Innovation Management - Introduction - Paul Trott - Chapter Summary

2025 India National Productivity Week - 12 - 18 February Theme - From Ideas to Impact: Protecting Intellectual Property for Competitive Startups.

The theme for Productivity Week 2025 provides a crucial platform to address the interconnected challenges and opportunities related to innovation, intellectual property (IP), and productivity within the Indian startup ecosystem.

For industrial engineers innovation and productivity are important themes to focus on. IEs have to organize events, participate in the event actively and promote industrial engineering as the department, function and discipline to promote productivity through innovation.

I am collecting background material to support industrial engineers in preparing for the events of the week.

Background Material - 2025 India National Productivity Week - February 12- 18, Theme - From Ideas to Impact: Protecting Intellectual Property for Competitive Startups.

https://nraoiekc.blogspot.com/2025/01/background-material-2025-india-national.html

Chapter contents

The importance of innovation 4

The study of innovation 7

Two traditions of innovation studies: Europe and the USA 9

Recent and contemporary studies 10

The need to view innovation in an organisational context 11

Individuals in the innovation process 12

Problems of definition and vocabulary 12

Entrepreneurship 13

Design 13

Innovation and invention 15

Successful and unsuccessful innovations 16

Different types of innovation 17

Technology and science 18

Popular views of innovation 20

Models of innovation 21

Serendipity 21

Linear models 22

Simultaneous coupling model 23

Architectural innovation 24

Interactive model 24

Innovation life cycle and dominant designs 25

Open innovation and the need to share and exchange knowledge 

(network models) 26

Doing, using and interacting (DUI) mode of innovation 27

Discontinuous innovation – step changes 28

Innovation as a management process 30

A framework for the management of innovation 30

New skills 33

Innovation and new product development 34

Case study: Has the Apple innovation machine stalled? 35

Learning objectives

When you have completed this chapter you will be able to:

● 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; and

● recognise the need to view innovation as a management process.

What is Innovation?

Innovation is the process consisting of sub-processes,  idea generation, technology development, manufacturing and marketing of a new (or improved) product or manufacturing process or equipment. Each of the sub-processes are in turn viewed as a process for further discussion.

Output of innovation is a  product or process.

Science can be defined as systematic and formulated knowledge.

 There are clearly significant differences between science and technology. Technology is often seen as being the application of science and has been defined in many ways (Lefever, 1992).

It is important to remember that technology is not an accident of nature. It is the product of deliberate action by human beings. Engineering methods create technology - products and processes. Product engineering and process engineering are popular terms.

The following definition is suggested:

Technology is knowledge applied to products or production processes.

Creativity: the thinking of novel and appropriate ideas. Innovation: the successful implementation of those ideas within an organisation.

The importance of innovation

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. Firms have to modify their products and processes to respond to the competition moves on product features, attributes, benefits, quality and cost and other characteristics. Modifications are done and are introduced in the market through the process termed innovation.

The ability to change and adapt is essential to survival in evolving market in which the needs and wants of people change and activities of competitors change. Corporations have to manage innovation.

In the United Kingdom, that industrial technological innovation has led to substantial economic benefits in the early years of industrial revolution (now industry 4.0 and 5.0).  STudy of later economic history shows that the innovating companies  and the innovating countries have become rich or developed countries. The industrial revolution of the nineteenth century was fuelled by technological innovations.  Technological innovations have also been an important component in the progress of human societies.  But innovations in other business areas are also important.

The study of innovation

Innovation has long been argued to be the engine of growth. It  can  provide growth, almost regardless of the condition of the larger economy. Innovation has been a topic for discussion and debate for hundreds of years. Nineteenth-century economic historians observed that the acceleration in economic growth was the result of technological progress. However, little effort was directed towards understanding how changes in technology contributed to this growth.

Schumpeter (1934, 1939, 1942) was amongst the first economists to emphasise the importance of new products as stimuli to economic growth. He argued that the competition posed by new products has substantial effect on competition and growth than price reductions in existing products due to cost reduction.

Abernathy and Utterback (1978) contended that at the birth of any industrial sector  there is radical product innovation, which is then followed by radical innovation in production processes, followed, in turn, by widespread incremental innovation.

 A series of studies of innovation were undertaken in the 1950s, which concentrated on the internal characteristics of the innovation process within the economy. A feature of these studies was that they adopted a cross-discipline approach, incorporating economics, organisational behaviour and business and management. The studies looked at:

● the generation of new knowledge;

● the application of this knowledge in the development of products and processes;

● the commercial exploitation of these products and services in terms of financial income generation.

These studies revealed that firms behaved differently. This led to the development of a new theoretical framework that attempted to understand how firms managed the above, and why some firms appeared to be more successful than others. Later studies in the 1960s were to confirm these initial findings and uncover significant differences in organisational characteristics (Burns and Stalker, 1961; Cyert and 

March, 1963; Myers and Marquis, 1969). The firm and how it used its resources was now seen as the key influence on innovation.

