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Article

Innovation in Family Business  

Alfredo De Massis, Emanuela Rondi, and Samuel Wayne Appleton

The involvement of families in firms’ ownership, management, and governance is a key driver of organizational attitudes, behaviors, and performances, especially those related to innovation. Starting from the beginning of the 21st century, the academic interest toward family firm innovation has bloomed. This body of research has mostly emerged from family firm scholars, while mainstream innovation scholars have often overlooked family variables in their studies. Indeed, innovation is one of the main areas in family firm research, integrating family and business aspects, leading to a plethora of sometimes contradictory findings. Initially, research compared innovation between family and nonfamily firms. While this approach has been beneficial to the rise of this stream of research and underlined the idiosyncratic characteristics of family firms on this matter, it soon emerged that within family firms there is a high degree of heterogeneity, especially in their attributes and the way they relate to innovation. Therefore, scholars have delved deeper into the heterogeneous influence that different types and degrees of family involvement in the firm can exert on innovation. This vast body of literature can be reconciled according to an antecedents–activities–outcomes framework allowing to attune current understanding of family firm innovation and recommend directions for future research. While most of current research has examined the antecedents of family business innovation, further examination of the activity of innovating in family firms is needed. Fostering accessibility to this literature allows students, practitioners, and scholars to grasp and digest this insightful area of family business research. It also encourages an extension of the range of perspectives adopted to examine innovation in family firms, contributing to advance current knowledge.

Article

International Research and Development and Knowledge Sourcing by Multinational Corporations  

Kazuhiro Asakawa and Jaeyong Song

Internationalization of R&D facilitates knowledge sourcing of multinational corporations (MNCs) on a global scale. As MNCs internationalize R&D, they not only engage in domestic-driven R&D but are actively involved in overseas-driven R&D. And accordingly, the role of overseas R&D laboratories often evolves, from applying the HQ-generated innovation to local market, to innovating locally and contributing to the parent company. Within an MNC boundary, knowledge flows have become multidirectional: on top of the most typical knowledge flows from headquarters (HQ) to a subsidiary, reverse knowledge flows from a subsidiary to HQ as well as horizontal knowledge flows among overseas subsidiaries have become more salient. In addition to knowledge flows within a firm, increasing attention has been paid to external knowledge sourcing, i.e., knowledge sourcing from foreign locations outside the firm. MNCs commonly engage in local knowledge sourcing, i.e., sourcing knowledge from an overseas local environment, to tap into local hotbeds of innovation. But MNCs are also increasingly conducting global knowledge sourcing, i.e., sourcing knowledge from around the world, to practise global open innovation. Theoretically, knowledge sourcing in international R&D has often been examined from the capability and embeddedness perspectives. The effect of capability has been discussed in connection with motivation, autonomy, and mandates of subsidiaries. The effect of embeddedness has been discussed in connection with complementarity between external and internal embeddedness. As future research agenda, the following are suggested. First, cross-fertilization among the research fields of international R&D, global innovation, and open innovation deserves further attention. Second, greater research focus can be placed on managerial processes of global knowledge sourcing. Third, further research can be advanced on global knowledge sourcing at the team level. Fourth, the association between corporate governance and global knowledge sourcing can be investigated further. Fifth, much more attention needs to be paid to microfoundations of global knowledge sourcing. And lastly, further evolving patterns of global knowledge sourcing by advanced country multinationals (AMNCs) and emerging economies multinationals (EMNCs) continue to be relevant.

