Term Paper Study on the importance of innovation management in the organization Sheikh Talha RS1904 B25 10906035 Submitted

to: Miss. Tannu Badhwar LOVELY PROFESSIONAL UNIVERSITY

Acknowledgement I take this opportunity to present my vote of thanks to all those guidepost who really acted as lightening pillars to enlighten our way throughout this project that has led to successful and satisfactory completion of this study. We are rea lly grateful to our COD Mr.Devdhar shetty for providing us with an opportunity t o undertake this project in this university and providing us with all the facili ties. We are highly thankful to Miss.Tannu Badhwar for her active support, valua ble time and advice, whole-hearted guidance, sincere cooperation and pains-takin g involvement during the study and in completing the assignment of preparing the said project within the time stipulated. Lastly, We are thankful to all those, particularly the various friends , who have been instrumental in creating proper , healthy and conductive environment and including new and fresh innovative idea s for us during the project, their help, it would have been extremely difficult for us to prepare the project in a time bound framework. SHEIKH TALHA

INNOVATION MANAGEMENT: HOW IDEAS GET TRANSFORMED INTO INNOVATION INTRODUCTION No distance is too far an d no dream is too large because the cycle of life keeps changing. Certainly, cha nges bring improved lifestyle and technological progress, consecutively to keep the momentum of improvements one has to really appreciate innovation. But where does the innovation come from? An apple in Newtons head sparked to deliver an Ide a, which plays a vital role in everyones life till today. Innovation can be consi dered to be as creativity, i.e., to create new ideas and knowledge creation. How ever it goes beyond idea generation to putting those ideas into action. So it is important to evaluate the ideas in order to yield good innovation. An idea that is developed and put into action creates innovation. Moreover, seamless flow of new Ideas is the vital source for sustained innovation. In order to gain advantag e of sustainable innovation, we need to evaluate the ideas and organizations need to have some metric in place to access the progress. Metrics can be customized by the managers to keep track on innovation success in their companies. These me trics can help senior executives assess their companys innovativeness and hence c ombat the insidious strategy decay that often afflicts a companys business. Accor ding to Hamel and Valikangas (2003) the organizations strategies can be decayed m ainly by four reasons. Over time they get replicated and they lose their distinc tiveness and, therefore, their power to produce above-average returns or better strategies supplant them Strategies also get exhausted as markets become saturat ed Customers get bored, or optimization programs reach the point of diminishing returns Finally, strategies get eviscerated. Customers or suppliers become so po werful that they can dictate much lower prices than before.

INNOVATION DEFINITION - INNOVATION The US federal advisory committee on measuring innovation defines innovation as follows. The design, invention, development and br implementation of new or altered products, services, process, systems, organ izational structure or business models for the purpose of creating new value for customers and financial returns of the firm . The definition of innovation can be divided into two perspectives, namely Opportunities to exploit and Opportunitie s to explore (Amy Wong, 2001). Lets try to understand both of them. First perspec tive, opportunities or changes to exploit are those where most of the parameters are well defined and understood. It is something like improving an ongoing proc ess, reducing cycle time, increasing throughput or reducing cost. So these are b asically incremental improvements. On the other hand, opportunities/changes to e xplore are those areas, where we have newly started and have little information about it. Here we have ideas and solutions which are applied in new ways to solv e new problems. It creates the environment for transformational innovation. For this paper, I adopt Peter Druckers (1993) definition of Innovation, who defines I nnovation in business terms as the fundamental to the quest for profitable and s ustainable growth. Precisely one of the important business competencies needed f or the future, it implies that innovation is not all about marginal improvements on some unimportant products. OTHER CLASSICAL DEFINITIONS OF INNOVATION ABS, th e Australias most comprehensive Innovation Survey (1996) defines, An innovation is any new or substantially improved goods or services which has been commercialis ed or any new or substantially improved process used for the commercial producti on of goods and services. First at the level of an individual firm, Innovation i s defined as the application of ideas that are new to the firm, whether the new i deas are embodied in products, processes, services or in work organization, mana gement or marketing systems.

Second at the business perspective, Innovation is something that is new or signif icantly improved, done by an enterprise to create added value either directly fo r the enterprise or indirectly for its customers. NEED FOR INNOVATION Why that in novation is playing a vital role in companies now? What is the need for innovati on and how does it impact companies growth? Horibe (2001) emphasizes What is likel y to kill a company in this new economy is not somebody doing something better, its somebody doing something differently. So is it all about being different in th e market, may be true for some industry sectors but not applicable for general i ndustries. In todays fast moving economic situation, mostly category breaking bus iness environments meet their objectives. Only such companies meet their estimat e growth, gain profit, out run their competitors and show excellence in executio n. They achieve by the culture of INNOVATION . In every industry, the leading compa nies are the innovators. However the cadre of innovators keeps changing. For exa mple, Thomas J. Peters and Robert Waterman (1982) cited that companies like Amda hl, Texas Instruments, Eastman Kodak, and Maytag as exemplars in their business classic, In Search of Excellence. They achieved that stage by extensive innovati on and market presence for years. Meanwhile, todays innovators such as Wal-Mart ( chain of retail shops), Southwest Airlines (good service for low fare), eBay (on line auctions), and the University of Phoenix (degree programs for working adult s) are themselves relative newcomers. Such high turnover at the top suggests tha t the real problem is not with the lack of innovation, but it is Sustained Innova tion . Companies may seize upon a good idea that gives them an advantage for a whi le, but sooner or later, they cede this advantage to a competitor who has found an even better idea. As Nicholas Stein (2000) correctly mentioned, Innovation is at the heart of sustaining a companys competitive advantage . This holds very true as long as any company wants to stay on top of their competitors and win the inn ovation game. Innovation is very important criterion for success in the future, (Horibe, Frances Dale Emy, 2001) an important study done on the rate of return o f 17 successful innovations

shows a mean return of 56% in comparison with an average Return on Investment (R Ol) of 16%. It is clear that organizations need to innovate to survive and achie ve good profit figures. WHAT TO INNOVATE Now we understood the importance of the role that innovation plays in an organization. The next important question now arise is where and which things to apply innovative ideas in a big organization. Suggestion and recommendation for where to apply innovations are as follows, 1. Innovation can be applied to products, services, design, invention, development , process, and systems. 2. To make a product! service compete with the new econo my. This is essentially to educate organizations to move out of their traditiona l old habits1 to the new innovation culture. 3. To avoid high risks Avoiding hig h risks involving money, staying ahead of competition and high pay off opportuni ties are the essence of the innovation 4. To gain long term market focus, as a r esult the company can save money. 2.1. KINDS OF INNOVATION Based on the way, it is implemented Innovation can be divided into two major categories namely, 1. In cremental Innovation and 2. Radical Innovation Let us discuss about how these in novation methods are applied in the industry and which are the companies adopt t hem. INCREMENTAL INNOVATION Incremental innovation projects are built upon an ex isting knowledge and resources within an organization. As a result the existing competencies of the company are being enhanced. There is a modest technological change and the 1Traditional myths & habits may change firms incompetent to the c urrent market and it is no longer useful existing product remains competitive in the market. Literally, these organizations dont work against their competitors, instead build innovation groups among their own

different kind of products and be an active competitor for their products. For e xample, the Hewlett-Packard2 Company produces both laser and ink jet printers. T hese products equally compete in the market. They came up with a plan, to divide the markets of both the ink jet and laser divisions. As a result, HP has become the leader in both laser and ink jet printers. RADICAL INNOVATION On the other hand, Radical Innovation projects are developed and implemented in a completely new area of operation. So organizations require to completely acquiring new know ledge and resources. In the execution, it involves large technological advanceme nts. As a result the existing competence of the organization might get turmoil a nd become obsolete. For example, Intel, one among the largest PC processor manuf acturers, appreciates radical innovation. It initially developed single core pro cessors, however as soon as it released its dual core processors, the former bec ame obsolete and the later gained its market. This process is endless, as Intel recently released its multi core processor, which might cease the interest of du al core processors in future. Literally, Intel cannibalizes its own business by constantly bringing out better processors to replace the ones that are once mark et leaders. PROBLEMS WITH CHANGE As we discussed about the types of innovation, now it is important to find out which method does an organization need to select . There arise the problems with managing changes, which are the results of innov ation activity. Most organizations are resistant to rapid and discontinuous chan ge, because of many factors like its traditional values, business strategies etc .; moreover it is difficult for them to find solutions in a new direction in whi ch their business is not focussed. The fear of chance makes many companies to st ick in their standard mode of operation. They work hard to bring up existing mod el work better and dont spend time looking for a better model, or a better method of operation. Gary Hamel (2003) puts forward, Most companies are built for conti nuous improvement, rather than for discontinuous innovation. They know how to ge t better, but they dont know how to get different.

