Innovation Model Analysis

The Evolution of Innovation Framework Models

 

Understanding of the process of innovation at the firm-level has evolved throughout recent decades from simple linear and sequential models to increasingly complex models embodying a diverse range of inter and intra stakeholders and processes. Distinguishable by their management focus, strategic drivers, accommodation of external actors and internal and external processes and function level integration, Rothwell (1994) documented five shifts or generations, demonstrating that the complexity and integration of the models increases with each subsequent generation as new practices emerge to adapt to changing contexts and address the limitations of earlier generations (Ortt and van der Duin, 2008) . For Rothwell (1994) the evolving generation of innovation models does not imply any automatic substitution of one model for another; many models exist side-by-side and, in some cases, elements of one model are interwoven with elements of another. More recently and following on from the seminal work of Rothwell’s innovation generation model typology, researchers (Kotesmir and Meissner, 2013) have suggested that Chesbrough (2003) open innovation model represent the latest wave of innovation models.

Table 1 illustrates an overview of the key characteristics of generations of innovation framework models. For a detailed overview of the various generations of innovation framework taxonomy see (Rothwell, 1994; Eleveens, 2010 ; O’ Raghallaigh et al., 2011 ).

Table 1 Generations of Innovation Framework Models

Model Generation Characteristic Strengths Weaknesses
Technology Push First Simple linear sequential process, emphasis on R&D and science

Simple

Radical innovation

Lack of feedbacks

No market attention

No networked interactions

No technological instruments
Market Pull Second Simple linear sequential process, emphasis on marketing, the market is the source  of new ideas for R&D

Simple

Incremental innovation

Lack of feedbacks

No technology research

No networked interactions

No technological instruments
Coupling Third Recognizing interaction between different elements and feedback loops between them, emphasis on integrating R&D and marketing

Simple

Radical and incremental innovation

Feedbacks between phases

No networked interactions yet

No technological instruments
Interactive Fourth Combination of push and pull models, integration within firm, emphasis on external linkages

Actor networking

Parallel phases

Complexity increment of reliability

No technological instruments
Network Fifth Emphasis on knowledge accumulation and external linkages, systems integration and extensive networking

Pervasive innovation

Use of sophisticated technological instruments

Networking to pursue innovation

 Complexity increment of reliability
Open Sixth Internal and external ideas as well as internal and external paths to market can be combined to advance the development of new technologies

Internal

and external

ideas as well as

internal and

external paths to

market can be

combined

Assumes capacity

and willingness to

collaborate and

network

Risks of external

collaboration


The first generation technology push era of innovation models represents a simple linear structure which mapped innovation as a sequential process performed across discrete stages. Technology push (Figure. 1) is based on the assumption that new technological advances based on R&D and scientific discovery, preceded and ‘pushed’ technological innovation via applied research, engineering, manufacturing and marketing towards successful products or inventions as outputs.

Figure 1 First and Second Generation Models

firstandsecondgenerationmodels


Source: Rothwell (1994)

In the second generation market pull era a linear model depiction of innovation also applies, this time prioritizing the importance of market demand in driving innovation endeavors. What distinguishes this model from its predecessor is that rather than product development originating from scientific advances, new ideas originate in the marketplace, with R&D becoming reactive to these needs.

The third generation Interactive, Coupling or Chain-linked models overcame many of the shortcomings of the previous linear atypical examples models, by incorporating interaction and feedback loops to recognize that innovation is characterized by a coupling of and interaction between science and technology and the marketplace. Consequently, the third generation models integrate multiple in-house functions and interdependent stages. While third generation models are non-linear with feedback loops, a sequential nature of the stages of innovation were characterized (Figure. 2).

Figure 2 Third Generation Coupling Model

thirdgencoupling


Source: Rothwell (1994)
Source: du Preez and Louw (2008)


In response, and aiming to reflect the high degree of cross functional integration within firms, fourth generation integrated or parallel models reflect significant functional overlaps between departments and/or activities (Figure. 3). A further novel feature of this model is the concept of external integration in terms of alliances and linkages with suppliers, customers, universities and government agencies.
Figure 3 Fourth Generation Integrated/ Parallel Model

Source: du Preez and Louw (2008)

Extending from the previous generation of innovation models, fifth generation systems integration and networking models emphasize that innovation is a distributed networking process requiring continuous change occurring within and between firms, characterized by a range of external inputs encompassing suppliers, customers, competitors and universities. Reflecting a systems thinking approach, the dominant characteristics are the integration of a firm’s internal innovation ecosystem and practices with external factors in the National Innovation Environment (du Preez and Louw, 2008) . The fifth generation models are characterized by the introduction of ICT systems to accelerate the innovation processes and communications across the networking systems in terms of raising both development efficiency and speed-to-market through strategic alliances (Figure. 4).

