Innovation Entrepreneurship & Born Global Flashcards
Innovation:
the establishment of new methods of production, supply & distribution;
the introduction of changes in management, work organisation, working conditions & skills of workforce
Entrepreneurship:
Capability and motivation to pursue innovative commercial opportunities that are riskier & more radical than normal
Resource-Based View:
The firm’s competitive advantage comes from its set of idiosyncratic & immobile strategic resources & capabilities
Resources
are what a firm draws upon to create value; not necessarily firm-specific i.e. CSAs or FSAs (tangible – e.g. financial assets, human capital, land, etc. or intangible Intellectual Property, knowledge, reputation, culture).
Firm-specific resources should be:
Valuable (add value sustainably)
Rare (not unique, but comparatively dissimilar to competitors)
Imperfectly imitable (hard to copy)
Organization-based (can firm be organised to exploit benefits?)
Capabilities
come from bundling resources together in ways which modify, reconfigure and leverage them to create competitive advantage; always firm-specific (FSAs) e.g. R&D skills, process efficiency, marketing knowledge & responsiveness
Dynamic capability:
The firm’s ability to integrate, build, and reconfigure internal and external competences to address rapidly changing environments
- Quick/incremental learning
- Integration of new assets/radical learning
- Modification & transformation of new assets
Lifecycle models
show lack of capital, people & expertise mean growth, diversification, economies of scale, & R&D difficult for SMEs
SMEs may need
agility, sensing & adapting quickly to new or temporary opportunities to maintain competitive advantage (e.g. New technology or consumer fads)
core dynamic capability of the innovative/ entrepreneurial firm
may be creating, developing & leveraging personal networks & clusters
-Consist of critical mass of entrepreneurs, venture capitalists, specialist suppliers & contractors; plus risk-embracing trial-&-error culture = self-reinforcing local growth cycle
Systems of Innovation
are based on interactions between the various components of inventions, research, technical change, learning and innovation
National Systems of Innovation (NSI):
firms & their home country environment interact & function as a ‘system’. Countries provide firms with CSAs through the ‘glue’ of formal (e.g. Intellectual property rights laws, relationships between firms, universities & government researchers) & informal (e.g. local scientific, technological, design & creative expertise & networks) institutions
Asset-augmenting:
Exploiting cheaper/better Inputs (e.g. materials, labour, technology, knowledge, R&D) to cut costs or improve products & services
Asset-exploiting:
Adapting Outputs (products, processes & services) for new markets to increase sales
Three generic forms of innovation activities:
- Sensing opportunities for innovation (e.g. new drugs to cure diseases; faster computer chips)
- Responding (e.g. allocating investment, establishing project teams)
- Implementing the innovation (new or changed products & services)