But successful companies deploy their managers to take responsibility for initia ting and directing change in addition to their objectives. Successful companies believe that they need to do something that the world has not seen before. They change and innovate so that they are first and unique in this wild and competiti ve market. Let us analyse this with the scenario from software industry. Yahoo f irst released its popular instant messaging program Yahoo! Messenger (YM). This is a GUI based beta release of the software, which became very popular in lategOs 3. Though YM is more popular, it had many bugs reported by the customers, so YM has to develop and release bug fix and patches. The lesson learnt is being ahead in the market and managing chance to sustain. Lately, YM introduced voice and l ive video messaging options, all as a result of adapting to chance and applying innovation. MISUNDERSTOOD TERMS There are few terms which are normally misunders tood in context. Perhaps this section will address those terms and avoid confusi ons of the same. CREATIVITY AND INNOVATION Creativity and innovation might sound similar in contextual meaning. Ofcourse, innovation typically involves creativi ty but it is not identical to it. Linda Naiman (2005) defines, Creativity is typi cally used to refer to the act of producing new ideas, approaches or actions, wh ile innovation is the process of both generating and applying such creative idea s in some specific context. In simpler words, innovation involves successful impl ementation of creative ideas. We can say that creativity is the act of producing new approaches and imaginative ideas. But, Innovation is the production or impl ementation of an idea in some specific context. So if we have ideas, but dont act on them, then it means that we are simply imaginative but not creative. INNOVAT ION VS INVENTION Following the above mentioned concept of creativity, the next s imilar misunderstood concepts are Innovation and Invention. Fagerberg (2004) dis tinguishes them as; Invention is the first occurrence of an idea for a new produc t or process, while innovation is the first attempt to carry it out into

practice . Interesting thing is that, Innovation does occur when someone uses an i nvention or an idea to change how the thing it works. So to make it more precise , invention is a ladder to reach the spot called innovation . GENESIS OF AN IDEA Th e types of innovation helped us to understand the methodology in which the innov ation is applied in industry. This also helped us to understand the risks involv ed if the organizations resist changing. This is a business view of innovation, now let us look it from the conceptual view of innovation. The basic building bl ocks of innovation are IDEAS. Ideas are basically the outcomes of the thought pr ocess. The quantity and quality of idea does have a direct impact in innovation, so it is important to classify ideas. As supported by Paulo Matos (2002) that i s if a company classifies a good idea it means that there is little evaluated ri sk involved to achieve excellence in execution. Therefore, to come up with good ideas and concepts for new products, CEOs have to encourage break through thinki ng. So to be innovative, the idea has to be creative and implemented. The core d iscussion of this paper is to analyse the ideas process and to apply suitable me trics to evaluate whether the germinated ideas is a good or not. IDEA GENERATION PROCESS The idea generation process is nothing but the whole pro cess from thinking to action, i.e., from the generation of first ideas to the fi nal innovative result. Understanding these phases will helps us to review the wa ys of combining and creating knowledge that can relate to reality. People! teams role in Idea generation process The idea generation process and thereby innovati ons are strongly connected to peoples attitudes. As Peter Drucker (1993) points o ut that in order to organise work, it is necessary to start with a specific task /problem, to then make the information input and finally develop the necessary h uman relations to get the work done.

But who has to take the ownership of this task? Druker (1 993) reinforces the pe oples role, according to him it is necessary that someone takes matters into his won hands and make them happen. A simple NO answer must always be confronted to get to know the underlying reasons and ease the search for answers. In other wor ds it just means that people and organisations have to exceed what is predefined in their functions. So people have to think that a problem is in place not to fai l but as an opportunity to seize for growth. If such an attitude has to be in pe ople, then their motivation level needs to be higher. Thus innovation should be attractive and beneficial for the owners! managers involved, for this there must be a clear definition of the innovations importance and its dimension in the glo bal setting. Human relations are based on communication. Thus effective communic ation between the employees and top management will certainly impact the idea ge neration process and to get appropriate solution in case of problems. Organisati on role on innovation In this section, let us discuss about the strategies and t actics that organizations need to follow in order to gain advantage from idea ge neration process. According to Paulo Matos (How to improve management of ideas, 2002), One important skill that organizations need for idea generation and Innova tion are The long term vision, The ability to identify or even anticipate market tendencies and The will and ability to gather and integrate the process. Additi onally, the EU innovation manuals states the other necessary skills that organiz ation needs to posses are The ability to take risk (Calculated risk) Internal co -operation between the different functional department and The external cooperat ion, with public investigation, with consulting services. Therefore, when develo ping new ideas it is important to understand the organizations skill and it is a good idea to have a list that allows controlling the critical factors for the id ea implementation. One among the critical factor is controlling the change. So t o handle this change, a good method could be to inherent organisation change

process into small entities such that it does not cause any ruptures with the on going procedures, articulating, and sequencing them so that in the long term th e desired result is achieved. Once the tactics are set, organizations need to em ploy appropriate tools and methodologies which are discussed in the later chapte rs. Summarizing the organizations role from the strategic point of view, an organ ization necessarily has to define the evaluation system towards the initial set goals. The system will include the aims to be attained, manage change, and organ ize the skill of the company and the indicators to consider in the innovation ac tivity analysis. PHASES OF IDEA There are many theories about the individual pha ses of ideas; different authors postulate different number of phases in the idea generation process. For this paper, I adopt Professors Hansen and Birkinshaw (2 003) work on innovation values chain. They divide innovation process as a sequen tial three phases. 1. Idea Generation 2. Idea Conversion 3. Idea Diffusion Addit ionally, for this discussion I tried to add one more phase, 4. Idea Assessment IDEA GENERATION A good start is half of the work 4, says an old Albanian adage. Sim ilarly a good start for an innovation/innovative product is GOOD IDEAS. But wher e do these good ideas come from? People who make difference in an organization a re the key resource of idea generation process. So the fragments of ideas that c ome across the organization will influence in generating a creative idea. For th e idea generation phase, the financial, practical, physical limitation and other business parameters are not considered, this is to ease seamless flow of ideas and to encourage out of box thinking. Sources of ideas Besides depending on the internal sources, organizations need to be open to gain information from externa l sources for idea generation. This could be from customers,

end users, competitors, universities, independent entrepreneurs, investors, inve ntors, scientists and suppliers who play a vital role. The common fallacy among companies is that outside ideas were not good as in-house ones. IDEA CONVERSION N ow we have lots of good ideas, but how are we utilize it? This is handled by thi s phase. The main objective of this phase is to filter out ideas, so that only f easible and refined ideas are selected. Refined ideas are the ones identified to be financially successful and technically viable. It doesnt mean that ideas are simply put away, but it is in this phase ideas are turned into revenue generatin g products, services and processes. Typical methodology that could be used in th is phase is brainstorming, to analyse the feasibility and problems. The possible problems might vary from one company to the other. It has to be noted the tight budgets, conventional thinking and strict funding criteria caused many novel id eas to shut down. Involving people with differences (can be based on lingual, cultural, geographic al, ethnic etc.,) can be used in such brainstorming discussions! sessions constr uctively. Because this gives room to ask as many weird and challenging questions about the ideas, which involve peoples educational, professional and cultural di versity. For instance, British Telecom, the UK telecommunications group doesnt la g with good ideas for its business; however its division providing services to m ultinational companies failed to hit targets6. We can infer such problem arise d ue to the inadequate commercial! business skills to tackle such projects. Signif icant Tools & Techniques for Idea Conversion Process According to Robert & Corde iro (2005), the generation of high number of ideas depends on the tools & techni ques that an organization adapts. Consequently, this helps to avoid strangling t he innovation process for lack of ideas. 1. Market surveys According to Robert, market surveys can be done through interv iews, through panels or