Figure 4 Fifth Generation Network Model

fifthgen

Source: du Preez and Louw (2008)

More recently and following on from the seminal work of Rothwell, innovation generation model typology researchers have signalled that open innovation represents the latest wave of innovation models. Reflecting a dominant orientation to the preceding network models of innovation, the open innovation approach is not limited to internal idea generation and development, as internal and external ideas in addition to internal and external paths to market (licensing, insourcing etc.) are facilitated within the innovation development chain (figure. 5).


Figure 5 Open Innovation Model

openinnmodel


Source: du Preez and Louw (2008)

Source: du Preez and Louw (2008)

Open innovation is considered as a paradigm shift whereby competitive advantage can result from leveraging discoveries beyond the confines of a single internal R&D unit (inbound open innovation) and can equally benefit from relying exclusively on their own internal paths to market through engaging with external organisations that may be better positioned to commercialize a given technology (outbound open innovation). In a similar vein, Enkel et al. (2009) identifies three core processes can be differentiated in open innovation:
(1) The outside-in process: which involves enhancing and extending an enterprise’s own knowledge base through the integration of suppliers, customers, and external knowledge sourcing.
(2) The inside-out process: which refers to securing commercial/revenue benefits by bringing ideas to market faster than internal development via licensing IP and/or multiplying technology, joint ventures, and spin-offs.
(3) The coupled process: which combines co-creation with partners through alliances, cooperation, and reciprocal joint ventures with the outside-in process (to gain external knowledge) and the inside-out process (to bring ideas to market).


The linear first and second generation models have been widely criticized for their overly simplistic linear, discrete and sequential nature of the innovation process. In response, the third generation of models demonstrates how the various business functions interact during the innovation process in addition to marrying the importance of technology push and market pull dimensions. Nonetheless, the main criticism of third generation models for is that they do not detail sufficiently mechanisms for interacting with environmental factors. Regarding fourth and fifth generation models there is a paucity of evidence to demonstrate the impact of these models. Mindful of the above, and factoring in a range of best practices within a specific historical period the notion of a generalized, prescriptive or isolated best practice approach can be misleading. More recently, the model whereby enterprises invest exclusively in research and development departments to drive innovation is eroding with the advent of open innovation. Contrasted to closed innovation, where innovation activities take place entirely within one firm, open innovation processes are characterized as spanning firm boundaries presenting opportunities to reduce risk and commercialize both external ideas and internal ideas externally.

In conclusion, there is no one size fits all solution to designing and implementing a successful innovation process as innovation engagement and management is unique to its respective organisational context. Nonetheless, there is an ever increasing general body of information around innovation practice and modelling which has direct relevance to informing firm-level innovation practice: the set of rules, models and stages involved (Tidd, 2006 ; Cormican and O’ Sullivan, 2004 ); considerations for R&D, utilizing knowledge sources and responding to market forces (O’Raghalliagh et al., 2011) and the strengths and weaknesses of the various generations of innovation models (Rothwell, 1994).

Irrespective of the firm-level context, exploring innovation models is important because they can assist management teams in framing, understanding, and acting on the issues which need managing. Such issues include, but are not limited to: the key phases in the innovation lifecycle and the activities, actors and their interrelationships. Moreover, the linkage of organisational contextual factors equally impacts upon the overarching innovation ecosystem. The imperative of developing the most optimal innovation processes and models is of paramount importance give than innovation is the means by which organisations execute in the present and adapt to the future challenges and opportunities.

 

R. Rothwell, “Towards the fifth-generation innovation process,” International Marketing Review, vol. 11, no. 1, pp. 7-31, 1994.
J. Ortt and P. van der Duin, “The evolution of innovation management towards contextual innovation,” European Journal of Innovation Management, vol. 11, no. 4, pp. 522-538, 2008.
M. Kotesmir and D. Meissner, “Conceptualizing the innovation process – trends and outlook,” NRU HSE Working Paper Series Science, Technology, Innovation. No. 10/STI/2013, 2013.
H. Chesborough, Open Innovation: The new imperative for creating and profiting from technology, Boston: Harvard Business School Press, 2003
C. Eleveens, “Innovation Management: A Literature Review of Innovation Process Models and their Implications,” Nijmegen, NL, 2010.
P. O'Raghallaigh, D. Sammon and C. Murphy, “A re-conceptualisation of innovation models to support decision design,” Journal of Decision Systems, vol. 20, no. 4, p. 369, 2011.
N. du Preez and L. Louw, “A framework for managing the innovation process,” in In: PICMET Proceedings, CapeTown, South Africa, 2008.
E. Enkel, O. Gassmann and H. Chesbrough, “Open R&D and Open Innovation: exploring the phenomenon,” R&D Management, vol. 39, no. 4, pp. 311-316, 2009.
J. Tidd, “A review of innovation models discussion paper 1,” Science and Technology Policy Research Unit, Tanaka Business School, University of Sussex, 2006.
K. Cormican and D. O'Sullivan, “Auditing best practice for effective product innovation.,” Technovation, vol. 24, no. 10, p. 819–829, 2004.

