Teaching PowerPoint Slides - Chapter 1

PERSPECTIVES ON INNOVATION
LEARNING OUTCOMES
At the end of this chapter, students should be able

to:
Describe the various definitions of innovation.
Distinguish between innovation and invention.
Discuss the factors that affect innovation.
Identify the sources of innovation.
Innovation Management All Rights Reserved

© Oxford Fajar Sdn. Bhd. (008974-T), 2016 1– 3
INTRODUCTION
 The word innovation originates from the Latin word innovare which
means ‘to make something new’.
 Innovation includes both new technologies and new ways of doing
things.
 Innovation is measured as a process which has to be established
in an organization for continued enhancement.
 Innovation management is the systematic processes used to
develop new and improved products, services and processes.
 Innovation is a major part of any organization, essential for growth
as it helps distinguish the organization from others.
 Success of innovation depends on the future vision of and the
encouragement from the organizational culture.

IMPORTANCE OF INNOVATION
 Innovativeness has become a force in wealth creation and business

success.
 It leads to new business ideas and technological revolutions.
 The survival aspect that an established organization would need is
to innovate, or face the consequences of extinction.
 Innovation, apart from products and services, also includes
processes, supply chain systems, marketing methods and
leadership/management styles.
 With the impact of globalization, coupled with technological and
knowledge revolutions, organizations and businesses will have to
constantly adapt to an ever changing business climate.
 Innovation adds value and propels organizations forward towards
overall improvement.

INNOVATION, INVENTION AND
CREATIVITY
 Innovation
– Ideas, concepts, and inventions are the precursors of innovation.
Ideas and concepts cannot generally be implemented.
– Innovation is about introducing something new or doing
something in a new way. The goal of innovation is to take an idea
from concept to realization and improve business performance.
– Innovation begins with an idea that is transformed into a concept
that includes some new combination of what is already known
and can be implemented to serve a purpose.
– Invention and innovation involve creativity.
– The goal of innovation is positive change, to make someone or
something better.

CREATIVITY (cont.)
 Invention
– Invent something that did not exist before.
– Example of invention: components, assemblies, mechanisms,
and various types of equipment used in daily living.
– Inventions are normally associated with patents, however many
inventions are never patented.
– Many organizations do not patent their processes but instead
treat them as organizational–confidential.
– Because once a patent is issued, knowledge of the invention
becomes available to all who choose to search the patent
literature.
– To be competitive is to have patents that add significant value.

CREATIVITY (cont.)
 Creativity
– Creativity is the generation of ideas that results in the
improved efficiency or effectiveness of a system.
– Creativity (or creativeness) is a mental process
involving the generation of new ideas or concepts, or
new associations between existing ideas or concepts.
– Creativity allows the entrepreneur to manufacture
products that are different from products
manufactured by competitors, allows a product to stay
in the market and have preference among customers.

CREATIVITY (cont.)
– Creativity has close connections with revolution,

evolution and dynamism.
– Innovation and creativity work in a kind of critical
tandem, but successful innovation requires more than
just creativity.

THE INNOVATION CONTINUUM
 Innovation lies on a continuum of events that begins with a raw

idea, which is developed into a concept, which then yields some
type of invention, and which is finally implemented and
commercialized.
 These are progressive and iterative stages that describe the
innovation process.
 Words like ‘ideas’, ‘concepts’, ‘inventions’, and ‘innovation’ are
often used interchangeably.
(cont.)
 Ideas
– Raw ideas provide little value unless someone pursues them.
– Few idea generators take the time to adequately describe the
idea, and many organizations, though not suffering from a lack
of raw ideas, suffer from a lack of interest in pursuing them.
 Transforming Idea to Concept
– Transforming an idea into a workable concept involves taking
account of the system in which the idea will be implemented.
– In the formative stages of the concept, the available information
may be limited but still needs to be considered.
– In addition, new information needs to be gathered and factored
into the decision process.

