Drivers of Innovation

Drivers of Innovation

Neeta Baporikar (HP-GSB, Namibia University of Science and Technology, Namibia)
DOI: 10.4018/978-1-4666-6457-9.ch014
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Abstract

Innovation helps organizations to grow. Growth, though measured in turnover and profit, can also occur in knowledge, experience, efficiency, and quality. Innovation is the process of making changes to existing, and it can be radical or incremental, applied to products, processes, or services. It can happen at all levels, from management teams to departments to individual. Various factors encourage and drive an organization to innovate. Each of these drivers demands continuity and learning. These drivers create a sense of urgency to create new organizational goals and generate new ideas for meeting these goals. The term innovation is often associated with products, but can also occur in processes that make products, services, or deliver products and services, including intangibles. This chapter focuses on innovation in the organizational context, describes concepts underlying innovation, and tries to understand the core of the innovation process: What drives innovation in organizations?
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Background

A couple of decades ago, when economists forecasted the highest earning countries across the globe, many put their money on Japan as the leader, Germany as the runner-up, and the United States in third place for the largest GDPs in the new millennium. But now that we're seven years into the 21st century, it's clear that those economists lost the bet: The United States' GDP is currently $12.3 trillion, exceeding the current GDPs of Japan and Germany by about $8 trillion and $10 trillion, respectively.

So what happened to make the United States' output soar above economists' predictions? According to some leading executives and management thinkers, the answer is innovation.

In fact, many argue that innovation is the most important driver of macro economics today. That's why it is interesting to understand what drive the innovation and to discuss innovation, leadership, and the new economy of creativity, knowledge, and invention -- and how to focus these amorphous concepts into real business dollars. These insights are relevant to executives from businesses large and small, global and local. Technological innovation is central to the progress of civilizations and economic and societal prosperity, yet most innovations fail. The primary reason most innovations fail is that end users do not adopt them. The reasons for lack of adoption are subtle, but often revolve around insufficient knowledge of end users’ preferences and requirements (these factors may also not be consciously known to the end users themselves—these may have to be revealed during “forced choice” situations). Henry Ford was fond of saying that if he had performed market research prior to developing the automobile, the responses he would have received would not have pointed toward the need to develop automobiles but rather toward the invention of faster horses that ate less hay. Improved marketing research per se will probably not lead to higher rates of successful innovation adoption.

Over the past five years innovation has become one of the top priorities for organizations that want to remain competitive in a knowledge/creative economy. Various studies report the importance given by executives to the implementation of innovation management initiatives (AMA, 2006; Andrew, Haanaes, Michael, Sirkin, & Taylor, 2009; Capgemini, 2008; IBM, 2006). Even during a time of financial crisis, organizations continue to strongly believe that innovation can be a solution to prepare them to bounce back once the crisis is over (Andrew et al., 2009). Innovation can be described through a variety of different lenses—application (product, service, process, paradigm or business concept), level (incremental, substantial, or radical), target (consumer, business, or procedure), etc. Different technologies can be used to support the various phases of the innovation process but very few are fully integrated and provide the features necessary to support the new managerial approaches and models of innovation. Since knowledge is considered as a catalyst of innovation we believe that a knowledge-enabled system could be of a great value to support and leverage the innovation process, which is currently rarely automated and very often not clearly defined.

INTERPRETING INNOVATION

Before discussing the idea generation, I want to emphasize again that I firmly believe that all people are inherently creative and can add value to the idea generation process.

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