ISL456U-TECHNOLOGY AND INNOVATION MANAGEMENT
Chapter 4: Process of Innovation
Introduction
Firms that want to gain a competitive advantage should do more. It is not enough just to adapt to changing environmental conditions. Firms that innovate are more successful in marketing, finance, human resources, production, and research and development than other firms. For firms, innovation is a very important competitive tool as it increases efficiency and profitability, enables entry into new markets, and enlarges the existing market.
Desouza et al. examined the studies conducted on the innovation process in their studies and finally defined 5 stages. Accordingly, the innovation process consists of idea generation and mobilization, advocacy and screening, experimentation, commercialization, diffusion and implementation steps, iteratively. Desouza et al. (2014), in their study, state that firms whose innovation process is defined and well-built have better performance in developing creative products than others. These firms are defined as robust firms. It is practical to realize innovation in robust firms.
Innovation is inevitable for firms. For productive innovation management, the process must be well designed. In this section, the stages of the innovation process will be explained. Each step of the 5-stage process will be explained and information will be given about an efficient innovation process. These are idea generation and mobilization, advocacy and screening, experimentation, commercialization, diffusion and implementation.
Idea Generation and Mobilization
Idea generation is the creative process or procedure that a firm uses to figure out solutions to any number of difficult challenges. In addition, flexible organizational culture, positive organizational climate, qualified human resources, and open communication channels in firms are very important for the effectiveness of the new idea development process.
Advocacy and Screening
The advocacy and screening phase allows us to evaluate an idea and understand its potential benefits and problems. It makes it easier for us to make decisions about the potential of the newly created idea. In this process, ideas are transformed from their raw form to their more mature form. Unnecessary parts of the idea can be discarded or improvements can be made in this process. If the idea has potential, different opinions can make the idea grow.
Experimentation
After the idea passes the first two stages, it must now be tested at this new stage. The applicability of the maturing idea to the production or service process should be tested. The innovation that will emerge must solve a problem or provide a benefit. Even if the idea is good, it can be eliminated in the experimentation process. Innovation
must be offered as a service or product and have a commercial value. Otherwise, ideas cannot progress.
Commercialization
Commercialization is the process of bringing new products or services to the market. At this stage, the idea of innovation is introduced to the target audience. The main purpose is to make the target audience find the idea attractive. Commercialization is important to understand how the idea is perceived from the outside. Besides, at this stage, who can use innovation is discovered. Potential buyers of innovations are also many. At the same time, an idea about the market value of the commercialized idea is obtained in the process.
Diffusion and Implementation
Diffusion and implementation are actions that are performed simultaneously at the final stage of the innovation process. Diffusion is the process of acceptance of the product by the consumers. The product must also be accepted by the company employees. The implementation process is the creation of the infrastructure required for the production phase of the prototyped product. At this stage, the product starts to be marketed to consumers. First impressions can be obtained from existing customers. Customer information management is important here. If the company is innovating on a product, it can determine the most suitable audience for this product through the customer information management system. The adoption of a product is likely to vary greatly depending on the competing technologies, the usefulness of innovation, and the efficiency through which information about the innovation is disseminated. How the idea was originally designed affects the success of this process. Although this process is the last stage, every stage of the innovation process is interdependent. Therefore, performance in previous stages affects the diffusion and implementation process. It is possible to divide the consumer group into five categories. These are;
• Innovators
• Early Adopter
• Early Majority
• Late Majority
• Laggards