by monitoring the evolution of a set of demographical, economical and consumptio n indicators as well as others. In this paper, there is a survey appended which helps us to understand the organizations perception on idea generation and innova tion. 2. Benchmarking Benchmarking is an important tool for competition analysis. Benc hmarking is an ongoing process of measuring and improving business practices aga inst the companies that can be identified as the best worldwide. It emphasizes t he importance of improving, rather than maintaining the status quo. It addresses searching worldwide for the best companies. Hence, the more innovative the idea s that are discovered, the greater the potential rewards that can be gained from the adaptation of the ideas. 3. Collecting Ideas from a. Employees The collecti on of employees ideas can be done through a specific programme or through more in formal methods in smaller groups. The more ways to participate in the company th e employees have, the bigger employee participation leads to a decrease in admin istrative staff (Paulo Matos, 2002) Stewart (1997) quotes the General Electric p rocess, where, through series of continuous meetings in several cities, employee s propose several ideas and the bossed have to approve or reject them right ther e on the spot. These programmes are successful as they allow people to have a sa fe place to share ideas without any kind of restriction. b. Suppliers In business terms, competitive suppliers usually have a better know ledge of what they are selling and how the client can obtain better benefits. Wh en suppliers are experts on their area, they may even present solutions for the companys specific needs. So collecting ideas from the suppliers is very important . c. Customers Customers are the important source of proposals concerning change s in products and

services. According to Peter Drucker (1993), building relationship with clients is also an important criterion as it creates a strong information source. Howeve r getting inputs/feedback from the end customers is not easy. For example in con sumer products business like tooth paste etc., so in those cases mediums like su ggestion boxes, suggestion phone lines will help the organization to address the complaints and feedback. 4. Co-operation with institutions Certain institutions like universities and industrial associations help the organization to have new ideas through co-operation settlements/agreements. Industrial forums like IEEE, NASSCOM7 etc., where organization get and provide inputs. Member organizations participate and form an ideal source for development of innovative ideas. For in stance, Infosys, a multinational software services company, started a campuscomp any programme by the name Campus Connect8 . This is to bring up ties with the acade mic institutions and there by creating a platform for information sharing. Howev er, there is a notable problem with having co-operation with academic institutio ns, relating to the data security. Because at the university level, there is an interest in divulging as much as possible the information obtained, while at the companies level there is an important set of information that the company does n ot want to see in the hands of competitors. This is evident during seeking surve ys/interviews for this paper, as most of the companies dont wish to keep their in formation confidential. 5. Brainstorming Brainstorming is a widely used techniqu e, in which a group of people were put together and discuss their ideas that the y can think of, even if apparently foolish. The important thumb rule of this tec hnique is not to criticise ideas presented until the discussion ends. An advanta ge of this method is the fact that the association of several ideas can trigger new ones.

IDEA DIFFUSION As we have reviewed how to select ideas for funding and developin g into products. Now, in this phase we diffuse those products and practices. Thu s Professor Hansen (2003) added that, organizations must get the relevant consti tuencies within the organization to support and spread the new products, busines s and practices across desirable geographic locations, channels and customer gro ups. This phase is particularly important for the large companies who have their divisions in many geographical locations. So the biggest question that I am int erested is what is the impact of diffusing of ideas within the organization? This question is not part of any of the authors research paper; however it is just to quench and explore the intuitions behind. One possible negative upshot could be leaking of your idea to the competitors, as happened in case of Procter & Gamble (P&G). The company first launched Pampers diapers in Germany, and then it devel oped ideas to establish the product in France. However it has taken long time to do so, P&G can able to launch its product only after five years. Meanwhile, Col gate Palmolive sensed that idea and launched its line of diapers in France two y ears before to P&Gs launch9. This is a typical example of improper diffusion of i deas. Idea specification is important in case there are several ideas to change a given product, service or process. Idea specification consists of choosing the idea that will have better advantages in being applied or combine existing idea s, to find a solution that is superior to each idea by itself. There are several tool and techniques for idea selection process, which an organization can avail . In this paper, two techniques are detailed. 1. Feasibility Analysis Feasibility analysis is a preliminary study undertaken t o determine a projects viability, which helps to ensure the successful completion of specific project goals and objectives. In addition, feasibility analysis giv es a clear picture, if an existing system is worth upgrading or not.

Feasibility analysis can be done in two perspectives, technical perspective and business perspective. However feasibility analysis can be done in many kinds. In the technical point of view, the feasibility study is carried out to check if i t is possible to implement the idea at an acceptable cost. This involves questio ns such as whether the technology needed for the system exists, how difficult it will be to build, and whether the organization has prior experience using that technology In the business perspective, the feasibility study is conducted to ch eck the factors affecting the commercial viability of the business. Also to ensu re the costeffectiveness of the proposed system i.e. if the benefits of the new idea do not outweigh the costs, then it is not worth going ahead. So it could be precisely called as a cost benefit analysis. For example, car manufacturers are now greatly involved in making use of hydrogen as the fuel source (Robert Boyd, 2007). But its use in cars is highly conditioned for safely. Thus, hydrogen fue l project is stronger in the technical point of view, but weaker in the business point of view. 2. Financial and Risk Analysis In a financial analysis, there is an attempt to project all the predictable revenue in relation to the predictabl e costs. Then it is applied financial calculation to evaluate the processs profit ability towards a value. From the comparison between the ideas profitability and the risk associated to the same, a decision can be made about the idea. With a r aising number of ideas analysed and processed there is a better understanding of the risk level of several types of ideas and the costs each one brings. The stu dy of this technique is strongly supported by a wide bibliography related to the economical and financial areas. IDEA ASSESSMENT From the previous discussion, i t is clear that Innovation develops through an evolutionary, interactive process between actors and between different stages in the development of an idea into innovation. Now lets us discuss Idea assessment which is one among the core topi cs in this paper. So the later part of this paper is

structured to address the following questions. What is idea assessment? Why orga nizations need to adopt Idea Assessment? The word Assessrnent in this context ref ers to Metric and Measurement of Ideas. Idea Measurement is a simplified & quant ified observation of ideas. Idea Metric is a comparative measure of the performa nce of the ideas and product or process. By using metrics we can find the deviat ion i.e., what is planned against what is achieved? Idea Assessment is very impo rtant to any organizations to monitor the trends in the actual effort spent on I dea generation process. This helps to understand where does company stand and fi nd areas of improvements. It also helps to replan or alter the ideas so that it is more technically viable. Significance of Idea Assessment The US government ad visory committees report on measuring Innovation, stresses the importance of meas uring the innovation. They add that the outcomes of innovative activity need to be tracked and measure to determine fully the impact of innovation on the econom y. This is on a macro level, simply means to evaluate the variations. Considerin g companies at a micro level, it is indeed important that Idea Assessment need n ot be made with the variations but also from customers (internal & external) sur vey and feedbacks. A typical feedback will help the organization to identity the areas of improvement and areas of strength. The important aims of idea assessme nt process are as follows, 1. Ideas need to be Optimally Quantitative, i.e. it w ill stretch out to the maximum possible extent to guide decision making based on measurable and quantifiable criteria 2. To help in addressing ideas submitted f or the organizational perusal, minimizing the scope of escapes in estimating the organizations potential long term returns, i.e., to ensure some business importa nt factors doesnt left unnoticed.

METRICS FOR GENERATED IDEAS Innovation metrics are important for at least two re asons as stated by Amy Muller (2001). First, metrics help managers make informed decisions based on objective data, which is especially valuable given the longterm nature and risk associated with certain innovation projects. Second, metric s affect behaviour by helping align goals and actions with the best interests of the company. Defining metrics is a bit risk and misleading task for the fact th at if some of the important indicators it left unnoticed will lead to a major co nfusion. Such indicators can consist of measure of the intensity or quality of i nnovation. Innovation indicators should also be able to differentiate between in novation as adoption and innovation as a creative activity (A. Arundel, 1998). I n this paper, I try to propose the metrics for IDEAS based on two majors, namely Quality based metrics Quantity based metrics (Metrics driven by figures) QUALITY BASED METRICS Lets discuss about how to measure the quality of an idea, w hich leads to innovation. A single indicator cannot provide all of the informati on that is needed, although traditional indicators such as R&D expenditures or p atents can serve a variety of purposes. There has also been some success in deve loping techniques to extract more information out of traditional indicators such as patents (K.Smith 1 998). Nevertheless, new indicators are required to meet p olicy needs and to test innovation theories. First, many innovation activities are not directly measurable. Organizations use some codified knowledge to assess such activities. Codified knowledge is a kind of tacit knowledge, which is generally undefined and firms have some internal m ethods for determining them. So, literally codified knowledge can be indirectly measured. For example, Informal contacts between firms are more likely based on some tacit knowledge.