 

Innovation Model Process Flows

Given the proliferation in research and scholarly attention afforded to innovation over the last three decades, a diverse range of innovation modelling processes exist in the literature (Rothwell, 1994 ; Tidd, 2006 ; du Preez and Louw, 2008 ; O’Raghallaigh et al., 2011 ). The existing catalogue of process models of innovation can be generally subdivided into three umbrella categories: (1) Linear (2) phased models, and (3) coupling, cyclical models.

1. Linear:
Early models of innovation presented innovation as a linear phenomenon where each element/stage in the process was considered modular and unconnected to other parts of the innovation process (Rothwell, 1994), underpinned by a linear underpinning approach to innovation; “Technology push” and “demand pull”. The first generation technology push era of innovation models represents a simple linear structure which mapped innovation as a sequential process performed across discrete stages. Technology push (Figure. 1) is based on the assumption that new technological advances based on R&D and scientific discovery, preceded and ‘pushed’ technological innovation via applied research, engineering, manufacturing and marketing towards successful products or inventions as outputs. In the second generation market pull era a linear model depiction of innovation also applies, this time prioritizing the importance of market demand in driving innovation endeavors. What distinguishes this model from its predecessor is that rather than product development originating from scientific advances, new ideas originate in the marketplace, with R&D becoming reactive to these needs.

 

firstandsecondgenerationmodels

 

Figure 1 First and Second Generation Models


Source: Rothwell (1994)

It was found early on that these models did not survive empirical scrutiny as this representation oversimplified the innovation process. Indeed, Kline and Rosenberg (1986) note that models that depict innovation as “…a smooth, well-behaved linear process badly misspecify the nature and direction of the causal factors at work. Innovation is complex, uncertain, somewhat disorderly, and subject to changes of many sorts”.

2. Phased:
Phased models serve as a management tool to map, systemize, control and review innovation progress across the sequential phases involved in an innovation project (Verworn and Herstatt, 2002) . Inputs and outputs for each phase are defined with management reviews at the end of each phase to determine the continuation of a project (“go-no-go”). The Stage-Gate process (Cooper, 2008) represents distinctive and orderly phases consists of a range of gates to evaluate the various stages in the innovation development journey. The advantages of such an approach is in reducing uncertainty and promoting completion of sub stages of the innovation process (Figure 2).

stagegatemodel

Figure 2 Stage Gate Model

Source: Cooper (1990)

3. Coupling/ cyclical models:
Mindful of the combination of technical activities occurring in the innovation process, the external forces of the market place, as well as the complex interac tions between the various stages of the process, researchers in the field of innovation have developed more complex and inclusive models based upon the limitations of linear and phased models (Leger and Swaminaham, 2007 ). For example, the Chain Linked innovation model (Kline and Rosenburg, 1986) combines both market pull and technology push orientations, and identifies multiple paths of innovation process incorporating feedback loops across the components of the innovaiton value chain. Kline and Rosenberg’s Chain Linked innovation model (Figure 3) combines both market pull and technology push orientations, identifies five paths of innovation process (C): starting with the perception of a new market opportunity and/or a new science and technology-based invention; this is necessarily followed by the ‘analytic design’ (D) for a new product or process, and subsequently leads to development, production and marketing.

 

cyclingmodel
Figure 3 Chain Linked Innovation Model

Source: Kline and Rosenberg (1986)

The process accomodates feedback loops (f, F) link each downstream phase in the central chain with the phase immediately preceding it and longer feedback loops link perceived market demand and product users with phases upstream. The second set of relationships links the innovation process embedded in firms and industries with the scientific and technical knowledge base and with research (K). In terms of use case scenarios – innovators search the existing knowledge bases to seek a solution to an identified problem (1), and if such solutions are available, continues along the innovation chain(2). If no solution knowledge is available, then the innovator resorts to conducting research (3). The restults of such research activities are then fed into the innovation chain (4). Finally, the results are subsequently integrated into the scientific arena (S).

