Corporate Innovation

Disruptive Thinking in Organizations

Donald Kuratko, Michael Goldsby, Jeffrey Hornsby

• Publisher: Routledge
• Year: 2018
• ISBN:
  9780429951015
• Edition: 1
• Topic: Negocios y empresa
• Subtopic: Desarrollo organizacional

Effectiveness is the underlying theme for this introduction to disruptive innovation. The book tells the manager, or student, what they need to know in transforming the thinking in an organization to an innovative mindset in the twenty-first century.

Corporate Innovation explains the four stages of the innovation process, and demonstrates how to improve skills in the innovation process, and unleash personal innovative abilities. This book also presents ways to assess the organization's attitudes toward innovation, providing insights into how to diagnose creative and innovative performance problems in the organization. Beginning with an overview of concepts involved with an innovative organization today, this book explores the fundamental aspects of the individual, the organization and the implementation. An I-Organization is a combination of:

• I-Skills developed within individuals
• I-Design thinking functions needed to shape innovation
• I-Teams that emerge from the HR perspective of structuring the appropriate climate
• I-Solution needed to provide a foundation for implementing any innovative ideas

Essential reading for students of corporate innovation, corporate ventures, corporate strategy, or human resources, this book also speaks to the specific needs of active managers charged with the expectation of enhancing the innovative prowess of their organization.

Instructors' outlines, lecture slides, and a test bank round out the ancillary online resources for this title.

PART 1

The Innovative Organization (I-Organization)

1 Understanding the Innovative Mindset

2 The Process of Corporate Innovation

1

UNDERSTANDING THE INNOVATIVE MINDSET

Wealth in the new regime flows directly from innovation, not optimization; that is, wealth is not gained by perfecting the known, but by imperfectly seizing the unknown.

~Kevin Kelly¹

Introduction: The “I-Challenge”

We are all confronting a global innovation challenge. The development, application, and enhancement of new technologies are occurring at a breathtaking pace and innovation is determining the way business is being conducted. As the number of new ventures, products, technologies, and patents literally explodes worldwide, established companies can either become victims of this innovation challenge or they can answer the call. The world is in the midst of a new wave of disruption in every industry, with entrepreneurship and innovation as the catalysts.

The nature of business has been transformed in this fast-paced, highly threatening, and increasingly global environment. Dramatic and ongoing changes are forcing leaders of organizations to re-examine their basic purpose and to become much more innovative with their approach to multiple stakeholders. Organizations today must continually redefine their markets, restructure their operations, and disrupt their business models. Effective companies in the twenty-first century have made the fundamental discovery that innovation drives success.² The ability to continually innovate (to engage in an ongoing process of entrepreneurial actions) has become the source of competitive advantage.

While innovative actions are a phenomenon that have captivated the interest of executives in many corporate boardrooms, there is a danger that managers can get too caught up in the excitement of a particular innovation or inspiring stories of individual corporate innovators. It is easy to become enamored with the idea of innovation, but the true value of innovation lies in the extent to which it becomes a corporate strategy to create sustainable competitive advantage.³ The early twenty-first century has been a time when innovative (or entrepreneurial) actions have been recognized widely as the path to competitive advantage and success in organizations of all types and sizes.⁴ Moreover, a lack of innovative (or entrepreneurial) actions in today’s global economy could be a recipe for failure.

In today’s competitive landscape, the opportunities and threats happen swiftly and are relentless in their frequency, affecting virtually all parts of an organization simultaneously. The business environment is filled with ambiguity and discontinuity, and the rules of the game are subject to constant revision. The job of management effectively becomes one of continual experimentation—experimenting with new structures, new reward systems, new technologies, new methods, new products, new markets, and much more. The quest remains the same: sustainable competitive advantage. Innovation and entrepreneurial actions represent the guiding light and the motivating force for organizations as they attempt to find their way down this path.

Achieving innovation (and entrepreneurial actions) is not something that you as a manager can simply decide to do. Corporate innovation must be understood by each individual and there must be a realization that it does not produce instant success. It requires considerable training, time, and investment, and there must be continual reinforcement. By their nature, organizations impose constraints on innovative behavior. To be sustainable, innovative thinking must be integrated into the mission, goals, strategies, structure, processes, and values of the organization. The managerial mindset must become an opportunity-driven mindset, where actions are never constrained by resources currently controlled.⁵ We call this the “innovative mindset.”

