SOURCES AND

TRANSFER OF
INNOVATION

SOURCES OF INNOVATION
Two main sources of innovation: functional and circumstantial Functional sources include: internal value chain external value-added chain of suppliers, customers and complementary innovators university, government and private laboratories competitors and related industries other nations and regions

FUNCTIONAL SOURCES OF INNOVATION

Technological Change

Regulation/deregulation

Customer expectations
Related industries

Nation 1

Competitors

Suppliers

R&D Manufacturing Marketing

Customers

Private and public labs

Universities

Globalization Social/demographic

Nation 2
Political/legal

Nation 3

Circumstantial Sources of Innovation

Planned firm activities Unexpected occurrences Change: creative destruction (technological discontinuities, regulation and deregulation, globalization, changing customer expectations and general environmental changes)

Innovation Transfer
Effectiveness of transferring innovations across functional and organizational boundaries is a function of the absorptive and transmission capacities of the receiving and transmitting entities the difference in the cultures of the receiving and transmitting entities the type of innovation the timing of the transfer

DETERMINANTS OF INNOVATION TRANSFER EFFECTIVENESS

Nature of innovation
-How tacit or explicit -How radical -Complexity

Organizational cultural differences

Effectiveness of transfer

Timing
-When ? -How long ?

Absorptive and delivery capacities

- Experience

Innovation Transfers Across National Borders

Innovation transfers across national borders are still effected by the same four criteria as shown in the following model.

DETERMINANTS OF THE EFFECTIVENESS OF CROSS-NATIONAL INNOVATION TRANSFERS

Nature of innovation -How tacit or explicit -How radical -Complexity

Differences in national cultures

Effectiveness of transfer

Timing -When -How long

Absorptive and delivery capacities - Experience

Co-opetitors

OVERCOMING IMPEDIMENTS TO INNOVATION TRANSFER

To overcome impediments to innovation transfer a firm needs an organization structure, strategies, systems and people to: quickly spot ideas or innovations boost the absorptive and transmission capacities of receiving and transmitting entities reduce the impedance mismatch between transmitter and receiver due to physical, cultural, national and knowledge gaps between entities

Science and Technology

Science - basic research, tends to be generic in its affect on business organizations Technology - Commercialization of applied research, tends to be specific in its affect on business organizations

RELATIONSHIP BETWEEN SCIENCE AND TECHNOLOGY

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Science

Verbally encoded information -publications -patents

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Technology

Physically and verbally encoded informationproducts and services - patents - documentation - publications