Lectures Flashcards by Jasper van Loon

What are the 5 types of innovation by Schumpeter (1883 - 1950)?

Products
Methods of production
Sources of supply
Exploitation of new markets
New ways to organize business

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What are the 4 types of innovation by The Oslo Manual for measuring innovation?

Product innovation: A good or service that is new or significantly improved. This includes significant improvements in technical specifications, components and materials, software in the product, user friendliness or other functional characteristics
E.g. going into the cloud is an improvement in technical specifications
Process innovation: A new or significantly improved production or delivery method. This includes significant changes in techniques, equipment and/or software
E.g. going into the cloud is enhancing the process from hardware to online software, digital security etc.
Marketing innovation: A new marketing method involving significant changes in product design or packaging, product placement, product promotion or pricing
E.g. going into the cloud creates faster engagement with customers
Organizational innovation: A new organizational method in business practices, workplace organization or external relations
E.g. going into the cloud means we need to make a new department for cloud and cyber security

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Why is an innovation not always succesful from day 1

It should keep developing. You need people that want to use it. Otherwise, you will always keep improving the product without use (motivation)

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What is the role of IS and IT in innovation?

Information Systems (Digital Transformation): The combination of technologies (what), people (who) and processes (how) that an organization uses to produce and manage information
Information Technologies (Digitization): All forms of technology used to create, store, exchange and use information: Computers, network, mobile phones etc.

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Why are trends and innovation not always the same?

You need to look at the performance, does it deliver something? Does it create a Digital Transformation?

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What determines the performance?

Business strategy: Management, Innovation and IT trends
Organizational strategy: Sourcing Project Management, Organizational change and Cultural/social values
Information strategy: Resources/planning, IT Governance, Alignment and Security/Privacy

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Why is innovation a business? What are the 4 pillars?

Because it is linked to performance, to improve companies’ performance. A great innovation without the pillars: Knowledge, People, Process and Collaboration is not going to work

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What are traits of innovative personalities? (Bill Gates, Elon Musk etc.)

If I heard about a new information technology, I would look for ways to experiment with it
Among my peers, I am usually the first to try out new information technologies
In general. I am hesitant to try out new information technologies
I like to experiment with new information technologies

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What are the 4 waves of innovation in IT?

Development (hard engineering –> intellectual property)

Mid 80s PC: Spreadsheets and word processors, PC architecture, MS-DOS
Late 80s - Mid 90s Applications: Mouse, GUI, LANs

Adoption (intellectual property –> customer benefit)

Mid 90s Internet: XML/SOAP, HTTP/HTML, SMTP, Email clients, web browsers
Mid 00s - future Client + Cloud: Manycore processors, Web Services/Mashups, Wi-Fi/broadband, Fully Productive Computing, Software + Services

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What is the shortcoming of privacy laws?

It became an audit/compliance thing, the company not wanting to get a fine.
It’s not about the protection of the citizens anymore
Too much regulation could kill innovation

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Why is Digital Transformation bullshit?

As soon as there is a “new trend” – well, some dorks still think it’s a hype – a whole bunch of new experts is lining up too, offering you all their shallow buzzword wisdom and silver bullets or fail-safe new methods

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What is Digital Transformation? (Gartner)

Digital transformation can refer to anything from IT modernization (for example, cloud computing), to digital optimization, to the invention of new digital business models. The term is widely used in public-sector organizations to refer to modest initiatives such as putting services online or legacy modernization. Thus, the term is more like “digitization” than “digital business transformation.”