Departing from a linear conceptualisation, Berkhout’s Cyclic Innovation Model (CIM) developed in the nineties views the innovation process as more than just technical invention and describes the innovation arena by a ‘circle of change' linking changes in science (left) and industry (right), and changes in technology (top) and markets (bottom) (Berkhout et al.,2007) . As illustrated in Figure 4, the model architecture is not a chain but a circle: where ideas may start anywhere in the circle and proceed clockwise or anticlockwise. Equally, the model portrays a system of dynamic processes –with four ‘nodes of change’: scientific exploration, technological research, product creations and market transitions and between these nodes there are ‘cycles of change’.

 

cyclicalinnovationmodel

Figure 4 Cyclical Innovation Model

Source: Berkhout et al. (2010)

 

[1] R. Rothwell, "Towards the fifth-generation innovation process," International Marketing Review, vol. 11, no. 1, pp. 7-31, 1994.

[1] J. Tidd, "A review of innovation models discussion paper 1," Science and Technology Policy Research Unit, Tanaka Business School, University of Sussex, 2006.

[1] N. du Preez and L. Louw, "A framework for managing the innovation process," in In: PICMET Proceedings, CapeTown, South Africa, 2008.

[1] P. O'Raghallaigh, D. Sammon and C. Murphy, "A re-conceptualisation of innovation models to support decision design," Journal of Decision Systems, vol. 20, no. 4, p. 369, 2011.

[1] S.J. Kline, and N. Rosenburg, “An overview of innovation,” in The Positive Sum Strategy: Harnessing Technology for Economic Growth., Washington, D.C, National Academy Press, 1986, pp. 275-305.

[1] B. Verworn and C. Herstatt, “The Innovation Process: an Introduction to Process Models.,” Working Paper No. 12, Technical University of Hamburg., 2002.

[1] R. Cooper, “Perspective: the stagegate idea to launch process update, what’s new, and NexGen system,” Journal of Product Innovation Management, vol. 25, no. 3, pp. 213-232, 2008.

[1] R. Cooper, “Stage-Gate Systems: a new tool for managing new products,” Business Horizons, vol. 33, pp. 44-56, 1990

[1] A. Leger and S. Swaminaham, “Innovation theories: relevance and implications for developing country innovation. Discussion Paper No. 743, .,” DIW Berlin, 2007.

[1] A. Berkhout, D. Hartmann and P. Trott, “Connecting Technological Capabilities with Market Needs using a Cyclic Innovation Model.,” R&D Management, vol. 40, no. 5, pp. 474-490, 2010.

 

Innovation Models

Varying attempts have been made to articulate conceptual order on the innovation processes of organisations, in the form of innovation process models. The variety amongst the models is the consequence of a lack of consensus as to how an innovation process should look like, given the unique contexts, environments, and purposes for which they are developed (Tidd, 2006 ; Eleveens, 2010 ). For O’Raghallaigh (2010) , innovation models are important because they offer a simplified external representation of a complex system to “…assist innovators and management teams in framing, understanding, and acting on the issues which need managing”.

A snapshot of a range of simplified innovation process is presented in Table 1 to illustrate, at a high level the range of components reflected in innovation modelling. The variety amongst such models is the consequence of a lack of consensus as to how an innovation process should look like, given the unique contexts, environments, and purposes for which they are developed (Tidd, 2006; Eleveens, 2010).


Simplified Innovation Process Models

simplifiedprocessmodels

Simplified Model of an Innovation Process (Tidd, et al., 2005)

processbased

Process Based Model of Innovation (Chiesea et al., 1996)

stagegate

TeamGuide Innovation Model (TECNOLÓGICA, 1999)

stagegatemodel

Cooper Stage Gate Model (Cooper, 1990)


While the cited models differ in their schematic layout, they all begin with some form of idea generation and trace the phases from development through to implementation. Tidd et al. (2005) indicate that an organisational innovation model needs to support the searching for, selection of, implementation and capture of innovative ideas supported by an overarching innovation organisation and strategy. Similarly, the TEAMGUIDE innovation model offers a phased approach from beginning with scanning and ending in implementation and learning. The stage-gate process, developed by Cooper, has the most distinctive and orderly phases. His earlier versions of the stage gate process more or less prescribe that the next phase can only start, if the project complied with all the requirements of the previous stage. However, the stage gate process has evolved to incorporate cyclical and feedback loops to address the limitation of a strict linear pattern. In addition to the temporal phases/stages of innovation processes, the aforementioned models underscore the organisational consideration in the form of strategy, leadership, resourcing and system and tools.

