I&K Memory

I&K course litterature structured according to the 5 themes.

1: Basics of Innovation 1. Schilling Ch 1.

Ved brændeskuret Esb.

Catwoman

(=Schilling) og Gollum

rundt om et træ hvor Steve Jobs

(=approriability) bygger et hegn

(=innovation) som står og sælger æbler

til en kø af Paris Hilton’er , som kun vil have æblerne fra træet (=new innovations) ikke dem fra jorden (=old products). (=more than one-third of their sales and profits from products developed within the past five + resource depletion).

Tech. innovation is the most important driver of competitive advantage in many industries. Many firms receive more than one-third of their sales and profits from products developed within the past five years. The increasing importance of innovation is driven by globalization, advanced technologies that enable more rapid product design and short production runs to be economically feasible. Tech. innovation impacts society by fostering an increased GDP, enabling greater communication and mobility, and improving medical treatments. Negative externalities also exist such as pollution, resource depletion. Government provides some funding of innovation but industry provides the majority of funds for R&D. 2. Schilling Ch. 2 Blindvej Gydevej 28

Catwoman

(=Schilling) skubber Homer

(=I-U collaboration) og Tony Hawk

(=employee), Finn Junge

(=lead user) ind I et kloster

(=cluster), når de kommer du igen er de forvandlet til Andy Warhol (=creativity).

Creativity is the underlying process for innovation in that it generates ideas. Creativity is a function of intellectual abilities, knowledge, thinking styles, personality traits, motivation and environment.

Innovation sometimes originates from an individual inventor most often with multiple competencies and entrepreneurial traits. Innovation can also arise from lead-users (snowboarding). Industry R&D is a major driver of innovation and considered the biggest within most firms. However in some countries government R&D exceed industry. Firms often collaborate with a number of external organizations in their innovation activities (customers, suppliers, universities, competitors, producers of complements, government laboratories, non profits etc.). Probably the most important source of innovation is the collaborative networks that leverage resources and capabilities across multiple organizations. They are often seen in high tech. clusters  R&D spillover between organizations.

3.

Metcalfe J. S. and Gibbons, M., (1989) "Technology, Variety and Organization: A Systematic Perspective on the Competitive Process" Ved indkørsel til Gydevej 28

En kalv

(=Metcalfe) står og græsser på en baseball

bane mens en gibbon-abe (=Gibbons) hænger i en vindmølle. På hver af

baseballbanens baser står der en Einstein

(=knowledge base) som hver har lavet en forskellig

vindmølle . (=different configurations), med hver deres “competitive advantage”. (billig vs. uden gear vs. kan stå i vandet).

Why and how do firm differ in capabilities to adopt technological changes?

Concepts from the evolutionary theory, survival of the fittest, by Darwin.

Revolutionary and radical Evolutionary and incremental How technical change acts as a motor of structural change and economic development:

design

-

how new technical forms are created how these technical forms come to acquire economic significance A design configuration is a particular set of facts, hypotheses, operating procedures, and design parameters that enable energy and materials to be translated into products and processes with a particular configuration and embodying a particular level of revealed performance.

They believe in that a product which today is not looked upon as a high quality product can be improved so the quality of the product in the future will be much higher, the same regarding the unit costs which can go from high to low over time. (model at page 166) (i.e. Sanchez said that you can make the same core product and then make them ready for different prices by activating different functions as Philips did with their televisions, so whether you bought a cheap or an expensive television they have the same technology and functions, but they are not equally set up for use) They believe in that the core of the technical regime is the same in the collection of design configurations. But then there are added new knowledge to each design configuration which create the difference btw them.

4. Kline, S. J. and Rosenberg, N., (1986), "An Overview of Innovation" Ved indkørsel til Værkstedsgården

Jesper Klein

(=Kline) og Rosenberg

(=Rosenberg) står og svinger med et

sjippetorv lavet af en jernkæde

sjippetorvet står researchere

hopper. Ved siden af er en balancebum

(=chainlinket model) inde under

(=research) og Einstein

(=knowledge) og

(=linear model), som ingen gider at bruge.

Innovation is complex, uncertain, somewhat disorderly.

Linear vs. chain-linked model Linear: no feedback, no evaluation, one path, science push Chain-linked model: feedback, evaluation, five paths, science pull Feedback-loops and sidelinks to research, support of scientific research and stored knowledge.

Chain-linked model reduces uncertainties in an innovation process. And contains a knowledge back so past experiences will be remembered.

The chain-linked model lacks: Financial aspects, time-frame (PLC), misses the link btw. Organizations (networking with DTU), the psychology of people involved (but do any models take the people involved into account?)

5. Fleming, L. and O. Sorenson, (2004), “Science as a map in technological search” Ved indkørsel til Stubmarken

James Bond (=fleming) og Thomas Sørensen (= Sorensen) er på trekking og vil gerne bestige det højeste bjerg (=best performance). De står i et science-landskab

med bind for øjnene, så de kan kun famle sig frem lige

omkring hvor de står (=local search). Så får de fat i Darwin (=fundamental science), som følger dem hen (=distant search) og op på højeste og bedste bjerge. På toppen af bjerget ligger der en

kameramobil

(=combination of components with high synergi effect).

Abstract A large body of work argues that scientific research increases the rate of technological advance, and with it economic growth. The precise mechanism through which science accelerates the rate of invention, however, remains an open question. Conceptualizing invention as a combinatorial search process, this paper argues that science alters inventors' search processes, by leading them more directly to useful combinations, eliminating fruitless paths of research, and motivating them to continue even in the face of negative feedback. These mechanisms prove most useful when inventors attempt to combine highly coupled components; therefore, the value of scientific research to invention varies systematically across applications. Empirical analyses of patent data support this thesis.

Thors noter: Science alters inventors search processes by leading them more directly to useful combinations. Science has no apparent effect when inventors work with relatively independent pieces; it only appears beneficial when inventors seek to combine highly coupled components — a particularly difficult task.

Research out of this tradition holds that invention comes either from combining technological components in a novel or through reconfiguring existing combinations. Researchers most commonly point to local search and inventors search incrementally. Explanations for the prevalence of local search

frequently focus on the value of experience. The downside is that inventors are prevented from distant – a potentially more useful – possibilities. Science is one way for engineers to gain knowledge on distant search before doing it in real-life. Science could usefully increase the effectiveness of search by identifying useless directions of search before hand, and by providing a glimpse of the possible – mapping out possible bumps and rocks. In other words, science can tell inventors how to avoid wasted effort solutions. It can also stop firms from trying to achieve an unobtainable goal indefinitely – thus wasting their effort by predicting whether something is theoretically possible. In landscape metaphor the ruggedness of the landscape increases as the degree of coupling among the components intensifies.

Inventors who search incrementally with strongly coupled components make slow progress and have no assurance of ultimate success. Rugged landscapes contain a large number of potentially useful configurations, if inventors can only find them. As the coupling increases, however, the difficulty of search rises, and the average usefulness of inventions declines.

6.

Carlsson, B., Holmén,M., Jacobsson,S., Rickne,A., and Stankiewicz,R., (2002), "The Analytical Approach and Methodology" Ved indkørsel til bygholmen

Carlsson på taget

skateboardet

(=Carlsson) og Holmen

(=Holmen) opfinder

da de finder en tom swimming pool (=design space). Mange syntes at det er

interessant så der kommer flere til

(=organizational dimension/non-economic

network relationship). Lars Larsen (=commercialization) ser muligheden for at tjene penge på skateboards og samler Carlsson på taget, Holmen og nogle andre i en competence block.

Measuring the performance of technical systems – The ability to exploit new opportunities.

Technology: A set of combinatorial design spaces formed by clusters of complementary technical capabilities or operand.

Technological systems: Socio economic networks generating, transferring, and utilizing technologies.

These systems are defined in terms of knowledge and competence flows rather than flows of ordinary goods and services. They consist of dynamic knowledge and competence networks. Such networks can

be transformed into development blocs – synergistic clusters of firms and technologies within an industry or a group of industries.

1.

2.

3.

There are three dimensions to technical systems: A cognitive (logic) dimension – design spaces, clustering of technologies An organizational dimension - the actor network: the actors that engage in creating the technologies and filling out the design space. Network relationships builds on knowledge and competence flows rather than flows of ordinary goods and services.

An economic dimension - the competence block, the actors who convert tech. possibilities into business opportunities. The economic organisation shaping relationships between actors

The three dimensions work together and co evolve over time, making it dynamic. The cognitive dimension does not involve human thinking, but rather the environment. The competence block is crucial – need to have a market-mind (patent) + economic and marketing competences.  a link can be made to ‘appropriability’ If the cognitive dimension changes, it is often due to changes in other technologies, and it has a changing effect on the other two dimensions.  think of how technologies sometime merge, e.g. computers and telecommunication (Skype) 7. Dalum, B & Holmén, M. ., (1999), “The economic challenge for Europe” Ved indkørsel til Børnehaven

Daloon

(=Dalum) star med en mobiltelefon (=nordjylland telecommunication case) og

Holmen

(=Holmen) somer svensker (=2 cases from sweden) kommer med en flad

hoppeborg som ligner et kloster

(=cluster). Finn Valentin

researcher) starter med at puste den op. Så får han Mia Enghave

(=Pioneer

og Filip Poulsen

(=Students of pioneer researchers who choose to make a career in local universities) til at

hjælpe sig. Herefter kommer Tom Cruise

(=firms) og Spiderman

(=networks) og hjælper. Så kommer Finn Junge

Hjort Frederiksen og hjælper

og hjælper. Herefter kommer Claus

(=labour market). Så kommer den tasmanske djævel

(=spin-offs) og nu er klosteret pustet op. Men så kommer Anders Fogh

(=national innvation system) og siger at han gerne vil bygge en lade rundt om hoppeborgen hvis de flytter den lidt (=national innovation systems adapts to the technocal system and visa versa).

Network between firms + I-U collaboration = knowledge transmission Issue: balance between free and targeted academic research “Innovation system” is used as the generic term covering both: • National systems of innovation • Sectoral systems • Technology systems The Technology System approach: Key concepts • • • • •

Nature of knowledge …. and hence spillovers Receiver competence Connectivity Variety Creation Mechanisms

2 cases on business clusters. One being the telecommunication cluster in Northern Jutland and the other being the microwave cluster in Malmö.

8.

Gallaher, Michael P., Link, Albert N., and Petrusa, Jeffrey E., (2006), “Innovation in the U.S. Service Sector”.

Ved indkørsel til Bygmarken

Liam Gallagher

shirt - og Paris Hilton

(=gallacher) – som har et “linked-in” logo

på sin t-

(=consumer demand) kommer ind i en bank (=service sector) hvor

Tony Hawk står ved kassen (=bank=lead used). Paris Hilton har så mange penge at Tony Hawk nu må udtænke et større pengeskab (=ad hoc innovation/off-the-shelf technologies developed by suppliers), som han får en fabrik (=manufacturer) til at producere. Liam gallacher vil gerne investere sine penge (=investment banking) så Tony Hawk beder in nørd (=in-house innovation) i afdelingen om at lave en ny lommeregner til Liam Gallacher.

Summary The US service sector has experienced enormous growth during the last decades The aim of the paper is to provide a taxonomy and framework for analyzing growth in the US service sector in terms of R&D and innovative activity. Traditional methods of measuring growth are insufficient and out-of-date because they were developed with an empirical foundation in the manufacturing industry. The service sector differs largely from the manufacturing industry. Improvements are mostly a matter of quality rather than quantity, and service sector outputs are often intangible and difficult to measure. Studies show that innovations within high tech equipment often are a product of end-user R&D activities (userdriven innovation). These end-users are often service sector firms who have first hand understanding of technology needs. Referring to Pilat (2001) service sector firms are taking on more proactive and leading roles in innovation processes, which often are characterized by collaboration between service and manufacturing companies. However, the distinction between service and manufacturing companies is becoming less obvious. Take for example manufacturing companies like IBM and Siemens where sales of services have become a dominant part of business. A servicisation is taking place.

Why is innovation within the service sector difficult to measure?

Service sector delivers abstract output such as knowledge to build organizational models or systems.

Service innovations draw less on scientific breakthroughs (in opposition to manufacturing) and innovations are mostly incremental based on customer-specific needs. Innovation departments are rarely seen within service companies and innovations are therefore generally not a systematic process, but rather an ad-hoc process consisting of spontaneous ideas. Furthermore, patenting in the service sector is difficult because of the high visibility and inexcludability of products/processes.

A model for innovation in service-sector firms (page 21) Innovative activities within service sector firms are driven by a high degree of competitive planning, due to the big focus on customers needs. Innovations are often incremental implying that planning is short-term in opposition to the manufacturing industry. The entrepreneur takes on a different role within a service sector innovation process compared to the manufacturing innovation process. The entrepreneur can be viewed as a manager or even an arbitrageur, because he/she collects and process knowledge and information, allocates resources and secures a state of equilibrium. Entrepreneurial activity is largely about purchasing technology in the form of equipment to be modified and integrated into operational systems in order to deliver modifications to existing products. Innovation within service companies is like within the manufacturing companies built on a scientific base of knowledge.

Where manufacturing companies often draw directly from collaboration with universities, service companies often purchase products that has this knowledge incorporated.

Summary of chapter 4 – Financial Services Industry This chapter describes recent tendencies within the financial services industry. Increased usage of IT and financial services has significantly influenced companies to increase R&D and innovate in order to maintain profitability. A distinction can be drawn between investment services and retail banking.

Investment services rely heavily on a number of different technologies to ensure that accurate and complete information is available to investors. Differentiation is attained through technology, which therefore requires innovation. Studies show that innovation among investment services firms are conducted in house. On the other hand, retail banks compete for customers on quality of service rather than innovation within services. The companies focus more on face-to-face interaction when providing complex services, which aren’t appropriate for automation. Based on interviews it is shown that investment service companies rely more on in-house development in opposition to retail banking companies, who rely on off-the-shelf technologies developed by vendors.

Innovation in financial services Innovation within financial services seems to be driven by customer demand. Larger financial services are conducting activities that conceptualize and develop technological advancements, while retail banking firms innovate by adopting and somewhat modifying existing technologies from vendors. The innovation process for financial services firms is initiated when the firm identifies a new service product to meet an actual customer need. In-house development occurs to specify the attributes of the needed innovative technology. Thereafter, the firm contacts an IT specialist to build the new technology, and finally the firm will incorporate the purchased technology into its business processes.

2. Arguments Innovation often stem from end-users coming from the service sector.

Innovations within service sector are mostly incremental improvements and modifications carried out in order to accommodate immediate needs among customers.

Service sector output is often intangible and difficult to measure.

Innovation processes within service sectors are often ad-hoc based with short-term perspectives and not as structured as we see it within the manufacturing sector.

In a traditional view maximizing R&D is viewed as a positive objective to achieve growth. However this might not be the case when it comes to the financial sector.

4. Documentation Data from NSF (National Science Foundation) is frequently used. Data shows that R&D expenditures have increased rapidly within the service sector reaching 40% of total industry R&D in 2001 compared to 8 % in 1986).

5. Key words Servicisation, intangible nature of service product, arbitrageur.

7. Researchers Von Hippel, 1988, concerning user driven innovation.

9. Schilling Ch. 3 Jordsti ned til cykelstien

Catwoman

kæmper

(=Schilling) er dommer når VHS

mod Betamax

(=era of ferment). VHS vinder og bliver dominant design

VHS til Super-VHS scenen (=technological discontinuity).

(=product 1)

(=product 2) mens de drikker Fernet

. Herefter bliver

(Era of incremental change), indtil Blue-ray og HD-dvd overtager

The most widely used distinctions between innovations are those of process vs. product innovation and radical vs. incremental innovation, competence enhancing vs. competence destroying, and architectural vs. component innovation. A graph of technological performance over time often exhibits an S-curve.

This suggests that development is initially hard and costly but as dominant standards are worked out it begins to accelerate as the tech. is better understood. Finally it diminishes as the tech. approaches its inherent limits. A graph of technology’s market adoption also exhibits a S-curve according to basically the same principles. The rate of tech. development often exceeds customer needs. Tech. change often follows a cyclical pattern: 1. tech. discontinuity and a war on industry standards 2. Dominant standard allowing producers to turn attention to increasing production efficiency and incremental improvements.

3. Then another technological discontinuity emerges (think. VHS vs. Betamax, BlueRay vs. HD-DVD) The most advanced innovation doesn’t win, it is the one that meets producer and costumer needs best.