INDICATORS BASED QUALITY METRICS There are certain indicators which can be made used to certify how much does an idea qualifies for its succession into a produc t. But these indicators cant be standardised entities as it is affected by type o f innovation, like a product innovation or a process innovation. For example, co nsider the case of a substantial improvement in which an organization, just want to make some minor adjustment to an existing product, in comparison with a comp any developing revolutionary product that is completely new. In such a scenario, A. Arundel, (1998) proposes some possible indicators one can adapt to measure. They are as follows, o Number of patents filed o R& D performance o R&D intensit y o Proportion of employees who are scientists! engineers It has to be noted tha t categorizing a common indicator is always a difficult task. It has a serious d rawback as the indicators fail to identify all firms that expend some creative e ffort on innovation. In brief, using R&D as an indicator is biased against firms that develop mechanical innovations, which is often based on design and complex production systems and underestimate innovative activities in small firms. KNOWLEDGE BASED QUALITY METRICS This metrics is designated to measure the organi zations performance based on the knowledge they can generate and the ability to u se them. The learning capacity of an individual company plays a vital role in me asuring the ideas. People are assets in such metrics, because they create ideas and transform that basic knowledge into desired product. So the rate in which pe ople learn new skills to keep

pace with chances in technology really matters. LATEST TRENDS & FUTURE OF INNOVATION IDEA BACKUP MANAGEMENT The concept of idea backup management is to track & manage filtered out ideas. An idea which might n ot fit into the organizations context in the present scenario might reward it wit h unanticipated gains in future. Hence, tracking and managing filtered out ideas is equally important. In this paper, a three fold ways are proposed for handlin g filtered out ideas management. R&D Support Productl Practice Line Diversificat ion Sponsoring and/or sourcing All of these are much discussed topics in themsel ves, and if dealt with details here, might lose the relevance and context of the paper. So it is left for future work. OUTSOURCING INNOVATION Outsourcing innova tion and research activities of a company might yield to long term budget saving s and it is an eminent cost cutting measure. The great opportunity is that we ca n get multi -dimensional solution for a problem. The possible advantages that an organization might gain by outsourcing innovation include a reduction in techno logical and market uncertainty, cost sharing, risk spreading, and reduced duplic ation of research, economic of scale and an ability to combine different experti ses.

Implementing innovation Innovative culture is created and influenced by leaders. Corporate culture in re turn influences leadership. Furthermore, company strategy is developed by leader s based on cultural norms and values of the leaders, thus by corporate culture. Business processes are derived from business strategy. Business processes reinfo rce company culture. Kick-off by leadership Companies operate between the poles of two extreme organi zational The 'mechanistic' operation mode and the 'organic' innovation mode. The "conventional leader" is someone who is excellent in managing an already existi ng organization with defined structures and processes to fulfill its standard ta sks. On the opposite side, there is the "lateral leader" which shows outstanding performance in motivating teams and driving them to their best. The balance gam e continues as competitive advantage challenges management: Standard performance isn't just enough to outfight competition. Thus, the demand is high for hybrid leaders; those that can equally manage people in standard mode for production an d in creative mode making innovation reproducible. This idea is based on the bel ief that every employee is willing to follow a leader or leaders and is capable of innovation regardless of personal motivation, skills, education or specializa tion. Still, innovation processes can support leaders and staff, and provide ski ll sets for innovation, experience in implementing changes, and developing poten tially beneficial concepts. The leadership ethos is reflected in the term "inven torpreneur" by 3M (Gundling 2000: 39): "An inventorpreneur is one who invents or creates a new product that fulfills a defined need; promotes the new opportunit y or product; manages, organizes, and assumes many risks in establishing a new b usiness based on that product."

The person inventing a new product has to deal with deployed innovation processe s and the uncertainties that come along with the novelty. Leaders' task is to la y the foundations for innovation by identifying the challenge for continuous imp rovement, imagining a possibly bright future, and discussing the vision and rela ted prospective goals along with the rest of the company. Three results of leade rship communication are essential: First, corporate strategy should enable emplo yees' acknowledgement to an environment of constant change and their willingness to challenge their default way of working. Second, employees should be empowere d to innovation, and should feel responsible for successful innovation by corpor ate strategy. Third, employees should be ready to put their best ideas and most striving concepts in the balance. Again, 3M provides an excellent example by its human resource principles as documented by Gundling (2000: 59). The following h eadings are taken from the book: "[] 1. Respect the dignity and worth of invidual s [] 2. Encourage the initiative of each employee [] 3. Challenge individual capab ilities [] 4. Provide equal opportunity []" Values and norms regarding the co-oper ation of people within the businesses as well as between staff and the environme nt are fundamental. This is done by formulating a strategy. This set of values n eeds to be formulated incorporating radical innovation in one or more innovation types as the must-do for economic survival. Importance of strategy Strategy should aim at formulating key elements that driv e innovative culture and the setup of innovation processes. Strategy is defined by Brache (2001: 51) as "[] the framework of choices that determine the nature an d direction of an organization."

The framework to consider when implementing an innovate corporate culture should consist of the following points: 1. Decision and commitment to innovative cultu re 2. Direction to innovative culture at the different organizational levels 3. Organizational setup supporting innovative culture and processes 4. Measurement of innovative results First and foremost, leaders should emphasize the need and the commitment to a corporate culture of innovation. Corporate innovation is not a choice; it is an imperative for viability. Hence, this message has to be wide spread within the company and deeply embedded into corporate culture by leaders. But management should keep in mind that there is a relationship between the mes sage and the way its value is perceived by employees through behavior of managem ent. This is one the findings of the research project in manufacturing measuring "the impact of organizational values on process innovation" by Khazanchi et al (2007: 880). Second, corporate culture is a set of shared values, beliefs and no rms. These cultural elements are learned. Thus, culture is quite stable and does not change over night. Therefore, a change of culture needs repetition over tim e until the members of the cultural group accept the new values, beliefs and nor ms. As culture is something that can be acquired,it suggests to employ so called "behavioral routines" and have the members of the organization learn to innovat e. Just like exploring any new capability, innovation can be excelled. The learn ing process consists of studying new elements of the novel culture, putting the elements together, providing feedback to the 'students of creativity'. After a w hile, future innovators are to mix, redevelop, and critically assess the element s from a master's point of view until innovation becomes self-controlled.

One of the results of their study stresses that employees working in production 'confronted' with an empowering innovation culture really can make a difference when it comes to optimizations due to their vast experience in operations. Third , the company should be organized to support innovation. This is rather a questi on of processes and policies than of structures; e.g. learning towards innovatio n, fostering crossfunctional innovation teams by reward and career systems. Agai n, there is a tension between production and innovation which is especially true in small companies. Whereas larger companies have more personnel resources to b alance 'mechanistic' and 'organic' behavior, smaller companies have to dedicate extra time and their energy for creativity parallel to standard business. Organi zing a company is not necessarily setting up organizational structures as. The r estructuring of reporting lines and different working groups is not of highest p riority. Adequate processes and skilled people using the same are the means of r esults not organizational structure itself. Additionally, structure might play a subordinate role when it comes to increasing efficiency and effectiveness. Four th, the results of innovation processes should be measured just like the results of other processes to setup or redefine objectives in relation to creativity an d innovation which support the high-level objectives. Setting up metrics and mea surement processes is essential because it supports an innovative company cultur e by getting feedback on creative efforts and keeping the employees aware to the need of innovation. Whereas the first two strategic elements, i.e. commitment a nd direction, need an implementation by company policy towards an innovative cul ture, the latter two (i.e. organizational setup and measurement) comprise the se tup of business processes related to innovation. Processes to put in place The quality of processes to be implemented largely dep ends on innovation strategy and the operational needs balancing the 'mechanistic ' and 'organic' functions of innovation.

"Well-designed processes actually stimulate creativity when it is desirable, bui ld in flexibility where it is needed, and enable talented people to make their o ptimum contribution." Brache Therefore, there should be business processes suppo rting innovation, and doing innovation. The larger number of innovation support processes are normally already in place. These standard business processes like payment schemes, career planning, educational offers, training-on-the-job and jo b-rotation, coaching, internal communication, controlling processes and so on sh ould be deeply linked to innovation. To achieve this, policies need to be adapte d, or existing processes need to be redefined. Examples of innovation support pr ocesses are highlighted in following three paragraphs. As mentioned in the previ ous chapter, measuring innovation performance is essential. The resulting contro lling system should trace targets and deadlines. These targets can consists of i deas that have been identified, or even realized in products, services, business es processes or management policies as well as financial gains from an innovatio n. Those can be broken down into time and furthermore into different levels like countries, markets, target groups, business processes and so forth . Another im portant element to a communication process is the internal marketing of new conc epts and ideas. Just like the example of the Post-it notes by 3M, the spreading o f the original innovation fostered the evolution and success of the later produc t. Interestingly, a study by Gunn (2008) shows that rewarding successful change projects is essential if a company wants to keep hands on their talents. There i s a positive correlation between the promotion of project leaders and their comm itment to the company. Innovation processes themselves comprise methodologies an d policies of innovation. Of course, these have to be implemented on different o rganizational levels. For instance, single innovation initiatives should rather be driven by individuals or groups. But innovation needs funding too. This is wh ere management comes into play.