Innovation processes illustrate the phases associated with the exploration of opportunities for new and/or improved products, processes and services, stimulated by advancements in technical practice or alternatively changes in market demand, and ideally a combination of both drivers (Pavitt, 2005) . In this vein, innovation process depictions commonly adopt a wide-scope view, encompassing the schema, phases and processes from the decision to commence research on an opportunity or problem, to development, commercialization, implementation and diffusion (Rogers, 1995) . Koen (2005) divides the innovation process into three distinct categories: the Fuzzy front end (FFE) concerning ideation generation and selection, the New Product Development Portion (NPD), and Commercialization. The next section, explores these phases in more detail.


While models may differ in their schematic layout, they all begin with some form of idea generation and trace the phases from selection, development through to implementation. In this vein, innovation model depictions commonly adopt a wide-scope view, encompassing the schema, phases and processes from the decision to commence research on an opportunity or problem, to development, commercialization, implementation and diffusion (Rogers, 1995). The Stage-Gate process (Cooper, 1990) has the most distinctive and orderly phases which more or less prescribe that each phase can only start, if the project complied with all the requirements of the previous phase. The innovation process, according to the Stage Gate model consists of a range of gates to evaluate the various stages in the innovation development journey. In addition to the temporal phases/stages of innovation processes depicted in table 1 above, the Innovation Pentathlon Model (Goffin and Pfeiffer, 1999) models underscore the organisational consideration in the form of strategy, leadership, resourcing and system and tools (Figure 1).

 

pentathlonmodel

Figure 1 The Pentathlon Model

Source: Goffin and Pfeiffer (1999)


The five interlocking elements referred to in the pentathlon are:
• Ideas Management & Creativity Management;
• Prioritization, Selection and Portfolio Management;
• Implementation Management (NPD etc.);
• Innovation Strategy;
• Human Resource Management (People and Organisation).

The pentathlon framework accommodates a wider range of soft organisational issues than the traditional linear innovation model. It overcomes the deficiencies of typical phased models by including: HRM, Creativity/Ideas Management, the selection of priorities, and the importance of market conditions (in respect of the products, processes and services). At the top of the model lies the role of an innovation strategy, which will dictate what is needed in terms of the focus and goals, communication, technology and the measurement of success. In the middle of the model, a flow is often conceptualised within a funnel, indicating a move of the ideas through a prioritisation process as and through to implementation and new product development interactions with the marketplace. Underneath this middle section, the model depicts the formalisation of the human element in innovation. The pentathlon framework (Goffin and Pfeiffer, 1999) is distinctive from earlier models in featuring the human factor in innovation; specifically, recognising how the people and organizational climate play a role, and consequently, the value of seeking a conducive culture, where people are motivated to innovate.

 

J. Tidd, "A review of innovation models discussion paper 1," Science and Technology Policy Research Unit, Tanaka Business School, University of Sussex, 2006.
C. Eleveens, "Innovation Management: A Literature Review of Innovation Process Models and their Implications," Nijmegen, NL, 2010
P. O'Raghallaigh, D. Sammon and C. Murphy, "A re-conceptualisation of innovation models to support decision design," Journal of Decision Systems, vol. 20, no. 4, p. 369, 2011.
J. Tidd, J. Bessant, and K. Pavit, “Managing Innovation – Integrating Technological, Market and Organizational Change. New York: John Wiley & Sons, 2005.
V. Chiesa, V., P. Coughlan, and C. Voss, C, “Development of a Technical Innovation Audit”, Journal of Product Innovation Management, Volume 13, pp. 105-36, 1996.
TECNOLÓGICA, COTEC – FUNDACIÓN COTEC PARA LA INNOVACIÓNCoates, “On the Future of Technological Forecasting”, Technology Forecasting Social Change, 67(1), pp. 1-17, 2001.
R. Cooper, “Stage-Gate Systems: a new tool for managing new products”, Business Horizons, Volume 33, pp. 44-56, 1990.
K. Pavitt, K., “Innovation Processes”, In: The Oxford Handbook of Innovation. New York: Oxford University Press, 2005.
E. Rogers, “Diffusion of Innovations”. New York: The Free Press, 1995.
P. Koen, “The Fuzzy Front End for Incremental, Platform, and Breakthrough Products”. In: The PDMA Handbook of New Product Development. Hoboken, New Jersey: John Wiley & Sons., pp. 81-91, 2005.
K. Goffin, K. and R. Pfeiffer, “Innovation Management in UK and German Manufacturing Companies”. London: Anglo-German Foundation, 1999.

