include time, money, extensive technical skills and knowledge.  The opportunities come from extensive market research that identifies trends and demands before they happen.  This sort of strategy is mostly the preserve of large multi-nationals like Pfizer and Siemens.  This strategy has its disadvantages and there are numerous companies that have now disappeared when they got their predictions wrong.  Nokia misunderstood the market for smart phones and Kodak misunderstood the market for digital photography, despite both have very large well-funded research and development departments, alongside large marketing departments.

An Evolutionary Approach

This approach calls on Darwin’s theory about being fit to survive.  Rather than looking to be the first with a solution the intention is continuous improvement and development.  The process mimics biological evolution where small random changes are applied to the solution in order to find improvements to the product or service.  This is a widely used approach in a lot of high tech innovations where the basic idea or solution is determined and then added to in order to meet demand.  One advantage of this approach is its flexibility.  As each incremental change is implemented you are able to identify alternative changes.  One disadvantage is that you could become involved in the search for an endless search for a solution.

A Processional Approach

The focus of this approach is around processes.  This approach eschews planning and formality.  The idea here is that innovation flows directly from an environment that encourages free thinking.   By removing structure and formality people are free to explore whatever takes their interest.  This is probably the most widely used approach amongst smaller businesses.  You have a problem and spend some time thinking about it as you continue your work.  However, some large companies do introduce a level of structure in that they may give employees time to develop their own ideas.  The disadvantage is that you can waste a lot of time wandering around ideas for solutions without settling on something specific.

A Systematic Approach

A systematic approach argues that there are multiple variants to the solutions depending on the market or area that the innovation is situated.  The point here is that there is not solution to suits everyone.  This probably works best where a service is being provided to a wide range of people.  An example of this is if you were an online retailer with customers in many different countries.  You web pages and the information on them may vary from country to country depending on the sort of information your customers are looking for.  A disadvantage here is that it could take a lot of work to find multiple solutions to the same problem and there is the risk of getting it wrong.

None of these approaches are necessarily better or worse than each other.  It is just as likely that you will start with one approach and then morph into another as you develop your solution.  However, understanding these approaches is useful when you are looking to develop innovative solutions to problems your business may face.

You need to answer the question in your workbook.

Reference

Whittington, Richard, 2001, What is strategy – and does it matter? 2nd ed, Thomson Learning: London

 

Task 2

Watch the video “Strategic Advantages ”.  You should take some notes for the next task.

You innovations should give you a strategic advantage, these tasks explains the various strategic advantages you can gain.

 

Task 3

Read the article “Strategic Advantages of Innovation ” and then answer the questions in your workbook.

This article explains the strategic advantages of innovation in more detail

 

Strategic Advantages of Innovation

We have shown how the rapidly changing business environment means that business is more competitive today than at any other time. So being innovative within your business is a critical strategy that you need to embed in your business processes. There are some substantial strategic advantages to organisations that innovate in some way, no matter how big your business is.  Ideally you need a framework to exploit the opportunities to innovate.

Understanding the strategic advantage that comes from your innovations helps frame how you will sell the innovation to your customers.  This is where this module links to the business venture development module and the marketing module.  Below are some examples of the different strategic advantages that come from various innovations.

Strategic Advantage	Products or services	Details
Novelty	Camera; vacuum cleaner	Both these products have been with us for a long time.  However, when they first emerged they were exceptional novel.  They implement such substantial changes that life without them is inconceivable.
Complexity	Jet engines; weapon systems	Both these products are extremely complex, so much so that only a few organisations produce them.  They are very difficult to manufacture and very expensive to develop.
Legal protection	Drugs; software	Although both of these could also be seen as complex the generally are the most heavily patented innovations.  This is because the cost of developing them is expensive.  Sometimes the value of the innovation is so low that it is not worth patenting.
Adding to competitive factors	Cars	A quick look at the history of cars shows how, particularly from the early 1980’s, how incremental additions improve the competitive advantage of cars.  The Volkswagen Golf and the Toyota Rav 4 are good examples.
Timing	Ipod and MP3 players	For a number of years people had been using the Walkman or various versions.  However, recorded music technology had move from analogue to digital and the internet was expanding.  The IPod in particular was release to the market at the right time for this sort of technology.
Rewriting the rules	Petrol engines to hybrid engines	The product still does the exact same thing, you just change the product.  Hybrid engine cars provide transport from one place to another in an identical way to petrol engine cars.  They just use a complete different product to do so.
Reconfiguring the process	Outsourcing; labour saving technology	The most obvious example of this strategic advantage is the shift from hand written invoices to typed invoices to word processing.  Basically you are still sending a written document.  But the process has created an advantage.  Similarly outsourcing processes also provide a strategic advantage in reducing costs.
Transferability	Polycarbonate wheels; microwaves	Transferring the useful factors of a product from on use to another is probably the most common innovative action.  You almost certainly do this yourself at home or work.  For example to may have used a heavy book to prop open a door or window.  In an earlier video we saw a number of items that have been repurposed from wine bottles.

 

There are connections here to previous units.  In Unit 1 OLL 2 we looked at how time lags influence innovations as well as the various connections where one innovation leads to another.  What you should be able to now see is how exploiting those opportunities when they appear give your business a strategic advantage over your competitors.

Look at the list of products or services in the column “Products and Services”.  Using the internet see if you can find one product or service that is not mentioned in the table.  Write your answer in your workbook.

 

Task 4

Watch the video “Consequences of Innovation ”. You should take some notes. Then answer the question in your workbook.

Everything you do has a consequence. This tasks shows what the consequences are of acting innovatively

 

Task 5

Open the presentation “Some Paradoxes of Innovation ” and listen to the commentary.  You should take some notes.  Then answer the question in your workbook.

We have previously discussed various myths of innovation.  This tasks looks at some of the paradoxes that emerge around innovation.

 

Task 6

Watch the video “4 Levels of Innovation ”.  You should take some notes.  Then answer the question in your workbook.

Innovation takes place at different levels, this takes explains the levels and how they influence innovative behaviours

 

Task 7

Open the presentation “Dimensions of Innovative Change ” and listen to the commentary.  You should take some notes.  Then answer the question in your workbook.

Innovation takes place in different dimensions.  Understanding the dimensions enables you to determine the structure and nature of innovative behaviour

 

Task 8

Quick quiz 

 

You should undertake further reading on the topics in this section.  We recommend that you read the following:

Nightingale, P. (1998), A Cognitive Model of Innovation, Research Policy, 27:7, p689 – 709

Schilling, M., (2013), Strategic Management of Technological Innovation, 4^th Editions, McGraw Hill, New York

Whittington, Richard, 2001, What is strategy – and does it matter?, 2^nd ed, Thomson Learning: London

 

The next section is Unit 3 SDL 1

[i] Adapted from Michanek, J. & Breiler, A. (2014) The Idea Agent, The Handbook on Creative Processes, New York: Routledge