Keywords Flashcards
Technology push (Tidd)
Applications and refinements which eventually found their way to the marketplace
Need pull (Tidd)
The market signaled needs for something new which then drew out new solutions to the problem (necessity becomes the mother of invention)
Shock trigger innovations (Tidd)
Change happens when people or organizations reach a threshold of opportunity or dissatisfaction
Ideas proliferate (Tidd)
After starting out in a single direction, the process proliferates into multiple, divergent progressions
Fluid phase (Tidd)
High uncertainty along two dimensions
Target: What will the new configuration be and who will want it?
Technical: How will we harness new technological knowledge to create and deliver this?
No one knows the right configuration, there is extensive experimentation and fast learning by a range of players
Dominant design (Tidd)
Something which begins to set up the new rules of the game
Technological trajectory (Tidd)
A ‘bandwagon’ begins to roll and innovation options become increasingly channelled around a core set of possibilities
Sailing ship effect (Tidd)
A mature technology accelerates its rate of improvement as a response to competition with new alternatives, as was the case with the development of sailing ships in competition with newly emerging steamship technology
Strong ties (Tidd)
Close and consistent relationships with regular partners in a network
Incentives and Pressures that influence the rate and direction of technological innovation (Tidd)
- Patterns of national demands: Strong local ‘demand pull’ for certain types of products, generates innovation opportunities for local firms (investment activities, production input prices, local natural resources)
- Competitive rivalry: Stimulates firms to invest in innovation and change, because their existence will be threatened if they don’t
Competencies in Production and Research that influence the rate and direction of technological innovation (Tidd)
The incentives and pressures will not result in innovation unless firms have the competencies that enable them to respond.
- Seek support in new knowledge/open innovation (universities and research centers)
- Leverage the network of the company (the whole is greater than the sum of its parts)
9 factors that influence the firm’s capacity to benefit commercially from its technology (Tidd)
- Secrecy: But, it is unlikely to provide absolute protection. Also, firms that share their knowledge outperform those that do not
- Accumulated tacit (understood/implied without being stated) knowledge: When closely integrated in firms, it can be long and difficult to imitate (Italian firms in clothing, Rolls-Royce in aircraft engines)
- Lead times and after-sales service: Protection against imitation by higher cost of entry for imitators. It can establish brand loyalty and credibility, accelerate feedback from customer use to product improvement and learning curve cost advantages
- The learning curve: Lower cost and powerful form of tacit knowledge that is well recognized by practitioners. The first-comer advantage
- Complementary assets: Production, marketing and after-sales to complement the technology
- Product complexity: Long lead times (imitation of planes takes very long), it is an effective barrier to imitation
- Standards: Widespread acceptance of a company’s product standard widens its own market and raises barriers against competitors
- Pioneering radical new products: Not always an advantage because of the risk. Success goes to the ‘early entrants’ with the vision, patience and flexibility to establish a mass consumer market
- Strength of patent protection: They are judged to be more effective than process innovations in protecting product innovations
5 factors that affect the rate and extent of adoption of an innovation (Tidd)
- Relative advantage: Degree to which an innovation is perceived to be better than the product it supersedes, or competing products (convenience, satisfaction, social prestige etc.) The greater the perceived advantage, the faster the rate of adoption
- Compatibility: Degree to which an innovation is perceived to be consistent with the existing values, experience and needs of potential adopters (availability of information, skilled users, technical assistance and maintenance)
- Complexity: Degree to which an innovation is perceived to be difficult to understand or use. Simple to understand = more rapid adoption
- Trialability: Degree to which an innovation can be experimented with on a limited basis. More learning by doing = more rapid adoption
- Observability: Degree to which the results of an innovation are visible to others. Easier to see the benefits of an innovation = more likely to be adopted
What are demand-side (statistical) and supply-side (sociological) models? (Tidd)
Demand-side
o Epidemic, based on direct contact with or imitation of prior adopters
o Bass, based on adopters consisting of innovators and imitators
o Probit, based on adopters with different benefit thresholds
o Bayesion, based on adopters with different perceptions of benefits and risk
Supply-side
o Appropriability, which emphasizes relative advantage of an innovation
o Dissemination, which emphasizes the availability of information
o Utilization, which emphasizes the reduction of barriers to use
o Communication, which emphasizes feedback between developers and users
What are the conclusions (Tidd)
- We need to identify more fruitful ways to begin a more constructive dialogue between pharmaceutical innovation research, policy and practice. There is scope for disruptive innovation from discontinuous technological (e.g. biotechnology), and market changes (funding and regulation of healthcare), but the current conceptualization of innovation in the sector and relationships between actors are likely to simply reinforce historical shortcomings.
- A shift away from an emphasis on inputs, such as the science base and radical technological advances, towards a more balanced support for the whole innovation process, which includes development and diffusion of all types of innovation – technological, commercial, and organizational.
- The assumption that innovation is the consequence of coupling technological opportunity and market demand is too limited. It needs to include the less obvious social concerns, expectations and pressures. These may appear to contradict stronger, but misleading market signals.
- Cumulative incremental improvements to platform technologies often create significant commercial and social benefits.
- Long-term investments in and development of organizational processes and capabilities are necessary to translate scientific and technological opportunities into successful new products and services that are widely adopted and supported.
- An equal and sometimes greater emphasis is needed on the outputs of the innovation process, specifically the processes of diffusion and adoption of innovations. This includes non-zero-sum issues of commercial appropriability and social externalities.
Performance trajectories (Bower & Christensen, 1995)
The rate at which the performance of a product has improved and is expected to improve over time
Sustaining technologies (Bower & Christensen, 1995)
Maintain a rate of improvement, they give customers something more or better in the attributes they already value
Disruptive technologies (Bower & Christensen, 1995)
Introduce a very different package of attributes from the one mainstream customers historically value and they often perform far worse along one or two dimensions that are particularly important to those customers.
Financial managers will rarely support it, technical personnel will likely do support it
Upmarket (Bower & Christensen, 1995)
Most established companies have higher cost structures to serve sustaining technologies with high(er) profit margins
Downmarket (Bower & Christensen, 1995)
Disruptive technologies with lower profit margins of the emerging markets
Method for spotting and cultivating disruptive technologies (Bower & Christensen, 1995)
- Determine whether the technology is disruptive or sustaining
- Define the strategic significance of the disruptive technology
- Locate the initial market for the disruptive technology
- Place responsibility for building a disruptive technology business in an independent organization
- Keep the disruptive organization independent
Technology S-curve (Ettlie)
Captures the “potential for technological improvement … resulting from a given amount of engineering effort,” which varies over time. First gradual and then rapid improvement of a product’s performance.
Can be used to forecast technology
Radical technology (Ettlie)
Length of time it takes to be truly different and produce something new to the world
Innovativeness (Ettlie)
A relative construct, relative to time, content (e.g. the firm may be innovative to production process but not product etc.) and reference domain (internal vs external), that is, compared to the firms various units, the industry, industry in general or other countries or economic regions.