One possible technique towards innovation is the "problem finding/solving cycle" . It begins with identification of a problem. The problem gets defined. By expl oring the problem, possible solutions might pop up. The subsequent selection (of an answer to oppose the problem) leads to implementation. The latter should be reviewed and might identify that the original problem has not been solved, or ne w problems have risen during implementation. Assessing innovation culture Trust towards company staff is one of the key facto rs positively influencing an innovative corporate culture. This can be seen in t he model of "High-Involvement Innovation" by Bessant (2003) which suggests a lea rning and innovation cherishing culture involving a large number of employees. A nother model is about "Lateral Leadership" by Sloane (2003). Managers and other key players within a corporation lead by curiosity, inspiration and empowerment. Key characteristics of an innovative company culture in this model are (Sloane 2003: 125): "[] 1. openness to ideas and input; 2. questioning of authority and c onventional wisdom; 3. agility ready, willing and able to change quickly; 4. goa l achievement oriented; 5. entrepreneurial spirit at all levels; 6. ready to tak e risks and learn from failure." These are soft factors which are hard to measur e objectively, and intricate to assess. That's why, this term paper will now int roduce a model to judge the development of company culture by its results. As di scussed earlier in this term paper, business processes create artifacts which re inforce culture; thus, all elements introduced to foster innovation represent cu lture as well.

Unfortunately, the tyre of the programme seems to lose air: Ideas appear to have no impact, and there are no 'big hits' advancing the company's success. So, the major point now is to keep promoting the idea of ongoing innovation, and reinfo rcing the innovation processes and policies. As the company reaches level 3 afte r a couple of month, the programme is still running smoothly. But there is a new obstacle coming up. This time, it seems that there is "a lack of a strategic fo cus to the problem-solving activity". The reaction of management is assessing an d readjusting the strategy, and breaking down the high-level objectives to innov ation objectives. On level 4, innovation is rooted in culture. There is a high l evel of trust amongst company members. Innovation is now deeply linked to strate gic goals. Progress and success of innovation objectives are constantly monitore d and measured whereas the innovation project teams largely act on their own aut hority. Innovation is focusing on the optimization of business processes related to quality and costs. Still, there are challenges to implement innovation on no vel products, services and processes as well as additional business elements. Fi nally, the company achieving innovation maturity level 5 is an innovation itself . People feel supported, actually are empowered to constantly innovate, and lead their innovations to success, or learn from inherent failure of innovation. The y share their experiences, invite others to join, coach innovation beginners and so on. The organization has turned into a pool of constant learning and innovat ion. Turning a company into a 'high-involvement organization' is a long-term change p rocess. It is about managing change with a clear strategic vision and commitment to innovation. A company might have invented innovation departments, processes and policies without success on a larger scale

Critical review As the research on this term paper has shown, most innovation ap proaches are focusing on product and service innovation. Process innovation foll ows from the need of quality and cost improvements in the value chain of product and service delivery. But yet, there seems to be no focus on innovating busines s processes or even management principles. As discussed with the model of the le arning organization , this might be related to the question of innovation maturi ty within a company. There is also one Hamel's model (2006) which address the ri ght ideas towards "management innovation" but it seems applicable only to large organizations that have a long track of successful innovation experience. Anothe r question on management innovation is: Why should companies publish radical inn ovations of their management practices as competitors could benefit of those rev olutions as well? So, maybe it is rather a question of intellectual property and protecting the competitive advantage than on developing those management innova tions and bring them to a wider public space. The leadership model seems to be t rend-setting since organizational practices and policies preferably see the adva ntages of employee involvement. Nevertheless, there are two obstacles to the not ion of 'creating leaders by leaders'. One is the question whether all employees could and should become leaders to the same extent. The second is concerned with human nature. People are not working for a company for their income. They have personal motives or even character traits that might partly, temporary or consta ntly prevent the wish to support innovation and become leaders themselves. On th e company side, there might be management behaviors that lower or prevent indivi dual contribution to innovation. Some of these are: putting too much emphasize o n 'mechanistic' production, no efficient planning of time for employees, low tra ining opportunities, low level of trust towards staff, and so on. Yet, there is another dimension to assess that has been discussed within the ter m paper: Implementation of innovation processes and an innovative corporate cult ure. There might some boundaries to the approach itself.

For a successful implementation of innovation, the commitment of management need s to be enormous and must be constantly reinforced. The costs of implementing ca n grow immense whereas returns can be expected in the long run but are not secur e at all. Implementing innovation might only be advisable at certain phases of t he organizational development. In turn, it might be more than threatening to the continuity of a business when applied in an already existing company crisis. In a globalizing world, the environmental culture, i.e. the culture of the country or area within a country, could negatively influence the transferability of an innovation culture and processes from the headquarter to its subsidiaries, or fr om one subsidiary to another if not make transfer impossible. Of course, the way of implementing is also mission-critical. If the leadership capabilities to be developed come from outside an existing company, or if corporate strategy is som ething that is imposed rather than discussed with the future leaders, or if the new way of doing things differently is just 'lip service', or if there are too m any exceptions to innovation rules and policies, the 'innovation dashboard' shou ld have all warning lights blinking. Thus, looking only at one business element to invent innovation, can't be successful. Moreover, a company should be viewed from a holistic perspective. Thus, innovation needs to take place in corporate s trategy, corporate culture, its business processes, and which is the most import ant element its people. Independent from the role that employees play in a corpo ration, these are human beings that create the artifacts that corporate culture comprise of.

Conclusion This term paper has developed an understanding of innovation fundamentals like t he modes of innovation, the types of innovation, and the elements of innovation from a strategic perspective. Whereas, the company management must decide upon t he first two points, i.e. how should innovation be setup in the organization, an d what kind of innovation the company is striving for, the latter point is more about taking a holistic view and the relations of the individual business elemen ts. Innovation neither requires a certain type of organizational structure nor d oes an existing organizational structure limit the potential of a business. It i s more a question of balancing the 'organic' setup of innovation project teams a s new opportunities by innovations arise. Although, innovation is frequently put in context to product innovation only, it is not limited to it. Process innovat ion in respect to product or service delivery follows product or service develop ment itself. Still, there is the discipline of process innovation from a managem ent point of view. This is along with management innovation itself a new field w hich has just recently been stressed, and thus requires more in-depth research. When it comes to implementation of innovation processes and an innovative cultur e, leadership is a good starting point. This invokes strategic values which in t urn results in business process supporting and doing culture. Innovation process es are artifacts of the corporate culture and reinforces the same. This kind of self-reference is one of the intriguing points in the holistic perspective. Leadership is role-modeling to the company's staff, provides a basic corporate c ulture, and formulates strategy. Strategy should address the management's commit ment to innovation, provide direction and coaching in innovation, build an innov ation capable organization which is flexible, and controlled by the results of i nnovation. The implementation of the overall innovation strategy is a long-term process. Business processes depend on strategy. Innovation supporting processes need to be streamlined and refined to support an innovative culture.

Focus should be put on the measurement, communication, and rewarding of innovati on. Essential innovation processes are the problem-solving cycle as a kick-off t o creativity as well as the organized assessment and selection of high-potential innovations. Corporate culture is a result of leadership, business strategy, an d business processes and just as it provide reference for the same elements. Inn ovation culture can be measured in terms of innovative maturity which relates ca pabilities in and the results of innovation . Despite the variety of obstacles a rising during the journey of implementing innovation, introducing it and working in an innovative enterprise should be challenging and interesting to everybody involved in micro-economics for their individual professional development and fo r the development of perspectives outside one's own box. Abstracts in relation with innovation management (Source:proquest.com) Exploratory Study of Organizational Creativity in Creative OrganizationsAbstract (Summary) The creative industries represent an important and growing sector of the UK economy. This paper explores organizational creativity in firms within th e creative industries. A questionnaire based on both Amabile's Organizational Cr eativity model and Ekvall's Creative Climate model was completed in ten firms in different sectors of the creative industries. Follow-up interviews with five fi rms were also conducted, to compare the outputs from each model as well as the v ariation in responses from firms in different sectors. The results indicate that both models of organizational creativity are complementary, although not necess arily fully applicable in the creative industries. Specific differences between firms in the graphic design/branding sector and firms in product design were als o observed.