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What is Digital Transformation? (Hinings et al, 2018)

The combined effects of several digital innovations bringing about novel actors (and actor constellations), structures, practices, values, and beliefs that change, threaten, replace or complement existing rules of the game within organizations, ecosystems, industries or fields

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What is Digital Transformation? (Nambisan et al, 2017)

3) The creation of (and consequent change in) market offerings, business processes, or models that result from the use of digital technology. Stated differently, in digital innovation, digital technologies and associated digitizing processes form an innate part of the new idea and/or its development, diffusion, or assimilation

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What is Digital Transformation? (Yoo et al, 2010)

4) Following Schumpeter (1934), we define digital innovation as the carrying out of new combinations of digital and physical components to produce novel products. Our use of the term digital innovation thus implies a focus on product innovation, distinguishing it from extant IT innovation research that has been primarily occupied with process innovation

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What is meant by digital innovation?

The use of technology in a wide range of innovation
A necessary but insufficient condition for digital innovation is that the new combination relies on digitization, i.e., the encoding of analog information into digital format. Digitization makes physical products programmable, addressable, sensible, communicable, memorable, traceable, and associable.

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What is meant by digital? (Yoo et al, 2010)

The conversion from mainly analog information into the binary language understood by computer (The digitization of the book)

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What are the 5 Digital Innovation elements to memorize?

A range of innovation outcomes, such as new products, platforms, and services as well as new customer experiences and other value pathways; as long as these outcomes are made possible through the use of digital technologies and digitized processes, the outcomes themselves do not need to be digital.
Zoom/Canvas is digital, but the outcome is not a new product/technology. It brings a new way of education that is made possible through technology. So, the innovation outcome and the outcome are (not) always the same.
A broad swath of digital tools and infrastructure (e.g., 3D printing, data analytics, mobile computing, etc.) for making innovation possible.
The possibility that the outcomes may be diffused, assimilated, or adapted to specific use contexts such as typically experienced with digital platforms.
If the doctor/patient don’t want to use the new amazing health innovation, it won’t be used regardless of how good it is.
You can’t have one system/platform that fits all, that why you need to think in contexts. To what level is innovation/digital transformation possible in this context?
Therefore….digital innovation is about the concerted orchestration of new products, new processes, new services, new platforms, or even new business models in a given context (e.g., organizational, firms, institution) and
Orchestration is a very important term (everything needs to work together)
Digital innovation furthermore requires a firm/institution/organization to revisit its organizing logic and its use of corporate IT infrastructures.
You need governance to launch innovation

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What are the 4 types/zones of innovation networks?

X-axis: Similar to heterogeneous
Y-axis: Incremental innovation to radical innovation

Zone 1 (Similar and Incremental):

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What are the 4 types/zones of innovation networks?

X-axis: Similar to heterogeneous
Y-axis: Incremental innovation to radical innovation

Zone 1 (Similar and Incremental): Sector forums, supply chain learning programmes
Zone 2 (Similar and Radical): Strategic alliance or sector consortium to develop new drug delivery systems
Zone 3 (Heterogeneous and Radical): Multi-company innovation networks in complex product systems
Zone 4 (Heteregeneous and Incremental): Regional clusters, “best practice” clubs. Best practices are more like protocols and procedures, it is not new/innovative

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What are the 4 types/zones of innovation networks?

X-axis: Similar to heterogeneous
Y-axis: Incremental innovation to radical innovation

Zone 1 (Similar and Incremental): Sector forums, supply chain learning programmes
Zone 2 (Similar and Radical): Strategic alliance or sector consortium to develop new drug delivery systems
Zone 3 (Heterogeneous and Radical): Multi-company innovation networks in complex product systems
Zone 4 (Heteregeneous and Incremental): Regional clusters, “best practice” clubs. Best practices are more like protocols and procedures, it is not new/innovative

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What is true about the (old school) Organizational Theories of Innovation?

Innovation itself started from these theories and it is getting developed further
They are overlapping each other
All of the models are right under a specific lens

What is the Technology S-curve? (Christensen, 1992)

X-axis: Measure of applied effort (resources, people, money, technology etc.)
Y-axis: Measure of advancement

Captures the potential for technological improvement … resulting from a given amount of engineering efforts which varies over time
Potential at the beginning of the life cycle is great and then increasing engineering effort has diminishing returns to performance of the technology
“Natural or physical limit”
Cumulative learning process
Shows incremental vs radical innovation

What is the difference between the natural and physical limit?