Article

National Systems of Innovation  

Erik E. Lehmann and Julian Schenkenhofer

The pursuit of economic growth stands out as one of the main imperatives within modern economies. Nevertheless, economies differ considerably in their competitiveness. Theories on the endogeneity of growth agree on the value of knowledge creation and innovativeness to determine a country’s capability to achieve a sustained performance and to adapt to the dynamics of changing environments and faster information flows. To this effect, national institutional regimes shape nation-specific contexts and embed individuals and firms. The resulting incentive structures shape the attitudes and behavior of individuals and firms alike, whose interactions contribute to the accumulation and flow of knowledge among the nodes of their networks. National systems of innovation (NSIs) therefore embody a concept that aims to analyze the national innovation performance of economies. It rests its rationale in the variation of national institutions that shape the diffusion of technologies through the process of shared knowledge creation and the development of learning routines. Both public and private institutions are thought to interact in a given nation-specific institutional context that essentially affects incentive schemes and resource allocation of the involved economic agents in creating, sharing, distributing, absorbing, and commercializing knowledge. To this effect, public policy plays a key role in the NSI through building bridges between these actors, reducing information asymmetries, and providing them with resources from others within the system. The different actors contributing to the creation and diffusion of knowledge within the system are needed to exchange information and provide the engine for sustained economic growth. Universities, research institutes, companies and the individual entrepreneur are in charge of shaping their economic system in a way that resource and skill complementarities are exploited to the mutual benefit.

Article

New Venture Legitimacy  

Greg Fisher

Starting an entrepreneurial endeavor is an uncertain and ambiguous project. This uncertainty and ambiguity make it difficult for entrepreneurs to generate much needed resources and support. In order to address this difficulty, a new venture needs to establish legitimacy, which entails being perceived as desirable, proper, or appropriate within the socially constructed system of norms, values, beliefs, and definitions within which it operates. New venture legitimacy is generated from various sources and hence has three broad dimensions—a cognitive, a moral, and a pragmatic dimension. The cognitive dimension accounts for the extent to which the activities and purpose of a venture are understood by key audiences and how knowledge about that venture spreads. The moral dimension reflects the extent to which a venture is perceived to be doing the right thing. The pragmatic dimension accounts for the extent to which a new venture serves the interests of critical constituents. All three of these dimensions factor into a legitimacy assessment of a new venture. Legitimacy is important for new ventures because it helps them overcome their liabilities of newness, allowing them to mobilize resources and engage in transactions, thereby increasing their chances of survival and success. Although legitimacy matters for almost all new ventures, it is most critical if an entrepreneur engages in activities that are new and novel, such as establishing a new industry or market or creating a new product or technology. In these circumstances, it is most important for entrepreneurs to strategically establish and manage a new venture’s legitimacy. The strategic establishment and management of new venture legitimacy may entail arranging venture elements to conform with the existing environment, selecting key environments in which to operate, manipulating elements of the external environment to align with venture activities, or creating a whole new social context to accommodate a new venture. Enacting each of these new venture legitimation strategies may necessitate employing identity, associative, and organizational mechanisms. Identity mechanisms include cultural tools and identity claims such as images, symbols, and language by entrepreneurs to enhance new venture legitimacy. Associative mechanisms reflect the formation of relationships and connections with other individuals and entities to establish new venture legitimacy. Organizational mechanisms account for manipulating the organization and structure of a new venture and the achievement of success measures by that venture to attain legitimacy. Ultimately all of this is done so that various external parties, with different logics and perspectives, will evaluate a new venture as legitimate and be prepared to provide that venture with resources and support.

Article

Online Communities and Knowledge Collaborations  

Samer Faraj and Takumi Shimizu

Online communities (OCs) are emerging as effective spaces for knowledge collaboration and innovation. As a new form of organizing, they offer possibilities for collaboration that extend beyond what is feasible in the traditional hierarchy. OC participants generate new ideas, talk about knowledge, and remix and build on each other’s contributions on a massive scale. OCs are characterized by fluidity in the resources that they draw upon, and they need to manage these tensions in order to sustain knowledge collaboration generatively. OCs sustain knowledge collaboration by facilitating both tacit and explicit knowledge flows. Further, OCs play a key role in supporting and sustaining the knowledge collaboration process that is necessary for open and user innovation. As collective spaces of knowledge flows, OCs are mutually constituted by digital technologies and participants. The future is bright for OC research adopting the knowledge perspective and focusing on how to sustain their knowledge flow.