10. Chesbrough, Henry (2001), “Assembling the elephant: A review of empirical studies on the impact of technical change upon incumbent firms” Busstoppet ved cykelstien

En

meteor

(=technological

discontinuity)

falder

ned

i

en

(=incumbent firms) hvor Davis Attenbrough

spiller

agurkmark

sidder og

skak (Chesbrough) med sine 16 brikker (=16 Sceintific papers). Han bygger en

klog elefant af papirerne som kan forudse hvilke agurker (=incumbents) der vil overleve og hvilke der vil dø.

On technological discontinuities (cf. radical innovation): The (large) literature on TD* is useful for management from two perspectives -

The perspective of the entrant: o TD as opportunity for entrepreneurship: o Understanding TDs so as to exploit them better as aggressive innovators.

The perspective of the incumbent: Understanding‌ o When TDs define a threat o Why incumbents sometimes fail to read the game

As the pace of technological advance continues and perhaps accelerates, scholars and managers alike require a deeper understanding of what factors explain differing organizational impact of innovation in different settings ďƒ Chesbrough is taking stock of the state of our academic knowledge on this subject by compiling the different studies and looking for common themes that recur and isolating differences in the results of the literature

A review of empirical studies on the impact of innovation upon incumbent firms Different areas of literature:

1) Literature with primary interest in organizations and how they respond to innovation

a. The literature treats technological changes as an exogenous event which creates an opportunity to examine the response of organisations to that shock.

2) Literature with primary interest in dominant design and industry evolution a. Closely related to ad 1) - HOWEVER, here more analysis of the character of technology and treats it as an endogenous element to be explained b. Greater emphasis on the causes of the technological shifts and the resulting impact on the evolution of the industry and the number of participants in the industry  less examination of how incumbent firms respond to those shifts and what factors influenced such responses Question about the external validity in the many studies on the topic of innovation  to what extent do the findings of incumbent firms in one industry apply to the experience of firms in other industries.  Chesbrough tries to assess the external validity in 16 studies that all meet 3 criteria concerning external validity: I) II) III)

Each of the stdies empirically examined one or at most a few industries Each followed its industry(s) over an extended period of time so that technological shifts were observed Each study focused on the response of incumbent firms to these shifts as its dependent variable

The chosen few from Chesbrough’s framework Study

Direction of causality

Utterback and Abernathy (1975)

Firm innovation should vary with its strategy and with industry environment Character of technology entrenches or displaces firms Incumbents fight to maintain old tech, entrant attack with new technology Arrival of dominant design shifts basis for competition Different innovation categories create different org outcomes Character of innovation determines org impact

Abernathy and Utterback (1978) Foster (1986) s-curve

Utterback (1994)

Abernathy and Clark (1985)

Tushman & Andersson

Dimensions of innovation typology Product-based vs. processbased technology

Incumbent success when…

Incumbent failure when…

Matches process choices and product goals to firm strategy Technology is evolutionary – process based innovation Incumbents aggressively pursue new technology

Process and product choices not matched, resources not focused Technology is revolutionary; product based innovation Incumbents continue to invest in old technology

Incremental vs. radical Process vs. product Technical production, market consumer

Overcomes inertia – organizes separate units Innovation linked to market need

Incumbents entrench in previous technology Innovation uncoupled from market

Competence enhancing vs. competence destroying

Innovation is competence enhancing

Innovation is competence destroying

Radical vs. revolutionary; product vs. process Old vs. new

Henderson & Clark (1990)

Anderson & Tushman (1990)

Different innovation categories create different org outcomes Technical discontinuities upsets incumbents, fosters new entrants

Component technology vs. system integration

System integration unchanged

System integration disrupted

Technology Pioneers Entrant pioneers fermant  dominant dominat design incremental design based based on fermant  on competence competence fermant enhancing destroying (evolutionary technology technology cycle) 11. Trajtenberg, Manuel, (2002), "General purpose technologies: Engines of growth'?"

Ved faldefærdig gård på cykelstien

James Watt opfinder dampmaskinen (=GPT) som gør det muligt (=enabling technologies) for dovendyret (=trajtenberg) at komme rundt med et damplokomotiv

GPT = General Purpose Technologies. To make VmLab work there have to be some other already existing technologies. Those existing technologies are GPT’s and in the case of VM they are power, light, camera, computer etc. Vision technology is at the moment not a GPT but it could become one eventually, because there might very well be invented other products that will be dependent on vision technology. Most GPT’s play the role of enabling technologies, opening up new opportunities rather than offering fine solutions.

Topic: General purpose technologies – the difference between technology and “technology”.

Summary: The paper tries to “forge a link between the economic incentives for developing specific technologies and the process of growth. The central notion is that, at any time, there are a handful of ‘general purpose technologies’ (GPT’s) characterized by the potential for pervasive use in a wide range of sectors and by their technological dynamism. As a GPT evolves and advances it spreads throughout the economy, bringing about and fostering generalized productivity gains” (pp. 84).

The GPT’s open up for new opportunities rather than being a complete, final solution, hence, GPT’s are “enabling technologies”. In this sense, the phenomenon involves “innovational complementarities”, which, because of the innovation embedded in the GPT, increases the productivity of R&D within a downstream sector. Thus, the IC magnifies the effects of the innovation in the GPT and helps it diffuse throughout the economy. Consequently, the GPT’s give rise to a number of other innovations using GPT-technology. The usage of GPT-technology in applications in various sectors raises the return to new advances in the GPT. Hence, there is a sort of circular motion increasing rapid technological growth and economic growth.

However, lack of innovation incentives can occur because the “complementary innovative activities are widely dispersed throughout the economy, making it very difficult to coordinate and provide adequate innovation incentives to the GPT and application sectors.” (pp. 85). This is down to the inherent uncertainty and asymmetric information, which are essential for new knowledge creation, but simultaneously make coordination difficult.

Key Words: General Purpose Technologies, innovational complementarities, interaction between sectors, 12. Freeman, Chris and Soete, Luc: (1997), “The Economics of Industrial Innovation” Cykelparkering ved klasseværelset

Morgan Freeman

Trump

(=Freeman) bliver barberet af Daniel

(=big companies) (Mark 1 vs. Mark 2). Ved siden af ham er der 5 drivhuse med buer

(=Kondratieff waves). Steve Jobs

hen over buerne i en vandcykel

(=innovation) og Burns

revolution). 2. drivhus:

(=industrial

(=steam engine, railway). 3. drivhus: lyn der slår ned i Eiffel

(=steel, electricity, heavy engineering). 4. drivhus: Ford T biler på samlebånd

(=fordisme, samlebånd). 5. drivhus: Iphone telecommunication).

(=capitalist) sejler

, men det er kun Steve Jobs som pedaler

(=innovation as the main engine of capitalist growth.) 1. drivhus: Che Guevara

tårnet

(=entrepreneur) og Donald

(=information and

Descriptive and historical context of industrial R&D especially within the US steel industry. The 5 Kondratieffs waves; 1) early mechanization, 2) steam power and railway, 3) electrical and heavy engineering (1880-1940), 4) fordist mass production (1930-1990), 5) information and communication (1980-). The end of each wave are often due to economic changes – ie. Oil crisis. Packages of GPT’s carries from one wave to the next – ie. Steam engines from wave 1 is carried to wave 2 in transportation – as a GPT. Freeman & Soete (1997): The economics of Industrial Innovation The theme of the text outlines the importance of entrepreneurships and the effect of interdependence of industries on the innovative process in the steel industry in the 18th and 19th century. Furthermore, the discussion is focused in a Schumpeterian outset on successive technological transformations.

The chapter deals in a historic-descriptive manner with research, invention and innovation in the waves of technical change which Schumpeter describes as “successive industrial revolutions  Schumpeter followed the Russian economist Kondratieff in describing these long, roughly half-century phases of development as cycles (can also be named waves or phases of growth).

Schumpeter – point of departure in the text In order to be able to understand the essence of entrepreneurship, a brief introduction to Joseph Schumpeter’s theory is necessary. Schumpeter gave two theories, sometimes called Mark I and Mark II on entrepreneurship. He argued that the innovation and technological change of a nation (National system of innovation) comes from the entrepreneurs, or wild spirits. He came up with the German word Unternehmergeist, meaning entrepreneur-spirit.

He believed that these individuals are the ones who make things work in the economy of the country. In Mark II, later in the United States as professor at Harvard, he pointed out that the ones who really move the innovation and economy are the big companies which have the resources and capital to invest in research and development. Both arguments might be complementary today.

The text puts emphasis on the relation among industries and the innovative process related to the so called ‘successive waves of technical changes.

Initially, the authors highlight what seems to be the focal point of the text, i.e.: innovation as the main engine of capitalist growth.

In relation to this approach, the authors put forward the case of the US’ steel industry to highlight the importance of interdependence among related industries. They argue that the interdependence between industries was the driving forces in developing and making the USA the leading producer of steel in the 18 and 1900’s. There are other reasons as to why the US were the fastest developing nation in the world and, likewise, the absolute dominant nation in the industry by the early 1900’s, but those reasons – although interesting – are not the main focal issues.

Basically, the essence of the text can be summarized into the following: The entrepreneurial theory put forward by Schumpeter explains why the crystallization of innovation developed rapidly in the US’ steel industry in the 1800’s and 1900’s. The vast abundance of territory and resources in the US combined with the entrepreneur-spirit (Schumpeter) gave birth to an industry able to take advantage of the huge US’ market and made way for an enrollment of organizational management on a way larger scale than of those seen in the industries in the UK and Germany. Radical innovations from the

UK were exploited in the US by converting these inventions to incremental innovation but with a far greater output. Hence the templates of technology as being used in different applications-areas in the steel production had a tremendous effect on the evolution of the efficiency in the steel industry.

Main arguments of the text The argument of the text is that the economic cycles put forward by Kondratieff, are based in revolutionary innovations, e.g. the invention of the steam engine in the 1780's; the invention of the combustion engine, etc. Furthermore, Schumpeter’s theory on the entrepreneurial spirit helps us to understand why the innovations made in the US (and i general) were far more cost and productive efficient in comparison with those of the UK and Germany. The crystallization powered the upswing of a huge and cost effective steel industry in the US. Problem A mismatch between technological potentials and the NTS and the overall organisation and infrastructure of economic activities defines a crisis, which must be resolved.

Conclusion Together with Schumpeter, the authors use the theory of Kondratieff to explain why innovations descend from entrepreneurs. Innovations are those mechanisms of society (national systems of innovations) which directly affect the wealth of the nation and the competitiveness of an industry.

Figures and tables: see text please. Almost 50 %of this text is made up by tables and figures.

2: Networked approaches to innovation 13. Harryson Ch. 1 Klasseværelse 9. klasse

Der står en Porsche

inde bag hver deres mur

og en Mercedes

.

(=chapter 1) i hånden. Spiderman

Porschen ned

Han inviterer Filip

. Begge biler er lukket

(=harryson) sidder i Porschen med en

blyant

(=the networker) er ved at rive muren rundt om

så han kan opfinde en ny keramisk bremseskive

(=grad student), Finn Junge

.

(=I-U

collaboration) og Einstein (=knowledge) ind. Til sidst kommer Gollum (=approriability) og murer muren op igen.

Topic: Exploration and exploitation of ceramic brakes in the automobile industry.

1. Summary: The chapter is about fast-car and solid car, which are competing about being first to bring out ceramic brakes on the market. Fast-car wants to cooperate with Solid-car, but Solid-car does not want to cooperate. Fast-car identified several issues that needed to be solved to revolutionize the market of ceramic brakes.

They supported open innovation and used external research institutes with alumni networks. A research competition was held between two leading academic research institutes. The best researchers were recruited into a brake engineering center. Fast-car continuously protected their results by the use of patents. External partners outside the automobile industry were engaged in the process to achieve a broader knowledge base and more flexibility. Spiderman from fast-car held research institutes with experts from the whole world, where Mr. Brainpower from solid-car was identified and recruited by one of fast-car’s partners.

Fast-car’s exploration process is historically known to be ventured with external partners due to heavy networking (know-who) principles. The research was publicly known in order to get further inputs from both stakeholders and competitors. Instead of holding on to their technologies they patented their inventions, and by licensing them out to partners and competitors they increased revenue. There seemed to be a good balance between the exploration and exploitation. Small research institutes and entrepreneurial universities were used in the exploration phase and large companies in the exploitation phase. Solid-car’s reaction to Fast-car’s success was to send Mr. Money Talks to buy some of Fast-car’s main suppliers of the missing link, thereby making it impossible to create the brake. One of the main suppliers, Mr. Grandissimo, refused due to his relationship with Spiderman.

2. Arguments Open innovation: Fast-car leveraged external brainpower for exploration of innovation. While open innovation is a great way to access external brainpower it is still very important to be aware of patenting.

Networking (Spiderman) It was important to Fast-car to have/create a lot of weak ties during the exploration phase.

Strong ties can be useful with key individuals/organizations.

In order to get the right knowhow you need to have the right know-who connections.

3. Quotations “Knowing who has the knowhow, defining new access points to this knowhow and converting it into new value networks created a new breakthrough. This was an incredible act of strategic intelligence that knocked out competition through ceramics.” (Harryson 2006, p. 5) “This book argues that successful spidermen are highly multicompetent and relationship driven networkers acting in core teams of past strong ties and a multitude of current weak ties.” (Harryson 2006, p. 30)

4. Technical terms: Weak ties are most useful in open creativity networks to enrich the creation and exploration of new knowledge.

Strong ties are more critical in rather closed process networks to drive the integration of innovation.

Creativity networks: Primary source of new knowledge and emerging technologies.

Project networks: Link between creativity networks and process networks.

Process networks: Effective transformation of invention into innovation. Incorporates key functions (R&D, D&M, M&S) working together.

14. Harryson Ch. 2 Køkkenet ved siden af klasseværelset

Columbus

(=exploration) star på den ene side af en vippe med en Anoto-pen i hånden

(=grundlægger/opfinder af Anoto). På midten af vippen

(=balance between exploitation and exploration) står Sigval Harryson

med en

(=Know who)

svane (chapter 2) i hånden og hjælper Rudy Frederiksen

(=exploitation) - som har et Ericsson BlueTooth headsæt

på - op på vippen. Idet Rudy

træder op falder Columbus af (=Anoto fires the explorating engineers). Gollum

(=appropriability) bygger en mur rundt om vippen og rækker licenser ud af et vindue

til Donald Trump

(=big companies). Ved siden af sidder der en viking

Stratego

(=viking strategi).

og spiller

Topic: Entrepreneurship from Creation to Commercialization, with focus on patenting and hiring expert personal to keep the innovation in house.

1. Summary Christer Fåhreaus wanted to make a digital pen that could read and store the parts of the text that you mark from any kind of printed text, and then download these selected parts on your computer. He gained financial support from Ericsson Mobile and started what was to become the Anoto Group. They managed to recruit a lot of highly skilled engineers such as the CTO and CSO of Ericsson Mobile together with friends from Lund University in Sweden. Anoto leveraged academic brainpower to build intellectual capital and transformed this into start-up capital. The initial invention and the resulting academic collaboration resulted in more than 40 patent applications within the first year of the innovation cycle. Several other investors followed Ericsson’s example.

Anoto acquired another valuable asset by hiring Mr. Bluetooth, Örjan Johansson as the new CEO. Örjan’s personal network and Bluetooth experience helped the company to establish a better market reach through new partnerships. With more than 300 active patents they moved from exploration to exploitation. Anoto realized that they would have to make an immense marketing effort in order to get exposure and reach the market. Instead they license their technologies to established major brands to get immediate market exposure. They concentrate on technology and product development and outsource logistics, distribution, marketing, sales and customer support.

2. Arguments IPR: You need to have a focus on IP capturing and licensing to be able to get access to capital, to have stronger arguments when negotiating with partners, to secure a good return on investments through licensing revenues and protect yourself against competitors.

Appropriate leadership: The leadership style has to fit the overall strategy, development and commercialization phases.

Relationship-based partnering: It is important to be aware of the company’s weaknesses so you can use your partners know-how and keep your costs low at the same time.

3. Quotations “In the end it is not important is you sell the product with your own brand name or not. The most critical aspect is that your product adds genuine value to the customer.” (Harryson 2006, Christer Fåhreaus, p. 43) “The main goal of the Anoto strategy was to sell in greater volumes and, therefore, establish a global de facto standard. The strategy that had to come in place was to recruit people with the right competences, develop the technology, create a strong patent portfolio and establish global partnerships.“ (Harryson 2006, p.45)

“If you develop new technologies and products for a mass marked it is very important that you protect them with patents. Once the marked grows the licensing revenues will grow accordingyl.” (Harryson 2006, Christer Fåhreaus, p. 52) “The Ericsson origin of several key people and the extensive partner network have certainly made know-how acquisitions through know-who based networking possible.” (Harryson 2006, p. 55) 5. Key word Networks, patents, brand names, partnerships, outsourcing.