Natural: Organic, our human limt (we are not ready to cope with it/accept it)
Physical: The limitation of the technology of some element
Most of the times, the natural follows the physical

What is radical technology?

The length of time it takes to be truly different and produce something new to the world

Questions to ask yourself to determine if it is radical and on what scale:

New to the world?
New to the industry?
New to the company/significant upgrade of an existing product?

Also, is the outcome radical? You can have an incremental change that will lead to a radical outcome improvement

What is radical technology?

The length of time it takes to be truly different and produce something new to the world

Questions to ask yourself to determine if it is radical and on what scale:

New to the world?
New to the industry?
New to the company/significant upgrade of an existing product?

Also, is the outcome radical? You can have an incremental change that will lead to a radical outcome improvement

What are the Dimensions of Innovation Space?

X-axis: What is changed (Product, Service, Process)
Y-axis: Perceived extent of change (Incremental, Radical, Transformation)

Radical change occurs if organizations or field move from one in-use organizing pattern encompassing practices, structures and values to another.

Perceived because the subjective idea depends on the stakeholder

Process Transformation is the goal (top right of the model)

What is technological forecasting?

Predicting trends and trajectories
The technology that is being forecast
The time of the forecast
A statement of characteristics of the technology
A statement of the probability associated with the forecast
Logistic curve

The goal is to predict (e.g. the breakthrough in the S-curve)
Is it going to be a hype or trend
Important to focus on one thing at a time

This is more objective (they try to measure it)

What is Punctuated Equilibrium? (Tushman and Anderson, 1994)

Newcomers initiate competence destroying technological changes, whereas existing firms use competence enhancing technology
Organizations that initiate major technological innovations have higher growth rates than others firms in that product class
Until a dominant design emerges in the competition there is considerable competitive turmoil, later reduced to relative calm when the current standard emerges in an industry and shake out abates

When do I need to stop putting effort in the innovation, to keep the company at the top. When will we be disrupted by a new breakthrough?

Developed as an alternative to phyletic gradualism, which stresses consistent, cumulative changes to species.

Existing firms use competence enhancing technology: ASML is constantly enhancing in their niche. But we know, he is not always going to stay on top

After a change, there is going to be a natural/physical limit which keeps it stable

What is Statis, Punctuation and Dominant Relative Frequency? (Eldridge and Gould, 1972)

X-axis: Time
Y-axis: Evolution

Statis: A long period of relatively unchanged form
Punctuation: Radical change over a short duration
Dominant Relative Frequency: The rate these events occur in a particular situation

What is Statis, Punctuation and Dominant Relative Frequency? (Eldridge and Gould, 1972)

X-axis: Time
Y-axis: Evolution

Statis: A long period of relatively unchanged form
Punctuation: Radical change over a short duration
Dominant Relative Frequency: The rate these events occur in a particular situation

What is Analogy… The Jolt Theory of Change?

X-axis: Time
Y-axis: Extent of Organizational Transformation

Evolutionary zone: Transition State I & II
Then, Radical De-stabilisation occurs
Revolutionary zone: Transition State III & IV

Shows the organization’s transition changes and is a exponential continuum of organizational adaptation

What is Diffusion of Innovation and Adoption? (Rogers, 1962)

Innovators: 2.5%
Early Adopters: 13.5%
Early Majority: 34%
Late Majority: 34%
Laggards: 16%

Diffusion or spread of ideas in social systems
Effect of social contagion
Depending on Geography: National specific regulatory regime
Adoption becomes a way of demonstrating organizational legitimacy through copying other organizations (mimetic isomorphism), or is legislated because of that societal legitimacy (coercive legitimacy) or is diffused as the appropriate professional standard (normative legitimacy).
This speaks to the impact of socio-cultural beliefs on the adoption of innovations and consequent organizational change.
IT people always look at this curve for the adoption of their new technology

What are Disruptive Technologies?

