Case study questions Flashcards
Why are large firms more reluctant to open their innovation?
Larger companies rely on exploitation, whereas innovation emerges on the existing assets of the organization and improves them through innovation.
larger firms operate with large R&D departments or pilot plants and are reluctant to partner up with suppliers and customers. Another reason is that they don’t want to give away knowledge so that other people can copy it and lose their invested money in R&D.
They also are reluctant to change their business model. Bigger firms tend to stick to their original business models which makes them less flexible.
What are the benefits of fostering external focus on SMEs.? (The give and get) Can an external focus help a firm to increase its absorptive capacity? Explain why.
Businesses must understand and evaluate their performance from their own perspective and their counterparts. External SMEs have a different way of seeing things and experiences that may not be easily seen from within the organization.
SMEs can identify points of improvement within the organization and potentially enable innovation.
Absorptive capacity: “a firm’s ability to recognize the value of new information, assimilate it, and apply it to commercial ends”.
How can a firm use external collaboration for tweaking its business model?
It is proven that when companies are open to their customers and share knowledge that they can improve their processes substantially by letting customers understand what they work with.
Based on customer’s feedback, they can turn problems into opportunities like for example making more user-friendly data, creating real time, synchronized databases, creating applications,… . It’s a system of give and gets where in the end both parties can win from.
What are the main traps that organizations may face as a consequence of fostering exploration and exploitation?
The ‘perpetual search trap’ and ‘the success trap’.
The perpetual search trap is relating to discovering something new, but the organization does not have the patience or persistence to build on the new discovery or idea. Instead of looking on the long term benefits the organization potentially can achieve from this new idea, the organization looks at short term benefits.
The success trap is related to ‘doing business as usual’ because the organization is reluctant to innovate itself, as it’s difficult to change. Companies that have achieved success, may be in the risk of falling in this trap, because the organization sticks to what it has already done, because it has been proven to be successful in the past.
Why do you think some organizations become less innovative when they become more competent?
It can be challenging for organizations to put emphasis on both exploitation and exploration. The balancing between these two elements is difficult.
Organizations can find it difficult to be patient and look at the long-term perspectives when look specifically on innovate ideas and transitions.
What lessons would you give to a SME from a traditional industry that want to foster ambidexterity at the organizational level?
My advice would be for organizations to identify their competitive advantage and at the same time invest in innovation activities. From history, we have observed how companies only relying on exploitation has been outcompeted by innovative organizations, whereas finding the balance between exploitation and exploration is the key to success.
The strategic agility within the organization is vital for companies to have success on the long term. It is important for organizations to put forward a strategy for innovation processes to improve products and services, and at the same time focus on the current demand of their product or service.
Why do you think it is so hard for managers to give up fundamental part of their working day when introducing new changes in the organization design?
For organizations and managers ‘business as usual’ tends to be the way of doing business. Organizations are usually reluctant to change their business model, thus being more comfortable in following the business format as they have always done it.
For a manager in an organization, it can be challenging to maneuver around in new business contexts, as it requires personal and financial investments. A manager might not possess all the abilities it requires to change the organization’s design, hence educational offers might be necessary.
Fear of failing can also be a reason for managers to be reluctant in introducing new changes. Self-doubt can be created; hence the managers have no experience with these new practices. It is in human nature to resist change, however, innovation and new ways of doing business are vital for organizations to survive.
Globalization of Innovation: List the challenges of internationalization
- Increased risk of knowledge leakage
- Increased coordination costs
- Difficulty of communication
Globalization of Innovation: List the opportunities of globalization
- More and new resources
- Ideas and know-how
- Benefit from R&D spillovers
Name the six difference Innovation strategies
- Offensive strategy or proactive (offensive R&D, High risk innovation, high-profitability potential.
- Defensive strategy or reactive technological follower (defensive R&D, risk aversion, focus on improvements of others innovation.
- Opportunistic strategy (focusing on market niches).
- Dependent Strategy (technology acquisition, licenses & patents, technological transfer).
- Imitative Strategy (minimum degree of innovation).
- Traditional Strategy (no innovation).