6. Technical terms IPR: intellectual property rights are a company’s intangible assets that are related to other resources, which can be vulnerable and duplicated if not protected.

15. Harryson Ch. 3 Fællesrummet

Harryson står med et

sidder Spiderman

hjerte (=chapter 3) i hånden. I midten af et spindelvæv

(=network) med et mælkekarton

(=combibloc) hånden. I dette spindelvæv står der en Arla-ko (=b-b costumer).

Spiderman spinder en tråd af mælk (=costumer focus) til et nærliggende spindelvæv hvor Christian d. 4.

(=supplier/Hörauf) sidder i midten. Gollum (=appropriability) bygger en mur rundt om begge spindelvæv (=appropriability is based on an unique network).

Topic: The text is about how Combibloc is trying to compete in the market of packaging by focusing on developing and commercializing, primarily by extensive networking and market research.

Contributed by: Group number 1 1. Summary The text is describing how Combibloc (CB) is trying to compete with Tetrapak, which is the clear market-leader due to better technology. CB started a project called “New Packaging Systems” which focused on market and costumer research shaping the pre-study. The idea was to give new appearance to big successful brands trough their box design and shapes. CB found the technological leader Hörauf, which was a leading supplier of packaging system equipment for round shapes, and they started working together. The benefit of this partnership was that Hörauf brought in 30 years of highly professional machine development know-how, and a powerful network, which CB could use to their cup-forming activities. The whole down-stream end packaging was outsourced to four different suppliers, coordinated by CB people. This gave them the advantage to stay in control of the process,

because they separated knowledge streams so only Hörauf and CB, could see the whole picture. They also bridged relations to different universities in an attempt to bring additional brainpower to the project.

To control this type of process with so many partners involved they hired Boutellier, which played an important role because he was in touch with all the key individuals in both the managing and development processes. To communicate effectively they established a common language and nomenclature for all customer-need definitions, key technologies and components involved.

2. Arguments • •

Market research o A key focus on customer need is a good way to secure success of your product.

Process and project leadership o It is important to maintain a strong network and personal relationships between upstream and downstream employees to keep a continues knowledge sharing in a given company. o The leaders must be aware of the fact that different processes and parts of the organization need certain types of leadership at different times.

3. Quotations Market-driven breakthrough approach by expanding and tapping its vast marketing network for customer need centric exploration of a concept, that was co-developed with external creativity networks and integrated through a forceful project network. This project network enjoyed strong CEO leadership, extensive know-who into the creativity networks and full control of the groupware that connected the different modules into a high-performing packaging system. A mutually beneficial incentive system further motivated the breakthrough innovation just in time for the Anuga exhibition (Harryson 2006 page 90).

5. Key words Networking, Leadership, Innovation, Market Driven Research.

6. Technical terms Creativity networks: Primary source of new knowledge and emerging technologies.

Project networks: Link between creativity networks and process networks Market pull/Technology push: In this case they focused on market research through a global market network consisting of R&D engineers and marketeers from different market companies.

You can also focus your concept creation on internal technology-push, which wasn’t the case here.

16. Harryson Ch 4 8. klasse

Harryson – som har et lille skib

- kommer ind i et kontorlandskab

(=chapter 4/innovation cruise) i hånden

(=seperated business units) med mure

(=barriers). Medarbejderne snakker i mobiltelefon

med at de har høreværn

(=mobilecompany) samtidig

(=lack of communication between business units) på og en øl

(=bottlenecks) i hånden. Harryson inviterer dem med ud på et skib, hvor han slår sin

værktøjskasse (=GTI as a tool) ud til en stige

For enden af stigen står Steve Jobs

med 6 trin (=GTI is seperated in 6 steps).

(=innovation).

Theme: The barriers to innovation and the key enablers of innovation Key words: Barriers to innovation, Enablers of innovation, GTI 6 steps process Background and chapter structure: This chapter is about how a successful telecommunication company, Mobile, experienced reduced innovation as a result of the divisionalization of the company. To overcome the problem of divisionalisation Harryson explains how to increase the interaction between different business units (BUs). He structures the chapter in the following way: Harryson presents a empirical explanation of why and how barriers in a Mobile company arise and how this has hindered further entrepreneurial behavior to take place. Armed with the empirical explanation Harryson takes the reader through the step-by-step process undertaken by the case

company, Mobile, to endorse innovation within the company, BUs and amongst employees. The case takes place in 199X-200X. Empirical explanation: Drucker’s definition of an entrepreneur is one that searches systematically for the sources of innovation to create something new (Harryson, 2002). In turn this allows entrepreneurs to also identify some typical barrier to innovation: • Company culture that punishes failure or risk taking • Lack of clear incentives or recognition of entrepreneurship • Poor understanding of customer needs in R&D Whilst the some typical key enablers are: • Encourage risk taking by making people accountable new products and services • Clear processes and frameworks for idea generation and innovation • Climate of open sharing of ideas with clear recognition of both idea generation and implementation Harryson identified via interview rounds with key players and employees in Mobile six barriers as well as six desired enablers of innovation as countermeasures (fig. 4.1, page 94).

The three main barriers for Mobile are: 1. There is no strategy for innovation and employees have no time for idea creation during working hours. Further innovation was not market- or user-driven but based on a technological push.

2. There is no process to channel new business ideas for the most appropriate BUs to assess and implement them. Nor was there any monitoring of the ongoing current product development pipeline.

3. BUs were driving their product development agendas and road maps without coordination across BUs. This resulted in overlaps in development efforts.

Lets abstain from the obvious, which would be to discuss the key enablers of innovation. Instead the research is taken a up a notch on the analysis scale to get a deeper understanding of the barriers with regards to issues such as ranking according to impact on innovation, removability, interdependency, critical barriers: • How much of a negative impact each barrier has on innovation?

• How difficult is it to remove the each barrier?

• To what extent on barrier causes another barrier and vice versa?

• Which barriers are critical to remove so as to get rid of other barriers?

The focus Harryson’s empirical study is to measure the impact on innovation and the removability of the barriers (25 barriers in total –unspecified). For overview purposes the barriers are in a matrix (fig 4.2, page 104) segregated by level of impact and level of removability to determine the “threat” of the barrier and the what right countermeasure to take.

Amongst the many barriers three bottle necks were emphasized: • Poor focus of idea process leading to low efficiency and long response times • Misperception that innovation has to be big new products • Lack of time and organization for innovation The bottle neck barriers are entrenched in Mobile’s organizational behavior and not associated or influenced by technology, market or user driven factors. Hence Mobile must pay attention to these when developing right countermeasure package consisting of: 1. Implement a stronger market and customer focus 2. Clarify roles, responsibilities and coordination of Bus 3. Overcome the “next SMS” hurdle to encourage innovation 4. Focus on simplicity and transparency for speed of implementation

Having identified what the barriers are Harryson proceeds to how Mobile can revitalize its innovation incubation by means of the Growth Through Innovation six step process (fig 4.3, pager 107).

Step-by-step: From this point onwards Harryson gives a detailed step-by-step account of what Mobile did to attain its goal i.e. remove the barriers to foster innovation. Below are listed the details of the GTI-effort (in bullet points): Set up GTI organization o o o

GTI board (design and communicate strategic framework for innovation and select best concepts) GTI driving team (drive the process incl. brainstorming, facilitating, meeting, documentation and communication) GTI coaching team (bring expertise to brainstorming and screening or ideas and coach on innovation teams)

Design a clear innovation strategy • • •

Conduct external and internal analysis of drivers for innovation and select the most important ones based on customer needs Benchmark against competitors and industry (if feasible) Remove the misperception of innovation only being big new products • § Distinguish between revolution and renovation innovations based on screening criteria • Consider aspects such as attractiveness i.e. the business concept of the revolution/renovation and determine the strategic fit i.e. the company’s ability to exploit the business opportunity • GTI implementation with will ensure overview and company-wide coordination of all ongoing development projects and activities

Brainstorming new opportunities for profitable growth • • • • • •

Follow brainstorming methodologies: Call out ideas Ideas trigger other ideas Post-it notes Wining and dining Brainstorming session on e.g. a cruise

Screening to filter out top candidates • •

The challenge in GTI efforts is to select the right potential idea winner amongst the bulk of ideas generated in a brainstorming session Provide feedback to runner up candidates as a token of appreciation to show support for the time and effort spent by employees in developing a concept/idea

Internal Competition to drive collaboration on business plans o Reward intrapreneurship with financial prizes especially useful when time barriers constrain employees to work on new concepts o Make brainstorming sessions available to entire organization and enthuse them to further develop on already generated ideas o Provide coaching sessions to make and review business plan in order to structure and formalize the concept to be present to the GTI board Initial ranking to focus and reward innovation performance o GTI board assesses the concepts and evaluates their respective fit and attractiveness Preparing detailed business plans for final ranking o Everything from vision and mission to NPV and risk analysis o GTI coaches must secure good progress in moving high-level to high-quality business plans. o Provide access to know-how in the company e.g. finance department to calculation of NPV and risk.

17. Harryson Ch 6 7. klasse

Harryson

har fået en snabel. Harryson slår en stige

(=exploration) og Rudy Frederiksen

Første trin:

Andet trin:

(=brainstorm)

(=filter)

Fjerde trin:

(=business plan)

Sjette trin:

(=exploration).

(=selection criteria).

Tredje trin:

Femte trin:

(=GTI) op mellem Columbus

(=10 criterias)

(=feasibility studies)

(=final ranking. 1-3 concepts is chosen)

Morten kunne godt tænke sig at komme op i CN tower

(=VGP).

Theme: The chapter introduces how the growth trough innovation process works in practise.

Keywords: Stage-gate-model, Growth through innovation (GTI), creativity, brainstorming sessions, business plans, screening team.

Coopers stage-gate-model: A product innovation is a process. It usually begins with an idea and ends up in a product launch. The stage-gate-model breaks down the innovation process into distinct and identifiable stages.

(Please see figure 6.1 pp. 187) The different stages are termed: 1: Discovery (All ideas are collected.)

2: Scoping (Information is gathered for each idea.)

3: Building the business case (At this stage a business case has to be developed, including target market definition, delineation of the product concept, specification of the product positioning strategy and the value proposition.)

4: Development (A development plan for the physical development of the product is the next point of performance. The outcome is a prototype of the product.)

5: Testing & validation (A this stage the product is being tested on customers. The customer acceptance is being validated.)

6: Launch (The product is ready for the market.)

Between each stage there are different decision points/gates.

The gates are the stages of the process during which all new information is brought together. The gates serve as a quality control and as where the go/no-go decisions are taken.

Sigvald J. Harryson’s critics on Coopers Stage-gate-model Sigvald argues that the following elements seems to be missing: - The trade-marked process seems not to be grounded in the theory - Knowledge creation has not been taking into consideration - Organizational learning has not been included - The networking aspect has not been taking into consideration.

The GTI-Model The growth through innovation process (GTI) has been developed to trigger creative thinking, build new concepts for innovation, select the innovation opportunities and support the implementation process. It consists of six steps that typically require a total of three month to complete.

(Please see figure 6.2 pp. 191) 1: Frame the platform for growth, which is about capturing and transforming complex strategic intelligence into crystal clear selection criteria.

2: Brainstorming. Important to identify the right people 3: Filter out the top 10 candidates.

4: Consists of developing the initial concepts into top-level business plans.

5: More detailed business planning has to be made, including feasibility studies of the concepts.

6: Run a final ranking. Chose one to three candidates. The criteria for selection is the same that were used in the initial ranking The over all idea of the GTI model is to create a successful conversion of intangible ideas into tangible concepts. The model helps you to have a clear strategic framework for innovation.

Said in another way: the process is designed to manage the transition from divergence to convergence and from quality to ideas to quality of the emerging concept.

Creativity vs. innovation Creativity can be defined in different ways: - “Creativity – the ability to bring something new into existence, conceiving the idea and articulating the new knowledge” (Holt 1992) - “The personal ability to recognize unusual patterns, relations, and produce novel ideas or things”

(Tang) - “Creativity is peoples ability to think or do something that has not been done before and breaking the predicted pattern” (Köbing) It seems clear from most definitions that creativity and innovation often appears together – sometimes with insufficient distinction. While creativity usually will lead to excitement and the creation of something new, it can easily produce confusion, divergence and perhaps even disillusion and, thereby, not even get close to innovation.

Recommendations on how to drive creativity in a corporate climate: - Be accessible and open also to small ideas - Keep different kinds of personalities to provide diversity Encourage risk-taking - Be open to accept change and limit management control to the minimum. Secure open communication and build trust.

The company 3M is maybe the most-cited example in terms of autonomy for innovation. Employees are encouraged to use 15 percent of their working time on their own curiosity agenda, and to do things that they normally would not have time or permission to do. 3M finds this way suitable and valuable in order to create creativity among the company’s employees.

Running brainstorming sessions Brainstorms are particularly useful when companies have: - Run out of ideas - Have lots of ideas but do not know how to identify the best - Already have identified good ideas, but think there may be more untapped brainpower that can create ideas that support the implementation of the ones already identified.

In many cases, the brainstorming sessions will be used opportunistically to kick in old ideas that may have surfaced in the past, but did not get the required support for implementation.

(Sigvald gives a more detailed description about his experiences on running brainstorming sessions on pp. 203-207) Who to involve on the Screening team A very important part of the innovation process is to choose whom to include on the screening team.

According to Cooper the selection of the individuals that are affiliated to the screening functions is specific to each business and its organizational structure. But some basic rules has to be fulfilled: - The screening team must have authority to approve the resources required for the next step in the innovation process. - To the extent that resources will be required from different functions the gatekeepers must represent these different functional areas - The gatekeepers usually change somewhat during different screening sessions, but there should also be some continuity of gatekeepers during different screening sessions.

Cooper et al. suggest that product managers, technical experts from systems and technology as well as operations and delivery, should man the first screening session. They argue that senior managers should enter the screening team only at a later stage (third gate) in the stage-gate process where financial and resource commitments are sustainable.

To Sigvalds personal experience, it is dangerous to delegate the initial go/no-go decisions to middle management and, in particular, to the product managers who may prioritize their own products. He believes that the screening body should be independent of particular BU’s, or represent all of them.

Making an implementable business plan For entrepreneurs the business plan is a set course of directions, like a roadmap towards the success of a new business, and a communication tool providing internal and external stakeholders with all necessary information about a new project or business concept (DeThomas, 2001).

It can be argued that a business plan encourages the entrepreneurs to take a holistic approach to their idea and analyze it across a number of important and interrelated dimensions.

There is no complete list on what to include in business plan. But some common elements are outlined below - these are based on Sigvald’s experience on what to include in a well prepared business plan: 1: Vision, Mission and Value Proposition 2: Concept and Business Model Description 3: Pricing

Strategy and Net Sales Potential 4: Market Situation, Target Group and Sales Channels 5: Value Chain Description and Analysis 6: Net Present Value and Break-even Point 7: Implementation Plan and Exit Strategy 8: Risk Analysis with Countermeasures 9: SWOT – as a reflection and summery of the concept.

18. Harryson Ch. 9

6. klasse

Harryson

står

med

en

ballon

(=chapter

Andy Andy Warhol

Spiderman

(=network) star med et smalt slips

(=open network) i hånden. ………….

9)

i

hånden.

(=creativity) og

(=weak tie) og en pingvin

(=strong tie) etc.

19. Harryson, S. and Kliknaite, S. (2007), “Killing the Myth of Web-Based Creativity” Gang uden for toilet

Afrikanere

får fat i en computer

med spam

. Harryson

med internet og fylder en BMW

og Nat

(=KLIKnate) tager deres stige

(=GTI) frem og inviterer Village people

(=diverse people), Tony Hawk

(=lead-user) og mange flere til GTI-hygge.

Topic: Creativity, idea generation, entrepreneurship, web 1. Summary The paper contributes with reflections upon how BMW and Nokia have tried to implement web based online registration of ideas as a part of the NPD and creativity process. Furthermore the paper tries to explore why the web-based approach has failed. Their main argument is based on the fact that in the case of BMW & Nokia, the human interaction link was missing in the initial process. By contrast a Finnish mobile operator has achieved great success by using the human interaction approach, whereby they have created a unique degree of entrepreneurship by working with the concept of ‘growth through innovation’ (GTI). The article discusses the empirical cases and tries to explain, why they regard the mobile operator’s approach to innovation to be more successful.

The web-based approach Due to the fact that the key driver for this paper is to kill the myth of web-based creativity; the approach is not regarded as worth pressuring. Both companies needed more than 500 ideas to get one idea worth going forward with. The web-based approach is too focused on exploring the weak ties in open networks without having the ability to combine these with closed network based on strong ties. They fall through seeing that they are not linking the right creativity networks together. Furthermore they are not having the proper structured process for linking the resulting ideas to internal process networks for exploitation.

