1. Process of Technological Change: Innovation
Narayanan: Chapter 3
Process of Technological Change: Innovation

2. Chapter objectives Innovation and its components
Variables that stimulate innovation
Four major types of innovation
Interrelationships between characteristics of technological change
Characteristics of innovative firms
Managerial implications of the dynamics of technical change.
egekwu-spring 2005

3. Dynamics of Tech. change
Firm level
problem recognition
technology choice
solution development(innovation&adoption)
commercialization and implementation
Technology level out of firm’s control
tech developers and facilitators, customers, regulators, others ...
egekwu-spring 2005

4. Implications to MOT as a result of dynamics
Identify two implications (relative to dynamics of technological change) for management of technology (MOT) using examples from your experience:
“The key to effective management of technology lies in linking technological solutions to market realities”
egekwu-spring 2005

5. Implications continued:
“Breakthroughs are hard to come by, and the financial payoffs have a tendency to go to someone other than the originator” Narayanan, p.59
“Make things that do what people expect them to. Build them to make these things easier rather than more complicated. Make them look and feel familiar” Eric Tucker, Tech. Review, April 2002
these three simple ideas rule out so much of what is envisioned for many tech products.
egekwu-spring 2005

6. Innovation
Definition - includes both output and the process of arriving at a technically feasible solution to a problem initiated by a technological opportunity or customer/societal need
Imitation
Innovation
Competitors
Adoption
Consumers
egekwu-spring 2005

7. Components of innovation
process refers to the means organizations use in achieving technological solution
output refers to the product or service that result from the innovation
hardware
software
evaluation information-a major activity during diffusion stage
egekwu-spring 2005

8. Drivers of innovation at the firm level
Market factors
response to market demands or competitive climate
Input factors
high labor costs can lead to investments in process technologies
expensive raw materials
egekwu-spring 2005

9. Question:Examples of Drivers of innovation
Give examples of innovation created by
market factors
input factors
egekwu-spring 2005

10. Process of innovation
Market pull innovations - specific market need necessitates tech advancement
tend to be incremental innovations
Technology-push innovations - advancement of technology directed towards increased technical performance of output
R&D efforts, and more frequent with new and emerging technologies.
egekwu-spring 2005

11. Innovation outputs: component knowledge Vs. component configuration
Incremental
Modular
Architectural
Radical
egekwu-spring 2005

12. 1. Evolution of technology- the changes to performance characteristics of a specific technology over time.
More complex than the 2 extremes of “inventor genius” or “orderly and planned process”
S-curve of technology evolution: stages
Emergence
Rapid improvement
Declining improvement
Maturity
egekwu-spring 2005

13. Evolution of technology
What are some performance characteristics?
S-curve impact of technology performance
Learning processes (refer to stages of product development)
Technology limits
egekwu-spring 2005

14. 2. Technology progression - process by which existing technologies become obsolete
Radical breakthrough - mostly a chance occurrence
Accumulation of learning/knowledge about technology
egekwu-spring 2005

15. 3. Levels of technology development
Does innovation always follow/begin with need identification?
There is often a lag between an invention and its application (innovation)
Major technological advances result from clusters of innovations
egekwu-spring 2005

16. Technology change agents
Federal and State research institutions (labs, NASA)
Private research entities – Batelle, universities, etc.
Entrepreneurs and others
egekwu-spring 2005

17. Characteristics of innovative firms
Entrepreneurial innovation
Managed innovation
Internal organizational characteristics – formalization, centralization,
Resources
Openness to external information
Informal internal communication
egekwu-spring 2005

18. Imparts of environmental trends on innovation
Globalization
Time Compression
Technology integration – advanced systems engineering skills are still rare
egekwu-spring 2005