A framework, process and tool for managing technology‐based assets

Technology organisations centre their business on the development of new technology‐based offerings (i.e. products and services). The strategic management of technology‐based assets is therefore crucial for these organisations as an imperative for business success. However, these assets are often intangible and reflect future rather than current value and are therefore difficult to manage when using traditional managerial concepts. This study investigates integrative mechanisms addressing the management of technology‐based assets and offerings in a technology organisation. The approach taken was to study the views and practices regarding the management of technology‐based assets in a number of strategic units of a technology organisation (CSIR, South Africa). The study maintains that the management of technology‐based assets and offerings requires clear strategic management of the process of technological innovation with special emphasis on the management of the intellectual capital (IC) and the intellectual property (IP) of the organisation. The study describes a framework linking the core processes supporting the management of technology‐based assets and offerings with other organisational elements such as leadership, strategy, and culture. Specific key links between the core process of innovation and the strategic management of investment in technology‐based assets using a portfolio approach are discussed.     

Mechanisms for improving the effectiveness of R&D: How many mechanisms are enough?

The author proposes and explains a method of rating the effectiveness of an R&D organisation without attempting to measure its output. He postulates that the basic reason that an R&D organisation does not do the right R&D or get it used effectively is that it is working in isolation. In other words the interfaces between R&D and the outside world are not being managed. To achieve effective interface management requires an organisational change. Hence the problem of increasing R&D effectiveness is transformed to a problem of developing strategies to bring about this change. The author proposes a strategy which first requires the company to define objectives for interface management. The next question is to find out why the interfaces need to be managed; for the present business, for improving the people involved or for creating new opportunities for the future? This is a sequence of increasing refinement. Each phase of the R&D process is then looked at to determine the current state of interface management and take action to bring it to the next more refined stage. The author gives examples of what he means and discusses how his system can help the practising R&D director.     

Firm–specific competencies determining technological innovation: A survey in Greece

This paper investigates the ‘importance’ and ‘awareness’ of firm–specific competencies as determinants of technological innovation in the context of a European newly industrialised country. A literature–based portfolio model was developed including 17 established innovation–determining factors, related to the firm’s technical, market, human resource and organisational competencies. The ‘importance’ of those factors as determinants of innovation in the Greek industry was tested with a survey of 105 manufacturing firms. Using correlation and regression analyses the author classified the competencies into ‘major importance’, ‘moderate importance’ and ‘unimportant’ ones. ‘Major importance’ determinants of innovation included the intensity of R&D, strength in marketing, proportion of university graduates and engineers in the staff, proportion of staff with managerial responsibility, proportion of professional staff with previous experience in another company and incentives offered to the employees to contribute to innovation. The ‘awareness’ of the important competencies differentiating Greek innovative companies was tested by comparing the above ‘objective’ results with the perceptions of the responding managers. The perceptual analysis confirmed the importance of the statistically–driven variables at the aggregated level. At the level of the individual variables, a number of inconsistencies were identified. The managers overestimated the importance of international work experience of professional staff and of training and underestimated the importance of the potential contribution of shop–floor employees. Relating the results to the Greek institutional context, the study’s general finding was that the important determinants of innovation were scarce in the Greek business environment. The highly innovative companies were the ones to overcome country–specific innovation barriers, such as negligible industrial R&D, general weakness in marketing, outdated educational system, limited labour mobility and cultural problems with involving shop–floor employees in the innovation process.     

Research and development (R&D) beyond manufacturing: the strange case of services R&D