The human interaction approach This paper contributes great expectation to human interaction as key driver when pressuring innovation.

By contrast to the web-based approach, human interaction can capture broader expertise by bringing together the right people, both internally and externally, in the initial process. By leveraging on both weak and strong network ties in the GIT process, the probability for providing the right strategic direction for idea creation towards clearly defined customers needs has increased radically.

4. Documentation The data foundation is based on three empirical studies conducted by the authors through consultant work – two portals were analyzed (BMW & Nokia) and one study was conduct on how a Finnish mobile operator could improve their entrepreneurial spirit and drive for innovation.

5. Key words Idea generation, innovation process, key drivers for creativity 6. Technical terms GTI: Growth Through Innovation Human Interaction: In this context, the significance of involving and learning for external networks Weak Ties: Many weak, loose, infrequent, distant contacts Strong Ties: Few, close, frequent relation based on trust communication

7. Researchers •

Granovetter (1973) – network studies – how weak ties help a new product development team with purposeful knowledge sharing.

20. Schilling Ch. 7 Toilletterne

Catwoman

og

bruger

(=Schilling) skal vælge den bedste projektor

en

lommeregner

(=quantitative

measuring)

(=project)

og

et

spørgeskema

(=qualitative measuring) til at afgøre valget.

1. Summary The chapter is about exploring methods used to evaluate/choose innovation projects. The focus in the text concerns different methods, the development budgets, qualitative and quantitative methods and a combination of the quantitative and qualitative methods.

1.1 Development budget Capital rationing: allocation of a finite quantity of resources over different possible uses. The firm sets a fixed budget to rank which projects that possibly could be funded.

• The budget is based on industry benchmarking or historical benchmarking of the firm’s own performance.

1.2 Quantitative methods – discounted cash flow methods •

Discounted cash flow is quantitative methods for assessing whether the anticipated future benefits are large enough to justify expenditure, given the risk. Discounted cash flow methods take into account the payback period, risk, and time value of money.

1.2.1 Net present value (NPV) NPV = Present values of cash inflow – Present value of cash outflows.

If this value is greater than 0, then the project generates wealth, given the assumptions made in the calculating its costs and cash inflows.

The present value of costs and future cash flows can also be used to calculate the discounted payback period.

1.2.2 Internal rate of return (IRR)

The internal rate of return of a project is the discount rate that makes the net present value of investment zero. Managers use the IRR to decide if they want to make the investments.

1.2.3 Real option Real option = It is the application of stock options valuation method to investment in non financial assets.

Firms use the real options approach to assessing project. Real options better account for the long-run strategic implications of a project. Unfortunately many new product development investment decisions do not conform to the assumptions inherent in an options valuation approach.

1.3 Qualitative methods Many new product development projects use some kind of qualitative information, but it is often difficult to quantify or quantification could lead to misleading results.

1.3.1 Screening question One commonly used qualitative method of assessing development project is to subject the project to a series of screening question. That considers the project from multiple angles. These questions may be used merely to structure the discussion of a project or to create rating scales that are then utilized in approach that combines qualitative and quantitative assessment 1.3.2 The Aggregate Project Planning Framework Many companies find it valuable to map their R&D portfolio to levels of risk, resource commitment, and timing of cash flows A company´s portfolio of projects of different types (e.g. advanced R&D, breakthrough, platforms, and derivative projects, figure 7.6) that have different resource requirements and different rates of return.

Companies can use a project map to assess what their balance of a project is and allocate resource accordingly.

1.3.3 Q-sort Q-sort is a qualitative method of assessing projects whereby individuals rank each project under consideration according to a series of criteria. Q-sort is most commonly used to provide a format for discussion and debate.

1.4 Combination of quantitative and qualitative Both quantitative methods and qualitative methods offer a number of benefits managers in choosing development projects. Many firms combine the two methods to choose which project to fund.

1.4.1 Conjoint Conjoint analysis is a method of converting qualitative assessment of a choice into quantitative weights of the different criteria underlying the choice. It is most often used for assessing how customers value different product attributes.

1.4.2 Data envelopment analysis (DEA) DEA is another method to combine qualitative and quantitative measures. DEA enables projects that have multiple criteria in different measurements units to rank by comparing them to a hypothetical efficiency frontier.

1.5 Cases • Boeing Sonic Cruiser • The Market • Marriott 2 Arguments

There is a variety of methods options when you want to rank and pursue different projects. There is no right way to make selection – however a combination of more than one of these methods could valuable in the end.

5. Keywords Decision methods, qualitative, quantitative methods and a combination 6. Technical NPV – Net Present Value IRR – Internal Rate of Return 21. Hauser, John R. and Clausing, Don. “The House of Quality” Område før trappe

Christian Stadil

(=marketing) og Johannes

(=engineer) går ind i et tysk hus

(=Hauser/house of quality) da de skal designe en BH

Hiltons bryster

til Paris

(=Costumer attributes).

1. Summary The house of quality is a “…basic design tool of the management approach known as quality function deployment (QFD), originated in 1972 at Mitsubishi’s Kobe shipyard site.” (p. 63). It is a set of planning and communication routines that focus and coordinate skills within an organization. The foundation of the house of quality is the belief that products should be designed to reflect customers’ desires and tastes – and that marketing, design engineers and manufacturing must work closely together right from the point when the product idea is conceived.

The house of quality is laid out as a conceptual map to provide a means for interfunctional planning and communication – and in this way solve the problem of making marketing and engineers talk together when designing a new product.

Building the House of Quality (see the “full house” p. 72) 1. Laying out the House of Quality begins with the customer, whose requirements are called customer attributes (CA) a. These requirements are identified through market research b. Not all customers are end-users – CAs can include demands of regulators, retailers etc.

2. The next step entails measuring the relative importance to the customer of all the CAs a. These weightings are either based on direct experience with consumers or on surveys b. The weightings are displayed in the house next to the CAs in terms of percentages 3. The third step is finding out how to match or exceed the competition a. Done through customer evaluations of competition matched to own product b. Used to identify strategic positioning of a product or product line 4. Now that the design team has described what to change the next step is for the engineering domain to find out how to do it. a. Along the top of the House the design team lists those engineering characteristics (EC) that are likely to affect one or more of the CAs

5.

The interfunctional team now fills in the body of the House – the relationship matrix – indicating how much each EC affects each CA and establishing the strength of this relationship. a. This enables the team to establish target values (benchmarking) 6. The roof matrix is the last step a. Helps specify the various engineering features that have to be improved collaterally b. Facilitates necessary engineering tradeoffs.

2. Arguments The main argument of the text is that the house of quality grid enables interfunctional team work and thus reduces pre- and post-launch time and tinkering and cuts costs.

By helping the team set targets, the house encourages marketers, engineers and managers to work together and understand one another’s priorities and goals.  It becomes a common “language” or framework for debating priorities.

3. Quotations “None of this is easy. An elegant idea ultimately decays into process, and processes will be confounded as long as human beings are involved. But that is no excuse to hold back. If a technique like house of quality can help break down functional barriers and encourage team work, serious effort to implement it will be many times rewarded.” (p. 73) 4. Documentation The authors refer to studies made of Toyota and other car manufacturers (Sullivan 1986) as evidence that the implementation of house of quality can save time and cut costs (see exhibits I+II, p. 64).

5. Key words (max. 5) Quality function deployment; Innovation strategy; priority setting; interfunctional team work 6. Technical terms To use the house of quality you need to know its glossary such as CA, customer attributes, and EC, engineering characteristics, but there are no technical terms per se.

22. Von Hippel, Eric (1988), “The Sources of Innovation”, Chapters 1 and Trappe

Tony Hawk som barn

Valentin

(=Lead user (begrebet “lead” bliver ikke brugt endnu!!)) og Finn

(=pioneer

researcher)

står

på

hver

deres

klippe

(=77% of innovation in the scientific instrument industry is invented by users) har

opfindet TechPattern

flodhest danser I baggrunden

(=user-innovation). En gammel (=old and outdated theory) lilla

(=von Hippel). En elefant

(=6) står og

kigger op på en klippe

(=7) hvor Tony Hawk

chip i hånden

Larsen

(=semi conductor). Donald Trump

(=lead user) står med en

(=big company) og Lars

(=commercialization) står nedenfor og kigger spændt op på klipperne.

Testing of the basic assumption, that manufacturers are the primary innovators. The text devides firms and individuals into groups of functional relationships through which they derive value from a given innovation.

These functional classes are: 1) Users (of that component, not necessarily the end-user), 2) Manufacturers, 3) Suppliers. The text suggests that that any functional class is a potential source of innovation under appropriate conditions.

Emphasis is put on the importance of users in the innovation process. Studies show that approx. 70-80% of the innovation process is centered on and developed by the user. Only commercial diffusion is carried out by the manufacturer.

The basic assumption is wrong. The role of the manufacturer is to replicate and commercialize the prototype product developed by the user.

23. Von Hippel, Eric (2005), “Democratizing Innovation”, Chapters 2 and 3 Område før toilet

Tony Hawk

(=lead user) en snowboarder

(=snowboard techniques) og Jørgen Ege

(=surgery techniques) innoverer nye teknikker og derefter nye produkter. Ved siden af

sidder der en heterogen flodhest som designer sine egne nike sko på nettet

(=customized by users).

Purpose and theme: 

Lead users innovates more than ‘normal’ users – and customers have heterogeneous needs.

Abstract – short & sweet Chapter 2: “Development of Products by lead Users” Chapter 3: “Why Many Users Want Custom products”

Chapter 2: “Development of Products by lead Users” 

  

There is now strong evidence that product development and modification by both user firms and users as individual consumers is frequent, pervasive, and important. Frequency ranges from 10-40 % in field studies.

E.g. university surgeons and mountain bikers have high rates of user innovations (both care much about equipment) – suggesting that as the intensity of interest goes down, it is likely that the rates of user innovation drop too.

No upper or lower bound on the commercial or technical importance of the userdeveloped products and modifications.

Users develop both major and minor (or incremental) innovations (most minor).

Studies show that quantitatively, some of the most important and novel products and processes have been developed by user firms and by individual users.



Lead User Theory Most user-developed products and product modifications (and the commercially most attractive ones) are developed by users with lead user characteristics.

These are: o Lead users are at the leading edge of an important market trend(s), and so are currently experiencing needs that will later be experienced by many users in that market o Lead users anticipate relatively high benefits from obtaining a solution to their needs, and may so innovate.



Empirical studies to date have confirmed the lead user theory – the two characteristics of lead users and the actual development of innovations by users were highly correlated. Further, the commercial attractiveness of innovations developed by users increased along with the strength of those user’s lead user characteristics.

4 cases are presented: Innovation in industrial product user firms, innovation in libraries, ‘consumer’ innovation in sports communities and innovation among hospital surgeons.

Even when manufacturers learn about users’ needs early, they may not think it profitable to develop their own solution for an ‘emerging’ need until years later.





Chapter 3: “Why Many Users Want Custom products” High rates of user innovation suggest that many users want custom products.  von Hippel argues that it is because many users have needs that differ in detail, and many also have both sufficient willingness to pay and sufficient resources to obtain a custom product that is just right for their individual needs.



Heterogeneity of user needs: when many individual users or firm users want something different in a product type. o If users’ needs are highly heterogeneous, only a small number of users will





tend to want exactly the same thing.

However, mass manufacturers tend to want to build products that will appeal to more users rather than fewer, as to spread their fixed costs of development and production Tests show: Users’ needs for new products and services are often highly heterogeneous. o An individual’s or a firm’s need for many products depends on detailed considerations regarding 1) the users initial state and resources, 2) on the pathway the user must traverse to get from the initial state to the preferred state, 3) on detailed considerations regarding their preferred end state as well. ⇒ Needs for many new products and services that are precisely right for the right user will differ: That needs for those products will be highly heterogeneous.

However, many will be willing to satisfice on many items because of limits on the money or time they have available to get what they want (cf.

Simon).

Evidence of heterogeneous user needs from studies of user innovation: Two studies provide descriptions of the functions of the innovations developed by users ⇒ different functionality implies that the developers of the products had different needs. The studies show a great deal of variation and few nearduplicates. o





Evidence of heterogeneous user needs from studies of market segmentation: Most market studies focus on similar needs from users – because of wish for mass manufacturing of standard products ⇒ partitioning the market into very few segments.

Within-segment variation is low: users within the segment have fairly homogeneous needs.

Within- segment variation is high: high heterogeneity ⇒ dissatisfaction with standard product designed to serve all customers in segment.

Studies show that heterogeneity of need might be very substantial among users in many product categories.



A study of heterogeneity and willingness to pay A need for a novel product not on the market must be accompanied by adequate willingness to pay (and resources) if it is to be associated with the actual development or purchase of a custom product ⇒ the relationship between heterogeneity of demand, willingness to pay (WTP), and custom product development of purchase.

Franke & von Hippel (2003): research of above in a population of users of web server software, Apache, mainly used by industrial firms. Showed very heterogeneous needs among those having in-house capabilities to modify Apache as well as those that did not – and the overall satisfaction with Apache was only moderate. Further, skilled users do not improve their Apache versions to the point where they are perfectly satisfied because the costs of doing so would exceed the benefits (cf. Simon – satisficing).

Method for estimating a users’ WTP: Asking the respondent directly about, how much they are willing to pay, respondents often overestimate WTP significantly.

In private purchases, actual spending is somewhat smaller than expressed. In

contrast, WTP is greatly overstated in the case of public goods (e.g. removal of road from a wilderness area).

Main arguments and conclusions Chapter 2: “Development of Products by lead Users”: User innovations in general and commercially attractive ones in particular tended to be developed by lead users.  In many fields, innovation in techniques is at least as important as equipment innovation (e.g. surgery, snowboarding). Technique-only innovations are also likely to be the work of lead users, and indeed many of the equipment innovations involved innovation in techniques as well as innovations in equipment.

Chapter 3: “Why Many Users Want Custom products”: 



Heterogeneity of user need is likely to be high for many types of products – explains why there is so much customization by users.

24. Von Hippel, Eric (1994), “Sticky Information and the Locus of Problem Solving: Implications for Innovation” Toilletterne 2. sal

En flodhest vil gerne lave et fly. Men viden omkring flymotorer

sted med superlim

er limet fast til et

(=sticky information). Resten af flyet er limet fast et andet sted

. Det vil være for dyrt at flytte motoren og flyet (=high transfer cost=very sticky information), derfor er flodhesten nød til at dele sig op (=task partitioning) for at indhente nok viden.

Text on sticky information. The texts explore the impact of information stickiness on the locus of innovation-related problem solving.

Sticky: very costly to transfer from place to place.

Stickiness: The stickiness of a given unit of information/knowledge is defined as the incremental expenditure to transfer it to a specific location in a form usable by a given information/knowledge seeker.

(Von Hippel, 1994) Producers or service design should move to the site of sticky information: If need information is very sticky, and solution information is not, product design should be done at their user site.

If solution information is very sticky, and need information is not, product design should be done at the manufacturer site.

Innovation: 1) a problem-solving process based upon directed trial-and-error, 2) carried out at the site of “sticky information”. (According to the slides) User innovation: Typically develop functionally novel innovations. (Need information) Manufacturers innovations: Tend to develop improvements. (Solution information) Summary The paper explores the impact of information stickiness on the locus of innovation-related problem solving. The text starts of by defining the term Sticky information and afterwards is divided into four sections where they explore four patterns in the locus of innovation-related problem solving that appear related to information stickiness. In the end they conclude on these four patterns and discuss further research directions of the topic.

Sticky Information They define the stickiness of a given unit of information in a given instance as the incremental expenditure required to transfer that unit of information to specified locus in a form usable by given information seekers. When this cost is low stickiness is low, when it is high stickiness is high.

Sticky Information and the Locus of Innovation-related Problem Solving If information transfer cost is high there is a tendency to carry out the innovation problem solving in these specific sticky information areas. For example many firms are placing their production facilities closely to these areas to minimize the transfer cost.

Sticky Information and "Iteration" When the solving a given problem requires access to sticky information located at two or more sites, we propose the problem-solving activity will sometimes move iteratively among these sites. The text illustrates this point in figure 1.

Figure 1 show how a problem solver first draw on user need information to generate some attributes for desired new product or service. Then, manufacturer information may be drawn upon in order to develop a prototype. Then the prototype is tested in the proposed use context. If the prototype doesn't match the requirements then the iteration continues until the prototype matches.

Different industries use this method in their problem solving process. The text uses the Danish food industry as an example. For example a Danish bakery was asked to develop a frozen unbaked cake by a British food company. It was less costly for the both to companies to send prototypes of the cake back and forth between the companies than to interact physical.