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. For example, the introduction of new computer software usually provides improvements for existing customers in terms of added features. Disruptive innovations tend to provide improvements greater than those demanded.

Page 9

Each firm’s unique organisational architecture 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 recognises that these will have a considerable impact on a firm’s innovative performance. So, too, will the way it manages its individual functions and its employees or individuals. These are separately identified within the framework as being influential in the innovation process.

Page 10

Success in the future,  surely will lie in the ability to acquire and utilise knowledge and apply this to the development of new products. Uncovering how to do this remains one of today’s most pressing management problems.

Page 15

One of the more comprehensive definitions is offered by 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.

Innovation = theoretical conception + technical invention + commercial exploitation

Page 32

Scientific exploration - Technological Research - Product Creation - Market Transitions

All have interactions - Entrepreneur has to interact with all steps.

Science is connected to all the three steps. We focus on technology and product creation aspects more.

Technology has application in product and marketing.

The cyclic model of innovation with interconnected cycles - Source: Berkhout et al. (2010).

Explanations for innovative capability of specific firms

Innovative firm    Explanation for innovative capability

Apple Innovative chief executive

Google Scientific freedom for employees

Samsung Speed of product development

Procter & Gamble Utilisation of external sources of technology

IBM Share patents with collaborators

BMW Design

Starbucks In-depth understanding of customers and their cultures

Toyota Close cooperation with suppliers

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Studies of innovation management

Study                             Date              Focus

1 Carter and Williams   1957              Industry and technical progress

2 Project Hindsight – TRACES (Isenson) 1968 Historical reviews of US 

government-funded defence industry

3 Wealth from knowledge (Langrish et al.) 1972 Queen’s Awards for technical 

innovation

4 Project SAPPHO (Rothwell et al.) 1974 Success and failure factors in 

chemical industry

5 Minnesota Studies (Van de Ven) 1989 14 case studies of innovations

6 Rothwell 1992 25-year review of studies

7 Sources of innovation (Wheelwright 

and Clark)

1992 Different levels of user involvement

8 MIT studies (Utterback) 1994 5 major industry-level cases

9 Project NEWPROD (Cooper) 1994 Longitudinal survey of success and 

failure in new products

10 Radical innovation (Leifer et al.) 2000 Review of mature businesses

11 TU Delft study (van der Panne et al.) 2003 Literature review of success and 

failure factors

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Innovation management process

Innovation needs to be viewed as a management process. We need to recognise that change is at the heart of it. And that change is caused by decisions that people make. Innovation process is iterative in nature. It is a network of  sub-processes. It is described in the form of an endless innovation circle with interconnected cycles. This circular concept helps to show how the firm gathers information over time, how it uses technical and societal knowledge, and how it develops an attractive proposition. This is achieved through developing linkages and partnerships with those having the necessary capabilities (‘open innovation’). In addition, the entrepreneur is positioned at the centre.

The framework is referred to as the ‘cyclic innovation model’ (CIM) (Berkhout et al., 2010); a cross-disciplinary view of change processes (and their interactions) as they take place in an open innovation arena. Natural sciences and engineering as well as Behavioural sciences and markets are brought together in a coherent system of processes with four principal nodes that function as roundabouts. The combination of the involved changes leads to a wealth of business opportunities. Here, entrepreneurship plays a central role by making use of those opportunities. The message is that without the drive of entrepreneurs there is no innovation, and without innovation there is no new business. 

Innovation is a cyclic process consisting of four internal cycles.

Scientific exploration - Technological Research - Product Creation - Market Introduction and Sales Expansion

All have interactions - Entrepreneur has to interact with all steps.

Science is connected to all the three steps. We focus on technology and product creation aspects more.

Technology has application in product and marketing.

The cyclic model of innovation with interconnected cycles - Source: Berkhout et al. (2010).

The most important feature of  the cyclic model of innovation is that the model architecture is not a chain but a circle: innovations build on innovations. Ideas create new concepts, successes create new challenges and failures create new insights. Note that new ideas may start anywhere in the circle, causing a wave that propagates clockwise and anti-clockwise through the circle.

It is hoped that this framework will help to provide readers with a reminder of how one can view the innovation process that needs to be managed by firms. The industry and products and services will determine the precise requirements necessary. It is a dynamic process and the framework tries to emphasise this. It is also a complex process and this helps to simplify it to enable further study. Very often, product innovation is viewed from a purely marketing perspective with little, if any, consideration of the R&D function and the difficulties of managing science and technology. Likewise, many manufacturing and technology approaches to product innovation have previously not taken sufficient notice of the needs of the customer. Into this mix we must not forget the role played by the entrepreneur in visioning the future.

New skills are required for innovation managers  in the following areas:

● virtual management;

● managing without authority;

● shared leadership;

● building extensive networks.

Ud. 27.1.2025

Pub. 14.1.2025