Article

Open Innovation  

Jennifer Kuan

Open Innovation, published in 2003, was a ground-breaking work by Henry Chesbrough that placed technology and innovation at the center of attention for managers of large firms. The term open innovation refers to the ways in which firms can generate and commercialize innovation by engaging outside entities. The ideas have attracted the notice of scholars, spawning annual world conferences and a large literature in technology and innovation management (including numerous journal special issues) that documents diverse examples of innovations and the often novel business models needed to make the most of those innovations. The role of business models in open innovation is the focus of Open Business Models, Chesbrough’s 2006 follow-up to Open Innovation. Managers have likewise flocked to Chesbrough’s approach, as the hundreds of thousands of hits from an online search using the term open innovation can attest. Surveys show that the majority of large firms were engaging in open innovation practices in 2017, compared to only 20% in 2003 when Open Innovation was published.

Article

Organizational Innovation  

Fariborz Damanpour

Innovation is a complex construct and overlaps with a few other prevalent concepts such as technology, creativity, and change. Research on innovation spans many fields of inquiry including business, economics, engineering, and public administration. Scholars have studied innovation at different levels of analysis such as individual, group, organization, industry, and economy. The term organizational innovation refers to the studies of innovation in business and public organizations. Studies of innovations in organizations are multidimensional, multilevel, and context-dependent. They investigate what external and internal conditions induce innovation, how organizations manage innovation process, and in what ways innovation changes organizational conduct and outcome. Indiscreet application of findings from one discipline or context to another, lack of distinction between generating (creating) and adopting (using) innovations, and likening organizational innovation with technological innovation have clouded the understanding of this important concept, hampering its advancement. This article organizes studies of organizational innovation to make them more accessible to interested scholars and combines insights from various strands of innovation research to help them design and conduct new studies to advance the field. The perspectives of organizational competition and performance and organizational adaptation and progression are introduced to serve as platforms to position organizational innovation in the midst of innovation concepts, elaborate differences between innovating and innovativeness, and decipher key typologies, primary sets of antecedents, and performance consequences of generating and adopting innovations. The antecedents of organizational innovation are organized into three dimensions of environmental (external, contextual), organizational (structure, culture), and managerial (leadership, human capital). A five-step heuristic based on innovation type and process is proposed to ease understanding of the existing studies and select suitable dimensions and factors for conducting new studies. The rationale for the innovation–performance relationship in strands of organizational innovation research, and the employment of types of innovation and performance indicators, is articulated by first-mover advantage and performance gap theory, in conjunction with the perspectives of competition and performance and of adaptation and progression. Differences between effects of technological and nontechnological innovation and stand-alone and synchronous innovations are discussed to articulate how and to what extent patterns of the introduction of different types of innovation could contribute to organizational performance or effectiveness. In conclusion, ideas are proposed to demystify organizational innovation to allure new researches, facilitate their learning, and provide opportunities for the development of new studies to advance the state of knowledge on organizational innovation.

Article

Platformizing Organizations: A Synthesis of the Literature  

Pankaj Setia, Franck Soh, and Kailing Deng

Organizations are widely building digital platforms to transform operations. Digital platforms represent a new way of organizing, as they leverage technology to interconnect providers and consumers. Using digital technologies, organizations are platformizing operations, as they open their rigid and closed boundaries by interconnecting providers and consumers through advanced application programming interfaces (APIs). Early research examined platformized development of technology products, with software development companies—such as Mozilla Foundation—leading the way. However, contemporary organizations are platformizing nontechnology offerings (e.g., ride-sharing or food delivery). With growing interest in platforms, the basic tenets underlying platformization are still not clear. This article synthesizes previous literature examining platforms, with the aim of examining what platformization is and how and why organizations platformize.