Sticky information and "Task Partitioning" When more than one locus of sticky information must be drawn upon to solve a problem, common experience suggest that even iteration can sometimes be very costly with respect to time and efforts.

The text explains who and why the problem solving can be divided into sub problems. They use the example of an airplane construction where the manufactures divided the production into two sub problems. One is the design of the engine and the other is the design of the aircraft body. It is important to divide the sub problems into the less costly and low information sticky method.

They mention the ASIC (Application Specific Integrated Circuit). In the ASIC method, the overall problem of designing custom circuits is partitioned into sub problem that each draw on only one locus of sticky information, thereby eliminating the need to integrate between two such sites on the design process.

Sticky Information and Investing in " Unsticking" Information When the cost of iteration are considered to be high, efforts will sometimes be directed toward investing in unsticking or reducing the stickiness of some of the information. Sticky information is

often tacit knowledge and firms so sometimes firms invest in tools that make the information more explicit. The tools consist often of databases and other computer technology which capture the tacit knowledge and transform it into explicit knowledge.

5. Key words Sticky information: Information Transform Costs, Innovation, User innovation, Technological Change, Problem Solving, Location of problem solving, Iteration.

25. Baldwin, Carliss, Hienerth, Christoph and von Hippel, Eric (2006), “How User Innovations become Commercial Products: A Theoretical Investigation and Case” Fællessal 2. Sal start

En hund opfinder en dårlig rodeo kajak

(=lead user) en god rodeo kajak

(= herefter opfinder Tony Hawk

(=dominant design). Alec Baldwin

(=Baldwin) afprøver kajakkerne og siger til Donald Trump company) at han skal sætte Tonys kajak i produktion.

(=big

Keywords: User innovation; Communities; Dominant design; Industry evolution; Real options

Abstract In this paper we model the pathways commonly traversed as user innovations are transformed into commercial products. First, one or more users recognize a new set of design possibilities and begin to innovate. They then join into communities, motivated by the increased efficiency of collective innovation. User-manufacturers then emerge, using high-variable/low-capital cost production methods. Finally, as user innovation slows, the market stabilizes enough for high-capital, low-variable cost manufacturing to enter. We test the model against the history of the rodeo kayak industry and find it supported. We discuss implications for “dominant design” theory and for innovation practice.

18 Lead user method and tools (CH) 26. Lilien, Gary L., Morrison, Pamela D., Searls, Kathleen, Sonnack, Mary, and von Hippel, Eric (2002) ,“Performance assessment of the lead user idea-generation process for new product development” Kanap 2. Sal fællesrum

Christian Stadil

(=marketing department) og Johannes

department) skal opfinde post-it notes

(=3M), de vil bruge nogle forbrugere til

at hjælpe dem med at opfinde, så de går på facebook

har kun to venner: Paris Hilton

(=technical

(=network). Men de

(=user/center of target market). Lilien

foreslår i stedet at linke videre (=pyramid networking) gennem sine kontakter til

Tony Hawk (=lead user)

. Stadil og Johannes inviterer herefter Tony Hawk ind i et

værksted (=workshop)

Topic: Lead user method and tools, idea generation techniques Summary Idea generation techniques: Instead of collecting information about needs from a random/typical set of customers, the lead-user process collects information about both need and solutions, both from the users at the leading edges of the target market as well as users in other markets that face similar problems but in a more extreme form.

Example: Auto manufacturers finding inspiration in the aerospace industry (that faces similar problems in a more extreme form) Main arguments Traditional marketing research methods: • Respondents at the center of the market are cognitively limited by current thinking, experience and environment • Does not lead to radical new product breakthroughs (new product ideas that result in entire new line of product or services), but more often incremental innovations.

• Collects need information only • Assign idea generation to manufacturers (not supported by this research)

LU idea generation method: • Gets information from lead users (that are motivated to innovate and experience needs earlier than the majority of the target market. “They live in the future”) • Collects information about both needs and ideas for solutions Ideation tools: Brainstorming, focus groups, customer visits, conjoint analysis, and channeled ideation.

The LU process (often used in next generation product development processes): Phase 1 – Goal generation and team formation (3-5 experienced people from marketing and technical departments, one project leader – all spend app. 12-20 hours per week on a project for 4-6 moths. LU team works with relevant stakeholders to select the target market and type and level of innovation desired) Phase 2 – Trend research (identifying and deeply understanding important market and technical trends) Phase 3 – LU Pyramid Networking (talk with people in other markets – experts tend to be able to point at people with even more expertise) Phase 4 – LU Workshop and Idea Improvement (invite 10-15 lead users and company personnel, first in small groups, then together and evaluate) Hypotheses and results based on an inductive, qualitative study of 3M: Hypothesis 1: LU methods will generate ideas with greater commercial potential (true: more novel ideas, more original/newer customer needs, higher market share, sales in year 5 eight times higher than non-LU methods) Hypothesis 2: LU methods will increase overall rate at which the organization generates major new product lines (true) Hypothesis 3: LU projects will exhibit a lower level of organizational fit (not true – no difference could be tracked) Hypothesis 4: LU ideas will be less protectable by patent (not true – no difference could be tracked) Hypothesis 5: LU methods will cost more in money and time (true: 3M pays $80,000 more, on average, for a successful LU project than for a successful non-LU project. A LU idea consumed 154 person days on average vs. 60 person days in non-LU idea) Conclusion The LU process generates breakthrough new products at a higher rate than by traditional means.

However, LU projects can and do fail! ( 5 out of 7 LU projects, initiated during the study of 3M ,generated ideas that were considered worthy of founding by management) 3. Quotations ”Now the LU process has been made the centerpiece of our new idea generation activities for product breakthroughs, and we have an abudance of radical new ideas. The challenge now is finding resources for all of them” ( 1056) ”LU studies had significantly higher novelty (usually being judged ”new to the world”), addressed more original newer customer needs, and also had significantly higher forecasted market share in year 5 (on average 68 % vs, 33 % for non LU ideas) than did those from more conventional methods” (1055) 27. Luthje, Christian, Herstatt, Cornelius (2004), “The Lead User Method: An Outline of Empirical Findings and Issues for Future Research” Memo loc.: Nødudgang

I forbindelse med udviklingen af LU (=lead user) Tony Hawk-kiksen er Che nødsaget til at gennemgå

fire trin, og dermed skrumpe Gus Hansen (=risk) . Først at samle Village People (=diverse team) og få dem til at ramme plet i en skyde skive (=goal). Hernæst må de smage en masse

kiks og finde dem som Tony Hawk (=lead user) bedst kan li (=trend research). Hernæst må de finde frem til Tony Hawk gennem deres netværk (=Identification of Lead Users). Når Tony

Hawk er fundet kan de sammen gå ind I (=workshop/Concept Design).

værktøjsskuret og bage LU kiks

ABSTRACT In order to reduce the risks of failure usually associated with NPD, leading companies such as 3M, HILTI, or Johnson&Johnson are increasingly working with so-called Lead Users. Their identification and involvement is supported by the Lead User method – a multi stage approach aiming to generate innovative new product concepts and to enhance the effectiveness of cross-functional innovation teams. While the Lead User method is frequently cited in the literature, yet, there are only limited attempts to comprehensively discuss how this approach is embedded in theories and empirical findings of innovation and marketing research. Therefore the Lead User method is in the focus of the present paper, both with respect to its theoretical foundation and its implementation into the innovation management system. First, empirical research on user innovations is reviewed to clarify the theoretical foundation of the Lead User method. Second the attention is drawn to the Lead User practice by discussing the various process steps of this specific approach on the basis of two applications of the method. Based on this discussion, we outline open questions related with the practical implementation of the Lead User method in order to start an agenda for future research.

28. Hienerth, Christoph, and Poetz, Marion (2005), “Making the Lead User Idea-Generation Process a Standard Tool for New Product Development” Memo loc.: Toilletter

Hienerth inviterer Village People til

Donald Trumps husorkester (=internal)

middagsselskab (=combining LU and intern personel) med en meget

ung (=early involvement) Tony Hawk (=lead user) fordi de skal udvikle Super VHS (=incremental innovation). Det viser sig imidlertidigt at Tony Hawk kun har motivation til at

udvikle DVD’en (=breakthrough innovation), og efter en højlydt diskussion bliver Village People ville med idéen og siger det til alle Trumps virksomhed (=commitment).

29. Online videos: The lead user method in practice go to: http://leaduser.com/introductory_article_and_online_video.html Memo loc.:

3: Strategy & Business Models: 30. Ron Sanchez (1999), “Modular architectures in the marketing process” Memo loc.: Busholdeplads Esb.

Pippi (3 Modulairty architectures PPKA)

Sanchez og

skal bygge en computer både til

Paris Hilton (= serve many market segments). Dette gør hun ved at udvikle et

olieboreplatfirm

(=platform) i samarbejde

og Johannes

med

(=product engineer). Derefter kan hun tilkoble netop de

moduler de to kunder hver især ønsker. På stoppestedet hænger et billede af huset i Lego (=modular architectures).

Topic:

stadil (=marketing)

Opera

Investigating the growing use of modular product, process, and knowledge architectures (PPKAs) as a new technological system for carrying out the marketing process.

1. Summary The rising and now widespread use of modular architectures (MA) first associated with computer and high technology industries represents a shift from single product designs towards the design of flexible platforms for product development.

Because of independent/interchangeable components MA are flexible and adaptive compared to more conventional optimized design processes, where components are interdependent and improvement/reconfiguration therefore costly and slow.

Using MA has important effects on various aspects of the marketing strategy, which is covered in the latter part of the article.

2. Arguments 1. MA allows for faster and more cost efficient development of variations in design, through mixing and matching of modular components.

2. Using modular architectures gives more freedom to developers of independent components and less associated management overhead.

3. As a framework for subcontracting development of components MA also gives more freedom to external suppliers and may reduce the initial investment, and thus the financial risk.

4. Strategic partitioning of architectures allows for different rates of technological change between types of components plus reducing costs by increasing use of common components in product variations.

5. Low cost development of product variations enables real-time market research like Sony and Nike does in so called “antenna stores” probing consumers with series of tiny new product lines.

6. Market uncertainties are better encountered, as shifting production to a fluctuating demand is cheaper and faster with modular architectures.

7. Marketing becomes more integrated with the rest of the organization especially designers/developers as (real-time) market input increases.

8. As competing companies incline towards industry-wide MA (i.e. open standardization) innovation and development increases in that industry and large-scale production and and distribution lower costs.

9. Ultimately industry MA/standardization can enable consumer-controlled product differentiation and may facilitate this at price levels comparable to producer-controlled differentiation.

10. Therefore MA is a potential platform for cost efficient mass-customization.

3. Quotations »In the short term, an organization's current product and process architectures determine the product offers the organization can bring to its markets. In the long term, an organization's knowledge about how to create new product and process architectures (i.e., its knowledge architecture) determines the new product and process architectures it can create to hring new kinds of product offers to market.

Thus, at any point in time, an organization's PPKAs act as both platforms that enable and bottlenecks that constrain the organization's ability to transform its perceptions of technological possibilities and market opportunities into new product offers.« (Sanchez, 1999:94) 4. Documentation Based on prior research and case studies by e.g. Sanchez and Collins 1998; Sanderson and Uzumeri 1997. See Table 1, page 96 for cases and references.

5. Key words Modular architectures. Conventional optimizing approach to product development. Strategic marketing.

Technology development. Mass-customization/consumer controlled differentiation. Speed to market.

6. Technical terms PPKAs: Modular product, process and knowledge architectures.

Architectures: Consist of components or if more complex of functional subsystems of components plus interface specifications for the interaction of components.

Interface specifications: Components interact through interface specifications e.g. attachment interfaces or user interfaces Modularity in architectures is created when interface between functional components are standardized (i.e. not changed over some period of time).

31. Ron Sanchez (2002), “Using modularity to manage the interactions of technical and industrial design” Memo loc.: Saltrup st.

Der er optræk til ballade (=confrontation about interface specs.) mellem en flok reasearchere, som ikke

kan blive enige om hvordan en

Inter Fan med et

motherboards (=

interface) ansigt skal males . Derfor skynder Sanchez sig at fryse Inter fans ansigt, som holder et motherboard (=freeze interface). Herefter kan researcherne kun male inter fanen på en måde.

Product architecture: the architecture of a product design refers to: 1. The way the overall functionality of a product design is decomposed into functional components 2. The way the functional components are intended to interact in the product – that is, the specifications of the component interfaces.

Decomposing product and process: major systems, subsystems, components, and parts. (major buildingblocks) Product and process architecture:

Topic: Modularity – design architecture and design process.

1. Summary Modularity is a design approach familiar to most designers, and is now also an important part of management thinking. Besides modularity firms are adopting new kind of product strategies and implementing new development processes in order to gain competitive advantage through modular product design.

The architecture of a product design refers to: 1) The way the overall functionality of a product design is decomposed into functional components. 2) The way the functional components are intended to interact in the product – that is, the specifications of the component interfaces.

A modular product architecture is one that has been designed to allow the “mixing and matching” of different “plug-and-play” component variations. A popular example is the desktop computer, in which a range of product variations can easily be achieved.

This new way of thinking in regards to product development has the benefit that it will increase the speed in which products can be introduced to the market. Traditionally most firms focus on developing key components and secondarily focus on interface specification – but Sanchez argue that this process is too rigid and often causes key component to be redesigned once it is realized that not all interface specification can be met. Instead what should be done is to specify all interface components and then “freeze” the process and constrain developers to conform to the original suggested design.

Strategic objectives for industrial design of modular products - to achieve ‘design intergrity, a costeffictive design solution, and so on’.

The inputs from industrial designers: firstly defining the essential benefits to users of the product, secondly it is to define the variations in functions, features and performance. Several factors interfere with this process; customer preferences and production cost (greater component commonalities result in lower cost) etc. Once the industrial designers are done, the interaction with industrial designers begins.

Benefits that can be obtained through a well-executed collaboration of industrial and technical designers in a modular architecture development process.

-

Improved efficiency and effectiveness in using development resources.

-

Better integration of marketing and technical development objectives

-

Improving the creative design process trough better technical definition.

2. Arguments The use of modularity to manage interactions of technical and industrial design has the following advantages according to Ron Sanchez: •

Accelerate the product development, (the key to getting fast in creating new products is using modularity to reverse the priorities that firms have traditionally followed in product development. The modular approach begins by first working out the component interface specifications for a product architecture, then standardizing –that is, freezing- those interfaces and subsequently constraining component development to conform the established interface specifications (figure 3b p12). Fully specifying and standardizing the component interfaces in modular product architectures, provides the essential information structure for coordinating concurrent development processes and is the key to radically improve speed in bringing new products to market).

•

Increase the range of product variations a company can bring to market, (the use of modular product architecture where you combine components/modules will allow you to configure an almost unlimited number of product variations).

•

Enable more rapid technological upgrading of products, (when component interfaces are specified to support the introduction of improved components expected to be available in the future, technologically upgraded product variations may be brought to market as soon as it becomes available).

•

Reduce the cost of development and production, (the use of common or reusable components that are “transparent” to consumers and thus are not sources of product differentiation, lowers the development costs of new product variations).

3. Quotations “A modular product architecture is one that has been designed to allow the mixing and matching of different plug-and-play component variations in the overall product design to configure product variations.” – Sanchez, design and knowledge management p.9 “Modular product architectures may also be designed to accommodate technologically improved components that are expected to become available during the commercial lifetime of a product architecture.” – Sanchez, design and knowledge management p.11 “Defining and standardizing component interface specifications as the first step in new product development is also the key to accessing the world of design and development capabilities outside one’s own firm.” – Sanchez, design and knowledge management p.13 “Industrial design also plays a critical role in conceptualizing a range of product variations in which each product variation is perceived as distinct from the other product models leveraged from a modular product architecture.”

4. Documentation Based on previous research done by Ron Sanchez. See acknowledgement and bibliography.

5. Key words • • •

Strategy: How to find design solutions that achieves the optimal trade-off, cost reduction benefits. Creating a product that will have an impact in the marketplace and enclose ‘speed-tomarket’ qualifications.

Product variety Cost & development time reduction

6. Technical terms • Product architecture: The way the overall functionality of a product design is decomposed into functional components and how they are intended to interact in the product; component interfaces.

• Modular product architecture: A product that has been designed to allow ‘mixing and matching’ of different ‘plug and play’ component variations in the overall product design to configure product variations • Components: Design elements that results from the functional decomposition of a product design.

• Interfaces: 1) Attachment interfaces How one component attaches to another 2) Spatial interfaces The space a given component occupies 3) Transfer interfaces What goes in (to be transformed) and comes out 4) Control and communication interfaces How one component signals to another component what state it is in, and how the second component signals to the first component whether to stay in that state or change to another state.

