Summary Strategic Management of Technological Innovation

ISBN-10 0078029236 ISBN-13 9780078029233
236 Flashcards & Notes
13 Students
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Summary - Strategic Management of Technological Innovation

  • 1 Introduction

  • What is technological innovation?
    The act of introducing a new device, method, or material for application to commercial or practical objectives
  • The increasing importance of innovation is due to?
    Globalization of markets and the advent (komst) of advanced technologies
  • What is GDP?
    Gross Domestic Product: The total annual output of an economy as measured by its final purchase price
  • How can the aggregate impact of technological innovation be observed?
    By looking at the Gross Domestic Product
  • What is the shortcoming of GDP?
    To measure the standard of living
  • Sometimes technological innovation results in externalities? What does externalities mean?
    Costs/benefits that are borne/reaped by individuals other than those responsible for them
  • What is technology in its purest essence?
    Knowledge - Knowledge to solve our problems and pursue our goals
  • What do succesfull innovators have in common?
    Clearly defined innovation strategies and management processes
  • Shortly explain the innovation funnel
    Many potential new products ideas go into the wide end, but very few make it throught the development process
  • What does a firm need to have to have a well designed new product development process to maximize the likelihood of projects being both technically and commercially successful? - Succesful innovation
    - An in-depth understanding of the dynamics of innovation
    - A well-crafted innovation strategy
    - Well-designed processes for implementing the innovation strategy
  • Why is innovation so important for firms to compete in many industries?
    Because it generates a lot of profit for companies. Many firms receive more than on-third of their sales and profits from products devloped within the past five years.
  • What are some advances of technological innovation? Disadvantages?
    Advantages (Positive externalities)Increased GDP
    Greater communication and mobility
    Improving medical treatments

    Disadvantages (Negative externalities)Pollution
    Resource depletion
  • Why do so many innovation projects fail to generate an economic return?
    If a firm wants to innovate succesfully it needs to possess three abilities:

    1 An understanding of the dynamics of innovation
    2 A well-crafted innovation strategy
    3 Well-developed processes for implementing the innovation strategy

    I believe that if a company lacks one of these abilities the firm wil fail to generate an economic return.
  • 2 Sources of Innovation

  • Where does can innovation arise from?
    - individuals
    - universities
    - government labs and incubators
    - private nonprofit organisations 
    - firms
  • Technological innovation
    The act of introducing a new device, method, or material for application to commercial or practical objectives.
  • What is the most important source of innovation?
    The linkage between the different sources of innovation.
  • How does an innovation begins?
    With generating new ideas. The ability to generate new useful ideas is termed creativity.
  • What are the most important intellectual abilities for creative thinking?
    - the ability to look at problems in unconventional ways
    - the ability to analyse which ideas are worth pursuing and which are not
    - the ability to articulate those ideas to other and convince other that the ideas are worthwhile. 
  • Why is it good to have an individual with only a moderate degree of knowledge in a field?
    1. Someone is unlikely to understand it well enough to contribute meaningfully to it
    2. Knows too well that person become trapped in existing logic, preventing that person from coming up with solutions
  • What are 2 important factors to extent creativity?
    1. Working on things that they are interested in
    2. Requires an environment that provides support and rewards for creative ideas
  • From what is the creativity of a organization a function of?
    Creativity of the individuals within the organization and a variety of social processes and contextual factors that shape the way those individuals interact and behave.
  • What is the most familiar method of a company tapping the creativity of its individual employees?
    The suggestion box.
  • What are the 4 traits a successful inventor possess?
    1. They have mastered the basic tools and operations of the field in which they invent.
    2. They are curious and more interested in problems than solutions. 
    3. They question the assumptions made in previous work in the field.
    4. They often have the sense that all knowledge is unified. 
  • Where are most innovation originate from?
    From those who create solutions for their own needs.
  • What are the two types of research?
    - Basic research: increasing understanding of a topic or field without a specific immediate commercial application in mind
    - Applied research: increasing understanding of a topic to meet a specific need (commercial objective). 
  • Where does development refers to?
    Activities that apply knowledge to produce useful devices, materials or processes.
  • What kind of R&D approaches are there?
    1. Science push: innovation proceeded linearly from scientific discovery, to invention, to engineering, then manu- facturing activities, and finally marketing. 
    2. demand pull: innovation was driven by the perceived demand of potential users. Research staff would develop new products in efforts to respond to customer problems or suggestions.
  • What are 4 examples of successful invention used sources?

    • In-house research and development, including basic research.
    • Linkages to customers or other potential users of innovations.
    • Linkages to an external network of firms that may include competitors, complementors, and suppliers.
    • Linkages to other external sources of scientific and technical information, such as universities and government laboratories.
  • What are complementors?
    Producers of complementary goods or services, such as lightbulbs for lamps, or DVD's for a DVD player.
  • What is absorptive capacity?
    The ability of an organization to recognise, assimilate, and utilise new knowledge.
  • How can a firm gain more absorptive capacity?
    Doing in-house R&D, enabling it to better assimilate and utilize information obtained externally.
  • What is a incubator?
    Institutions designed to nurture the development of new businesses that might otherwise lack access to adequate funding or advice.
  • What is one way how the government supports the research and development efforts in both public and private sectors?
    Through the formation of science parks and incubators.
  • What is the function of a incubators?
    They help overcome the market failure that can result when a new technology has the potential for important societal benefits, but its potential for direct returns is highly uncertain.
  • What are different type of collaborations?
    - Joint ventures
    - Licensing and second sourcing agreements
    - Research associations
    - Government sponsored joint research programs
    - Value-added networks for technical and scientific interchange
    - Informal networks
  • Why is collaborative research especially important in high-technology sectors?
    It is unlikely that a single individual or organization will posses all of the resources and capabilities necessary to develop and implement a significant innovation.
  • What is the primary reason for technology clusters on regional basis?
    The benefit of proximity in knowledge exchange and knowledge held by people and people are often only reluctantly mobile.
  • How can proximity and interaction directly influence firms' ability and willingness to exchange knowledge?
    1. Knowledge that is complex or tacit require frequent and close interaction to be meaningfully exchanged.
    2. Closeness and frequency of interaction can influence a firm's willingness to exchange.
  • What is tacit knowledge?
    Knowledge that cannot be readily codified (documented in written form).
  • What is an agglomeration economy?
    The benefits firms reap by locating in close geographical proximity to each other. E.q. increase employment, tax revenues, improvement of schools and infrastructure
  • What are the 3 downsides from agglomeration economies?
    1. Proximity of many competitors serving a local market can lead to competition that reduces pricing power
    2. Close proximity of firms may increase the likelihood of a firm's competitors gaining access to the firm's proprietary knowledge. 
    3. Clustering can potentially lead to traffic congestion, high housing costs, and higher concentrations of pollution. 
  • On what is geographically clustered depends on?
    - The nature of the technology
    - Industry characteristics
    - The cultural context of the technology
  • What is an technological spillover?
    Technological spillover is the positive externality from R&D resulting from the spread of knowledge across organizational and regional boundaries. Research suggest that is has a significant influence on innovation.
    If R&D knowledge will spread is a function of: protection mechanisms, the nature of the underlying knowledge base and the mobility of the labor pool.
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