Article

Product and Innovation Portfolio Management  

Vinícius Chagas Brasil and J.P. Eggers

In competitive strategy, firms manage two primary (non-financial) portfolios—the product portfolio and the innovation portfolio. Portfolio management involves resource allocation to balance the important tradeoff of risk reduction and upside maximization, with important decisions around the evaluation, prioritization and selection of products and innovation projects. These two portfolios are interdependent in ways that create reinforcing dynamics—the innovation portfolio is the array of potential future products, while the product portfolio both informs innovation strategy and provides inputs to future innovation efforts. Additionally, portfolio management processes operate at two levels, which is reflected in the literature's structure. The first is a micro lens which focuses on management frameworks to boost portfolio performance and success through project-level selection tools. This research has its roots in financial portfolio management, relates closely to research on new product development and marketing product management, and explores the effects of portfolio management decisions on other organizational functions (e.g., operations). The second lens is a macro lens on portfolio management research, which considers the portfolio as a whole and integrates key organizational and competitive concepts such as entry timing, portfolio management resource allocation regimes (e.g., real options reasoning), organizational experience, and the culling of products and projects. This literature aims to set portfolio management as higher level organizational decision-making capability that embodies the growth strategy of the organization. The organizational ability to manage both the product and innovation portfolios connects portfolio management to key strategic organizational capabilities, including ambidexterity and dynamic capabilities, and operationalizes strategic flexibility. We therefore view portfolio management as a source of competitive advantage that supports organizational renewal.

Article

Recontextualization in International Business  

Mary Yoko Brannen

Recontextualization in international business (IB) refers to the transformation of meaning of firm offerings (technologies, work practices, products, etc.) as they are uprooted from one context and transplanted into another. The question of whether transferred firm assets will fit into receiving contexts abroad is one of the biggest concerns of multinational enterprises in the internationalization process. Whether a firm internationalizes by means of an international joint- venture, merger or acquisition, or a wholly owned subsidiary, this potential lack of strategic fit of firm assets is considered a major contributor to a firm’s liability of foreignness and ultimate lack of success abroad. As such, much research has been conducted in the field of IB to shed light on understanding the causes, implications, and recommendations for managing strategic fit in the internationalization process. Most IB research has focused on the tangible, explicit, and codifiable aspects of lack of fit, such as differences in technology, metrics, and labor regulations, which are relatively easy to discern. Often overlooked are the more subtle, less visible, tacit differences between sending and receiving contexts that affect how firm offerings are understood in the new organizational environments. Organizational contexts are embedded in multiple and intersecting cultural environments, including the organizational culture internal to the firm and the larger, societal culture external to the firm, as well as the smaller, more particular work group environments within a firm characterized by disparate functional or expert practices. Every cultural environment is embedded with its own meaning system involving distinct work-related assumptions, behaviors, and norms. Given this, unforeseen misalignments easily occur between the sender and receiver contexts stemming from disparities or divergences in meaning systems attributed to the transferred firm offerings, which can significantly affect a firm’s global strategic success. Such are the misalignments that stem from recontextualization. Firm offerings go through a preliminary round of recipient cultural sense-making in which they are assimilated into pre-existing meanings. Then, as they are implemented, acted on, and interacted with, they continue to undergo recontextualization. Language is the vehicle by which firm offerings are transferred (with the rare exception of digital code or numerical formulas), and through which sense-making is processed by individuals in the receiving contexts, thus making semantic fit a necessary complement to strategic fit in elucidating the process of recontextualization. Research in a variety of industries—from highly culturally sensitive ones such as entertainment, to seemingly culture-free, automated industrial contexts such as automotive—has shown that recontextualization will always happen no matter what the industry. This is because sending and receiving contexts can never be the same, so firm offerings will always undergo a certain amount of recontextualization to adjust to the new operating environment. Recontextualization can have positive or negative effects on a firm’s internationalization. Positive recontextualization, if the process is properly understood, can become a source of ongoing organizational learning and, in turn, become a valuable source of competitive advantage. Negative recontextualization, on the other hand, can result in lost opportunities for site-specific learning and strategic realignment, and, in the most severe cases, may seriously hinder transnational transfer and global integration efforts. Yet planning for and monitoring recontextualization are not simple matters. In most cases, managers are initially unaware of all but the most obvious sources of recontextualization, such as differences in language, metrics, organizational structure, or shop-floor layout. However, much of recontextualization happens in situ and cannot be planned for. At best, managers can opine where recontextualization might occur by utilizing industry-specific, cross-cultural consultants or internal boundary-spanners such as bilingual or bicultural employees. In some fortunate cases, managers may become aware of recontextualization early on in transfer efforts as they are confronted with organizational barriers to implementation such as significant differences in industrial and supplier relations. But, for the most part, recontextualization goes unrecognized until productivity plummets and financial goals go unmet without readily identifiable economic or other such quantifiable causes.