5) User interfaces How each component will interact with the intended ambient environment. How the functioning of one component affects the functioning of other components in a product in unintended ways.

6) Environmental interfaces How each component will interact with the intended ambient environment. How the functioning of one component affects the functioning of other components in a product in unintended ways.

32. Ron Sanchez (2000), “Modular architectures, knowledge assets, and organizational learning: New management processes for product creation” Græsted Syd

Ron Sanches

er lokofører på et tog med 3 vogne. Vognene er designet af “matrix-manden”

(=system

designer).

Matrix-manden

adskiller

alle

vognene

(=Decoupling technological, architectural and

component development), så Einstein

(=knowledge) kan hoppe op i dem. I den foreste vogn

(=technological development) ligger der en masse lange termometre

(=long term). Einstein bruger dem til at forudsige vejret (=the future). I den

bagerste vogn ligger der en masse korte numse-termometre

(=knowledge) propper op i numsen på Paris Hilton at ta temperaturen på kunderne.

som Einstein

(=consumer demand) for

Technical modularity: mix-and-match, plug-and-play (possible to change the components)(from slide) In managing modular product creation processes managers must provide guidance for two essential but distinct processes: Defining next-generation and future-generation product and process architectures Developing product and process variations within current architectures

Managers should think of themselves as system designers (not ‘heavyweight managers’) whose task is to create organizational systems for the architectural coordination of product creation and realization activities.

Specifying interfaces in product and process architectures: Attachment interfaces (how one component attaches to another) Spatial interfaces (where a given component fits) Transfer interfaces (what goes in (get transformed) and goes out) Control and communication interfaces (how one component signals another) User interfaces (how users interact with the product or process + macro-system context, ie using AAA batteries) Environmental interfaces (interaction with user environment, the function of one component can affect another component in unintended ways) 33. Ron Sanchez (2004), “Creating modular platforms for strategic flexibility” Stop ved Prima

Ron Sanches

startego

sidder på en olieboreplatform

(=strategi) med en slange

de sidder på en platform kan Ron Sanches børste tænder . case) på slangen.

(=platform) og spiller

(=flexibility). Fordi

(=Philips toothbrush

Succeeding in today’s competitive product markets requires that firms have the strategic flexibility to respond more quickly to changing market demands, to differentiate more product variations for rapidly segmenting markets, and to bring new and upgraded products to market faster.

The text puts emphasis on organisational modularity, which enhances the organisational structure. Modular platform creation calls for more-extensive integration of product design and supply chain design, leading to more-intensive interactions of product designers with all the aspects of the supply chain that will execute a platform-driven market strategy.

34. Ron Sanchez (2001), “Product, process, and knowledge architectures in organizational competence” Græsted rutebilsstation

Ron Sanches er træner for Hull City (=holistic organization approach).

Vind og vejr spiller altid en vigtig faktor når der er kamp. (=changing environments). Ron Sanches

udvikler alle spillerne (=different departments in the organization) meget specielle talenter – eks.: sparke hjørnespark. Ingen af spillerne ved dog hvad de andre kan, så de ved

ikke hvordan de skal spille bolden til hinanden. Einstein (=knowledge) bliver ansat som assistenttræner og han får spillerne til at snakke sammen på banen. (=importance of knowledge sharing when implementing modular design).

Sanchez (2001) especially investigate how adopting modular product and process architectures can significantly enhance a firm’s ability to identify and manage its organizational knowledge in creating and realizing products.

Sanchez adds four dimensions on organizational competences: The environment of a firm is dynamic Organisations are open systems that are embedded in larger macrosystems of industries and societies Managing systemic organizational change in a dynamic environment poses substantial cognitive challenges for managers Managing organizations as systems in a changing and uncertain environment requires an understanding of the holistic nature of organizations. (p. 241) 35. Afuah, A., (2004), “Business models: a strategic management approach”.

Helsinge station

Afuah

star sammen med Mortan Albæk

som er I gang mad at lave en ramme man kan udstillle penge i

(=business model)

(=framework for

making money). Afuah holder et modelfly

insulinpen i dne anden hånd

(=airline industri) i den ene hårn og en

(=pharmaceutical industri).

Topic: Designing and using different business models as integral part of business performance 1. Summary Chapter one: A business model is primarily a framework for making money. It is the set of activities which a company performs, how it performs them and when it performs them that are the main focus as the firm uses its resources to perform activities given its industry to create superior value to its customers and to put itself in a position to appropriate the value.

A firm’s profitability is determined by both industry and firm-specific factors.

Three main industry factors are identified as: 1) Competitive forces in the industry (rivals, suppliers, customers, potential new entrants, complementors and substitute products) 2) The influence of the macro environment (government policies, legal systems, the country’s culture, fiscal and monetary policies and technological change) 3) Cooperative forces between the firms and their suppliers, customers, rivals and potential new entrants Three firm-specific factors are identified as: 1) Positions of a firm (customer value, marked segment, sources of revenues, positioning, price) 2) Activities of a firm (which, how and when the firm chooses to perform the activities) 3) Resources of a firm - tangible assets (plants and equipment etc) and intangible assets (brand, patents, trade secrets, human skills, knowledge etc.)

An attractive industry is an industry where the competitive forces are low which allow these firms in that industry to be, on average, more profitable than firms in other industries. An example is the Pharmaceuticals industry. An unattractive industry is the airline industry.

A firm’s ability to turn its assets into customer value for different market segments and the right bargaining position is its competence.

A business model depends on the factors that determine a firm’s profitability. These components are: positions, activities, resources, industry factors and cost. Revenues are just one element of making money and a business model is distinguished by how the firm earns a profit, not by how it generates revenue alone.

Strategy and business models are closely related because the two models both deal with the winning/performance aspect. Nevertheless, the two models also show dissimilarities. A business model includes the profit-oriented aspect of strategy and operational effectiveness, the elements of both business strategy (the competitive strategy) and implementation that are oriented toward financial performance and the profit oriented factors of its business strategies.

Chapter two: Offering better customer value than competitors is a central aspect of a business model.

The firm generates better customer value by offering A) a differentiated product or B) a low-cost product (or both – notice figure p. 28 regarding the dilemma of “being stuck in the middle”).

•

•

A) To follow a differentiation strategy, the firm should offer a product or service that the customers perceive offering benefits that are superior to those of competing products or as having benefits that competitors do not have. Seven differentiation factors are identified: product features, brand-name reputation, network size, timing, location, service and product mix.

B) To follow a low-cost strategy, a firm needs in performing value-adding activities to understand what the determinants of its costs are. The six determinants of a firm’s per-unit costs are: economies of scale, factor costs, industry-specific costs, innovation, agency costs and economies of learning. To follow a low-cost strategy a firm should be able to compete on price.

Offering better or superior customer value may not always be sufficient. A firm’s position within an industry, determined by the competitive forces in that industry (customers, suppliers, rivals, potential new entrants, complementors and substitutes) is very important as well.

Chapter three: Pricing is also an essential part of a business model in maximizing profits. The firm should strive to set the price as close to customer’s reservation prices as possible. A customer’s reservation price is the maximum price that the customer is willing to pay (a function of needs, perception, benefits and ability to pay). However, this is very difficult in practice. Different pricing strategies and methods as cost-based pricing, customer value-based pricing, segment pricing, two-parttariff pricing are discussed in this chapter.

It is very important that the pricing strategy fits with the business model.

Chapter four: Is about how the firm generates revenue and identifies the sources of revenues.

A revenue model identifies how to generate revenue: which sources to pursue, what value to offer, how to price the value and to identify who will pay for the value.

Different sources of revenues are: direct product/service sales, after-sales service, product financing, pay-later financing, royalties and intellectual properties.

Different revenue models are: advertising, commission, fee for service, production etc.

The Growth-Share Matrix and the GE/McKinsey Matrix are two frameworks to analyze how well the firm is doing in generating revenues from the sources or revenue models mentioned above. However, these two models also have limitations see p. 73-74.

A successful business model is also about targeting the right customer segment that has the right value.

To do this the firm can choose one-to-all marketing, one-to-one marketing or one-to-segment marketing (business or customer segments).

Chapter five: The activities of a business system are called a value chain, value network or a value shop. Each time an activity in the value chain is performed the perceived value by the customer is increased (figure 5.1 p. 85 from downstream looking upstream toward the design stage.) In the value chain the firm interacts with customers, suppliers, complementors and firms form other industries. The system of business systems is therefore called a value system or a supply chain. To enhance the chance of having a competitive advantage the firm should follow activities that are different from rivals, but still consistent with product differentiation or low-cost, take advantage of the value drivers in the industry and form a system that are difficult to imitate. A firm should enhance its ability to offer superior customer value and to appropriate it.

A firm should integrate vertically if the firm then can offer better customer value than its competitors or if it then can put itself in a position to appropriate value.

The timing of activities, that have the goal of increasing the chances for a competitive advantage, is very important in relation to for example first-mover advantage. Furthermore, the Wal-Mart case is a clear example on the importance of which, how and when activities are performed see p. 104-107.

2. Arguments - Low-cost or differentiated products are central in making superior customer value.

- The stronger the competitive forces are the less profitable the industry’s firms are – for instance the airline industry.

- A firm’s business model and the characteristics in it that allows the firm to earn a higher rate of profits than its competitors are its competitive advantage. Meaning that a well-conceived and executed business model can give a firm a competitive advantage - In setting a price, it is important to have an objective in mind and to find some way of tracking the extent to which the price that is set meets the goal.

- The excess of a product’s price over its variable cost usually goes to recover fixed costs. When the fixed costs have been recovered, the excess becomes the firm’s profit.

- To choose the right set of activities to perform and which not to perform is a central aspect to gain success. See p. 96 about Coca-Cola and offering superior value.

- Resources and product-market positions are translated into profits and therefore the link between resources, product-market positions and profits becomes important.

3. Quotations - “…there is something about some industries that allows the firms within those industries to be more profitable on average, than firms in other industries” (p.2) - “…within each industry, there is something about some firms that makes them more profitable than their rivals” (p.3) Appropriate value here means “earn a profit commensurate with the value created” 5. Key words Business model, profitability, industry and firm specific factors, competitive forces, customer value, differentiation strategy, low-cost strategy, capability and competence, pricing strategy, revenue model, revenue sources, right customer targeting, business system, competitive advantage, vertical integration, value chain, supply chain, first–mover advantage.

36. The case of Tesla and Koenigsegg Memo loc.:

4: Knowledge and analytical tools 37. Boisot, Max H. (1998), “Knowledge Assets. Securing Competitive Advantage in the Information Economy” Gang op til indgang

Bo Hamburger

kasse. Nede i kassen

med sod

(=Boisot) i hovedet står ved siden af en

(=I-space) ligger der et abstrakt maleri

(=abstraction), en

sæk med cement

(=concrete), en dankortterminal

(=codification) og BS

(=tacit knowledge). Einstein er også dernede og han elsker at rejse rundt samtidig med at

han klæder sig ud.

1.

2.

3.

4.

5.

6.

7.

-

(=Knowledge).

I-space: Describes what knowledge is good for Between data and information You can stall the information = an asset How knowledge contributes to effectiveness How we can economies, with this new knowledge and contribute to output Knowledge makes it possible to produce better measurement of output A piece of information that allows us to use resources for road maintenance We start with knowledge then use data to structure and select information, which again gives us knowledge. The more data we can press together the more physical output we are able to do.

The information space has three cognitive processes: Codification = to organize and structure, ex. traffic light Abstraction = to make things more specific Diffusion = decodify. To make them explanatory for others When it has taken one tour around the I-space it is adopted by others. After diffusion the product is much more accessible for other firms.

Block = if you can take out a patent it is a way of destroying the cycle. but it depends on how the patent works within the different industries.

Finn adds a forth cognitive process; Configuration = the firms has pressed all the knowledge that solve a problem for the customer and then puts it into a configuration and a product package that solves the customers problem (consultant). With configuration it is more difficult for others to imitate your product, because the product is much more complex.

Knowledge builds on information that is extracted from data. Data can be characterized as a property of things, knowledge is a property of agents predisposing them to act in particular circumstances.

Information is that subset of the data residing in things that activate an agent – it is filtered from the data by the agent’s perceptual or conceptual apparatus. Knowledge makes data meaningful and into information.

Boisot introduces the information space (I-space) in which information can flow and evolve. The Ispace is a conceptual framework within which the behaviour of information flows can be explored and, though these, the creation and diffusion of knowledge within selected populations (social groups) can be understood.

The act of codification attempts to reduce uncertainty Definitions: ENTROPI (entropy)1. den tilstand af uorden el. tilfældighed der råder inden for et system, fx mellem partiklerne i en genstand; et systems entropi vokser når det, som fx ved opvarmning el. nedbrydning af et stof, går fra en mere til en mindre velordnet tilstand E-min: top-left under ordered regime (company achieve competitive adv./exploitation) E-max: bottom-right under chaotic regime (data has no structure and diffusion is random/exploration)

V-min: bottom-right under chaotic regime (is value generating in learning/exploration) V-max: top-left under ordered regime (diffusion at a min. and codification and abstraction at a max./exploitation) In the chaotic regime is where the most data is, in complex regime there is medium data, and in ordered regime there is little data.

Topic:

To secure the competitive advantage in the information economy

1. Summary The evolutionary production function (p. 25) The base of the article is a graph depicting a concept defined the evolutionary production function. On the x-axis the physical factors represents all resources needed in the production. The y-axis represents knowledge in the form of data. The argument is, that by increasing knowledge an automatic decrease in resource-consumption follows. “By traveling up or down the transformation curve AA´a system can economize on the consumption of physical resources by increasing its consumption of data and vice versa (p.27)” The second argument of the article is that beyond the evolution of knowledge i.e. the linearity of learning, there is insight; “The act of insight generates meaningful patterns that convey to the useful information about the world it exists in and hence modifies its disposition to act- i.e. it creates knowledge (p. 30)” this is graphically described as a jump between graphs of different levels. The abovementioned argument means that, contrary to neoclassical production function, the movement on graph cannot go backwards; it is not possible to have an “un-insight”.

Information Space (I-space) (p.41) Information space (I-Space) is basically about ideas there are brought together in a single integrated conceptual framework. They are brought together in three terms: Codification, Abstraction and Diffusion.

Codification (P.42): is about the process of creating perceptual and conceptual categories that facilitate the classification of phenomena1. It could be based on selection of characteristics/dimensions (e.g. colour, shapes, sizes etc.) which is relevant for the transition of data into information.

Phenomena that vary discretely are easier to codify than those that vary continuously.

Abstraction (p.48): Codification and abstraction often run closely together, so much so that they are frequently confused. They are however quite different.

Abstraction gives form to structure instead of phenomena. It produces simpler, underlying structures that represent or explain data. e.g. In the form of scientific theory.

Abstraction like codification is a device for shedding data – i.e. for economizing on data-processing resources.

Diffusion (p.52): Can be scaled to refer to the proportion of a given population of data-processing agents that can be reached with information operating at different degrees of codification and abstraction. If you want to put the information together you can lead the message to the desired effect, by the sender and receiver obtaining the information and sharing it together, more than just coding the schemes together. In order to share this information they must share compatible orientations such as; values, attitudes and motivations.

Is basically about accessibility of information – i.e. making info less person and context dependent.

1

From page 42 under bullet 3.2 second section!

Several considerations can affect the diffusion trajectory of a message within a given population.

Different levels of technical, social and cultural considerations will influence the absortion of information within that population and hence the rate at which it is taken up and used.

I-space (p.55) When we look at the codification and abstraction together, they are mutually reinforced and, acting together, they greatly facilitated with diffusion of information.

The I-space is a conceptual framework within which the behavior of information flows can be explored and, through these, the creation and diffusion of knowledge within selected populations can be understood.

5. Key words Evolutionary production function, Codification, Abstraction, Diffusion and I-Space, Knowledge sharing.

6. Technical terms The evolutionary production function = The coherency between data (knowledge) and physical factors (resources) (p. 26) Codification = A process of giving form to phenomena or to experience (p. 41) Abstraction = The process of discerning the structures that underlie the forms (p. 41) Diffusion = Is about accessibility of information - I.e. making info less person and context dependent (p.

52) The I-space (Information space) = Bringing together the three above-mentioned terms (p. 55)

38. Griffith, Dorothy and Boisot, Max H., “Are There Any Competencies Out There? Identifying and Using Technical Competencies” Studievejleder

Griffen

people) til en workshop

(=Griffith) inviterer village people

(=internal diverse

(=workshop). Village people har sammen bagt en

pizza (=product of any components) med kerner (=core competence) i. De skal nu alle smage på pizzaen og registrere om de enkelte stykker indeholder kerner eller ej (=identification of core competences). Det skal de så notere i c-space på et stykke

papir. På baggrund af papirerne fortæller griffen eller s-learning. Eller en kombination.

