Syddansk Universitet Integration of market pull and technology push in the corporate front end and innovation management Insights from the German software industry
Yüklə 316,83 Kb. Pdf görüntüsü
|
- Bu səhifədəki naviqasiya:
- Fundamental research Technology development Pre- development activities
- Idea generation
- ENGINE Idea genesis Opportunity analysis Opportunity identification
- Idea management, concept finding phase, predevelopment phase Project management
|
Syddansk Universitet Integration of market pull and technology push in the corporate front end and innovation management - Insights from the German software industry Brem, Alexander; Voigt, K.-I. Published in: Technovation Publication date: 2009
Document version Publisher's PDF, also known as Version of record Citation for pulished version (APA): Brem, A., & Voigt, K-I. (2009). Integration of market pull and technology push in the corporate front end and innovation management - Insights from the German software industry. Technovation, 29(5), 351-367.
Copyright and moral rights for the publications made accessible in the public portal are retained by the authors and/or other copyright owners and it is a condition of accessing publications that users recognise and abide by the legal requirements associated with these rights. • Users may download and print one copy of any publication from the public portal for the purpose of private study or research. • You may not further distribute the material or use it for any profit-making activity or commercial gain • You may freely distribute the URL identifying the publication in the public portal ? Take down policy If you believe that this document breaches copyright please contact us providing details, and we will remove access to the work immediately and investigate your claim. Download date: 03. May. 2017 Author's personal copy Technovation 29 (2009) 351–367 Integration of market pull and technology push in the corporate front end and innovation management—Insights from the German software industry Alexander Brem à , Kai-Ingo Voigt Friedrich-Alexander University of Erlangen-Nuremberg, Chair of Industrial Management, Lange Gasse 20, 90403 Nuremberg, Germany Abstract
Within the framework of this paper, an extensive literature overview of technology and innovation management aspects on market pull and technology push will be given. The existing classification of market pull and technology push will be particularly shown and called into question by suggesting a conceptual framework. Additionally, the most common front end innovation models will be introduced. Finally, the authors will introduce how a technology-based service company is managing the connection of these two alternatives. A special focus will be laid on the accordant methods in order to search for current market needs and new related technologies. The selected case study will focus on one of Germany’s biggest and most successful software development and information technology service providers. Based on interviews, document analysis, and practical applications, an advanced conceptual framework will be introduced as to how market pull and technology push activities within the corporate technology and innovation management can be integrated. Hence, the purpose of the paper is to introduce a theory-based conceptual framework that can be used in today’s corporate environment. In this context, technology managers may use the results as a conceptual mirror, especially regarding the influencing factors of innovation impulses and the use of interdisciplinary teams (with people from inside and outside the company) to accomplish successful corporate technology and innovation management. r 2008 Elsevier Ltd. All rights reserved. Keywords: Idea management; Front end; Innovation management; Technology management; Innovation process; Market pull; Technology push; Software industry 1. Introduction and purpose Organizations and businesses have recognized the need for finding new methods and paradigms to efficiently serve existing and new markets with new and/or modified products as well as services ( Ansoff, 1965 ). Thus, the changing global environment is compelling organizations and businesses to permanently seek the most efficient models to maximize their innovation management efforts ( Christiansen, 2000 ). As innovation is a responsibility of all business units and departments, their involvement needs to be determined accordingly ( Tucker, 2002 ). In this context, an organization’s ability to identify, acquire, and utilize (external) ideas can be seen as a critical factor in regards to its