The share of business research and development (R&D) expenditure stemming from the services sector of the economy has been growing rapidly in many (though not all) OECD countries, according to official statistics. The same data sources also indicate, however, that services contribute less to R&D than would be expected given their large shares of employment and output in national economies. In part, incomplete sampling of services in R&D surveys may lead to some underestimation of their R&D activity, but this is unlikely to account for their apparently poor performance. This paper draws on an analysis of existing statistical sources, and on interviews and workshops with service firms' managers. It finds difficulties associated with the ways in which R&D has been operationalised in survey questions. Examination of survey questionnaires suggests that the formulation of these questions, focusing on technological R&D and ruling out much social scientific R&D, disproportionately reduces the reporting of R&D by service firms. But beyond this, the R&D concept itself has some problematic features where it comes to documenting innovation in service firms. This was investigated through a programme of interviews and workshops with service firms, where a lack of familiarity with the R&D concept and R&D management practices was found to be commonplace. R&D performance and innovation activities vary across services of different sorts, even though most service subsectors appear to be low R&D investors. It is thus important to examine services' innovation patterns and processes, to establish what types of R&D‐like activity are underway in these subsectors. While some modification in R&D measurement would be desirable to capture services' activities, effort to understand the non‐R&D elements of services innovation is also important – for management and for policy (given that governments are seeking to create R&D incentives and targets for services and other sectors). There are grounds for expecting (a) services' share of business R&D to continue to grow; (b) this share to continue to be well below what would be expected from the prevalence of services in economic activity, and (c) for many services' innovation to continue to rely heavily on sources that are not directly associated with R&D.     

An Empirical Investigation into the Antecedents of Knowledge Dissemination at the Strategic Business Unit Level

Knowledge dissemination is of crucial importance for the strategic planning in new product development. Many new ideas stem from recombination of previously successful, disseminated actions, and knowledge dissemination offers a clear overview of market needs, technology developments, and competitors' actions. Moreover, in dynamic environments, where strategic planning has to be added by some kind of improvisation, knowledge dissemination leads to a high quality of improvisation. It leads to a quick awareness of external or internal surprises, gives an opportunity to learn quickly from the past, and compensates for a coordination mechanism instead of planning. The dissemination of knowledge does not always happen spontaneously. Especially, people with a technical background often are highly individualistic and do not disseminate knowledge naturally. So, this must be fostered by the organization. In management research, particularly on technology and innovation management, many facilitating factors have been identified that enhance communication. Intuitively, they also would seem useful in enhancing knowledge dissemination; however, these factors have not been tested empirically for this specific use. Research on knowledge and its management has not given much attention to the way knowledge in an organization is disseminated and the factors that can facilitate it. If such factors are mentioned, they are not tested empirically and their relative impact is not addressed. In this study we identified 17 important factors in enhancing knowledge dissemination and validated 10 of these factors empirically and determined their relative impact. We focused on technological knowledge in new product development—not on the project level but on the level of the strategic business unit. The field research comprised three parts. In the first step, we conducted in‐depth interviews with research and development (R&D) managers and their supervisors to select the most important potential facilitating factors. In the second step, in‐depth interviews with senior executives, information technology (IT) officers, and R&D experts were conducted to determine whether the constructs regarding knowledge dissemination and the potential facilitating factors had face validity. Finally, the potential factors were tested empirically in 277 U.S. high‐technology firms at the strategic business unit (SBU) level. It was our intention to examine potential factors beyond the level of the particular project, so we looked for antecedents in an SBU environment with a longer‐term impact. Our results indicate that individual commitment to the firm is very important to facilitate knowledge dissemination as well as organizational crises and risk‐taking behavior. Individual commitment was found to have the greatest impact on the level of knowledge dissemination, followed by organizational crisis and risk‐taking behavior. It is thus up to management to find new ways to control individual commitment. More research, however, is required to better understand the ways by which managerial interventions stimulates knowledge dissemination.     

The importance of internal and external R&D network linkages for R&D organisations: evidence from Singapore

This paper examines the importance of internal and external R&D networks for R&D organisations of multinational firms (MNCs) in Singapore and investigates corresponding R&D management requirements in this context, namely a late-industrialising country in Asia. A unique feature of Singapore is its ability to attract 'high quality' foreign direct investment, involving activities of higher value added and more complex technology without having developed full-fledged R&D activities among its business organisations, thus creating a challenging situation for subsidiary R&D managers, both in the internal R&D organisation as well as in the external research environment. This paper analyses these issues.
Based on in-depth interviews with 53 R&D subsidiaries of MNCs operating in Singapore, this paper identifies internal and external R&D management needs. Through our analysis of data gleaned from these interviews, we found that subsidiary R&D managers need to increase and/or maintain the strategic importance of their R&D site internally within their global corporate R&D organisation. This requires constant upgrading of the technological level at the R&D subsidiary and intense communication with headquarters as well as other R&D subsidiaries. Furthermore, our findings indicate that in the external research environment, subsidiary R&D managers need to create an efficient local network of external players. If these internal and external issues are properly addressed, the R&D subsidiary can effectively contribute to the corporate R&D organisation and be a critical partner in the local research network. Lessons learned from the Singapore experience include the need to develop sufficient local expertise as well as to change the mindset of managers to focus on creativity rather than precise execution.     