Phases, Components and Contexts of Innovation Process Models

An extensive corpus of literature has accumulated documenting the range of end to end phases relating to innovation processes. Eleveens (2010) synthesized these phases ranging from idea generation through to implementation and review as illustrated in Table 1 below. All models start with some form of idea generation or searching stage. Secondly, a selection phase follows to determine which projects are feasible and potentially lucrative enough to be pursued. The third step reflects the development phase where the idea is developed into a tangible product, process or service. This stage can be described differently where terminologies such as development, prototyping, manufacturing and realization are used inter-changeably. The fourth phase represents implementation/launch and typically entails marketing, distribution, logistics and customer facing activities. Some authors also include a post launch phase to accommodate re-innovating, scaling and learning dimensions.

phasesofinnovationprocesses 2


Table 1 Phases of Innovation Processes

Source: (Eleveens, 2010)

In addition to these innovation phases, several authors acknowledge that innovation process does not occur within a vacuum, and thereby indicate a range of contextual factors which impact on the processes deployed (Rothwell, 1994 ; Cormican and O;Sullivan, 2004 ; Tidd and Bessant, 2005 ). Innovators operate within complex and turbulent environments, and are increasingly confronted with escalating and rapid technology developments, competitive global market competition and shorter product life cycles meaning they must be reactive and flexible to organizational, technological and market shifts (Garud et al., 2006 ). Such contextual factors range from organisational characteristics to societal factors and from internal factors that are controllable to external factors. These factors have been mapped by (Eleveens, 2010) into six categories which include: Strategy; Culture; Leadership; Organisational structure; Resources/Skills and links and networking links.


Indeed, the literature base identifies a range of organisational, environmental and contextual factors which impact on the processes deployed (Rothwell, 1994; Cormican and O’Sullivan, 2005 and Tidd et al., 2005 ). The AT Kearney House of Innovation model, which underscores the European Commission’s IMP³rove programme maps such innovation lifecycle and organisational/contextual factors (Figure 1).

 

improveinnovation atkearney 2


Figure 1 AT Kearney House of Innovation

Source: A.T. Kearney 2006 – available at: www.improve-innovation.eu


• The Innovation Strategy identifies the most promising areas where innovator can achieve superior profit growth rates either with new products/services or with existing products/service in new markets or with new or improved processes or business models.
• The Organization and Culture must support this innovation strategy so that the profit growth targets can be reached. Organisations must have the structures, for example, to integrate external partners in their development processes or to seamlessly manage the development processes. Their culture must be open to new ideas no matter where they come from. The organisation has to translate the innovation strategy to pursue those ideas that are most promising for their focus areas.
• In the Innovation Life-Cycle Management there are many steps where leading innovators avoid inefficiencies and ensure short time-to-profit, while the average company might only focus on the time-to-market and forget about proper life-cycle management after the launch of the innovation.
• Enabling factors such as knowledge management or capabilities in specific technologies or expertise in new market development also have a significant impact on growth through innovation management. They must be aligned with the innovation strategy, allocated in the right manner in the organization and leveraged for successful innovation management to fully exploit the growth potential of the innovation.

 

C. Eleveens, "Innovation Management: A Literature Review of Innovation Process Models and their Implications," Nijmegen, NL, 2010.
R. Rothwell, "Towards the fifth-generation innovation process," International Marketing Review, vol. 11, no. 1, pp. 7-31, 1994.
K. Cormican and D. O'Sullivan, "Auditing best practice for effective product innovation.," Technovation, vol. 24, no. 10, p. 819–829, 2004.
J. Tidd and J. Bessant, Managing innovation - Integrating technology market and organizational change, Chicester: Wiley, 2005.
Garud, R., A. Kumaraswamy and V. Sambamurthy, "Emergent by design: performance and transformation at infosys technologies," Organization Science, vol. 17, no. 2, p. 277–286, 2006.
J. Tidd, J. Bessant, and K. Pavit, “Managing Innovation – Integrating Technological, Market and Organizational Change. New York: John Wiley & Sons, 2005.

Innovation Practices and Requirements in Privacy and Cyber Security Organisations

 

While innovation is widely recognized by as a sustainable and competitive enabler; nonetheless understanding of innovation management and practice remains fragmented, misunderstood and untamed by practitioners and researchers alike. Based on the foregoing, developing an understanding of PACS (Privacy and Cyber Security) stakeholders’ innovation requirements represents an integral and anchoring component of the IPACSO project, with reference to informing the development of appropriate and targeted support interventions/solutions. For this reason, this synopsized overview focuses on identifying stakeholders’ innovation practices and requirements to develop an understanding of the following:

• Environment, approaches and requirements in relation to innovation engagement.
• Challenges, barriers and support requirements in relation to PACS innovation.