Examining the Leaders of Creative Efforts: What Do They Do, and What Do They Thi nk About?Abstract (Summary) Due to the rapidly changing economy, innovation is b ecoming more and more critical for the success and survival of many organization s. Although several factors shaping innovation (e.g., strategy, climate, etc.) h ave been examined in the literature, the leadership of innovation has received r elatively less attention. In this article, we attempt to summarize the literatur e on the leadership of creative efforts focusing on critical leadership behaviou rs. We also explore a model of core leader functions tailored for creativity and innovation, as well as a model of innovation planning. The implications of thes e models for the leadership of innovation are discussed. Innovation Labs: An Exa mination into the Use of Physical Spaces to Enhance Organizational CreativityAbs tract (Summary) Recent years have seen an increase in the number of innovation l abs, purpose-built physical facilities designed to enhance and support creativit y and innovation in organizations. This rising phenomenon may be driven by the i ncreasing emphasis placed on innovation as the key to the survival of modern day organizations. Innovation labs are attracting greater attention from organizati ons, yet little is known about their effectiveness. Using a mixed-method approac h this paper aims to evaluate the effectiveness of a major UK-based facility in enhancing creativity and to explore users' attitudes towards this rising organiz ational phenomenon. The findings have implications for the management of existin g innovation labs and those in the planning. Towards a More Realistic Creative Problem Solving ApproachAbstract (Summary) Thi s paper takes a closer look at the existing multi-step diamond shaped models for creative problem solving (CPS). A case history of a real-life technical problem in which CPS techniques were used is our source of inspiration for some new ide as about approaching CPS. We propose three concurrent processes: Content finding , Acceptance finding and Information finding. In concrete in-company projects, t hese

three processes need to be managed simultaneously, which leads to a fourth overa rching process: project management. Content finding is concerned with the proces s the creative session members are going through based on people's own active kn owledge and ideas and on sharing their mental models to get new ideas. Acceptanc e finding is concerned with the co-creation of new and additional mental systems that are needed for bringing new ideas into good currency within the existing o rganization and goes beyond agreement on implementation plans. Information findi ng is concerned with gathering additional knowledge on the ideas that are not re adily available during the session. Finally, Project management is concerned wit h organizing and leading the creative session and in the embedding of the projec t into the larger organization. An Empirical Evaluation of R&D-Marketing NPD Int egration in Chinese Firms: The Guanxi Effect Helen Perks, Kenneth Kahn, Cong Zha ng. The Journal of Product Innovation Management. New York: Nov 2009. Vol. 26, I ss. 6; pg. 640 Abstract (Summary) Research examining new product development (NP D) practices recognizes the importance of research and development (R&D)-marketi ng integration to performance. Although a plethora of work has been carried out in the R&D-marketing domain, including Chinese firms, the study of cross-country contexts has relied on country type as the demarcation to explain country diffe rences. In the case of China, this study introduces the cultural more of guanxi. Seen as an alternative to formal institutionalized interactions, guanxi charact erizes the bond between people in Chinese society. The present study examines wh ether guanxi affects the nature of R&D-marketing integration in Chinese firms. S tudy measures were developed, and factor analysis was applied to the NPD integra tion items. Correlation and logistic regression analyses were employed. The find ings identify particular aspects of integration practices between Chinese R&D an d marketing managers that differ from the West in light of the significant effec t reflected by the guanxi construct. The results show that reliance on informal social systems, through guanxi, can act as a significant support for integration in certain

activity areas and that guanxi can influence integration in mid- to late-phase a ctivities. This study's findings suggest that guanxi can act as a unifying force in underdeveloped processes and may, paradoxically, reinforce acceptance of for malized structures. These findings suggest that where the basis for guanxi exist s, traditional and culturally derived interpersonal relationships still impact t he way people work together. The results of this research provide new knowledge of how guanxi positively influences the integration of R&D and marketing departm ents as well as successful NPD performance. Innovation management in organizatio ns Roman Inderst. European Economic Review. Amsterdam: Nov 2009. Vol. 53, Iss. 8 ; pg. 871 Abstract (Summary) This paper poses the question of how a firm should optimally choose both its organization and its compensation in the pursuit of in novation. One key result is that incentive pay arises as a robust instrument of innovation management both with and without delegation, although in the present model its primary purpose is not to elicit more effort for the creation of new i deas, but to ensure that new ideas are implemented if and only if this is effici ent. While without delegation, the firm may "underinvest" in innovation, with de legation the opposite bias may arise as new ideas may be implemented too often ( "overinvestment"). The optimal organizational choice trades off these two biases . Financial Champions and Masters of Innovation: Analyzing the Effects of Balanc ing Strategic Orientations Angela Paladino. The Journal of Product Innovation Ma nagement. New York: Nov 2009. Vol. 26, Iss. 6; pg. 616 Abstract (Summary) Theory predicts that market and resource orientations can each lead to innovation and financial success. Despite this, no research has examined whether the pursuit of both resource and market orientations is feasible and, if so, the impact of thi s combined

effect on innovative and financial outcomes. This paper aims to address these ga ps. Thus, it is the first to examine the interdependent relationship between mar ket orientation (MO) and resource orientation (RO). Additionally, this study res ponds to calls for (1) cross-disciplinary research, particularly in the areas of marketing and strategic management, and (2) comparative studies of diverse stra tegic orientations on performance. In doing so, this paper investigates the diff erence in innovation performance and financial performance between firms adoptin g a high or low degree of market orientation or a high or low degree of resource orientation. This allows us to observe independent and interdependent effects o f these orientations on the firm's performance. Data were collected from 250 sen ior executives in Australia. Confirmatory factor analysis and related techniques were applied to assess the robustness of the measures used. A two-way between-g roups analysis of variance (ANOVA) was used to evaluate the relationships. Resul ts show the emergence of four organizational types: unfocused imitators or follo wers; market-driven innovators; masters of innovation; and financial champions. From these, financial champions emerge as having the greatest impact on the fina ncial performance of the firm, while masters of innovation are best for maximizi ng innovation outcomes. In fact, organizations with a high RO in the matrix (mas ters of innovation and financial champions) achieved a higher impact on innovati on relative to the quadrants reflecting a lower MO. Results also demonstrate tha t pursuing a low degree of resource and market orientations leads to inferior fi nancial performance. Therefore, a balance of resource and market orientations is important. A potential extension of this research is to assess these relationsh ips on an industry-by-industry basis. This would contribute to our knowledge by allowing us to determine if and how these results differ between industries. Man agerial and theoretical implications are also discussed. Management Control and Strategic Renewal in the Front End of Innovation Jarno Poskela, Miia Martinsuo. The Journal of Product Innovation Management. New York: Nov 2009. Vol. 26, Iss. 6; pg. 671

Abstract (Summary) Should management control the front end of innovation in comp anies, and, if so, how? This paper examines the use of management control in the front end of innovation, how the different mechanisms of control are associated with generating strategic renewal, and what the moderating effect of technology and market uncertainty is. The front end of innovation has been characterized a s highly uncertain and creative, thereby requiring high levels of freedom and in dependence for those executing front-end activities. However, a certain amount o f control appears necessary to secure the effective use of resources and the ach ievement of the company's long-term objectives. The current findings of manageme nt control and its influence on performance in new product development context i n general are conflicting. While many authors argue that behavioral control kill s creativity, some others emphasize advantages of improved communication and coo rdination created by process formalization. Some authors stress the importance o f setting specific and challenging strategic goals for development work, but som e papers indicate that this inhibits creativity and learning. One challenge of i nterpreting the conflicting results of existing management control research in n ew product development context is that most studies treat the front-end phase si multaneously with product development projects, thereby averaging the totally di fferent characteristics of these two innovation phases. Studies that would have investigated management control in the front end of innovation are still scarce. This study develops a framework for management control in the front end of inno vation and tests hypotheses on the relationship between different control mechan isms and achieving strategic renewal. The role of technology and market uncertai nty as potential moderators of this relationship is investigated. Management con trol is covered through seven constructs: input control; front-end process forma lization; outcome-based rewarding; strategic vision; informal communication; par ticipative planning; and intrinsic task motivation. Strategic renewal is used as a front-end performance indicator. Data from the front-end phase of 133 new pro duct development projects from different large and medium-sized companies were c ollected and analyzed. A factor model was used to test the validity of the manag ement control framework, and a moderated regression analysis was used for hypoth esis testing. The results show that input control is