Changing Patterns in Industrial R&D Management

A successful R&D manager is, in many ways, an agent of change. R&D managers must respond effectively to changes in domestic and global competition, product and process technologies, customer requirements, regulatory matters, and senior management's perception of the role R&D plays in a firm. The responses to these changes flow downstream from R&D to other parts of the organization, in the form of new materials, methods, processes, and products. To help us understand the changes facing R&D management, Ashok K. Gupta and David Wilemon present the results of a study that examines the ideas and experiences of 120 R&D directors from technology-based companies. The study explores the major changes that R&D management has undergone in recent years, the changes R&D managers expect to encounter during the next few years, and the causes of those changes. The respondents also identify the skills and knowledge they view as necessary for effective R&D management, and they assess their organizations' capabilities in those areas. According to the respondents, major changes that R&D has encountered include increased emphasis on such issues as cross-functional teamwork, R&D's contribution to both short- and long-term business results, R&D's capability to quickly bring to market new products that customers value, efficient use of R&D resources, and R&D alliances. Other changes noted by respondents include greater pressure to find new markets, increased attention on the effective management of technical personnel, and increased regulations and sensitivity to environmental issues. The knowledge domains that the respondents highlighted as having the greatest effect on R&D performance include such capabilities as understanding customer needs, monitoring market developments, commercializing new technologies, building cross-functional teams, managing multiple R&D projects, and accelerating new product development. According to the respondents, the largest gaps between required and current capabilities exist in several of the areas listed as being most important to effective R&D management, including monitoring market developments that can affect R&D activities and overall business performance, maintaining a spirit of inquiry while ensuring that R&D contributes to overall corporate performance, developing technology commercialization capabilities, fostering mutually profitable strategic alliances, and accelerating the development and commercialization of new products.     

创新项目组合管理绩效关键影响因素的实证研究

为了维持长期的竞争优势,企业需要不断进行技术创新和产品创新。如何在有限的研发资源下使创新项目组合的绩效最大化是企业进行创新管理中面临的主要问题。本文从创新项目组合的战略一致性、平均项目绩效和业务协同3个指标来度量创新项目组合管理绩效,并从流程和管理者的视角研究其关键影响因素。通过实证研究发现,高管参与和项目组合管理流程的设计与实施对项目组合的战略一致性有显著的正向影响;高管参与、项目经理胜任力和项目终止质量对平均项目绩效有显著正向影响;项目经理胜任力、项目组合管理流程的设计与实施和项目中止质量对业务协同有显著正向影响。     

The Decision to Exploit an R&D Project: Divergent Thinking across Middle and Senior Managers

Research and development (R&D) generates projects, but the question often remains: which projects should be exploited? Building on the innovation, strategy, and managerial cognition literatures, we use a conjoint field experiment to collect data on 4032 decisions made by 126 R&D managers to test how project attributes, strategic context, and managers' characteristics influence innovation exploitation decisions. Using hierarchical linear modeling, we find that (1) experience impacts project exploitation decision policies of middle managers more than senior managers, (2) divergent thinking across middle and senior managers increases with experience, and (3) experienced middle managers diverge from experienced senior managers in their decisions to exploit opportunities by placing greater emphasis on strategic context (relative to competitors and fit within the portfolio) and lesser emphasis on uncertainty (technological and demand). These findings have implications for the strategy and innovation literature.     