market success ( Zahra and George, 2002 ). This so-called ‘Front-End of Innovation’ is therefore one of the most important areas of corporate management. Technology and technology-oriented companies, espe- cially in the business-to-business area, are traditionally more influenced by new technologies than other compa- nies. However, firms in the business-to-consumer sector focus more on end-users, and, therefore, market-induced impulses. The related scientific discussion regarding the ‘right’ innovation management and especially the ‘best’ source of innovation is similar to the question of whether the chicken or egg came first. The question becomes even more complex since there are several examples of successful technology-oriented companies as well as market-oriented ones. Therefore, the question is not which view is right or wrong, but if there is a practicable way to combine both views or even extend them to other related factors. ARTICLE IN PRESS www.elsevier.com/locate/technovation 0166-4972/$ - see front matter r 2008 Elsevier Ltd. All rights reserved. doi:
10.1016/j.technovation.2008.06.003 ÃCorresponding author. Tel.: +49 911 5302 235; fax: +49 911 5302 238. E-mail address: brem@industriebetriebslehre.de (A. Brem). Author's personal copy Hence, the purpose of the paper is to introduce a theory- based conceptual framework that can be used in today’s corporate environment. In order to achieve this, the related theoretical background (with a focus on the front end of innovation) is discussed, supplemented by a case study from the German software industry. Finally, the discussion and implication section summarizes and consolidates the findings of both parts with the introduction of
different case-specific sources for innovation impulses, an extended conceptual framework for corporate innovation management and
an advanced front-end innovation approach. 2. Theoretical background and literature review 2.1. Conceptual classifications In order to build a common understanding of market pull and technology push activities, some fundamental considerations will be introduced. Dealing with technology means to handle different stages of research and therefore special management duties and responsibilities (see Fig. 1 ).
Specht (2002) , the stages of technology development and pre-development activities belong to technology management. The field of R&D management is determined by adding upstream fundamental research as well as product and process development. Finally, innova- tion management includes the product and market introduction phase. Thus, innovation management can be defined as ‘a systematic planning and controlling process, which includes all activities to develop and introduce new products and processes for the company’ ( Seibert, 1998, p. 127 ) or, in short, the dispositive constitution of innovation processes ( Hauschildt, 2004 ). Following Thom
(1980) , these innovation processes can be divided into the stages of ‘idea generation’, ‘idea acceptance’, and ‘idea realization’ (see Fig. 2 ).
inside or outside the company ( Boeddrich, 2004 ). In order to obtain a maximum number of innovative product and process ideas, a holistic view of the innovation process is needed. Hence, the basic approach of Thom (1980) is to
collect as many promising ideas as possible; therefore, the determinations of the search fields are especially crucial to the whole innovation process. Search fields can be identified, for instance, by defining the individual user needs and the current product value ( Burgelman et al., 2004 ). The idea acceptance phase consists of several stages through which the ideas have to pass and where they are enriched ( Cooper, 2005 ). When realizing the selected ideas, it is important to choose efficient ways of saving resources ( Aeberhard and Schreier, 2001 ). The final success of idea management strongly depends on the right process structure for the different kinds of ideas and the corresponding adequate organizational implementation ( Voigt and Brem, 2005 ). 2.1.1. Fuzzy front end of innovation For further consideration of the matter, the under- standing of the front end of innovation (FEI) plays an important role. Therefore, FEI will be defined and some recent approaches will be introduced. ARTICLE IN PRESS
Prototype Theory
Invention Fundamental research Technology development Pre- development activities Product and process- development Product and market- introduction Technology management R&D management Innovation management Innovation Technology Fig. 1. Classification of technology, R&D and innovation management ( Specht, 2002 ).
