Innovation Management
Course Overview
Lecture video, discussion sessions, coaching week 48 and 51
Do videos, reads, discussion points before lecture: come to classes with
questions, discussion of topics.
Digital Exam (MQ+open) 70%.
Assignment 30%. Watch out for deadlines
Week 1: Introduction to course + introduction to innovation
Discussion points of this week (answer to this topics)
Discussion session: lecture 1
Last point of course goals: assignment.
See documents to support assignment: choose company, study company
aspects, get familiar with business and their innovation approach. How do they
do innovation, manage it and strategies. See if they have a R&D or innovation
department. Interview with R&D manager.
, Lecture Summaries week 1
Topics for this week
Importance of innovation: what is an innovation.
Sources of innovation (creativity, R&D, firm linkages, clusters)
Types of innovation (product vs. process; radical vs. incremental;
competence-enhancing vs. competence destroying; architectural vs. component
innovation)
Patterns of innovation (S-curves in technology improvement and technology
diffusion; technology cycles)
1.What is an innovation?
Schumpeter: father of innovation. Difference between invention and innovation is that
innovation goes beyond.
• Invention= an idea, a sketch or model for a new or improved device, product,
process or system
• Innovation= the process and outcome of creation and commercialization of
something new. (market side)
• Innovation includes opportunity identification, ideation or invention to
development, prototyping, production, marketing and sales
• Innovation vs Eship: they can overlap but they differ in focus, eship can only
involve exploitation of opportunities and commercialization as innovation is
much larger than that.
• Innovation= invention + exploitation.
How do innovations benefit society: eg: eletric cars (sustainability, comfort,etc), less
deaths from diseases through pharmaceutical innovations (penincilina, pandemic
vacines, etc).
,Total factor productivity, growth over time: factor to measure contribution of innovation
activity to economy growth, by economist.
It grows over time. See economy growth. It explains how innovation activity help improve
economic well-being of society. Marginal part (grey area): residual not explained by capital
or labor (traditional factors of production).
Until 70’s increase, after moderate increase, why?
The moderate increase after the 70’s, and the explaining of the grey area can be
caused by 3factors:
• More time to wait for patent application
• R&D decrease
• Less degrees that are crucial for labor inputs in technological innovation
, Standard economics strategy vs Innovation
Standard: analyse existing structures and equilibriums (it can be boring)
Innovation: does the opposite, it’s about:
• Creation: new, evolving, destroys equilibrium
• Change
• Novelty in society
Why is it difficult to implement innovation?
Innovation Funnel: Most innovative ideas do not become successful new products.
There is a need for crafted strategies. It is a lengthy and complex process to implement
innovative ideas. Be aware of the constant changing external factors: barriers,
competitors, innovation patterns, environment, etc
Innovation and failure
-Most new ideas fail (70%-90%), relates to the funnel concept.
-A lot of innovations emerge from failure. E.g.: Walt Disney, Jeff Bezos, Bill Gates, etc.
2.Sources of Innovation
The focus of this course being the private firms.
R&D in firms