Article

Risk in Strategic Management  

George M. Puia and Mark D. Potts

Although risk is an essential element of the business landscape and one of the more widely researched topics in business, there is noticeably less scholarship on strategic risk. Business risk literature tends to only delineate characteristics of risk that are operational rather than strategic in nature. The current operational risk paradigm focuses primarily on only two dimensions of risk: the probability of its occurrence and the severity of its outcomes. In contrast, literature in the natural and social sciences exhibits greater dimensionality in the risk lexicon, including temporal risk dimensions absent from academic business discussions. Additionally, descriptions of operational risk included minimal linkage to strategic outcomes that could constrain or enable resources, markets, or competition. When working with a multidimensional model of risk, one can adjust the process of environmental scanning and risk assessment in ways that were potentially more measurable. Given the temporal dimensions of risk, risk management cannot always function proactively. In risk environments with short risk horizons, rapid risk acceleration, or limited risk reaction time, firms must utilize dynamic capabilities. The literature proposes multiple approaches to managing risk that are often focused on single challenges or solutions. By combining a strategic management focus with a multidimensional model of strategic risk, one can match risk management protocols to specific strategic challenges. Lastly, one of more powerful dimensions of risky events is their ability to differentially affect competitors, changing the basis of competition. Risk need not solely be viewed as defending against potential losses; many risky occurrences may represent new strategic opportunities.

Article

Science and Innovation Policy  

Cristina Chaminade and Bengt-Åke Lundvall

This is an advance summary of a forthcoming article in the Oxford Research Encyclopedia of Business and Management. Please check back later for the full article. Scientific advance and innovation are major sources of economic growth and are crucial for making social and environmental development sustainable. A critical question is if private enterprises invest sufficiently in research and development and, if not, to what degree and how governments should engage in the support of science and innovation. While neoclassical economists point to market failure as the main rationale for innovation policy, evolutionary economists point to the role of government in building stronger innovation systems and creating wider opportunities for innovation. Research shows that the transmission mechanisms between scientific advance and innovation are complex and indirect. There are other equally important sources of innovation, including experience-based learning. Innovation is increasingly seen as a systemic process where the feedback from users needs to be taken into account when designing public policy. Science and innovation policy may aim at accelerating knowledge production along well-established trajectories or at giving new direction to the production and use of knowledge. It may be focused exclusively on economic growth, or it may give attention to the impact on social inclusion and the natural environment. An emerging topic is the extent to which national perspectives continue to be relevant in a globalizing learning economy facing multiple global complex challenges, including the issue of global warming. Scholars point to a movement toward transformative innovation policy and global knowledge sharing as a response to current challenges.

Article

The Strategic Management of Technology and Innovation  

Mark Dodgson

The strategic management of technology and innovation is an important contributor to organizational performance and competitiveness. It creates value, assists differentiation, enhances productivity, and guides creativity and initiative. In the face of uncertainty in operating environments, caused especially by rapid technological change, the strategic management of innovation configures capabilities and resources within organizations. These include the capability to search for innovations, select the most advantageous, and appropriate or capture their returns. It involves investing in sources of innovation, such as research and development (R&D) and collaboration with external partners, and using methods for effectively assessing their contributions. Unstable and turbulent operating conditions can disrupt established organizational policies and practices and make planning difficult. As a result, strategies for technology and innovation are necessarily emergent rather than prescriptive, exploratory rather than determinable. Any advantages technology and innovation create are likely to be transitory. The pressing need for greater environmental sustainability, increased focus on the social consequences of innovation, and the impact of new digital and data-rich technologies, add to the challenges of the strategic management of technology and innovation. To address these challenges, attention to physical and intellectual capital needs to be supplemented by greater concern for human, social, and natural capital, and to organizational culture and behavior. This requires the foundation of the strategic management of technology and innovation in the discipline of economics to be complemented by others, such as psychology, organizational behavior, and ethics.