(cont.)
 The work effort in transforming ideas into developing concepts
includes the following tasks:
─ Identifying the available resources: The required resources
from either within or outside the organization.
─ Understanding the organizational infrastructure: The
infrastructure that supports innovation.
─ Assessing the competencies and capabilities of the
organization: Individual, team, and various group competencies
that are required to develop into organizational capability.
─ Interpreting economic and global demographic information:
Information related to the context of the concept under
consideration.

(cont.)
─ Evaluating the competencies of all the support functions: The
skill levels of the organizational support functions, noting the
deficiencies.
─ Managing the interfaces: Those involved in bringing any
concept to fruition.
─ Integrating individual, team and group competencies into
organizational capability: Individual competence that develops
into organizational capability.

FACTORS THAT AFFECT
INNOVATION
 Resources
– Organizational resources include people, money,
intellectual property, access to information, capability,
time, customers, suppliers, plant and equipment and
financial reserves.
– All the resources mentioned play a vital role in producing
innovative products or services for an organization.
 Infrastructure
– The organizational infrastructure includes the purpose of
the organization, its objectives, its strategies, management
attributes, and its support of innovation.

FACTORS THAT AFFECT
INNOVATION (cont.)
−The infrastructure of an organization will also provide
support for any new ideas, invention and innovative ideas.
− A strong organization with such strategies will encourage
employees to co-operate in producing new products.
 Culture
– An organizational culture includes shared values, beliefs,
legends, rituals, past history, intellectual and operational
traditions, pride in past accomplishments, policies and
practices, rules of conduct, the organization’s general
philosophy of operation, and other artifacts that define the
organization.

FACTORS THAT AFFECT
INNOVATION (cont.)
–
A healthy culture will make employees feel easy to give
suggestions to the organization’s management team.
 Process
– Consists of an idea from some recognized need that is
developed into a concept, followed by an invention, and
then taken through development, production, diffusion and
adoption by end users.

SOURCES OF INNOVATION
 The Unexpected Event

– An unexpected failure, an unexpected success or an
unexpected outside event can be a platform of a unique
opportunity.
 The Incongruous
– A discrepancy between reality and what everyone
assumes it to be, or between what is and what ought to be,
can create an innovative opportunity.
 The Process Need
– This one is task-focused rather than situation-focused. A
process is perfected, redesigned or a weak link replaced.

SOURCES OF INNOVATION (cont.)
 The Industry and Market Structure Change

– The opportunity for an innovative product, service or
business approach occurs when the underlying foundation
of the industry or market shifts.
 Demographics
– Changes in the population’s age structure, size, income,
level of education and employment can create
opportunities for innovation.

SOURCES OF INNOVATION (cont.)
 Changes in Perception, Meaning, and Mood

– Innovative opportunities can develop when a society’s
beliefs, attitudes and general assumptions change.
 New Knowledge
– Advances in scientific and non-scientific knowledge can
create new products and new markets.

INNOVATION CULTURE AND
MYTHS
Myths Reality
1 Individuals drive innovation. 1 Innovation is a team sport.
2 Innovation begins with 2 Innovation begins with
brainstorming. understanding the customer.
3 Innovation requires creative 3 Innovation requires effective
people. problem solvers rather than
creative people.
4 An innovation process will give 4 The innovation process is only
the results you need. one tool for successful innovation.


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PERSPECTIVES ON INNOVATION

At the end of this chapter, students should be able

Innovation Management All Rights Reserved

Innovation Management All Rights Reserved

 Innovativeness has become a force in wealth creation and business

Innovation Management All Rights Reserved

Innovation Management All Rights Reserved

Innovation Management All Rights Reserved

Innovation Management All Rights Reserved

– Creativity has close connections with revolution,

Innovation Management All Rights Reserved

 Innovation lies on a continuum of events that begins with a raw

Innovation Management All Rights Reserved

Innovation Management All Rights Reserved

Innovation Management All Rights Reserved

Innovation Management All Rights Reserved

Innovation Management All Rights Reserved

Innovation Management All Rights Reserved

 The Unexpected Event

Innovation Management All Rights Reserved

 The Industry and Market Structure Change

Innovation Management All Rights Reserved

 Changes in Perception, Meaning, and Mood

Innovation Management All Rights Reserved

Innovation Management All Rights Reserved

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