Link til Harryson weak vs. strong ties + open vs. closed network.

Link Shilling ch. 3: Dominant design.

(=Griffith) om de skal bruge n-

Topic: Core Competence, C-space 1. Summary The first section the text contrasts the traditional/technological view of company core competencies with the Resource-Based/Institutional view of company core competencies. The technological view emphasizes core competencies as “objective capabilities”- focus on the firm to create (innovate) and capture (Schumpeter, Porter). The institutional view focuses on the socio-political factors that influence a firm’s definition of what it is and deals with identification (Selznick, Prahalad and Hamel).

Prahalad and Hamel’s (1994), (p. 203) definition of a core competence: • • • • •

Are an integration of skills and technologies, exist at an aggregate level Are a product of learning, incorporate both tacit and explicit knowledge Deliver a fundamental customer benefit Difficult to imitate- longevity Enable access to new markets

Furthermore they distinguish three types of core competencies: Market access, Integrity-related and functionally-related.

Additionally, Penrose (1959) adds to the discussion of core competencies that “…path dependency and the cumulative nature of technological knowledge within firms..:” (p. 204) is important.

To help companies extract both tacit and explicit knowledge to clearly identify their core competencies Boisot (1994) has developed the conceptual framework the C-Space, which explains “…the structuring and flow of information within and between organizations…” (Griffiths & Boitsot, 2000).

The C-space framework indicates the degree to which knowledge is codified/un-codified and whether it is diffused/undiffused in the organization. The model helps disillusion companies to clearly see if what is assumed to be their core competence really is their core competence. In this way the C-Space will test against an assumed core competence, and explore whether this core competence is present or not. In the C-space tacit knowledge can also be recognized with and without codification without becoming explicit knowledge.

The figure shows the Social Learning Cycle (SLC) integrated into the C-Space.

See application of C-Space conceptual framework to companies under 4 – documentation.

2. Arguments Main argument: It is very difficult to clearly identify core competencies since they are composed of both tacit and explicit knowledge.

3. Quotations “We feel that at least part of the problem rests with the process and consequences of accessing and exposing tacit knowledge. Tacit knowledge, almost by definition, is difficult to capture.” (p. 207).

“The use of the C-Space meant that they did not actually have to articulate these key processes: The CSpace facilitated both recognition and recognition without codification. It is this tacit element of competence which we believe provides inimitability and sustainability.” (p. 227) 4. Documentation The text includes examples of three companies that have sought to clearly identify their core competencies. Example one, company A, discovered that an assumed core competence was actually market knowledge, and not firm-specific technology that gave them a competitive advantage.

Example two, company B, discovered that although they have successful have developed a product they do that have the core competencies to develop its’ successor. “… if it did, we would have expected to see some technologies and linkages located in the lower left quadrant of the C-Space..” (p. 224).

Example three, company C, discovered that “… technology generation remained important to them even though they no longer sought to exploit their knowledge assets by moving them through the region of maximum value…” (p. 225). Furthermore they recognizes tacit knowledge within the company and realized its’ value.

5. Key words Competence, tacit and explicit knowledge, C-space, paradox of value 7. Researchers M. Porter (1980, 1985): Competitive Strategy, Competitive Advantage (Traditional approach)

Prahalad and Hamel (1990, 1994): Definition and classification of core competencies (The institutional view / resource based view.) Institutional definition of core competence.

Schumpeter (1934): technological definition of core competence.

39. Arora, Ashish, Fosfuri, Andrea Gambardella, Alfonso, (2001), “Context dependence, sticky information and the limits of the market for technology” Bogdepot

Steve Jobs

(=innovation) skal slagtes (=division of innovative labour). Herefter skal

han flyves rundt til forskellige dele af verden i en Aurora bomber

(=Arora) og

sammen med operahuset i lego (=modular architectures) droppes af forskellige steder. Aurora bomberen har været dyppet i lim og er derfor dyr at flyve med (sticky information is expencive).

The main point is to the extent to which knowledge can be made more or less explicit is fundamentally an economic decision (will the organization use money on creating a database so the knowledge can be extracted from tacit to explicit knowledge).

Tacit to explicit knowledge (said by Nonaka in the text – 4 knowledge conversion) The 8 attributes of knowledge describes how easy tacit knowledge can be transformed and imitated in an organization (said by Winter in the text) Most knowledge is embedded within organizational knowledge so the diffusion of it depends on the command ways and communication inside the organization (said by Kogut & Zander in the text) People who possess skills and expertise within technical problem solving are usually the people who use tacit knowledge as a way to store and transfer knowledge (said by Polanyi’s in the text) Link to modularity as the authors touch this concept of modularity and modularity in product design.

Simon says that decomposition of a complex problem into separate, more elementary subproblems in an organizational design issue (from slide) Topic: Cognitive factors in technology transfer and division of labour.

1. Summary What is knowledge and technology? How can it be transfered between companies, used in innovation, commercialized, and secure a division of labour?

4.2 Knowledge as an economic ressource

Polyani (1966): Most knowledge is tacit (as opposed to codified “articulated/written down”). As it can be difficult to articulate, it can also be difficult to communicate and transfer to others.

Nelson and Winther (1982): Companies posses a complex set of knowledge bases, competencies and skills, which are embodied in sometimes unintentional organizational routines. This creates organizational knowledge, which can be difficult to transfer outside the organization.

Winter (1987): Taxonomy of eight pairs of attributes to distinguish different types of knowledge: Articulate or tacit, teachable or unteachable, articulated or nonarticulated, observable or nonobservable, simple or complicated, system-independent or system-dependent, context-independent or contextdependent, monodisciplinary or transdisciplinary. Characteristcs of the first element of each pair makes it easier to transfer knowledge, characteristics of the second makes it harder.

Sometimes it is better to keep knowledge tacit – reducing the risk of “leakages”. While sometimes the knowledge should be codified and supplied to other parties, to obtain higher economic value. (licensing technology to other firms who can exploit the technology commercially, etc) Nonaka (1991): Four modes of knowledge exchange: From tacit to tacit (socialization – individuals working together), from explicit to explicit (combination – combining explicit knowledge, for example into a manual), from tacit to explicit (articulation – standardizing tacit knowledge into blueprints etc), from explicit to tacit (internalization – internalizing explicit knowledge from manuals etc, so individuals can use this knowledge on a daily basis without making reference to the manuals) Arora and Gambardella (1994a): Whether knowledge is to be tacit or codified is an economic decision. Computers etc also makes it easier to codify and standardize knowledge and make it less context-dependent. Therefore it can be shared and transferred across platforms easier. (for example in the semiconductor and biotech industry).

4.3 The complex organizational design of a division of innovative labour Succesful division of innovative labour requies that the innovation process is also decomposable.

Herbert Simon (1962): The extent to which problems are decomposed into seperate, more elementary subproblems is an organizational design issue. For example the precapitalistic artisan who performed all activities in the value chain himself, to the decomposed Fordist systems of manufacturing.

Vincenti (1990, 76): More complex tasks, for example in engineering, requires mastery in several fields. For example in airplane related equipment manufacturing, different specialized teams work on each their task, but they will still need to communicate a great deal among the teams during the process.

Teece (1998): The interdependencies among tasks in the innovation process and the natural uncertainty associated with development and commercialization of innovations create at least three sources of transation costs: 1) Due to the uncertainty, contracts cannot be precise and can therefore be open to oppotunistic behaviour from either party. 2) Tight interactions with one supplier can generate sunken costs, which may in turn increase “lock-in” and switching costs. 3) Releasing pre-contract information to bidders also open up vulnerability that competitors may discover the company’s R&D plans. This is why this process is often kept within the firm.

4.4 Modularity If companies can divide products into seperate components or “modules”, the organizations responsible for commercializing the product can also be modularized.

Henderson and Clark (1990): If the architechture can be designed and developed independently from the individual components, the components can also be improved individually of each other. (This can counter shorter PLCs, reduce TTM, and generally increase the value of product customization.)

Langlois and Robertson (1992): state the case of the above with computers, where the individual hardware components can be changed independently of each other.

Sanchez and Mahoney (1996): Modularity in products design bring about modular organizations, which can coordinate their activities independently of a superior managerial authority.

Baldwin and Clark (1997): This reduces transation costs and enhances the opportunities for marketbased contractual arrangements.

4.5 Task-partitioning and Sticky information Von Hippel (1990, 1994, 1998): Greater efficiency can be achieved by dividing the overall problemsolving effort into tasks with maximum interaction within them and minimum interactions across them.

(For example in building an aircraft – one team designs the body, another designs the engine) Von Hippel (1994, 1988): Sticky informaiton is information which can only be transferred at a very high costs to the other parties. For example in development of a new system for a bank or insurance company. The developers would first spend time at the institution to identify the needs of the users, then go back and develop. Instead the problem-solving effort should be moved so that user and producer can only draw upon local information.

4.6 Task-partitioning in Innovation and the Technology of Technical change.

Bonacorsi and Pammoli (1996): Systemic uncertainty means that even if one has tested the functions performed by the different modules, there is still an uncertainty whether the system as a whole will perform as expected, as it can only be assessed when the full system is assembled and tested.

Langlois (1999): Ford’s consolidation of all production steps in a vertically integrated company was crucial to the successful introduction of the Ford T. Existing suppliers were either unable to provide the needed equipment or believed that it was not possible to produce the equipment as specified by Ford. If Ford had not integrated all the steps, experimentation with new techniques, machines and parts would not be possible, or at least bear a very high coordination costs.

Cohen, Levinthal (1989), Rosenberg (199): Also, as buyers of information have to be knowledgeable themselves. Even firms downstream in the innovation process will have to invest in considerable absorptive capacity.

40. (Case: Finn Valentin Carl Bro and Pavement Management) Ved gratismagasiner

Lars Larsen

sælger til Paris Hilton

hun køber en manual Valentin/appropriability).

(=commercialization) har lavet an kopi af Prima 100

som han

(=costumer demand), men Paris Hilton kan ikke få den til at virke før

(=software information) af Finn Valentin

41. Fleming, L. and O. Sorenson, (2004), “Science as a map in technological search” Fællesrum

(=Finn

James Bond (=fleming) og Thomas Sørensen (= Sorensen) er på trekking og vil gerne bestige det højeste bjerg (=best performance). De står i et

science-landskab med bind for øjnene, så de kan kun famle sig frem lige omkring hvor de står (=local search). Så får de fat i Darwin

(=fundamental science), som følger dem hen (=distant search) og op på højeste

og bedste bjerge. På toppen af bjerget ligger der en kameramobil

(=combination of components with high synergi effect).

Science alters inventors search processes by leading them more directly to useful combinations. Science has no apparent effect when inventors work with relatively independent pieces; it only appears beneficial when inventors seek to combine highly coupled components — a particularly difficult task.

Research out of this tradition holds that invention comes either from combining technological components in a novel or through reconfiguring existing combinations. Researchers most commonly point to local search and inventors search incrementally. Explanations for the prevalence of local search frequently focus on the value of experience. The downside is that inventors are prevented from distant – a potentially more useful – possibilities. Science is one way for engineers to gain knowledge on distant search before doing it in real-life. Science could usefully increase the effectiveness of search by identifying useless directions of search before hand, and by providing a glimpse of the possible – mapping out possible bumps and rocks. In other words, science can tell inventors how to avoid wasted effort solutions. It can also stop firms from trying to achieve an unobtainable goal indefinitely – thus wasting their effort by predicting whether something is theoretically possible. In landscape metaphor the ruggedness of the landscape increases as the degree of coupling among the components intensifies.

Inventors who search incrementally with strongly coupled components make slow progress and have no assurance of ultimate success. Rugged landscapes contain a large number of potentially useful configurations, if inventors can only find them. As the coupling increases, however, the difficulty of search rises, and the average usefulness of inventions declines.

42. Klevorick, A. K. et al., (1995), “On the sources and significance of inter-industry differences in technological opportunities” Dramarum

En klog Ricky Martin med briller

en dæmning

(=Klevorick) bygger

(=pool of technological opportunities). Finn Valentin

(=pioneer research/Advances in scientific understanding and technique), et Viking Jazz

band (=technological advance in other industries) og Scooter (=Positive feedback from an industry technological advances) fylder vand i poolen (Scooter fylder

vandet igennem en tragt

(=trajectory). Techno Viking

drikker

vandet og begynder at danse (=technological advancement). Techno Viking besøger også en anden dæmning, men den er der ikke noget vand i, så han danser ikke (=no technological advancement).

Positive feedback from an industry’s technological advances.

He discusses whether or not universities have any impact on the industries and concludes from empirical studies that it depends on what kind of industries he analyses. R&D intensity is largely determined by two key variables, technical opportunities, and the ability tp appropriate returns from new development. Refer to Schumpeter: size of company + market structure. Large companies (monopolistic structure)  more innovation and research.

43. Tidd, J.; Bessant, J., and Pavitt, K., (2001), “Managing Innovation – Integrating Technological, Market and Organizational Change.”

Kantinen

En pige med store bryster

(=Tidd) og Paven

(=5) og en tragt

Cruise

(=firms) til at mase en techno viking

(=Pavitt) som har en klo

(=trajectories) i hånden, tvinger Tom

(=technology) gennem en tragt

(=trajectories/path dependent) ned på et strategospil (=strategy).

Five major technological trajectories (kurs/bane/livsbane)/ also Pavitt’s taxonomies; 1) supplier– dominant firms (the company does not add any creativity, often comes from supplier company.

Managerial challenge, technology-taker companies: can’t appreciate the technology), 2) scale-intensive firms (product manufacturing as motor  production design + engineering  key mechanism: secure scale economies), 3) science based firms (basic electronic, exploit basic science. Patenting), 4) information-intensive firms, 5) specialized supplier firms (Taylor-making technologies for specific enduser. monitoring opportunities).

An invention needs both a demand pull and technology push in order to become a reality – said by Schumpeter in the text.

Innovation is a process which can be managed (manipulated to affect the outcome), routines underlying the process of innovation management – the model with five stages. 1) Environment scanning & signal processing. 2) Strategy & planning. 3) resourcing. 4) Implementation. 5) (optional) review the feedback of the previous stages in order to gain knowledge from experience

The majority of failures are due to some weakness in the way the process is managed. Success in innovation seems to depend on two key ingredients: tech. resources and the capabilities in the organization to manage them.

44. Reger, Guido and Schmoch, Ulrich, (1996): “Organization of Science and Technology at the Watershed.”

Område ved bænke og 3 comp.

En streaker med et “R” på maven

(=four categories of firms). Darwin

(=Reger) løber ind over en baseball-bane

(=science) og Tom Cruise

(=firms) står ved den første base og laver coke til de Tom Cruise kloner (=other firms) som står på de andre baser. Tom Cruise klonerne som står på de andre baser er meget afhængige af den coke som Darwin og Tom Cruise laver på den første base, for at kunne lave ”produkter”. Tom Cruise og Darwin vil gerne finde ud af hvilke produkter der kræver mest coke at lave, så de får streakeren til at

spørge en gruppe gruplende mennesker med de mest R&D krævende produkter.

(=Grupp) om han kan kan lave en liste

They argue that there is a linkage between four different categories of firms; 1) supplier dominated firms, 2) scale-intensive firms, 3) science based firms, 4) specialized equipment suppliers. This linkage is they essence of they argument and the difference from Tidd’s trajectories. The text discusses how most industrial sectors rely more or less on science. Depending on what kind of product is produced the dependency on science in the specific industry can be established by looking into companies R&D budget + amount of patents taken + scientific journals published. Science based firms rely heavily on R&D, which in turn is largely based on the rapid development of the underlying sciences in universities and elsewhere.

Theme: The text focuses on the importance of R&D across different industrial sectors. It further divides products into being either leading-edge – or high-end technology. The main issue is which industries, sectors or products depend on R&D. The findings are that R&D is very crucial in the fields of chemicals and electronics.

Summary: Pavitt (1984) divides firms into four main categories: Supplier-dominated firms, scale-intensive firms, specialized equipment suppliers and science-based firms. The text focus is on the science-based firms, emphasizing that R&D is a crucial factor in this industrial sector. R&D does not only play a role for the science-based sector itself, the whole economic system depends on innovations from the science-based industry even though the effect often is not tangible in the final products. Because industrial sectors are not homogenous in their structure, Grupp (1993a) characterizes and divides products according to their R&D intensity into either leading-edge technology or high-end technology. His findings are that the fields of chemicals and electronics prevail (these belong to Pavitt’s science-based sector), as well as motors, aircraft and machine tools (these don’t belong to Pavitt’s science-based sector).