Article

Strategic Planning in the Public Sector  

John Bryson and Lauren Hamilton Edwards

Strategic planning has become a fairly routine and common practice at all levels of government in the United States and elsewhere. It can be part of the broader practice of strategic management that links planning with implementation. Strategic planning can be applied to organizations, collaborations, functions (e.g., transportation or health), and to places ranging from local to national to transnational. Research results are somewhat mixed, but they generally show a positive relationship between strategic planning and improved organizational performance. Much has been learned about public-sector strategic planning over the past several decades but there is much that is not known. There are a variety of approaches to strategic planning. Some are comprehensive process-oriented approaches (i.e., public-sector variants of the Harvard Policy Model, logical incrementalism, stakeholder management, and strategic management systems). Others are more narrowly focused process approaches that are in effect strategies (i.e., strategic negotiations, strategic issues management, and strategic planning as a framework for innovation). Finally, there are content-oriented approaches (i.e., portfolio analyses and competitive forces analysis). The research on public-sector strategic planning has pursued a number of themes. The first concerns what strategic planning “is” theoretically and practically. The approaches mentioned above may be thought of as generic—their ostensive aspect—but they must be applied contingently and sensitively in practice—their performative aspect. Scholars vary in whether they conceptualize strategic planning in a generic or performative way. A second theme concerns attempts to understand whether and how strategic planning “works.” Not surprisingly, how strategic planning is conceptualized and operationalized affects the answers. A third theme focuses on outcomes of strategic planning. The outcomes studied typically have been performance-related, such as efficiency and effectiveness, but some studies focus on intermediate outcomes, such as participation and learning, and a small number focus on a broader range of public values, such as transparency or equity. A final theme looks at what contributes to strategic planning success. Factors related to success include effective leadership, organizational capacity and resources, and participation, among others. A substantial research agenda remains. Public-sector strategic planning is not a single thing, but many things, and can be conceptualized in a variety of ways. Useful findings have come from each of these different conceptualizations through use of a variety of methodologies. This more open approach to research should continue. Given the increasing ubiquity of strategic planning across the globe, the additional insights this research approach can yield into exactly what works best, in which situations, and why, is likely to be helpful for advancing public purposes.

Article

The Swiss Watch Industry  

Pierre-Yves Donzé

The Swiss watch industry has enjoyed uncontested domination of the global market for more than two decades. Despite high costs and high wages, Switzerland is the home of most of the largest companies in this industry. Scholars in business history, economics, management studies, and other social sciences focused on four major issues to explain such success. The first is product innovation, which has been viewed as one of the key determinants of competitiveness in the watch industry. Considerable attention has been focused on the development of electronic watches during the 1970s, as well as the emergence of new players in Japan and Hong Kong. Yet the rebirth of mechanical watches during the early 1990s as luxury accessories also can be characterized as a product innovation (in this case, linked to marketing strategy rather than pure technological innovation). Second, brand management has been a key instrument in changing the identity of Swiss watches, repositioning them as a luxury business. Various strategies have been adopted since the early 1990s to add value to brands by using culture as a marketing resource. Third, the evolution of the industry’s structure emphasizes a deep transformation during the 1980s, characterized by a shift from classical industrial districts to multinational enterprises. Concentration in Switzerland, as well as the relocation abroad of some production units through foreign direct investment (FDI) and independent suppliers, have enabled Swiss watch companies to control manufacturing costs and regain competitiveness against Japanese firms.Fourth, studying the institutional framework of the Swiss watch industry helps to explain why this activity was not fully relocated abroad, unlike most sectors in low-tech industries. The cartel that was in force from the 1920s to the early 1960s, and then the Swiss Made law of 1971, are two major institutions that shaped the watch industry.