Business Strategy, R&D Management and Environmental Imperatives

Abstract
Environmental imperatives are seen by many business leaders to represent a major issue for the 1990's and beyond. The debate about the environmental sustainability of economic activity has important implications for the development of business and places considerable emphasis on the need for planned corporate change. The strategic significance of the environment is particularly critical to R&D as this is characterised by long planning horizons and provides the setting for the development of future products and processes.
The purpose of this paper is to examine the connections between environmental imperatives, strategic change and R&D management. To this end the paper reviews the strategic nature of environmental pressures on business. From this base, consideration is given to the responses required by business, in meeting these pressures. The paper concludes by suggesting that the application of management techniques in concert with organisational change is needed for R&D management to build environmental considerations effectively into innovation. These suggestions can be used to gauge how far individual businesses have developed the systems and structures to enable them to move towards sustainability. The implication of the paper is that R&D management will not only need to apply new management techniques but will have to play a leading role in innovative organisational structures in order to fulfil the full potential of environmentally sensitive products and processes.     

Adaptation and Organizational Connectedness in Corporate Radical Innovation Programs*

This research examines how established companies organize programs for fostering technology‐based radical innovation. It addresses conflicts revealed in the innovation literature concerning the appropriate design of the strategic, structural, and process components of these programs. In developing innovation strategies, managers must balance the desire for strategic clarity with the need to allow for creativity and exploration. They must structure programs that ensure innovations benefit from the organization's resources while minimizing the numerous constraints that can impede these unconventional activities. Additionally, though they may favor management processes that provide accountability and effective resource allocation, managers must also ensure these do not restrict the flexibility required for successful innovation. The study is a longitudinal, comparative case analysis of interviews with managers involved in innovation programs in 12 industry‐leading multinational corporations. Site visits at each company were followed by biannual interviews with key managers in each company. A total of 81 follow‐up interviews were conducted over a three‐year period. These interviews were aimed at identifying the changes and progress in the programs over time and internal and external impacts on the organization's innovation activity. The analysis reveals (1) distinct but evolving objectives that maintain a logical strategic connection, (2) adaptive structures that shift and transform but preserve relationships with the broader organization, and (3) flexible processes that are understandable beyond the innovation program and are modifiable, both for the context and in response to learning over time. This suggests that programs introducing high uncertainty and risk into mature corporate environments are highly flexible systems that maintain organizational connectedness as they evolve. For academics, this implies a need to understand the evolution of innovation programs as an adaptive learning process that, regardless of form and purpose, preserves its connection to the traditional organization. For practitioners, it highlights the importance of considering the process, strategic, and structural connections to the broader organization when designing innovation programs and suggests the need for feedback mechanisms to help adapt these elements over time.     

Networking as a Means to Strategy Change: The Case of Open Innovation in Mobile Telephony

The purpose of this article is to investigate how innovation networks can be used to deal with a changing technological environment. This study combines different concepts related to research and development (R&D) collaboration strategies of large firms and applies these concepts to R&D alliance projects undertaken by Nokia Corporation in the period 1985–2002. The research methodology is a combination of in‐depth semistructured interviews and a large‐scale quantitative analysis of alliance agreements. For the empirical analysis a distinction is made between exploration and exploitation in innovation networks in terms of three different measures. As a first measure, the difference between exploration and exploitation strategies by means of the observed capabilities of the partners of the contracting firms is investigated. The second measure is related to partner turnover. The present article argues that in exploration networks partner turnover will be higher than in exploitation networks. As a third measure, the type of alliance contract will be taken; exploration networks will make use of flexible legal organizational structures, whereas exploitation alliances are associated with legal structures that enable long‐term collaboration. The case of Nokia has illustrated the importance of strategic technology networks for strategic repositioning under conditions of change. Nokia followed an exploitation strategy in the development of the first two generations of mobile telephony and an exploration strategy in the development of technologies for the third generation. Such interfirm networks seem to offer flexibility, speed, innovation, and the ability to adjust smoothly to changing market conditions and new strategic opportunities. These two different strategies have led to distinctly different international innovation networks, have helped the company in becoming a world leader in the mobile phone industry, and have enabled it to sustain that position in a radically changed technological environment. This study also illustrates that Nokia effectively uses an open innovation strategy in the development of new products and services and in setting technology standards for current and future use of mobile communication applications. This article presents one of the first longitudinal studies, which describes the use of innovation networks as a means to adapt swiftly to changing market conditions and strategic change. This study contributes to the emerging, but still inconsistent, literature on explorative and exploitative learning by means of strategic technology networks.     

