1. Intrapreneurship, and Creativity
Innovation,
Intrapreneurship, and Creativity
Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall
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2. Learning Objectives
Describe how innovation and technological change affect each other
Discuss the relationship among innovation, intrapreneurship, and creativity
Understand the many steps involved in creating an organizational setting that fosters innovation and creativity
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3. Learning Objectives
Identify the ways in which information technology can be used to foster creativity and to speed innovation and new product development
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4. Innovation and Technological Change
Innovation: Process by which new goods and services or new production and operating systems are developed
Enables better response to customer needs
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5. Types of Innovation
Quantum technological change: A fundamental shift in technology that revolutionizes products or the way they are produced
Quantum innovation: New products or operating systems that incorporate quantum technological improvement
These can cause major changes in the environment
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6. Types of Innovation (cont.)
Incremental technological change: Technological change that represents a continual refinement of some base technology
Incremental innovations: Products or operating systems that incorporate refinements of some base technology
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7. Property Rights Innovation is expensive and needs to be protected
Patents
Copyrights
Trademarks
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8. Innovation, Intrapreneurship, and Creativity
Intrapreneurs: Entrepreneurs inside an organization who are responsible for the success or failure of a project
Notice opportunities
Manage product development
May leave organization if their ideas are not supported
Become entrepreneurs
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9. Innovation, Intrapreneurship, and Creativity (cont.)
Creativity: Ideas going beyond the current boundaries, whether those boundaries are based on technology, knowledge, social norms, or beliefs
May involve combining and synthesizing new things
Knowledge-creating organization: An organization where innovation is going on at all levels and in all areas
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10. Entrepreneurship as “Creative Destruction”
Creative destruction - The widespread technological changes brought about by increasing global competition that generate new innovations
It leads older, less-forward looking companies to become uncompetitive or driven out of business by new, more innovative ones
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11. Innovation and the Product Life Cycle
Product life cycle: The changes in demand for a product that occur over time
Demand for most successful products passes through four stages:
The embryonic stage
The growth stage
The maturity stage
The decline stage
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12. Innovation and the Product Life Cycle (cont.)
Determinants of the length of the product life cycle
Rate of technological change
Faster the rate of change, the shorter the product life cycle
Role of fads and fashion
Determine the attractiveness of products to customers
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13. Figure 13.1 - Technological Change and Length of the Product Life Cycle
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14. Managing the Innovation Process
Project management: The process of leading and controlling a project so that it results in the creation of effective new or improved products
Project: A subunit whose goal centers on developing the products or service on time, within budget, and in conformance with predetermined performance specifications
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15. Managing the Innovation Process (cont.)
Effective product management begins with a clearly articulated plan
Takes a product through the concept, initial test, modification, and manufacturing phases
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16. Managing the Innovation Process (cont.)
Project manager’s (PMs) tasks are different from regular managers
Manages high proportion of highly skilled and educated professionals
Balances team members creative efforts with cost and time considerations
Maintains the momentum of the project
Key to a PM’s success - The ability to think ahead and conduct effective advance planning
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17. Managing the Innovation Process (cont.)
Quantitative modeling
PERT/CAM network or GANTT chart - Flowcharts of a project that can be built with many proprietary software packages
These software packages focus on:
Modeling the sequence of actions necessary to reach a project’s goal
Relating these actions to cost and time criteria
Sorting out and defining the optimal path for reaching the goal
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18. Managing the Innovation Process (cont.)
Critical path method (CPM)
Goal is to determine:
Which particular tasks or activities of the many that have to be performed are critical in their effect on project time and cost
How to sequence or schedule critical tasks so that a project can meet a target date at minimum cost
Optimal sequencing of tasks is often worked out by a team
Analysis is an important learning tool
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19. Figure 13.2 - CPM Project Design
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20. Managing the Innovation Process (cont.)
Stage-gate development funnel
A structured and coherent innovation process that improves control over the product development effort
Forces managers to make choices among competing new product development projects so that resources are not spread thinly over too many projects
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21. Figure 13.3 - A Stage-Gate Development Funnel
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22. Managing the Innovation Process (cont.)
Stage 1: Funnel has a wide mouth to encourage as many new product ideas as possible from both new and established project managers
Stage 2: Specify all of the information required to make a decision about whether to go ahead with a full-blown product development effort
Stage 3: Proceed to development phase
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23. Managing the Innovation Process (cont.)
Cross-functional teams
Coordinating R&D function with other functions is critical but often difficult
New product development teams
Marketing, engineering, and manufacturing need to be core members of product teams
Core members - A nucleus of three to six people who bear primary responsibility for the product development effort
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24. Figure 13.4 - Innovation as a Cross-Functional Activity
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25. Managing the Innovation Process (cont.)
Team leadership
Having cross-functional teams is not sufficient for innovation – they have to be managed properly
Lightweight team leader - A mid-level functional manager who has lower status than the head of a functional department
Heavyweight team leader - A true project manager who has higher status within the organization
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26. Managing the Innovation Process (cont.)
Skunk works - a temporary task force that is created to expedite new product design and to promote innovation by coordinating the activities of functional groups
An island of innovation located away from the organization
Dissolved when the product is brought to market
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27. Managing the Innovation Process (cont.)
New venture divisions - A self-contained, independent division given the resources to develop a complete set of value-creating functions to manage a project from beginning to end
Assumes full responsibility for the commercialization of the product
Balance of control between the division and the corporate center is problematic
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28. Managing the Innovation Process (cont.)
Joint venture
Allows organizations to combine their skills and technologies and pool their resources to embark on risky R&D projects
Partners may disagree over future development plans
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29. Managing the Innovation Process (cont.)
Creating a culture for innovation
Organizational structure - Creating the right setting is important to fostering innovation
People – Organizations need to guard against too much similarity
Property rights – Create career paths to show that success is closely linked with future promotion and rewards
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30. Innovation and Information Technology
Information efficiencies: The cost and time savings that occur when IT allows employees to perform current tasks at a higher level
Enables employees to assume additional tasks
Enables employees to expand their roles in the organization due to advances in the ability to gather and analyze data also allows information efficiencies
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31. Innovation and Information Synergies
Information synergies: The knowledge building created when individuals or subunits pool their resources and collaborate across boundaries
Boundary-spanning activity: The interactions of people/groups across the organizational boundary to obtain valuable information and knowledge from the environment to help promote innovation
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32. IT and Organizational Structure and Culture
IT affects the innovation process through its many effects on organizational structure
IT gives lower-level employees more detailed and current knowledge of consumer and market trends and opportunities
IT can produce information synergies
Facilitates increased communication and coordination between decentralized decision makers and top managers
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33. IT and Organizational Structure and Culture (cont.)
IT means that fewer levels of managers are needed to handle problem solving and decision making
IT provides lower-level employees with more freedom to coordinate their actions
Information synergies may emerge as employees experiment and find better ways of performing their tasks
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34. IT and Organizational Structure and Culture (cont.)
IT facilitates the sharing of beliefs, values, and norms
Allows for the quick transmission of rich and detailed information between people and subunits
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35. Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America.
Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall
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