Article

Technology Standardization in Innovation Management  

Vadake Narayanan and Yamuna Baburaj

The profound impact of technology standards—specifications for interfacing or compatibility between different components or products to interact and function synergistically—dictates an understanding of their evolution, processes by which they come to be, and their impact on businesses, industries, and countries. Technology standards span almost every conceivable aspect of the existing business landscape, especially in dynamic industry sectors. Standardization, the processes by which standards emerge and diffuse, is a complex phenomenon encompassing various actors at multiple levels (firm, industry, institutions) that engage in a sociopolitical process of negotiation and collaboration to facilitate the coalescing of multiple stakeholder interests on a chosen standard. Standardization is multifaceted and emerges through various mechanisms, mainly involving one or more of committee-based (de jure) standards, market-based competitive battles (de facto standards), and institutional (government-based) processes, most involving collective action. Market-based processes give prominence to dominant or pioneering firms that introduce technology leveraging the power of large installed base and network externalities, many times tipping the market in favor of the technology format that was first to market. Nonetheless, markets may not tip, and several technology formats may continue to dominate the market, as in the video game market. Standard-setting organizations (SSOs) spearhead convergence around standards by bringing various entities together to derive the specifications for technical compatibility through consensus. The role of governments in the emergence and diffusion of standards varies by the country, region, and nature of the standard. Standards have facilitated innovation at the firm and industry levels and broadly enhanced trade between nations. Intellectual property, specifically standard-essential patents (SEPs), has attracted significant attention due to the strategic and economic benefits that accrue to owners of such patents as well as the challenges they create within SSOs.

Article

University Technology Commercialization  

Kathleen R. Allen

For decades researchers have studied various aspects of the technology transfer and commercialization process in universities in hopes of discovering effective methods for enabling more research to leave the university as technologies that benefit society. However, this effort has fallen short, as only a very small percentage of applied research finds its way to the marketplace through licenses to large companies or to new ventures. Furthermore, the reasons for this failure have yet to be completely explained. In some respects, this appears to be an ontological problem. In their effort to understand the phenomenon of university commercialization, researchers tend to reduce the process into its component parts and study each part in isolation. The result is conclusions that ignore a host of variables that interact with the part being studied and frameworks that describe a linear process from invention to market rather than a complex system. To understand how individuals in the technology commercialization system make strategic choices around outcomes, studies have been successful in identifying some units of analysis (the tech transfer office, the laboratory, the investment community, the entrepreneurship community); but they have been less effective at integrating the commercialization process, contexts, behaviors, and potential outcomes to explain the forces and reciprocal interactions that might alter those outcomes. The technology commercialization process that leads to new technology products and entrepreneurial ventures needs to be viewed as a complex adaptive system that operates under conditions of risk and uncertainty with nonlinear inputs and outputs such that the system is in a constant state of change and reorganization. There is no overall project manager managing tasks and relationships; therefore, the individuals in the system act independently and codependently. No single individual is aware of what is going on in any other part of the system at any point in time, and each individual has a different agenda with different metrics on which their performance is judged. What this means is that a small number of decision makers in the university commercialization system can have a disproportionate impact on the effectiveness and success of the entire system and its research outcomes. Critics of reductionist research propose that understanding complex adaptive systems, such as university technology commercialization, requires a different mode of thinking—systems thinking—which looks at the interrelationships and dependencies among all the parts of the system. Combined with real options reasoning, which enables resilience in the system to mitigate uncertainty and improve decision-making, it may hold the key to better understanding the complexity of the university technology commercialization process and why it has not been as effective as it could be.