Some countries are more active in the science-intensive technologies. It mainly depends on the national academic and industrial traditions. National topics of public research are often linked to prestige projects or the requirement of sectors or local pressure groups and are therefore not necessarily scienceintensive.

2. Arguments Main arguments: The main technological linkages between the different categories of firms. ( Figure 4.2.1) 3. Quotations Universities are important centers for technology production (p. 65) 4. Documentation Reports by Pavitt and Grupp/Schmoch are used to document the theory.

5. Key words Tecknological linkages, Science-based firms, Collaboration with universities, patents, Science-based firms, Leading-edge Technology, High-end technology 45. Gambardella, Alfonso, (1995), “Science and Innovation - The US pharmaceutical industry during the 1980s” Bibliotek

Rihanna synger ‘Umbrella’

(=Gambardella) alt imens en flok researchere

(=pharmaceutical researchers) forsøger at løse en suduko (=pharmaceutical product) ved at prøve med tilfældige tal (trial-error). Efter lang tid kommer Finn

Valentin

(=Pioneer researcher) og Darwin

(=science) med en Matlab

(=simulering) og forklarer dem teorien bag sudoko. Med hjælp fra teorien og matlab kan de hurtigt løse sudokoen. Researcherne prøver derefter at ansætte Finn Valentin.

Main purpose is to understand that the state of affairs within industrial research is changing, due to the fact that there have been made spectacular scientific developments and equally impressive progress in computational capabilities and instrumentation → instead of “blind� (physical) experiments to see what works, scientists today test hypotheses using highly sophisticated instruments. Theoretical advances, combined with powerful computational skills, are encouraging the diffusion of a new approach to industrial research.

The drug innovation cycle: Drug innovation is composed of fairly standardized steps, which are designed in the main by regulatory authorities, starting at the pre-clinical R&D, clinical R&D (3 phases), NDA review, and finally the post-marketing surveillance.

Historical description of the US pharmaceutical drug development in the 1950-1960 Topic:

Pharmaceutical industry, the influence of science on innovation,

1. Summary Most innovative steps forward in history have stemmed not from any scientific framework but have in fact mainly come from old-fashioned trial-and-error experiments. This hit-and-miss nature of the experiments are in agreement with Schumpeter's view that big firms could afford the huge set-up fees of R&D labs; making many experiments and thus bringing a semblance of order to the process.

The time-lag between scientific discoveries and their industrial applications becoming 'visible' has been decreasing, especially in the 70s and 80s. This is because scientists can simulate a lot of experiments through computer power, which also allows for increased scalability of the experiments so that more tests can take place in a shorter period with fewer costs.

This improvement does not mean, however, that the R&D process and innovation have become a linear and structured process - it still requires great amounts of feedback at every stage from an array of sources.

Scientific research has traditionally produced slow-to-market innovations, but this is changing and along with it; the number of innovations per scientific discovery, potentially. This means that more first-mover advantages and the like can be experienced by the firm behind the R&D. This is not the only incentive, however, to have an in-house R&D department; it also allows for monitoring and evaluation of external knowledge.

Science and innovation in pharmaceutical research Drug innovation is standardized into steps, usually designed by the regulatory authorities, with each steps testing the compound for particular properties or characteristics. The number of compounds is drastically cut down after each step, with the whole process ranging from 38 months to 20 years (average=9yrs). There is probably no other industry that is more directly affected by scientific research as the pharmaceutical industry. In terms of costs, the direct R&D stage where the compounds are discovered, account for between 8 and 24%, whilst the last two steps account for 57-72% combined with various testing in between 4-10% each.

In terms of risk; about 1 in 5000 compounds eventually reach the market, and 25-30% of those submitted for initial FDA (U.S. Authorities) approval finish the final stage.

[There follows a long diatribe about how the pharmaceutical industry developed from the1900s until 1990 but doesn't contain information that is useful, in my opinion, to the course] During the 1950s, 'discovery by design' came to the forefront. This was as an alternative to trial and error - where R&D teams would look at the general properties of molecules and try and find a suitable combination to tackle the problem - i.e. demand driven research, rather than 'hit and hope'.

2. Arguments Reports suggest that people with university backgrounds are usually tackle more general problems than those with no university training. Further, research shows that information used in a select group of innovations rarely come from academic research - so the training from university is necessary, but the research isn't. Which ironically poses the question of the functionality of research papers like this.

If public support to science diminishes, firms may become the new partrons of science. Because of their short-run, private objectives, they may impose restrictions on diffusion, thereby undermining the very same factor that has encouraged their long-run growth.

3. Quotations “Advances in computational capabilities, computer science, and corresponding theoretical tools (e.g. chaos theory, genetic algorithms neuronal networks, and artificial intelligence) are making it possible to understand very complex problems, like the flight of airplanes, the dynamics of mechanical and electromechanical systems. “ “Basic research produces information that guides applied R&D towards trajectories that are more likely to generate successful outcomes”. (p. 11) “Firms with better research skills and assets, and possibly with better downstream resources for commercialization, can then secure more effectively the benefits of their investment in basic science and technology, and they have greater incentives to perform fundamental research.” (p. 5) 4. Documentation Empirical studies of the US pharmaceutical industry in the 1950’s. Direct references are missing.

5. Key words 1950’s, USA, pharmaceutical industry, R&D, university research Technical terms scientific research, R&D, drug innovation, discovery by design 46. Grupp, Hariolf: “Foundations of the Economics of Innovation” Gang ved opslagstavler

Badet I laserlys

(=laser) spiller Michael Jackson

liv til en gruppe gruplende mennesker

et skyggespil over sit

(=Grupp). Han forklarer først om hans

gennembrud i et band med Darwin (=science) derefter hvordan han udgav sit første album (= first tech’al achievements). Hernæst hvordan han gik solo fra Darwin (= Science fully developed), men havde problemer med at sælge plader (= Difficulities in commerzializing). Han indså derefter hvordan han matte genopfinde sig selv for at blive ‘The King of Pop’. Herefter udgav han albummet ‘Thriller’ produceret af Technoviking. Dette blev en monstersællert! (= penetration of all markets). Med tiden gik hans karriere ned ad bakke (= decline).

Analyses the evolution from science to technology and on to production. The text takes its point of departure through a model (the market formation model, 8 stages), which represent the dynamics of

the innovation process through the interplay pf science, technology and innovative production. The first four stages of the model occur prior to the innovative phase, whereas the last four is as the innovation is launched, in the production phase and in the postproduction phase.

The 8 stages: 1. Exploration in the scientific domain 2. Properly developed science; first tech’al achievements 3. Science fully developed; technology still capable of extensions; prototypes 4. Difficulties discernible in economic transposition 5. Temporary stagnation in science and technology; reorientations 6. Industrial R&D envisages new possibilities; but still capable of expansion 7. First commercial applications; industrial R&D and economic devl’t full developed 8. Penetration of all markets; importance of R&D warning relative turnover Grupps main argument is that all innovation stems from a scientific breakthrough, which in some way can translate into a technology in some form or shape.

PLC – Intro, growth, maturity, decline 47. Arora, Ashish; Fosfuri, Andrea; Gambardella, Alfonso “Markets for Technology and their Implications for Corporate Strategy” Toilletter

Einstein

(=knowledge) og Technoviking

(=teknologi) arbejder for Lars Larsen

(= commercialization), og har lavet en tegning

(=intelectual

property) til et mikroskop der kan se alle baktierer, som Gollum

bevogter

med

et

Arora

kampfly

(=approriability)

(=arora)

som

bruger

patè

(=patents) som bomber). Herefter sætter Lars Larsen sig ned ved et bord og sælger copier (= licensing out) til en kø af medicinal folk i kitler. Lars Larsen ringer til Christer Fahreus, og siger at det var godt nok nemt tjente penge (= low entry barriers for entrepreneurs) Abstract Although market transactions for technologies, ideas, knowledge or information are limited by several wellknown imperfections, there is evidence that they have become more common than in the past. In this paper we

analyze how the presence of markets for technology conditions the technology and corporate strategy of firms.

The first and most obvious implication is that markets for technology increase the strategy space: firms can choose to license in the technology instead of developing it in-house or they can choose to license out their technology instead of (or in addition to) investing in the downstream assets needed to manufacture and commercialize the goods. The implications for management include more proactive management of intellectual property, greater attention to external monitoring of technologies, and organizational changes to support technology licensing, joint-ventures and acquisition of external technology. For entrepreneurial startups, markets for technology make a focused business model more attractive. At the industry level, markets for technology may lower barriers to entry and increase competition, with important implications for the firms' broader strategy as well.

48. Nelson, Richard R. (2003), “On the uneven evolution of human know-how” Ved metaldør

Finn Valentin

(=, Einstein

negerbarn med hr. Nelson

og Lars Larsen

står foran et lille

(=Nelson) på skulderen som er ved at dø af ebola,

og overvejer om de skal lave en vaccine. Men da Paris Hilton

(=customer demand) plager

om at få opfundet en vaccination til sin lille hostende hund , og Finn Valentinn i øvrigt ved meget om hundesygdomme (= strong science) beslutter de sig for at forske, opfinde og sælge en sådan (= demand side/profit seaking).

Keywords: Know-How; Research; Problem-Solving. (search for similar items in EconPapers) Abstract: It is widely recognized that advances in knowhow have been the key driving force between the great improvements in human material well-being that have been achieved over the past two centuries. However, not much attention has been directed to the fact that the advances in knowhow that have been achieved have been highly uneven across different human wants. Thus advances in communications and computation technology have been dramatic. We have learned to eliminate or cure a wide variety of human diseases. Yet on the other hand, we have made little progress on certain kinds of diseases. And there has been very little progress on the processes of primary and secondary education. This paper explores the reasons behind the unevenness.

Education is used as a canonical example of an area where little progress has been made. The analytic argument makes considerable use of a comparison between research and problem-solving in education, and research and problem-solving in various areas of medicine.

49. Finn Valentin and Rasmus Lund Jensen: (2002), “Reaping the fruits of science – Comparing exploitations of a scientific breakthrough in European innovation systems” Fællesrum Finn Valentin er dørmand til en technofest, hvor der er 8 gæster (= Grupp’s model). Han smider 5 ud heriblandt Michael Jackson så der kun er 3 tilbage (= rewriting). Darwin opfinder og nedskriver dansen

(= scienfic breaktrough). Herefter lærer Darwin Techno Viking at danse ( = Research and technology developments), og sammen opfinder de også en masse helt nye dansetrin (=complementary tech’s), som de dog ikke helt kan sætte sammen (= alignment gaps). Til sidst har de dog øvet de nye trin nok til at videreudvikle dansen (= tech. bundling) og opfinde technodansen (= Technology take-off). Gollum (= Appropriability), som efterhånden er blevet godt forelsket i danseparet ,bygger en mur omkring dem, og tager entré for at folk kan se dem danse (= patents).

A rewriting of Grupp’s model of 8 stages, and puts them into three main stages instead: 1. The stage of break-through (stage 1-2) 2. The stage of stagnation and re-orientation (stage 3-6/7) 3. The stage of technology take-off (stage 7-8) Science and technology are two separate (but interlinked) knowledge systems – however they are both systematic (they become only functional in the form of bundles of operants; combined into functional configurations – e.g. as aeroplanes). Hence, an advance in technology can only be exploited of another complementary technologies within the same bundle are able to perform in alignment with the initial advance. Of the complementary technology is performing deficient we have a situation of “alignment gaps” which increase search costs.

50. Harryson. (2008), “Entrepreneurship Through Relationships – Navigating from Creativity to Commercialization” Film TV Weak ties – Strong ties

51. Harryson. (2006), Chapter 7 Klasseværelse

icepower:

Combibloc:

Porsche:

5: Appropriability 52. Schilling Ch. 9 Memo loc.: Undervisnings lokale

(=spin-offs)

outsource

insource

Catwoman

(=Schilling) iført nike-dragt

og mona lisa (skilled in the art)

venter på et spil til PS, fra Gollum

(=approriability) bygger en mur spil i vinduet

mens Gollum

af forskellige bogstaver ( © ® ™ )

og sorterer

53. Cohen, Wesley M., Nelson, Richard, and Walsh, John P., (2000), “Protecting their intellectual assets: Appropriability conditions and why US manufacturing firms Patent (or not)” Toilet Donald Trump (= Big Firms) er til middagsselskab, hvor Leonard Cohen spiller, og har taget sin nye innovative paryk (= product innovation) på, som skal sættes med paté (= patent). Ydermere vælger han at holde det hemmeligt (=secrecy) for damerne og konkurrenede ældre rigmænd, at han har paryk på sådan at han kan score hurtigere end sine konkurrenter (= Lead Time). Et fåtal af hans konkurrenter prøver en scoremetode (= process innovations) baseret på at lokke damer til med paté, men langt de fleste holder deres metoder skjult for andre (= secrecy/ patents discloses information). Til sidst opdager Trump, at det er utroligt effektivt at lokke damerne til med 100 dollar sedler (= complementary asset) og speed (Lead time).

54. Harryson, Ch. 8.

Memo loc.: Elevator

beundre hvordan myiagi fanger bier

(business intelligence)

med sine 4 pinde( nonakas 4 faser). mr myagi vil gerne lære sigvald hvordan man med en klo (= 5 faser kan lære at fange bier)

1)

Først vokser sigvals hovede ( enlarging individuals knowledge)

2)

Sigvald lærer af myagi hvordan man laver wax on/wax off. (sharing tatic knowledge) Sigvald skal fortsætte indtil han forstår konceptet idet og det er krystalklart for ham hvad han laver og kan fortælle det til sine venner( externalized)

3)

(Conceptualizing and crystallization)

4) herefter skal mr myiagi justificere det = (Justification by management )

5)nu skal sigvald ud på markede og score damer med al den viden han

har fået af myagi

(networking knowledge)

det lykkes og sigvald ryger I kanen med damen og burger en si (strategic intelligence) som prævention og får et barn med damen (closing the loop og innovation through network knowledge)

This chapter examines how business intelligence and information can be transformed to strategic intelligence and knowledge and finally innovation trough knowledge networks. It draws primarily on knowledge creation theory developed by Nonaka and Takeuchi. This is important because turning both ext. and int. knowledge into strategic innovation is becoming vital in a fast moving environment. BI units can be organized departmental, decentralized, centralized, supportive and complex within the organization. However knowledge sharing across BU’s are of high importance. It is vital that the tacit dimension of knowledge and intelligence is managed properly. Organizational knowledge creation is enabled by managing 4 modes of knowledge conversion. 1. Socialization 2. Externalization 3.

Combination 4. Internalization  The spiral of knowledge creation. Also a process of knowledge creation is put forth by Nonaka: 1. Enlarging individuals’ knowledge 2. Sharing tacit knowledge 3.

Justification 4. Network knowledge. To enable these a set of 5 enabling conditions are needed as well: 1. Intention 2. chaos/fluctuation 3. Autonomy 3. Redundancy. The ability to combine tacit and explicit knowledge – both internal and external – has a great impact on BI performance.

This raises the need for an internal and external knowledge network (know-who innovation).

Knowledge networks drive innovation faster, more creative, and more attuned by reusing knowledge and resources already available in the network rather than re-inventing the wheel.

55. Harryson, S., Dudkowski, R. and Stern, A. (2008), “Transformation Networks in Innovation Alliances - the Development of Volvo C70” Memo loc.: Trappe

sigvald italien(Pininfarina)

og

kører Volvo c70 sverige fyldt

med

to

andy

warhols

mellem kloner

(creativity) og 1 spiderman ( network) undervejs sparker han først den ene Warhol ud og samler en rudi

fredriksen (exploitaion in process network)op. nu tranformere (TRANSFORMATION NETWORK) bil sig til en cabriolet. senere

sparker sigvald den anden Warhol ud og samler endnu en rudi op og bilen er fyldt med (process network/exploitation phase ).

56. Enghave, Mia & Poulsen, Filip et al. (2008) Memo loc.: Spisesal

Mia Enghave

kernekompetencer

og Filip Poulsen

)

I

foodprocesser

Putter

æbleskrog

(=

(=

er

processen

kernekompentencen) og det bliver til mælk (casestudy om foss) som boisot drikker (mangler jeres billede af boisot) det er deres process viden der i virkeligheden er kernekompetences hvor foss troede det var deres product der var unikt. Dette gores gennem TECHPATTERN® + boisot mapping

57. Ernst, Holger (2003), Patent information for strategic technological information Memo loc.: Kantine

spiller stratego( strategy) , mod Gollum Ernst vinder( better performance) da han har analyseret gollums (do not yet pay attention to patent data) patenterede moves.

Efterfølgende vil gollum gerne lære hvordan man gør og Ernst fortæller at man kan se på patent portfolio management og HRM perspektivet og identificere kvaliteten af patenter.