X-axis: Time
Y-axis: Performance
The performance of the disruptive technology grows hard to the performance improvement required by mainstream market and eventually surpasses it

Disrupt business model of leading companies
Do not address needs of leading customers in existing markets
Companies can’t sell to their best, most profitable customers
A new product/service, judged worse by mainstream customers
Have other attributes that enable new markets to emerge
Improve so rapidly that they ultimately address the needs of mainstream customers as well

What is the Evolution of the Productive Segment? (Abernathy & Wayne, Utterback & Wayne)

X-axis: Fluid phase, Traditional phase, specific phase
Y-axis: Rate of Major Innovation

Successful firms tend to invest heavily in product R&D early in the life cycle of an industry or product group
Interesting framework to compare the results of investments in manufacturing innovation
Best choice maybe to slow or reverse evolutionary progress or to remain in that particular stage which offers the best trade-off between conflicting objectives (aof adaptability and innovativeness vs. higher productive rates

What is the Evolution of the Productive Segment? (Abernathy & Wayne, Utterback & Wayne)

X-axis: Fluid phase, Traditional phase, specific phase
Y-axis: Rate of Major Innovation

Successful firms tend to invest heavily in product R&D early in the life cycle of an industry or product group
Interesting framework to compare the results of investments in manufacturing innovation
Best choice maybe to slow or reverse evolutionary progress or to remain in that particular stage which offers the best trade-off between conflicting objectives (of adaptability and innovativeness vs. higher productive rates

What is the Computer Science + Von Neumann theory? (see Yoo et al, 2010)

Digital technology’s transformative impact on industrial-age products has remained surprisingly unnoticed in the IS literature.
Should focus more on arrangement of functional elements, the mapping from functional elements to physical components (hardware), and the specification of interfaces among components (Ulrich 1995, p. 420)—affect a firm’s strategic choices and related IT deployments.
Neither has the literature considered the emergence of new organizing logics—i.e., the “managerial rationale for designing and evolving specific organizational arrangements in response to an enterprise’s environmental and strategic imperatives” (Sambamurthy and Zmud2000, p. 107)—spurred by changes in product architecture because of digital technology. This is unfortunate because changes in product architecture and organizing logic reshape the landscape of IS strategy and use in firms.
The model starts from products (innovation), from there on reshape your organization
This is the vision from Weigand, Caron, Iannaou (they are from Computer Science)
Top-down approach

The problem must be steered by the IS architecture in this article

What is the Organizational and Institutional theory? (See Nambisan)

Organizational (parallel): Change the organization to reach a specific digital innovation outcome
Institutional: We are dealing not with one technology, but with several technologies, each with its historical pattern of developement, skill requirements and strategic implications

Organizations are not purely rational systems of producing goods and services, adapting to an environment of suppliers, consumers, and competitors.
They are themselves social and cultural systems that are embedded within an “institutional” context of social expectations and prescriptions about what constitutes appropriate (“legitimate”) behavior.
Institutional perspective, organizations cannot be understood without taking account of the influence of this institutional context.
Organizations are seriously constrained by social expectations and the social approval -legitimacy - of particular actions and ways of organizing

The impact of the board of directors, governance (alignment, auditing), shareholders/stakeholders
All these norms and systems are different in firms, industries and cultural backgrounds

What are the 7 pillars of the Organizational theory?

Initiate: Identify, assimilate and apply valuable knowledge from inside and outside the firm pertaining to problems and opportunities amenable to digital innovation
Develop: Design and develop a new information system, customize an existing solution, adop a pre-existing solution
Implement: Install and maintain IS from both a technical and an organizational perspective, including new governance systems, training and processes
Exploit: Leverage existing IS for maximal value. Reuse existing systems, data etc. for new purposes
Internal organizational environment: The organizational backdrop, including business strategies, cultures, knowledge management and ways of doing
External competitive environment: The competitive marketplace within which firm is embedded, including fads, fashions and consumer segments
Outcomes: Eiter projected or actual new business processes, products and services because of digital innovation

What are the 6 pillars of the institutional theory?