Making sense of new technology during organisational change

This article examines how employees interpret the use of various social media and web 2.0 technologies by managers of an organisation during a merger process. The article explores the way in which managers use technology to give sense to the merger process, the corresponding sensemaking of employees and also how employees make sense of the use of technology itself. The findings show that new media enables the sharing of emotional sense about organisational processes between managers and employees and places employees with different levels of involvement with the process and at different points in the organisational hierarchy on equal footing. In spite of this, employees view the use of technology negatively and feel mastered by the technology itself. In discussing these unintended consequences of the use of this technology, the article further discusses the paradoxes that emerge from using new technology to give sense during organisational change.     

Does Strategic Planning Enhance or Impede Innovation and Firm Performance?*

Does strategic planning enhance or impede innovation and firm performance? The current literature provides contradictory views. This study extends the resource‐advantage theory to examine the conditions in which strategic planning increases or decreases the number of new product development projects and firm performance. The authors test the theoretical model by collecting data from 227 firms. The empirical evidence suggests that more strategic planning and more new product development (NPD) projects lead to better firm performance. Firms with organizational redundancy benefit more from strategic planning than firms with less organizational redundancy. Increasing R&D intensity boosts both the number of NPD projects and firm performance. Strategic planning is more effective in larger firms with higher R&D intensity for increasing the number of NPD projects. The results reported in this study also consist of several findings that challenge the traditional views of strategic planning. The evidence suggests that strategic planning impedes, not enhances, the number of NPD projects. Larger firms benefit less, not more, from strategic planning for improving firm performance. Larger firms do not necessarily create more NPD projects. Increasing organizational redundancy has no effect on the number of NPD projects. These empirical results provide important strategic implications. First, managers should be aware that, in general, formal strategic planning decreases the number of NPD projects for innovation management. Improvised rather than planned activities are more conducive to creating NPD project ideas. Moreover, innovations tend to emerge from improvisational processes, during which the impromptu execution of NPD activities without planning spurs “thinking outside the box,” which enhances the process of creating NPD project ideas. Therefore, more flexible strategic plans that accommodate potential improvisation may be needed in NPD management since innovation‐related activities cannot be planned precisely due to the unexpected jolts and contingencies of the NPD process. Second, large firms with high levels of R&D intensity can overcome the negative effect of strategic planning on the number of NPD projects. Specifically, a firm's abundant resources, when allocated and deployed for NPD activities, signal the high priority and importance of the NPD activities and thus motivate employees to acquire, collect, and gather customer and technical knowledge, which leads to creating more NPD projects. Finally, managers must understand that managing strategic planning and generating NPD project ideas are beneficial to the ultimate outcome of firm performance despite the adverse relationship between strategic planning and the number of NPD projects.     

Process reengineering: A review of enablers

In an attempt to improve productivity, performance and overall competitiveness in both domestic and global markets, organisations have realised that there is a need to reform their business practices and become more customer focused. Consequently, these organisations have recognised the need for organisational change, but do not necessarily know how and what to change, to achieve improvements in productivity and performance. Process reengineering has been described as the elixir for achieving dramatic improvements in production time and cost. Process reengineering is not about fixing current processes, but rebuilding them, with the aim of process improvement. This paper will explain what is meant by process reengineering and suggests that before an organisation attempts to process reengineer, a thorough understanding of current practices, procedures and enablers of change are required. Typically, information technology is implemented as the key change enabler of process reengineering implemented as the key enabler without prior consideration to other enablers such as organisational, human resource and total quality management. This paper suggests that the use of information technology as an enabler is rarely sufficient to cause process change. The paper concludes by suggesting that a combination of information technology, organisational and human resource enablers and a total quality management based philosophy are requisite for the effective redesign of business processes.     