A detailed report of IPACO’s Stakeholder Requirement findings will be released shortly.


In pursuit of identifying PACS stakeholders’ innovation requirements a mixed method triangulated research design was employed, encompassing an online questionnaire, semi-structured telephone interviews, secondary research, engagement with the Innovation Advisory Board and IPACSO Innovation Award finalists’ innovators (see Figure 1).


Figure 1 Triangulated Research Design

triangulatedresearchdesign3

High-Level Insights
• A diverse range of innovation modelling processes, practices and, in turn, requirements proliferate the PACS innovation domain.
• Multiple and integrated innovation models are utilized which draw upon elements of technology push, demand pull, cooperative, networking and open innovation principles. This variance, creates difference scenarios of practice and focus both in terms of the stakeholders involved and the phases/gates deployed and in turn, their requirements.
• The level of innovation practice and requirements of innovators varies depending on their respective maturity level. While market shifts and demands represent a key innovation component and driver in any industry setting, the constantly changing and hard to predict PACS environment exerts a significant challenge.
• At a high level, the research indicates that existing competencies and investment are directed in the early phases of the innovation lifecycle (ideation through to concept development); whereas significant scope and requirements occur in the latter stages (test and implementation).
• A significant finding is that innovation challenges transcend infrastructural, market, knowledge, cost and legal domains. Cost factors ranked first for all the respondents with knowledge and market factors also representing a serious problematic innovation challenge.
• The stakeholders identified a broad scope for innovation supports across the entire innovation value chain and ecosystem (i.e. strategy, business intelligence, ideation, portfolio management, resource management development, and launch).
• A common denominator from the interview findings is the varying levels of disconnect between research and technology development and innovation diffusion/implementation. While the imperative of underpinning innovation development activities with sound commercial business cases was recognized by all, competency and proficiency in this area varies significantly.


PACS Respondent Demographics

Reflecting IPACSO’s multi-stakeholder foci, a broad range of stakeholder categories are represented in the research findings ranging from industry innovators in the PACS domain, research innovators, innovation intermediaries in the form of consultancy and industry support, in addition to funding and policy representatives.

• PACS relevant subdomains of those who participated in the research include but are not limited to: mobile and cloud security, telco, cyber protection, cryptography, malware, privacy enhancing technologies, surveillance and intrusion detection, security intelligence, distributed computing and big data.
• Regarding organisation size, categories ranging from micro to large are represented with small organisations (34.8%) leading the response rate followed by micro (26.1%) and large (26.1%) and medium size organisations (13%) respectively. The data reflects the growing consensus placed upon small firms proliferating the diverse and fragmented PACS landscape, with small and micro firms accounting for over half of all participants in the research.
• Demonstrating a diverse canvas of participation from all areas within organisational structures, respondents included: founders and directors, R&D managers and personnel, CTO’s, commercial directors and business developers, CEO’s, project and product managers, technology transfer managers, professors and researchers from research institutes, policy makers and security evangelists.

Innovation Practices
• A diverse approach to organizing innovation transcends the domain
While two thirds of respondents indicated that an innovation strategy(s) is in place in their organisation, there are variances in terms of supporting and complementary policies and procedures underpinning such strategies. A broad range of processes for organising innovation were identified - Two thirds adopt a cross functional approach to facilitate innovation; whereas a third utilize specialized organization units (e.g. research centres). Over a quarter of respondents reported an ad-hoc, informal approach to innovation organisation and a further 16.7% identified that their innovation operations are conducted externally through outsourcing arrangements.

• Multi-disciplinary internal and external stakeholder involvement
A wide-ranging spectrum of stakeholders are involved in innovation activities, albeit at varying levels. Internal staff represent the highest frequency of stakeholders used, followed by a combination of clients/customers, competitors, consultants are utilised at lower levels of frequency with professional/industry associations, universities and government/research institutes being used as least frequent partners..

• Multiple and integrated innovation models are utilized
Demonstrating that innovation practice is a combination of technology push and demand pull dimensions, both of these categories are strongly represented amongst the respondents. Reflecting the previously reported dominant role of internal cross functional staff integration, a cooperative and parallel approach is also commonly pursued. Underscoring the escalating incidences of collaborations between innovating organisations and external stakeholders, over 50 % positive agreement statements were reported for systems/networking integration and open innovation models.