positively associated with achieving strategic renewal in the front-end phase. T he results also confirm the importance of intrinsic task motivation of the front -end group. Under high technology uncertainty, the use of outcome-based rewardin g or front-end process formalization has a negative influence on strategic renew al. What about Design Newness? Investigating the Relevance of a Neglected Dimens ion of Product Innovativeness Katrin Talke, Sren Salomo, Jaap E Wieringa, Antje L utz. The Journal of Product Innovation Management. New York: Nov 2009. Vol. 26, Iss. 6; pg. 601 Abstract (Summary) In several industries, new products are very similar in functional features but compete on their unique design. Firms like Al essi, Apple, Bang & Olufsen, Dyson, or Kartell all follow a design-driven innova tion approach and use their products' visual appearance as the main mean for dif ferentiation. In spite of this, design newness is never discussed among the dime nsions of product innovativeness. Instead, conceptualizations of product innovat iveness mostly focus on a product's technical newness or the changes it implies for the innovating firm or for the market it enters. This paper seeks to build a n argument for why design newness should be considered as a dimension of product innovativeness. In addition to providing conceptual rationale, empirical eviden ce is offered on the influence of design newness on sales performance across a p roduct's life cycle. To be able to put the findings into perspective, the perfor mance effects of design newness are compared with those of technical newness. As several products exemplify that design newness and technical newness can go han d in hand, not only direct performance effects but also interaction effects betw een both newness dimensions are investigated. The arguments are tested on a samp le of 157 new cars launched between 1978 and 2006 in Germany. The automobile ind ustry is selected because of the strategic role of both technical and design asp ects in product innovation. Putting a focus on this industry also has the advant age that historical information on car specifics and objective sales data over t ime are accessible. The results emphasize that both design and technical newness are important drivers of car sales. However, the effects differ

widely across the product life cycle. While design newness has a positive impact right after the introduction and persists in strength over time, technical newn ess drives sales with a lagged effect and decreases toward the end of the life c ycle. The test of a combined influence of design newness and technical newness o n sales performance produces no significant results. These results open interest ing avenues for future research on product innovativeness in general and design newness in particular. For management practice, the findings emphasize the impor tance of overall product innovativeness, clarify the different performance effec ts of design and technical newness across the product life cycle, and show the v alue of creating a unique visual product appearance to positively trigger produc t diffusion. Where Do Good Innovation Ideas Come From? Exploring the Influence o f Network Connectivity on Innovation Idea Quality Jennie Bjrk, Mats Magnusson. Th e Journal of Product Innovation Management. New York: Nov 2009. Vol. 26, Iss. 6; pg. 662 Abstract (Summary) This paper aims to add to innovation management theo ry and practice by exploring the interrelationship between innovation idea quali ty and idea providers' network connectivity, using social network analysis. The study uses a database from a company that has worked systematically with idea ma nagement over a long period of time and today has a well-established information technology system that collects ideas from a large number of employees. In addi tion to the idea database, a number of interviews with key individuals within in novation were conducted to create rich contextual knowledge and understand more in detail how ideas are handled in the company. The analysis indicated that ther e is a clear interrelationship between the network connectivity and the quality of the innovation ideas created. The analysis was done for all the innovation id eas and then for ideas created by single individuals and by groups, respectively . In all three analyses the proportion of high-quality innovation ideas increase d, as a step function, between the least connected group and the group thereafte r. There is apparently a need for a certain amount of relations to increase the

proportion of high-quality innovation ideas generated. Regarding only ideas prov ided by single individuals, more connections within the network resulted in a hi gher proportion of high-quality ideas. A different pattern was seen for ideas pr ovided by groups as the proportion of high-quality innovation ideas grew with so me increase in the connectivity of groups but declined with a further increase i n connectivity. The findings suggest a number of implications for ideation manag ement. To increase the number of high-quality innovation ideas created by indivi duals, the possibility to interact with other people should be supported and fac ilitated. However, in these settings, where individuals work with others in diff erent groups, the most connected groups perform worst in terms of the proportion of high-quality ideas generated, which points to the necessity to consider a mu ltitude of factors when managing ideation. Exploring the microfoundations of ext ernal technology commercialization; A dynamic capabilities perspective Mattia Bi anchi, Vittorio Chiesa, Federico Frattini. European Journal of Innovation Manage ment. Bradford: 2009. Vol. 12, Iss. 4; pg. 444 Abstract (Summary) Purpose - Exte rnal technology commercialization (ETC) refers to the firm's transfer of technol ogical assets, disembodied from products, to another organization involving a co ntractual obligation for compensation. The purpose of this paper is to identify the managerial and organizational antecedents that are capable of explaining sup erior capabilities in ETC. Design/methodology/approach - Starting from an in-dep th analysis of the literature about technology commercialization and adopting th e dynamic capabilities strategic perspective, the study develops a theoretical f ramework that shows how a number of concepts (resources, capabilities and microf oundations) may affect performance in ETC. A case study analysis is conducted wi th illustrative purposes. Findings - The paper shows that adequate management an d organization of ETC activities are needed to successfully undertake ETC. Combi ning evidence from a case study and findings from prior studies, research propos itions are developed regarding key process, organizational and human resource me chanisms that lie at the

heart of superior capabilities in ETC. Practical implications - The paper provid es technology and innovation managers with a number of suggestions for organizin g and managing ETC that are likely to improve performance. Originality/value - O wing to the complexity of ETC related activities and the high transaction costs characterizing the markets for technologies, only few companies are reaping the gains from the commercialization of their technologies while the majority fail t o realize their potential. This paper is the first attempt, to the best knowledg e of the authors, which adopts the dynamic capabilities perspective to unearth t he managerial levers driving superior performance in ETC. Implementation of strategic green orientation in supply chain; An empirical stud y of manufacturing firms Paul Hong, He-Boong Kwon, James Jungbae Roh. European J ournal of Innovation Management. Bradford: 2009. Vol. 12, Iss. 4; pg. 512 Abstra ct (Summary) Purpose - The purpose of this paper is to present a research model that defines the inter-relationships between strategic green orientation, integr ated product development, supply chain coordination, green performance outcomes and business unit performance. This paper aims to address innovation issues by i ntegrating strategic orientation, internal business practices, supply chain coor dination, and performance outcomes measures. Design/methodology/approach - The i nternational data of 711 firms accessed through the International Manufacturing Strategy Survey (IMSS IV) are used to validate this model. Findings - A firm's s trategic green orientation involves past green practices, implementation of inno vative environment improvement program and future commitment for environmental p ractices. This strategic green orientation is supported by a set of inter-organi zational innovation practices such as integrated product development practices, effective coordination of supply chain network and relevant and measurable perfo rmance outcomes. Originality/value - The model, variables, empirical tests and r esults in this paper suggest a new understanding about

strategic green orientation and its relationships with product development pract ices and supply chain coordination. The framework is intended both to explicitly inform senior executives of the importance of inter-organizational innovation p ractices such as strategic green orientation in terms of past, present and futur e practices as well as to the factors that effectively implement such strategic direction and commitment. It is also intended to provide a lens with which furth er research can be directed to enhance environmental reputation and outcomes of firms through new product development practices and supply chain network coordin ation and the sustainable long-term competitive advantages of the firms. Creativ ity and Its Discontents: Professional Ideology and Creativity in Architect Work Alexander Styhre, Pernilla Gluch. Creativity and Innovation Management. Oxford: Sep 2009. Vol. 18, Iss. 3; pg. 224 Abstract (Summary) Architects are a professio nal group that is commonly associated with creative and aesthetic work and with strong professional norms, values and identities. While such shared norms and be liefs are positive overall in terms of being constitutive of professional subjec t-positions, an overemphasis on specific skills and qualities may also be regard ed as a burden on members of the professional community. A study of a major Scan dinavian architect office suggests that the perceived lack of creative and innov ative thinking and accompanying dialogues and discussions among practising archi tects tends to produce cynicism and, to some extent, disappointment. As a conseq uence, professional ideologies may in some cases be out of joint with everyday w ork realities, and thereby to some extent produce expectations that are complica ted to fulfil. Professional ideologies are thus both what integrates and consoli dates a profession while at the same time prescribing ideal future scenarios for the professional community. Embedding a Threshold Concept in Teaching and Learn ing of Product Development Management

Paul Coughlan, Anne Graham. Creativity and Innovation Management. Oxford: Sep 20 09. Vol. 18, Iss. 3; pg. 190 Abstract (Summary) This paper uses insights from th e literature on threshold concepts to develop a structure for understanding teac hing and learning in the area of managing product development. The paper defines the threshold concept, outlines pedagogic principles and describes learning act ivities that seek to enact these principles. The paper is based upon experience of an established final-year university undergraduate course. Innovation in the Absence of Principled Knowledge: The Case of the Wright Brothers Carl Bereiter. Creativity and Innovation Management. Oxford: Sep 2009. Vol. 18, Iss. 3; pg. 234 Abstract (Summary) Although the Wright Brothers are most famous for achieving t he first successful manned powered flight, their innovation that had a revolutio nary effect on airplane design was a plane capable of making banked turns. Yet t his appears to have been an unintended by-product of their effort to maximize co ntrol, in contrast to the efforts of competitors to maximize stability. The succ ess of the Wright Brothers in this effort can be attributed to their taking an a pproach that was on one hand well adapted to the low state of aeronautical knowl edge existing at the time but that on the other hand was committed to the constr uction and pursuit of principled knowledge. This involved the use of analogies, not as a source of problem solutions but as an aid in developing theory-like pri nciples. It also involved sequences of increasingly realistic experiments. Their approach contrasts with that of J.P. Langley, who took what has become a tradit ional R&D or 'theory-intopractice' approach, dependent on a high level of princi pled knowledge. This history yields several suggestions, not radical in themselv es, about how radical advances may be made in knowledge-poor fields, which are s till common today, especially in the human sciences.