Although some earlier researchers concluded that innovation (entrepreneurship) and bureaucracies were mutually exclusive and could not coexist,⁶ today we find many researchers examining innovation within the enterprise framework.⁷ Leading strategic thinkers are moving beyond the traditional product and service innovations to pioneering innovation in processes, value chains, business models, and all functions of management.⁸ Thus, innovative attitudes and behaviors are necessary for firms of all sizes to prosper and flourish in competitive environments.

Developing a corporate innovative philosophy provides a number of advantages. One is that this type of atmosphere often leads to the development of new products and services and helps the organization expand and grow. A second is it creates a workforce that can help the enterprise maintain its competitive posture. A third is it promotes a climate conducive to high achievers and helps the enterprise motivate and keep its best people.

This new millennium has been characterized as an age of instant information, ever-increasing development and application of technology, disruptive changes, revolutionary processes, and global competition. It is now an age filled with turbulence and paradox. The key descriptive words used about this new “innovation challenge” of the twenty-first century are: dreaming, creating, exploring, inventing, pioneering, and imagining! We believe this is a point in time when the gap between what can be imagined and what can be accomplished has never been smaller. It is a time requiring innovative vision, courage, calculated risk-taking, and strong leadership. It is simply answering “the innovative challenge of the twenty-first century.” Thus, the “I-Challenge” confronts all organizations today.

Innovative Thinking

The constantly changing economic environment provides a continuous flow of potential opportunities if an individual can recognize a profitable idea amid the chaos and cynicism that also permeates such an environment. Thousands of alternatives exist since every individual creates and develops ideas with a unique frame of reference. Thus, innovative thinking has become a critical skill for the twenty-first century. During the last two decades, the entrepreneurial flame has caught on throughout the world, with the world’s economies searching for the free enterprise solution through innovative development.

However, innovative thinking goes beyond the mere creation of business. The characteristics of seeking opportunities, taking risks beyond security, and having the tenacity to push an idea through to reality combine into a special perspective that permeates innovative individuals. Innovative thinking can be developed in individuals. This mindset can be exhibited inside or outside an organization, in profit or not-for-profit enterprises, and in business or non-business activities for the purpose of bringing forth creative ideas. As one author stated, “Ideas come from people. Innovation is a capability of the many. That capability is utilized when people give commitment to the mission and life of the enterprise and have the power to do something with their capabilities.”⁹

Thus, innovative thinking is an integrated mindset that permeates individuals and organizations in an effective manner. Let’s examine exactly what innovation is and how this mindset can be nurtured in individuals.

The Concept of Innovation

Innovation, Creativity, and Entrepreneurship

The terms entrepreneurship, creativity, and innovation are sometimes used interchangeably, and while that is understandable, it can be misleading. Creativity and innovation are very similar concepts, but there are some differences. Creativity is typically described as the process of generating new ideas, while innovation takes creativity a step further by being a process that turns those ideas into reality. Innovation is often the basis on which entrepreneurship is built because of the competitive advantage it provides. Innovation is a key function in the entrepreneurial process. Researchers and authors in the field of innovation and entrepreneurship are, for the most part, in agreement with renowned consultant and author Peter F. Drucker about the concept of innovation:

Innovation is the specific function of entrepreneurship. . . . It is the means by which the entrepreneur either creates new wealth-producing resources or endows existing resources with enhanced potential for creating wealth.¹⁰

Thus, innovation is the process by which entrepreneurs convert opportunities (ideas) into marketable solutions. Innovation is a process that transforms ideas into outputs. It is the means by which entrepreneurs become catalysts for change.¹¹ The emerging perspective by researchers in the field of innovation is to define innovation in the broadest context possible, as in this specific example:

Innovation is the process of making changes, large and small, radical and incremental, to products, processes, and services that results in the introduction of something new for the organization that adds value to customers and contributes to the knowledge store of the organization.¹²

There are numerous alternative definitions of innovation. One popular alternative is to present innovation as an invention that has been exploited commercially.¹³ Innovation can also be viewed as the systematic approach to creating an environment based on creative discovery, invention, and commercial exploitation of ideas that meet unmet needs. However, there are millions of innovations that are often much smaller in scale, do not involve an invention, or are not necessarily exploited in the same commercial sense. Therefore, one simplified alternative definition might be:

Innovation = Creativity + Exploitation

In this sense innovation becomes the composition of creative thoughts and the determination to implement those ideas into a marketable concept. Since there are numerous ways in which individuals apply creative thoughts into exploitation of opportunities, there also are numerous ways to categorize innovation.

Categorizing Innovation

Types

The term inno...