From Experience: Linking Product Innovation to Business Growth

Industry pundits often take managers to task for their supposedly myopic approach to planning and decision making. These sweeping generalizations gloss over the complex challenges confronting the managers who must ensure that their firms enjoy ongoing revenue growth opportunities. In place of pat answers, those managers require analysis and planning tools that offer clearer insights into the effects their decisions have on their firms' continued business success. As Marv Patterson points out, however, determining the effects of product innovation decisions poses a particular challenge for management, because the consequences of those decisions typically do not become evident until long after the decisions have been made. Presenting a conceptual model that links product innovation activities to revenue growth, he identifies three drivers of revenue growth, and explains how these growth drivers are linked by a set of mathematical relationships that can be presented in the form of an enterprise-specific growth table. He applies the model to three types of enterprises, and he discusses the key implications that the model holds for the business leaders who must keep shareholders satisfied. He depicts the relationship between a company and its customers as a closed-loop system in which the company converts labor, parts, and material into products, which it delivers to customers. The company invests a portion of the resulting revenue stream in the resources that generate new products. By effectively and continually applying a sufficiently large investment in this innovation engine, the company creates an ongoing stream of new products. The revenues from these new products more than offset the drop in revenues from products that are approaching obsolescence. He identifies three factors that drive revenue growth from these investments in the innovation engine: the fraction of revenues invested in product innovation, new product revenue gain, and the behavior of revenue over time for a particular business. Using a graph called a product vintage chart, he demonstrates that for a large company, the revenue contributions of a particular new-product year (or vintage) fall into a regular pattern over time, which enables a company to determine mathematical relationships for revenue growth as a function of R&D investment and new product revenue growth. In this way, senior managers can gain clearer understanding of the interplay between product innovation, R&D investment, revenue growth, and profitability over time.     

德国RWE能源集团的经营特点分析

作为拥有百年历史的欧洲大型能源企业，德国RWE能源集团以在欧洲大陆经营电力、天然气为主营业务，通过强化战略管理、业务一体化运作、积极开拓邻国能源市场、加快新技术开发应用等一系列举措实现了企业持续稳定发展。概要介绍了RWE的主要业务、组织机构，分析了其在煤电一体化、并购等方面的经营特点和发展动态，提出了对我国能源企业的启示。     

The Interplay of Customer and Product Innovation Dynamics: An Exploratory Study

The challenges of successfully developing radical or really new products have received considerable attention from a variety of marketing, strategic, and organizational perspectives. Previous research has stressed the importance of a market‐driven customer orientation, the resolution of market and technological uncertainty, and organizational processes such as cross‐functional teams and organizational learning. However, several fundamental issues have not been addressed. From a customer's perspective, a more innovative product tends to have uncertain benefits and requires customers to learn new behaviors. Customer preferences can, therefore, change as product experience and learning increase. From a firm's perspective, it is unclear how to be customer‐oriented under such dynamic preferences, and product strategies using evolving technologies will tend to interact with how customers learn about an innovation. This research focuses on identifying unresolved issues about these customer and product innovation dynamics. A conceptual framework and series of propositions are presented that relate both changing technology and customer learning to a firm's strategic decisions in developing and launching really new products. The framework is based on in‐depth interviews with high‐tech product managers across several sectors, focusing on the business‐to‐business context. The propositions resulting from the framework highlight the need to consider relevant customer dynamics as integral to a firm's product innovation process. Successful innovation strategies and future research challenges are discussed, and applications to better understanding customer needs and theories of disruptive innovation are examined. Several key insights for innovation success hinge on a broad, downstream orientation to customer needs and product innovation dynamics. To be effective innovators, firms must know their customers' customers and competitors as well as or better than their immediate customers do. Market research must extend downstream for a comprehensive understanding of customer needs dynamics. In the context of disruptive innovation, new dimensions of customer needs may become more valuable based on perceived downstream customer trends. Firms may also innovate on secondary needs because mainstream customers do not always give firms the design freedom to radically innovate on primary features. Understanding customer commitments and how they develop under evolving needs can help firms focus resources on innovative efforts more likely to be accepted by customers.