According

to

Thompson

(1965)

innovation

means

"generation,

acceptance

and

implementation of new ideas, processes, products or services". Drucker wrote in his 1985 classic, Innovation and Entrepreneurship The high-tech industries . . . have so far not been able to generate more jobs than the old industries have been losing,.The technology is not electronics or genetics or new materials, Drucker asserted. The new technology is entrepreneurial management. Similar to knowledge, also new innovations are more or less based on what is already known and being introduced to the market, thus varying degrees of innovativeness are possible. Nothings new in the kitchen. All the appliances, apart from the Salad Shooter, were invented decades ago. The automobile isnt much changed since the Model T. All weve been doing is adding new ornaments to old innovations, and the days when technology gave rise to millions of new jobs are long gone.

NEW PRODUCT INNOVATION PROCESS

In business and engineering, new product development (NPD) is the term used to describe the complete process of bringing a new product to market. A product is a set of benefits offered for exchange and can be tangible (that is, something physical you can touch) or intangible (like a service, experience, or belief). There are two parallel paths involved in the NPD process: one involves the idea generation, product design and detail engineering; the other involves market research and marketing analysis.

For the more innovative products great amounts of uncertainty and change may exist, which makes it difficult or impossible to plan the complete project before starting it. Because the process typically requires both engineering and marketing expertise, cross-functional teams are a common way of organizing projects. The team is responsible for all aspects of the project, from initial idea generation to final commercialization, and they usually report to senior management (often to a vice president or Program Manager).

PROBLEMS OF PARTIAL VIEWS OF INNOVATION If innovation is only seen as The result can be

Strong R&D capability

Technology which fails to meet user needs and may not be accepted

The province of Specialists

Lack of involvement by others, and a lack of key knowledge and experience input from other perspectives in the R&D

Understanding and meeting customer needs Advances along the technology frontier

Lack of technical progression, leading to inability to gain competitive edge Producing products or services which the market does not want or designing processes which do not meet the needs of the user and whose implementation is resisted

The province only of large firms

Weak small firms with too high a dependence on large customers. Disruptive innovation as apparently insignificant small players seize new technical or market opportunities

WHAT MAKES THE DIFFERENCE FOR SUCCESSFUL INNOVATORS?

You can spend all you want on innovation, but you can't guarantee success. In fact, the most innovative companies are not necessarily the biggest spenders, according to Booz & Company's global innovation study. What matters instead? The ability to build the right innovation capabilities to connect with the overall business strategy and other critical capabilities. Take Apple as an example. Today Apple epitomizes a capabilities-driven innovation strategy, but it wasn't always so. In the early 1990s the company squandered enormous resources and billions of dollars on a series of failed consumer products like the Newton PDA. Its efforts to do everything itself, building capabilities as varied as cutting-edge hardware development and volume manufacturing, led to huge losses and massive layoffs. But in 1997 Apple began to focus its portfolio and its capabilities. In fact, the company concentrated first on the capabilities at which it excelled, and which differentiated it clearly from peers: --An exceptional consumer experience --Intuitive user interfaces --Sleek product design --Iconic branding

This focus on what the company did distinctly well help Apple both narrow and extend its portfolio to products that made the most of these unique capabilities. Rather than expanding more broadly into personal computers (a move that many at the time discussed), the company refocused on its base and specifically targeted consumers and creative professionals with an improved core Mac offering. Rather than seeking world-class performance in manufacturing, Apple sold its factories. Rather than continuing to spend energy and investment on raw technology development, it created a program building on the innovations of others, providing then the true value add of integration, design and branding that has made each product extension a success. The results speak for themselves. Apple's profitability and market capitalization are well above the industry average, and in survey it was voted the most innovative company by a huge margin--all despite the fact that it has consistently spent far less on R&D as a percentage of sales than the median company in the computer and electronics industry. Successful innovators focus on what matters most rather than spreading their effort and resources on capabilities that are less critical. With better focus and alignment, they are able to innovate more effectively, bring their innovations to market more efficiently, boost top-line growth and reduce relative costs--all at the same time. Procter & Gamble has operated one of the greatest research and development operations in corporate history. But as the company grew to a $70 billion enterprise, the global innovation model it devised in the 1980s was not up to the task. CEO A. G. Lafley decided to broaden the horizon by looking at external sources for innovation. P&G's new strategy, connect and develop, uses technology and networks to seek out new ideas for future products. "Connect and develop will become the dominant innovation model in the twenty-first century, The world's innovation landscape has changed.CEOs understand the importance of innovation to growth, yet how many have overhauled their basic approach to innovation? Until companies realize that the innovation landscape has changed and acknowledges that their current model is unsustainable, most will find that the top-line growth they require will elude them.