1. “Managing Innovation: Integrating Technological, Market and Organizational Change” Chapter 5: “Paths: Exploiting Technological Trajectories”
Joe Tidd
John Bessant
Keith Pavit
Second Edition(2001), John Wiley & Sons Ltd.
Students: Carlos Neves
Rui Carvalho

2. Not an option Not an option
Technological Trajectory
Not an option
Technological Knowledge
Firms Path
Now
Future
Firms Competence
Incremental Learning
Path dependant
Knowledge accumulated thr. experience
Not an option

3. Innovating Firms – Characteristics
Size: Big or Small
Type of product: price sensitive vs performance sensitive
Objectives: product or process
Sources: Suppliers, customers, in-house & basic research
Locus: labs, design offices, production engineering
Sectoral Differences!
Technological Trajectories (Sectors and Firms)
DANGER: All firms and sectors are different = no generalization!
Generalize based on one firm = misleading conclusions!

4. Pavvits’ Taxonomy Five Major Technological Trajectories (Sectors)
Supplier Dominated
Scale Intensive Firms
Science Based
Information Intensive
Specialized Suppliers
What differs in each trajectory…
… sources of technology
… innovation strategy
… typical core products

5. Domínio
do fornecedor
Escala-
-intensivas
Suportadas
na ciência
Informação
Fornecedores
especializados
Produtos chave típicos
• Agricultura
• Serviços
• Produção Tradicional
• Matérias primas
• Bens de consumo duradouros
• Automóvel
• Engenharia Civil
• Electrónica
• Química
• Finanças
• Retalho
• Edição
• Viagens
• Equipamento
• Instrumentação
• Software
Principais fontes de tecnologia
• Fornecedores
• Aprendizagem de produção
• Engenharia de produção
• Gabinetes de Design
• I&D
• Investigação
fundamental
• Departamento
de software e
sistemas
• Concepção
• Utilizadores
avançados
Principais tarefas da estratégia de inovação
1. Posição
1. Baseada em
vantagens não
tecnológicas
1. Eficácia do custo e segurança dos produtos e processos complexos
1. Desenvolv. técnico de produtos relacionados
1. Novos produtos e serviços
1. Monitorização e resposta às necessidades dos clientes
2. Trajectória
2 .Utilização das Tl nas finanças e na distribuição
2. Integração incremental do novo conhecimento (ex, protótipos virtuais, novos materiais)
2. Exploração da ciência básica (ex. biologia molecular)
2. Concepção e operação de sistemas complexos de processamento de informação
2.Compatibilizacao das mudanças tecnológicas às necessidades dos clientes
3. Processos
3. Flexibilidade de resposta aos clientes
3. Divulgação das melhores praticas de concepção, produção e distribuição
3. Obtenção de
acções complementares. Redefinição de fronteiras das divisões
3. Adequar as oportunidades baseadas nas Tl com necessidades dos clientes
3. Fortes elos de ligação com os clientes avançados

6. Revolutionary Technologies - Biotechnology
Biology
Biochemistry
Genetics
Microbiology
Biochemical engineering and separation processing
Discovery of the structure of the DNA
R&D programmes of companies in the pharmaceutical and agro-food sectors
Food processing, drinks and detergents
Textiles, leather, paper and pulp, oil refining, metals and mining, printing, environmental services, and speciality chemicals.

7. Revolutionary Technologies – Advanced Materials
Materials for information and communication, for aerospace, for ground transportation and energy utilization; advanced metals, polymers and ceramics.

8. Revolutionary Technologies – Information Technology
Microelectronics revolution, software technology, Internet.
Three features of the IT revolution:
1- Digitalisation and interconnection of previously separate activities: home electronics, logistics, sales and distribution in retailing, management information systems;
2- Decreasing cost of product development through the use of simulations and virtual prototypes;
3- Growing importance of software technology in distribution activities.

9. Developing Firms-specific Competencies
Hamel and Prahalad on Competencies
1-The sustainable competitive advantage of firms resides not in their product but in their core competencies;
2-They use the metaphor of the tree;
3-Associated organizational competencies;
4-Core competencies require focus;
5-Not only as a collection of strategic business units, but as bundles of competencies that don’t necessarily fit tidily in one business unit;
6-The development of a firm’s competencies depend on its strategy architecture; example of core competencies of Canon (1950-precision mechanics, 1964-electronic calculator; 1965-electrofax copier; 1968-paper copier technology; fine optics and microelectronics).

10. CORE COMPETENCIES TREE METAPHOR END PRODUCTS BUSINESS UNITS CORE

11. Japanese Automobile Companies
Heavyweight Product Managers and Fat Product Designs
Overlaping problem solving among the engineering and manufacturing functions, leading to shorter model changes cycle;
Small teams with broad task assignments, leading to high development productivity and shorter lead times;
Using a heavyweight product manager with extensive project influence;
In 1990’s these features has been emulated by US automobile companies, and the gap had disappeared;
Another reason for the lost of the Japanese competitive edge – “fat products designs”, an excess in product variety, speed of model change and unnecessary options

12. Developing and Sustaining Competencies
Technological competencies bypasses two central tasks of corporate technology strategy:
1 – identifying and developing the range of disciplines or fields that must be combined into a functioning technology;
2 – identifying and explore the new competencies that must be added if the functional capability isn’t to become obsolete.
Richard Hall Model
Core competencies
Intangible assets
(intellectual property rights and reputation)
Intangible competencies (skills and know-how of employees, suppliers and distributors, and the collective attributes)
Most significant are:
company reputation and
employee know-how,
which may be a function
of organizational culture (values and beliefs)

13. Learning About Opto-Eelctronics in Japanese Companies
Kumiko Miyazaki
Tracing the development and exploitation of opto-electronics technologies in Japanese firms;
By examining the types of papers related to semiconductors lasers over a 13 years period, it was found that in most firms there was a decrease in experimental type papers accompanied by a rise in papers marking “new developments” or “practical applications”;
The competence building is a cumulative and long process resulting from trial and error and experimentation, which may eventually lead to fruitful outcomes;
Firms search over a broad range in basic and applied research and a narrower range in technological development;
The early phases of competence building, firms explore a broad range of technical possibilities, since they are not sure how the technology might be useful for them.

14. Categories of Innovating Small Firms
Superstars
NTBF’s
Specialized
Suppliers
Supplier-Dominated
Examples
Polaroid, Xerox, Microsoft, Compaq, Sony, Casio, Benneton
Start-ups in electronics, biotechnology and software
Producer goods(machines, components, software)
Traditional products(textiles, wood, food) and many services
Sources of competitive advantage
Successful exploitation of major invention or technological trajectories
Product or process development in fast-moving and specialized area
Privatizing academic research
Combining technologies to meet users needs
Integration and adaptation of innovations by suppliers
Main tasks of innovation strategy
Preparing replacements for original invention
Superstar or specialized supplier?
Knowledge or money
Links to advanced users and pervasive technologies
Exploiting new IT-based opportunities in design, distribution and coordination