• Product and service innovation are primary foci
Product and service innovation dominate respondents’ primary innovation focus; whereas process innovation represents the key secondary focus. Conversely, organisational and marketing innovation was not reported as a focus by 50% and 40% of respondents respectively.


Stakeholder Insights
• Innovation practice and requirements vary by the maturity levels of organisations
The level of innovation practice and requirements of innovators varies depending on their respective maturity level. For start-ups the emphasis is on finances and growth; whereas more established enterprises encounter bureaucracy, scaling and diversification requirements.

• PACS trends constantly move the goalposts
While the speed of innovation and short product cycles are signature aspects of digital markets which are continuously altered through emerging threat and vulnerabilities “it’s a continuous race between hackers and solution, the target is always moving and so too is the risk”. Equally so, it was cautioned that research, innovation and development priorities cannot be solely based on today’s problem – the world moves on, new waves of technology and threats are emerging, the key is finding windows of opportunity.

• Difficult to retro-fit Privacy and Cyber Security innovation focus
A significant proportion of the interview respondents signalled that in order for innovation outcomes to be successful in the domain, PACS specific guiding principles should be a motivator, as opposed to an afterthought of product/service development - “It is much more difficult to retro-engineer at the end, security is all about how it is used and should be a driving force from concept commencement”.

• Value chain positioning impacts on innovation focus
The majority of observable innovation in cyber-security and privacy markets is best described as incremental. This means that much of the innovation is a product or service improvement, but not a radically new development that forces businesses to re-organization or leads to the emergence of wholly new markets.

• Importance of marrying business, technology and research excellence
A common denominator from the interview findings is the varying levels of disconnect between research and technology development and innovation diffusion/implementation. While the imperative of underpinning innovation development activities with sound commercial business cases was recognized by all, competency and proficiency in this area varies significantly.

• Bureaucratic funding/support mechanisms
The interview respondents who have current and previous experience of participating in both national and European innovation funding initiatives reported frustrations and concerns surrounding such instruments in light of the fast paced, short lifecycle demands of the PACS environment.


Innovation Challenges and Requirements
Respondents rated how typical innovation challenges related to their organisation (infrastructure, cost, knowledge, market and legal/regulatory factors). As presented in Figure 1, all of the challenge factors rated as both moderate and minor challenges for the respondents. Cost factors ranked first as a series problem for all the respondents with a score in the region of 70%. One out of five respondents also identified knowledge and market factors as a serious problematic innovation challenge.

Figure 1 Innovation Challenges

innovationchallenges

• Innovation competency levels vary across the innovation value chain
Respondents identified high and competent levels of proficiency is the areas of ideation and concept development and design and business analysis. Areas where respondents felt there was scope for improvement included the phases towards the end of the lifecycle including test, implementation and post launch.

• Variance in innovation investment and performance
On average the greatest level of investment is directed in the early phases of the innovation lifecycle (ideation through to concept development); whereas less investment is directed towards the latter stages (test and implementation).
• Diverse scope for innovation support prioritization
Respondents highlighted a range of requirements and scope for prioritising areas/aspects where they consider support, guidance and knowledge would be of benefit (Figure 2). Strong requirements for innovation supports were reported in the areas of portfolio management, post launch, resource and competence management and business intelligence.

Figure 2 Scope for Innovation Supports

scopeforinnovationsupports

Elaborating upon these findings, Table 3 synopsizes a range of related and additional innovation requirement aspects, in terms of areas presenting scope for improvement.

Table 3 Additional Scope for Innovation Supports

 

 

 

Economic Supports
  • Funding of expensive projects
  • EU/Government incentives in innovation (Tax incentives)
  • Economic assistance and investment supports
Networking and Collaboration supports
  • Assistance in linking with major companies
  • Programmes to encourage smaller and larger companies to collaborate
Market Supports
  • Regulation, screening and patent searching
  • Targeted initiatives aimed at channel development
  • Assistance in scanning the market
Human/People supports
  • Top management commitment
  • Access to key competence for hiring
  • Dedicated training and consultancy supports
Business Development Supports
  • Market positioning and benchmarking
  • Business intelligence
  • PR and marketing
  • Implementation and customer engagement
Risk and Awareness Building Supports
  • Initiatives for encouraging disruptive innovation engagement
  • Confidence building in ideation and follow through
  • Initiatives to promote European enterprises to be leaders as opposed to followers

More Articles ...

  1. Considerations for Innovation Modelling

Getting Started

Which type of company are you? Choose one of the options below and get a head-start.

Framework Overview

Navigate through the different parts of the Framework

leeg

Joomla! Debug Console

Session

Profile Information

Memory Usage

Database Queries