Digitally-enabled novel institutional arrangements:
Novel digital forms of organizing: Digitally-enabled arrangement of practices, structures and values constituting an organization’s core and that is appropriate in a given institutional context (AirBnB, Uber)
Novel digital institutional infrastructures: Standard-setting digital technologies enabling, constraiting and coordinating numerous actors’ actions and interactions in ecosystems, fields or industries (Product platforms, Blockchain)
Novel digital institutional building blocks: Generally-accepted, ready-made or customizable modules encompassing sets of digital technologies for running or creating an organization (ERP, Square, Wordpress)

Existing institutional arrangements:
Existing forms of organizing
Existing institutional infrastructures
Existing institutional building blocks

What are the 6 pillars of the institutional theory?

Existing institutional arrangements:
Existing forms of organizing
Existing institutional infrastructures
Existing institutional building blocks

First, start at looking at the firm to understand what has to be done (existing institutional arrangements)
Police need legal support in order to make picture of an accident, this wasn’t possible with the new technology. Then the feedback loop goes back (building block) and this has to be changed

What are the 6 pillars of the institutional theory?

Existing institutional arrangements:
Existing forms of organizing
Existing institutional infrastructures
Existing institutional building blocks

First, start bylooking at the firm to understand what has to be done (existing institutional arrangements)
Police need legal support in order to make picture of an accident, this wasn’t possible with the new technology. Then the feedback loop goes back (building block) and this has to be changed

What are the socio-cultural aspects?

By emphasizing the socio-cultural aspects of organizing, institutional theory has developed a particular approach to understanding change and innovation.
There are two aspects to this approach: one is to hold in tension the relationship between stasis and change, seeing continuity and homogeneity as well as change and heterogeneity amongst organizations.
The other is to understand change and stasis as an outcome of structures, activities and actions at multiple levels of analysis, societal, field, organization and individual.
These two approaches produce a richness and a complexity to understanding innovation at the level of new products, services and processes, but also, and perhaps more importantly, an emphasis on issues of digital transformation or radical change

What are the socio-cultural aspects?

By emphasizing the socio-cultural aspects of organizing, institutional theory has developed a particular approach to understanding change and innovation.
There are two aspects to this approach: one is to hold in tension the relationship between stasis and change, seeing continuity and homogeneity as well as change and heterogeneity amongst organizations.
The other is to understand change and stasis as an outcome of structures, activities and actions at multiple levels of analysis, societal, field, organization and individual.
These two approaches produce a richness and a complexity to understanding innovation at the level of new products, services and processes, but also, and perhaps more importantly, an emphasis on issues of digital transformation or radical change

What is national advantages in technological accumulation?

National advantages in natural resources and traditional industries have been fused with related competencies in broad technological fields that then become the basis for technological advantage in new product fields.
E.g. raw materials, % of employment in innovative firms, spending on education, level of business ownership (entrepreneurship), government support for R&D etc.
These have an impact on country performance (growth, job creation, competitiveness)

What are the 11 sources of discontinuity (Tanaka business school)

New markets
New technologies
New political rules
Market exhaustion
Sea change in market sentiment or behavior
Deregulation/shifts in regulatory regime
Fractures along ‘fault lines’
Unthinkable events
Shifts in ‘techno-economic paradigm’ - systematic changes which impact whole sectors or even whole societies
Architectural innovation

What are the 11 sources of discontinuity (Tanaka business school)

New markets
New technologies
New political rules
Market exhaustion
Sea change in market sentiment or behavior
Deregulation/shifts in regulatory regime
Fractures along ‘fault lines’
Unthinkable events
Shifts in ‘techno-economic paradigm’ - systematic changes which impact whole sectors or even whole societies
Architectural innovation

What is (digital) Innovation Management?

