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Samenvatting Sammenvatting technology & innovation
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Summary technology & innovation:Chapter 1:
Corporations 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. Nineteenth-century
economic historians observed that the acceleration in economic growth was the result of
technological progress. Schumpeter (1934, 1939, 1942) was among the first economists to emphasize
the importance of new products as stimuli to economic growth. He argued that the competition posed
by new products was far more important than marginal changes in the prices of existing products.
Early observations suggested that economic development does not occur in any regular manner, but
seemed to occur in bursts or waves of activity, thereby indicating the important influence of external
factors on economic development. It was Marx who first suggested that innovations could be
associated with waves of economic growth.
Neo-classical economics is a theory of economic growth that explains how savings, investments and
growth respond to population growth and technological change. The rate of technological change
influences the rate of economic growth, but economic mined by chance. Thus population growth and
technological change are exogenous. Also, neo-classical economic theory tends to concentrate on
industry or economy wide performance. It tends to ignore differences among firms in the same line of
business. The Schumpeterian view sees firms different – it is the way a firm manages its resources
over time and develops capabilities that influences its innovation performance. Each firm’s unique
organizational structure represents the way it has constructed itself over time. This comprises its
internal design, including its functions and the relationships it has built up with suppliers, competitors,
customers etc. This framework recognizes that these will have a considerable impact on a firm’s
innovative performance.
The importance of uncovering and satisfying needs of customers is the important role played by
marketing and these activities feed into the new product development process. To be successful in
industries characterized by technological change, firms may be required to pursue innovations that are
not demanded by their current customers. Christensen (2003) distinguishes between ‘disruptive
innovations’ and ‘sustaining innovations’ (radical or incremental innovations). Sustaining innovations
appealed to existing customers, since they provided improvements to established products. Disruptive
innovations tend to provide improvements greater than those demanded. Innovation is invariably a
team game.
Within organizations it is individuals in the role of managers who decide what activities should be
undertaken, the amount of resources to be deployed and how they should be carried out. This has led
to the development of so-called key individuals in the innovation process, such as inventor,
entrepreneur, business sponsor etc. Entrepreneurship is defined as: the pursuit of opportunity beyond
resources you currently control ( Stevenson and Amabile, 1999).
The definition of design with regard to business seems to be widening ever further and encompassing
almost all aspects of business. For many people, design is about developing or creating something.
Henderson and douglas (2001: 476) suggest design is concerned with the emergent arrangement of
concrete details that embody the new idea. It seems that in most cases the word design means the same
as development.
Innovation is the first cousin of an invention, but it is not the same. Innovation itself is a very broad
concept that can be understood in a variety of ways. Myers and Marquis (1969): Innovation is not a
single action but a total process of interrelated sub processes. It is not just the conception of a new
idea, nor the invention of a new device, nor the development of a new market. The process is all these
things acting in an integrated fashion. Rogers & Shoemaker (1972): It matters little, as far as human
behavior is concerned, whether an idea is objectively new as measured by the lapse of time since its
first use or discovery. If the idea seems new and different to the individual, it is an innovation.
Invention, then, is the conception of the idea, whereas innovation is the subsequent translation of the
invention into the economy.
Innovation= theoretical conception + technical invention + commercial exploitation.
The conception of new ideas is the starting point for innovation. The process for converting
intellectual thoughts into a tangible new artifact is an invention. It is the complete process that
represents innovation. 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)
product or manufacturing process or equipment. This definition of innovation as management
process also offers a distinction between an innovation and a product, the latter being the output of
innovation. Industrial innovation not only includes major (radical) innovations but also minor
(incremental) technological advances. We also need to consider the role played by science and
technology in innovation. Science can be defined as systematic and formulated knowledge. These are
clearly significant differences between science and technology. Technology is often seen as being the
application of science and has been defined I many ways. It is important to remember that technology
is not an accident of nature. It is the product of deliberate action by human beings. The following
definition:
Technology is knowledge applied to products or production processes.
Technology is an outgrowth of science and engineers are not scientist who make technology happen.
The resource-based view of innovation focuses on the firm and its resources, capabilities and skills.
It argues that when firms have resources that are valuable, rare and not easily copied they can achieve
a sustainable competitive advantage- frequently in the form of innovative new products.
A technology driven model technology push. In a market pull model, the customer need-driven
model emphasizes the role of marketing as an initiator of new ideas resulting from close interactions
with customers. These, in turn, are conveyed to R&D design and engineering and then to
manufacturing for production. The linear model is only able to offer an explanation of where the initial
stimulus for innovation was born, that is, where the trigger for the idea or need was initiated.
Furthermore, the point of commencement for innovation is not known in advance.
Henderson & Clark (1990) divide the technological knowledge along two new dimensions: knowledge
of the components and knowledge of the linkage between them, which they call architectural
knowledge. The result is 4 possible types of innovation: incremental, modular, radical and architectural
innovation. Essentially, they distinguish between the components of a product and the ways they are
integrated into the system, that is, the product architecture, which they define as innovations that
change the architecture of a product without changing its components. New entrants will have a large
advantage if the innovation is radical because they will not need to change their knowledge
background.
The interactive model links together the technology push and market pull models. It emphasizes that
innovations occur as the result of the interaction of the market place, the science base and the
organization’s capabilities. There is no explicit starting point. It gives a more comprehensive
representation of the innovation process. At the centre of the model are the organizational functions of
R&D, engineering and design, manufacturing and marketing and sales. While this may look as a linear
model, the flow of communication is not necessarily linear. Also, linkages with the science base and
the marketplace occur between all functions, not just with R&D or marketing.
The launch of an innovative new product into the market is usually only the beginning of the
technology progress. At the industry level, the introduction of a new technology will cause a reaction:
competitors will respond to this new product, hence technological progress depends on factors other
than those internal to the firm. Chesbrough (2003), adopting a business strategy perspective, presents a
persuasive argument that the process of innovation has shifted from one of closed systems, internal to
the firm, to a new mode of open systems involving a range of players distributed up and down the
supply chain. Significantly, it is Chesbrough’s emphasis on the new knowledge-based economy that
informs the concept open innovation. There is an importance of learning through experimentation.
There are significant changes occurring at all levels of the innovation process, forcing us to
reconceptualize the process with emphasis placed on the three areas that have experienced most
significant change through the introduction and use of new technologies. These are: technologies that
facilitate creativity, technologies that facilitate communication and technologies that facilitate
manufacturing.
Occasionally, something happens in an industry which causes disruption. These changes are seen as
not continuous, that is discontinuous and the change is very significant (figure 1.8). In a study of
radical innovation in the highly innovative motorsport industry, Delbridge and Mariotti (2009) found
that successful innovators:
- Engage in wide exploratory innovation search activities, looking beyond their own knowledge base
and domain of expertise
- Identify the advantages offered by new combinations of existing knowledge, through the application
of technologies and materials initially developed elsewhere.
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