Article

University Technology Transfer in Innovation Management  

Tom Hockaday and Andrea Piccaluga

University technology transfer (UTT) has been growing in importance for many decades and is of increasing importance to university leadership, university researchers, research funding agencies, and government policy makers. It is of interest to academic researchers in the fields of business management, economics, innovation, geography, and public policy. UTT is a subset of the broader field of technology transfer, and it involves the transfer of university research results from the university to business so that the business can invest in the development of products and services that benefit society. The research results can arise from any academic discipline, are not limited to a particular definition of technology, and can be transferred to existing and new for-profit and not-for-profit organizations. The core activity involves licensing patent applications and other intellectual property to existing companies and establishing new companies that raise investment finance, to develop the early-stage research outputs into new products and services. In recent decades, research universities have set up technology transfer offices (TTOs) to manage their UTT activities. TTOs adopt a project management approach to supporting university researchers who wish to transfer the results of their research to business. Project stages include identifying, evaluating, protecting, marketing, deal making, and post-deal management. TTOs are also involved in other activities, beyond patenting, licensing, and entrepreneurship, which generate positive impact on society. Measuring and evaluating UTT is a topic of continuing debate, with an early focus on activity metrics developing into a more sophisticated assessment of the impact of university research outputs on society. Current issues in UTT involve understanding the position of UTT in the broader area of research impact, as well as funding and organization models for UTT within a university. The COVID-19 global crisis is highlighting the importance of university research and its transfer out to organizations that develop and deliver products and services that benefit society. It has further emphasized the importance of UTT as an activity where much more has to be researched and understood in order to maximize the benefits for society of all the activities performed by universities.

Article

User Innovation  

Nikolaus Franke and Christian Lüthje

Users of products and services, be they user firms or consumers, frequently develop innovations for their own benefit. Such user innovation is a long-existing phenomenon, but it has gained much momentum in the new millennium. The Internet has greatly facilitated connections between creative users, and at the same time cost-effective design and prototyping technologies are making it increasingly feasible for users to develop their own products and services. Users have been found to innovate mainly because they want solutions that best serve their own needs. In general, their innovation activities involve no expectations of monetary profit, being motivated rather by self-rewards (such as fun, positive feelings of altruism, signaling of competence to the community of peers). This explains why users are typically willing to share their innovations without requiring payment. A problem of user innovation is that, since the benefit that others could gain is an externality for users, they lack strong incentives to invest in the active diffusion of their innovations. The consequence of this “diffusion shortfall” is social welfare losses. There are several ways in which producers and service providers can help overcome these problems and benefit from the innovation potential of users at the same time. They can apply the lead user method to actively search for a small group of particularly highly motivated and qualified users, they can outsource product design work to their users via user design toolkits, and they can broadcast innovation challenges to an appropriate crowd of external problem solvers.

Article

Virtual Worlds Affordances for Organizations  

Kathryn Aten

Virtual work has become critical to competing in the global information economy for many organizations. Successfully working through technology across time and space, especially on collaborative tasks, however, remains challenging. Virtual work can lead to feelings of isolation, communication and coordination difficulties, and decreased innovation. Researchers attribute many of these challenges to a lack of common ground. Virtual worlds, one type of virtualization technology, offer a potentially promising solution. Despite initial interest, organizational adoption of virtual worlds has been slower than researchers and proponents expected. The challenges of virtual work, however, remain, and research has identified virtual world technology affordances that can support virtual collaboration. Virtual world features such as multi-user voice and chat, persistence, avatars, and three-dimensional environment afford, in particular, social actions associated with successful collaboration. This suggests that the greatest value virtual worlds may offer to organizations is their potential to support virtual collaboration. Organizational scholars increasingly use a technology affordance lens to examine how features of malleable communication technologies influence organizational behavior and outcomes. Technology affordances represent possibilities of action enabled by technology features or combinations of features. Particularly relevant to virtual world technology are social affordances—affordances of social mediating technologies that support users’ social and psychological needs. To be useful to organizations, there must be a match between virtual world technology affordances, organizational practices, and a technology frame or organizing vision. Recent studies suggest a growing appreciation of the influence of physical organizational spaces on individual and organizational outcomes and increasing awareness of the need for virtual intelligence in individuals. This appreciation provides a possible basis for an emerging organizing vision that, along with recent technology developments and societal comfort with virtual environments, may support wider organizational adoption of virtual worlds and other virtualization technologies.