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Resources and Competencies and the Innovation Portfolio
Innovation is a question of resources:
- Tacit: not codified and difficult to share.
- Socially complex: emerging through the interaction of many individuals.
- Affected by causal ambiguity: cause-effect relation between the resource and its outcome is difficult to understand.
Innovation is a question of competencies:
- Core competencies: What makes the difference in terms of strategy, mix of abilities connected with specific resources (longitudinal, idiosyncratic, sticky).
- Core rigidities: major competencies can impede exploration of other fields.
- Dynamic capabilities: A set of abilities support the learning process and the quick reconfiguration of abilities to adapt.
Managing innovation in a knowledge perspective:
- One-way transfers
- Two-way transfers
- Carry over: reusing solutions already adopted in the past
- Shelf innovation: development of solutions to store in projects a virtual library
- Common part: sharing solutions in multiple projects
- Platforms: architectural
goodplaform planning requires up-front considera2on of marke2ng, design, and manufacturing issues.
MANAGING THE PORTFOLIO
- Strategic planning
- Projects porfolio defini2ons
- Development Timing
- Resources sharing
- Plaform design
Organiza2on
- Organiza2onal design (func2onal vs. project)
- Team management
- Performance measures
Investments in team training and resources
Project management
- Objec2ves priority
- Development planning
- Project milestones
- Communica2on tools (project team)
- Project controlling
MANAGING THE PROCESS
- From strategy planning to project management and organiza2on design
Looking at the decisional process, innova2on strategy needs to be sustained by a set of organisa2onal and managerial choices and tools
Two opposite approaches can be used to manage a process of product innova2on
- Sequen2al approach : stages one aier the other
- top down flow of informa2on
- sequen2al stages
- formal systems of communica2on and coordina2on
- Advantage: reduc2on of uncertainty
- Disadvantage:
late problems detection
✦ Concurrent approach: two-ways flow of preliminary information, numerous feedbacks
✦ Parallel stages (time saving)
✦ Adoption of informal systems of communication/coordination
Advantage: early problems detection
✦ Disadvantage: higher level of uncertainty
STAGE AND GATE-
- Each gate is a go/kill
- Each gate has three components: deliverables derived from previous stage, criteria to make the go/kill choice, outputs including an action plan for the next stage
- Each stage costs more than the previous one, thus breaking down the structure of the project results in a series of incremental commitments
How to manage work in innovation processes?
- Major decisions include:
- Team size
Is there a right size?
- Small vs big
- Changes along the process
- Social loafing: "the phenomenon of a person exerting less effort to achieve a goal when they work in a group than when working alone"
- Team composition
Language and communication/coordination
- costs
- Informa2on sources
- Relevance of the context (industry, internal competencies)
TEAM ORGANISATION
Func2onal team structure : no cross-func2onal integra2on; employees remain within func2onal department
CEO → | Research & Development | Manufacturing | Marke2ng | → CEO
Lightweight team structure : Employees remain within func2onal departments but project manager provides cross-func2onal integra2on
CEO → | Research & Development | Manufacturing | Marke2ng | → Project manager → CEO
Heavyweight team structure : Project manager provides cross-func2onal integra2on; team members are collocated but s2ll report to func2onal managers also
CEO → Research & Development → manager | Manufacturing → manager | Marke2ng → manager | → Project manager → CEO
Autonomous team struJure : project manager provides cross-func2onal integra2on; team members are collocated and report only to project manager
CEO → Project manager → CEO
Research & Development | Manufacturing | Marketing | → 3 managers → Project manager → CEO- Key characteristics of different types of teams Characteristics Functional team Lightweight team Heavyweight team Autonomous team Project manager (PM) No Yes Yes Yes Power Low High Very high. . . . Primary orientation of Team Function Function Team Team Members (TM) Location Functions Functions Co-located with PM Co-located with PM. . . . Evaluation of TM Functional heads Functional heads PM & F heads Project manager Incentives skewed towards F performance F performance Team and F perf Team performance. . . . Conflict team vs. functions Low Low Moderate High Cross-functional integration Low Moderate High High. . . . Fit w/ existing practices High High High Moderate high- - - - Appropriate for Not appropriate Derivative project Platform & B project Breakthrough (B) project Gaps and critical issues in platforms organization The ideal organization Conclusions Single projects and the innovationstrategy.Modularity and plaforms reshape the organiza2on.
How to redesign the organiza2on to fit the innova2on strategy.
What is missing?
HOW TO MANAGE FOR COLLECTIVE CREATIVITY
Common idea of great leadership does not work when it comes to leading innova2on- ‣ If we want to build organiza2ons that can innovate 2me and again, we must unlearn our conven2onal no2onsof leadership≠ Leading innova2on is not about crea2ng a vision, and inspiring others to execute it
Innova2on is not about solo genius, it is about collec2ve genius.- Pixar:- No solo genius, no flash of inspira2on produces one of those movies. On the contrary, it takes about 250-people four to five years, to make one of those movies.
Innova2ve organiza2ons are communi2es that have three capabili2es:-
- Crea2ve abrasion : being able to create a marketplace of ideas through debate and discourse; amplifydifferences; not about brainstorming, where people suspend their judgment instead have very heated butconstruc2ve arguments
- func1onali1es and technologies (Vergan1 2007)
Radical innova1ons can be strategically driven by design•SWATCH AS THE PERFECT EXAMPLE- Wacth dilemma : either high-end jewellery or Casio (watch for calcula1on and many other func1onali1es)- New kinds of watches based on the jewellery frame and the compe11on of the Chinese brand- Swatch : connected with expression of yourself (aesthe1c choice)-Translate product : how does it work - kind of technology - how to sa1sfy the market-THE ORIGINAL FRAMEWORK-- Swatch example- Process/tech innova/ons Func/ons RequirementsQuarz, assembly technology, Time, date, chronograph Precision, shock and water proof→ →modularity ↕ ↕ ↕Classic shape, poor materials, Cheap, to be consumed, to be Watches as fashion accessories→ →fashion, customisa1on customised, to be collectedMAJOR STEPS OF MOVING FROM ARCHITECTURAL OBJECTS TO MEANINGS EMBODIED IN PRODUCTS-1. Searching for new languages.In 1995, a process of explora1on on the
concepts of “light” in biology, science, sociology and other fields of-research.
2. Inves1ng in new technologies.
The R&D department technically develops the ini1al idea, transla1ng images emerged in the first workshop.
-They develop a kit with chroma1c filters and remote control systems
3. New product development.
Language and technology are integrated giving birth to the design phase. Differ