Determine search field Suggest ideas Find ideas
Decide to realize a plan Test and rate ideas Create realization plans Idea realization Control acceptance Realizing the new idea Sell new idea to addressee Fig. 2. Standardized stages of the corporate innovation process ( Thom,
1980 ). A. Brem, K.-I. Voigt / Technovation 29 (2009) 351–367 352 Author's personal copy The term ‘(fuzzy) front end’ describes the earliest stage of an idea’s development and comprises the entire time spent on the idea, as well as activities focusing on strengthening it, prior to a first official discussion of the idea ( Reid and de Brentani, 2004 ). Wellsprings for ideas have both internal and external sources ( von Hippel, 1988 ). In this context, it is important to consider the differences of the new product and process development (see Table 1
). Furthermore, the terms ‘(fuzzy) front end’ and ‘front end innovation’ are synonymous. Following the argumentation of Koen et al. (2001) that this fuzziness implies an innovation process phase consisting of unknowable and uncontrollable factors, the term ‘front end innovation’ will be the sole one used in this paper. In this sense, the phase is partly analog to the introduced idea generation stage, but the focus on the front end is mainly one of opportunity identification and analysis ( Belliveau et al., 2004 ; Khurana
and Rosenthal, 2002 ). Therefore, the front end is one of the greatest areas of weakness of the innovation process and fundamentally determines the later innovation success ( Koen et al., 2001 ). It will come as no surprise, then, that effective management of the front end results is a sustainable competitive (innovation) advantage. Surpris- ingly, there has been little research done on the issue thus far ( Kim and Wilemon, 2002 ). A flow-oriented approach, the so-called ‘idea tunnel’, which resulted from an older concept called ‘development funnel’ ( Hayes et al., 1988 ), is the elementary basic model for front end considerations (see Fig. 3
). Hence, there are two ways of gaining ideas: one, collecting them in a sense that they are already present somehow (at least in the mind of a person or group), or two, generating them through a well thought-out process utilizing creative methods. Consequently, creative practice methods and techniques are needed to foster a continuous spirit of creative evolution ( Kelley and Littman, 2005 ). Key
elements for promoting corporate creativity include a motivating reward system, officially recognized creativity initiatives, the encouragement of self-initiated activities, and the allowance of redundancy ( Stenmark, 2000 ). Nevertheless, several general requirements must be fulfilled in order to generate ideas that will be successful in the marketplace ( Boeddrich, 2004 ): a consideration of the company’s corporate strategy,
obvious benefits for the ideas’ target audience and a systematically structured and conducted concept- identification phase. Moreover, there are not only general, but also company- specific ramifications to consider, which increase the ARTICLE IN PRESS Table 1 Front end innovation vs. new product and process development ( Koen et al., 2001 ) Front end of innovation New product and process development Nature of work Experimental, often chaotic, difficult to plan, ‘eureka’ moments
Structured, disciplined, and goal- oriented with a project plan
Commercialization date
Unpredictable Definable
Funding Variable; in the beginning phase, many projects may be ‘bootlegged’, while others will need funding to proceed Budgeted
Revenue expectations Often uncertain, sometimes done with a great deal of speculation Believable and with increasing certainty, analysis, and documentation as the release date gets closer Activity
Both individual and team-oriented in areas to minimize risk and optimize potential Multi-functional product and/or process development teams
collect create refine
evaluate document
view evaluate
ideas selected for confirmation and temporary programs rejected ideas ideas put back ideas put back new findings check
Idea Idea view
rate enrich
Idea Idea Idea Idea Idea rejected ideas ideas put back ideas put back Idea Fig. 3. The idea tunnel ( Deschamps et al., 1995 ). A. Brem, K.-I. Voigt / Technovation 29 (2009) 351–367 353 Author's personal copy situation’s complexity ( Boeddrich, 2004 ). That is why there is always a dilemma between giving the front end a certain system and structure on one hand, and forcing creativity (as well as implementing externals) on the other hand. Due to page restrictions, the following list of FEI models is not exhaustive, but gives an overview of existing approaches with different focuses. The most popular one is the new concept development model from Koen et al. (2001) , which is supposed to provide a common language for front end activities (see
Fig. 4 ). The circular shape shows the flow, circulation, and iteration of ideas within the five core elements and surrounding (external) influencing factors. A fundamental distinction is made between an opportunity and an idea: thus, opportunity identification and analysis precede a (business) idea because these stages include an ongoing process of several information enrichment stages, such as market studies or scientific experiments. Finally, a formal business plan or project proposal indicates the changeover to the new product and process development. A proposal for a more process-oriented procedure is given by Boeddrich (2004) (see Fig. 5
). In this framework, there is a specific differentiation between single process steps on one hand and organiza- tional responsibilities on the other hand. Boeddrich identified company-specific preconditions for the successful management of front end activities, which were confirmed by several other studies ( Boeddrich, 2004 ):
commitment to company-specific evaluation methods and selection criteria, especially with regard to K.O. criteria for approved projects,
commitment to the owner of the idea management process,
commitment to individuals or organizational units that promote innovation within the company,
definition of creative scopes for the company, influence of the top management,
number of stages and gates in the tailor-made idea management and
investigation of stakeholders in the structured front end and establishment of their participation. In a recent approach, Sandmeier et al. (2004) defined a
very comprehensive process model and went explicitly into the topic of market pull vs. technology push (see Fig. 6 ).