Definition: Digital innovation management refers to the practices, processes, and principles that underlie the effective orchestration of digital innovation
Prior studies on innovation management, have, by and large, presupposed a fixed, discrete set of boundaries and features for the new product (or service) idea that underlies a market opportunity (e.g., Ulrich and Eppinger 2011). The scope, features and value of digital offerings can continue to evolve even after the innovation has been launched or implemented. Most digital designs remain somewhat incomplete and in a state of flux (INCREMENTIAL INNOVATION, see Yoo et al., 2010)
Thus, this imparts an unprecedented level of unpredictability and dynamism with regard to assumed structural or organizational boundaries of the digital innovation, be it a product, platform, or service. Boundaries on what is or is not an innovation outcome have become more porous and fluid.

What is flux, porous and fluid?

The old vision was boundaries (fixed, discrete etc.)
But now, in DT and I it has become more porous and fluid. A product is never complete, you keep adding changes and enhancements. By this, you can create a form of disruption at your own product

How do academics see the trends as opposed to Gartner?

A. Innovation processes, in addition to outcomes, also have become less bounded, in terms of their temporal structure.
B. The digitization of innovation processes helps to break down the boundaries between different innovation phases and brings a greater level of unpredictability and overlap in their time horizons.
C. New digital infrastructures (e.g., 3D printing, digital makerspaces, etc.) enable product ideas to be quickly formed, enacted, modified, and reenacted through repeated cycles of experimentation and implementation (Ries2011), making it less clear as to when a particular innovation process phase starts and/or ends.
D. Similarly, digital infrastructures (e.g., cloud computing) facilitate rapid scaling up (or down) of product implementation plans. These create a new level of fluidity in innovation processes, allowing them to unfold in a nonlinear fashion across time and space.
E. Less bounded innovation outcomes and processes also reflect newer success criteria (for example, ones that reflect the potential for radical rescoping of the product, community based generativity, platform-based network effects, etc.)

A: Measure of applied effort or time
B: Sometimes breakthrough can become disruption, depending on where you stand from
C: Enacted = being put together. They don’t talk about DT directly but about enactment and reenactment (to work differently). This is another way to view DT. There are no boundaries. It is an incremental process (Tetris)  it is getting faster and faster and the shape is getting more complex. That is the same in software development, you always have to change the elements. A gap/problem in software can disrupt
D: Also, Tetris. Agility is bullshit, you need to have a good plan/roadmap/spectrum etc. When you reach a platform that can’t get higher, agility can help
E: The breakthrough can lead to rescoping, COVID (external event) took us to blended learning (online). It changed our institution and it will likely (partly) will keep being used more

Why are robots replacing human workers?

Cheap and getting cheaper
More reliable than humans
More accurate than humans
Used for a wide range of tasks
o On the assembly line
o In warehouses
o Da Vinci surgical robotic systems
Getting safer
o Numerous fatalities in the past
o Proximity sensing systems
o Training for human-robot teams
But, people are still needed

How to have a mindful attitude towards technology?

Make users aware of how to mindfully use IT tools (and avoid unintended consequences)
Develop better policy making
Ensure adequate testing of technology
Be aware of next technological waves
Control investment in technologies, in balance with innovation
Keep learning…and developing key skills.. these that cannot be automatized!

What are Mason’s areas of managerial concern (1995)

Privacy

What information must a person reveal about one’s self to others?
What information should others be able to access about you - with or without your permission?
What safeguards exist for your protection?

Accuracy

Who is responsible for the reliability and accuracy of information?
Who will be accountable for errors?

Property

Who owns information?
Who owns the channels of distribution, and how should they be regulated?

Accessibility
- What information does a person or an organization have a right to obtain, under what conditions and with what safeguards?

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