Successful Patterns of Internal SME Characteristics Leading to High Overall Inno vation Performance Annemien Pullen, Petra de Weerd-Nederhof, Aard Groen, Michael Song, Olaf Fisscher. Creativity and Innovation Management. Oxford: Sep 2009. Vo l. 18, Iss. 3; pg. 209 Abstract (Summary) Small and medium-sized enterprises (SM Es) struggle with the paradox of developing new products and technologies on the one hand and minimizing costs on the other. These SMEs must be innovative to su rvive and grow. However, compared to large firms, SMEs have several problems in their innovation process, which negatively influence their overall innovation pe rformance. This research explores successful patterns of internal SME characteri stics that lead to high overall innovation performance. Cluster analyses were co nducted to find patterns in the internal characteristics of SMEs with high overa ll innovation performance. We find that companies that focus on incremental inno vation and that achieve high overall innovation performance indeed share a patte rn in their internal organization, when controlling for innovation type. The pap er adds to the current body of knowledge by comparing highand low-performing com panies based on competence differences. Because real-life organizations consist of multiple organizational characteristics, we also contribute to management pra ctice by simultaneously addressing multiple organizational characteristics for t he successful organization of innovation. Uppsala Creativity Day, 2 March 2009 S usan Moger, Tudor Rickards. Creativity and Innovation Management. Oxford: Sep 20 09. Vol. 18, Iss. 3; pg. 242 Abstract (Summary) The University and the City of U ppsala joined forces on 2 March 2009 to explore the nature of creativity and of the creative city. Swedish participants were joined by international contributor s from Europe and America. Discussions ranged from science

policy to neurological aspects of idea generation, from creative leadership of t eams to the creative city. Teaching Innovation through Interdisciplinary Courses and Programmes in Product Design and Development: An Analysis at 16 US Schools Sebastian K Fixson. Creativity and Innovation Management. Oxford: Sep 2009. Vol. 18, Iss. 3; pg. 199 Abstract (Summary) If innovation is understood as a process of inventing and commercializing new products and services, as a process that i ncorporates activities from multiple disciplines, and as a process that follows more heuristic than algorithmic rules, then perhaps this process can be taught i n an interdisciplinary setting with a strong experiential emphasis, such as prod uct design and development. In this paper, I compare and contrast 14 courses and three programmes in interdisciplinary product development at 16 leading US scho ols. The overall finding is that while the courses appear similar on a high leve l, there exists substantial variation in the details. In particular, the way in which multiple disciplines are involved in these courses and programmes varies s ubstantially. Similarly, while a teambased term project tends to be the common e lement across the courses and programmes, the degree of fidelity to which the pr oducts and services are developed varies considerably. Overall, although these c ourses and programmes tend to be very labour and co-ordination intensive, their success has established the legitimacy of interdisciplinary, experiential produc t design and development education at leading schools in the US. Adaptation and Organizational Connectedness in Corporate Radical Innovation Prog rams Donna Kelley. The Journal of Product Innovation Management. New York: Sep 2 009. Vol. 26, Iss. 5; pg. 487

Abstract (Summary) This research examines how established companies organize pro grams for fostering technology-based radical innovation. It addresses conflicts revealed in the innovation literature concerning the appropriate design of the s trategic, structural, and process components of these programs. In developing in novation strategies, managers must balance the desire for strategic clarity with the need to allow for creativity and exploration. They must structure programs that ensure innovations benefit from the organization's resources while minimizi ng the numerous constraints that can impede these unconventional activities. Add itionally, though they may favor management processes that provide accountabilit y and effective resource allocation, managers must also ensure these do not rest rict the flexibility required for successful innovation. The study is a longitud inal, comparative case analysis of interviews with managers involved in innovati on programs in 12 industry-leading multinational corporations. Site visits at ea ch company were followed by biannual interviews with key managers in each compan y. A total of 81 follow-up interviews were conducted over a three-year period. T hese interviews were aimed at identifying the changes and progress in the progra ms over time and internal and external impacts on the organization's innovation activity. The analysis reveals (1) distinct but evolving objectives that maintai n a logical strategic connection, (2) adaptive structures that shift and transfo rm but preserve relationships with the broader organization, and (3) flexible pr ocesses that are understandable beyond the innovation program and are modifiable , both for the context and in response to learning over time. This suggests that programs introducing high uncertainty and risk into mature corporate environmen ts are highly flexible systems that maintain organizational connectedness as the y evolve. For academics, this implies a need to understand the evolution of inno vation programs as an adaptive learning process that, regardless of form and pur pose, preserves its connection to the traditional organization. For practitioner s, it highlights the importance of considering the process, strategic, and struc tural connections to the broader organization when designing innovation programs and suggests the need for feedback mechanisms to help adapt these elements over time.

The Moderating Effects of Virtuality on the Antecedents and Outcome of NPD Team Trust Paul E Bierly III, Eric M Stark, Eric H Kessler. The Journal of Product In novation Management. New York: Sep 2009. Vol. 26, Iss. 5; pg. 551 Abstract (Summ ary) The fundamental dynamics of virtual and traditional face-to-face teams may be very different. The purpose of this study is to empirically examine and asses s the moderating effects of virtuality on the antecedents and outcome of trust, where virtuality is measured along a continuum from face to face (no virtuality) to fully virtual rather than the more common approach of dichotomizing teams in to two groups (i.e., face to face and virtual). The sample includes 116 differen t new product development teams from a variety of industries. The antecedents of trust that are studied are familiarity, goal clarity, training, relationship co nflict, and process conflict. The outcome of trust is analyzed by determining ho w the impact of trust on cooperation changes as the level of virtuality changes. Primary findings are as follows: (1) Relationship conflict can be more detrimen tal to virtual teams than face-to-face teams because it is very difficult for te am members of virtual teams to resolve their interpersonal disputes; (2) goal cl arity is more important for face-to-face teams and less important for virtual te ams in creating trust among team members; and (3) the impact of trust on coopera tion is less for virtual teams than face-to-face teams. The primary implication for researchers and practice of these findings is that the role and importance o f trust in virtual teams needs to be reevaluated. Managers using virtual teams n eed to realize that interpersonal relationships in virtual teams do not evolve i n the same manner as face-to-face teams and may require different management tec hniques to be successful.

References: http://www. nasscom in/Nasscom/templates/LandingPage.aspx?id=50154 http://www.un itedbit.com/idea-diffusion-3rd-phase-in-the.innovation-chain http://www.sych.uni to.it/csc/copscio5/frame/oster/2/ma285-mueller.pdf http://www.northsomerset.nhs. uk/PubIicatons/meetincs/PCT Board Meetincis/2007/ July/i 3%20-%20Appendix%201 %2 0%2OFITN ESS%2OFOR%2OPU RPOSE%200APABILITY%20 DEVELOPMENT%20 P LAN.pdf UK Govt, Department for innovation, Report on universities & skills, viewed on September 1 0th 2008, httr://www.dius.ciov.uk/oIicy/innovation.html http//www.innovationmetr ics.pov/ Innovation metrics: Embedding innovation in an organizations system , week ly newsletter from Innovation Network, viewed on 19th November 2008, httD://www. thinksmart.com/newsletter

3M 2002. A Century of Innovation The 3M Story. St. Paul: 3M http://multimedia.mm m.com/mws/mediawebserver.dyn?6666660Zjcf6lVs6EVs666IMhC OrrrrQ