Innovation in Industries
WHAT IS AN INNOVATION?
❖ It is an idea, practice, or object that is perceived as new by an individual or other unit of adoption.
❖ It is a use of new knowledge to offer a new product or service that customers want. Thus, it is
Invention + Commercialization. “Innovation is the search for and the discovery, development,
improvement, adoption, and commercialization of new processes, new products, and new
organizational structures and procedures.
CHARACTERISTICS OF INNOVATION
❖ There is an object or target which is being changed.
❖ It can be a product, a process, an individual’s lifestyle, an organization's strategy, or a society’s
culture.
❖ Innovation varies in extent or magnitude i.e. degree to which one deviates from the past.
❖ It is closely related to problem-solving since the generation & implementation of ideas for change
never transpire without difficulty.
, ❖ A final characteristic is the impact of the change and the significance or range of its effects.
GOALS OF INNOVATION
◼ Improving quality
◼ Creation of new markets
◼ Extension of the product range
◼ Reducing labor cost
◼ Improving production process
◼ Reducing materials
◼ Reducing environmental damage
◼ Replacement of products/services
◼ Reducing energy consumption
◼ Conformance to regulations
SOURCES OF INNOVATION
➢ Organizational Structure. - Organic structures positively influence innovation. As there is lower
vertical differentiation, formalization, and centralization. Organic organizations facilitate flexibility,
adaptation & cross-fertilization.
➢ Long tenure in Management - Managerial tenure apparently provides legitimacy & knowledge of how
to accomplish a task and obtain desired outcomes.
➢ Slack Resources - Having an abundance of resources allows an organization to afford to purchase
innovations, bear the cost of instituting innovations & absorb failures.
➢ Interunit Communications - Innovative organizations are high users of committees, task forces, and
cross-functional teams that facilitate interaction across departmental lines.
TYPES OF INNOVATION
▪ Product & Process Innovation
▪ Open & Closed Innovation
▪ Incremental & Radical Innovation
▪ Modular and Architectural Innovation
WHAT IS AN INNOVATION?
❖ It is an idea, practice, or object that is perceived as new by an individual or other unit of adoption.
❖ It is a use of new knowledge to offer a new product or service that customers want. Thus, it is
Invention + Commercialization. “Innovation is the search for and the discovery, development,
improvement, adoption, and commercialization of new processes, new products, and new
organizational structures and procedures.
CHARACTERISTICS OF INNOVATION
❖ There is an object or target which is being changed.
❖ It can be a product, a process, an individual’s lifestyle, an organization's strategy, or a society’s
culture.
❖ Innovation varies in extent or magnitude i.e. degree to which one deviates from the past.
❖ It is closely related to problem-solving since the generation & implementation of ideas for change
never transpire without difficulty.
, ❖ A final characteristic is the impact of the change and the significance or range of its effects.
GOALS OF INNOVATION
◼ Improving quality
◼ Creation of new markets
◼ Extension of the product range
◼ Reducing labor cost
◼ Improving production process
◼ Reducing materials
◼ Reducing environmental damage
◼ Replacement of products/services
◼ Reducing energy consumption
◼ Conformance to regulations
SOURCES OF INNOVATION
➢ Organizational Structure. - Organic structures positively influence innovation. As there is lower
vertical differentiation, formalization, and centralization. Organic organizations facilitate flexibility,
adaptation & cross-fertilization.
➢ Long tenure in Management - Managerial tenure apparently provides legitimacy & knowledge of how
to accomplish a task and obtain desired outcomes.
➢ Slack Resources - Having an abundance of resources allows an organization to afford to purchase
innovations, bear the cost of instituting innovations & absorb failures.
➢ Interunit Communications - Innovative organizations are high users of committees, task forces, and
cross-functional teams that facilitate interaction across departmental lines.
TYPES OF INNOVATION
▪ Product & Process Innovation
▪ Open & Closed Innovation
▪ Incremental & Radical Innovation
▪ Modular and Architectural Innovation