tunities of a company. The central and iterative activities are the strategies and goals of an innovation. Finally, there are one to two opportunities and search fields for the next stage. The following phase deals with the actual idea generation and evaluation, including several sub-processes ARTICLE IN PRESS ENGINE Idea genesis Opportunity analysis Opportunity identification Concept & technology development Idea selection To NPPD Fig. 4. New concept development model ( Koen et al., 2001 ). Multi-project- management Allocation of R&D-budget Verification of estimations Cross-functional teams reach decisions on ideas based on estimation (product, technical, financial, and market attractiveness) Strategic analysis of ideas by idea or innovation manager
Development of innovation- guidelines by top
management and innovation manager Portfolio of innovation projects
D E C I S I O N Preliminary projects Idea screening execution and further conceptual development Idea gener- ationand adoption Strategic guidelines for innovations Idea management, concept finding phase, predevelopment phase Project management Fig. 5. Front end model proposal ( Boeddrich, 2004 ). A. Brem, K.-I. Voigt / Technovation 29 (2009) 351–367 354 Author's personal copy in order to result in the creation of balanced business and product cards. The final phase transfers the generated ideas into business plans and product concepts, which will be devolved to the product development phase. Moreover, role-specific responsibilities are assigned, depending on the innovation development progress. It can be deduced that the described models vary in terms of perception, resource considerations, and detailing. What they have in common is that they are all based on case studies and not on quantitative research. Hence, even across a range of different companies, industries, and strategies of product and process development, the front end innovation challenges and threats seem to be very similar. There continues a need for additional inter-branch- based research for further consideration. Considering the above background, this paper makes a synthesis of recent literature and evaluates the synthesis in light of what is learned through the case study to see whether sector and/or branch specific-approaches are needed. 2.1.2. Market pull vs. technology push Generally, there are two common ways innovation impulses differ ( Boehme, 1986 ; Brockhoff, 1969 ; Bullinger, 1994 ;
): (i) Market pull/demand pull/need pull: The innovations’ source is a currently inadequate satisfaction of customer needs, which results in new demands for problem-solving (‘invent-to-order’ a product for a certain need). The impulse comes from individuals or groups who (are willing to) articulate their subjective demands. (ii) Technology push: The stimulus for new products and processes comes from (internal or external) research; the goal is to make commercial use of new know-how. The impulse is caused by the application push of a technical capability. Therefore, it does not matter if a certain demand already exists or not. In this context, Gerpott
(2005) makes a difference between high and low ‘newness’ of the innovation and thus between radical innova- tions (‘technology push’) and incremental innovations (‘market pull’) (see Table 2
). Therefore, technology push can be characterized as creative/destructive, with
new/major improvements; market pull, however, is a replacement or substitute ( Walsh et al., 2002 ). Another view comes from Abernathy and Utterback (1978) , stating that radical product and process innovation is subsequently followed by incremental innovations. This is in accordance with Pavitt (1984) who
states that technology is particularly relevant for the early stages of the product life cycle, and market factors especially for their further diffusion. A sole focus on technology push can lead to the so-called ‘lab in the woods approach’, where the R&D department is organizationally and regionally undocked from the rest of the corporation, working without any daily routine on technological developments. This approach often results in ‘reinventions of the wheel’ and, consequently, ineffective research. A strong concentration on market pull tends to ARTICLE IN PRESS Analysis of future needs and requirements
Yüklə 316,83 Kb. Dostları ilə paylaş:
|