What is “innovation”?

Innovation in EISIGS
Tony Larsson
Professor of Embedded Systems
Henrik Florén,
Associate Professor of Industrial Management
Innovation research role in EISIGS
• Teach the process of innovation and how to manage it
• Specific innovation research interests (examples):
• Product development processes (e.g. the front end of innovation)
• Business model innovation
• “Green innovations”
• Role in EISIGS:
• Make sure that the PhDs will learn the right things about
• Support the innovation parts of PhD work
• Organize courses and innovation activities
Why a focus on innovation in EISIGS?
• Companies are challenged by meeting the demands
brought by the accelerating development of digital
technology and the increased globalization of business
• There is a need for researchers that can recognize,
utilize and develop the innovation potential of industrial
• “strengthen Swedish industry by training doctoral level
researchers that have both technical depth and a
broad understanding of industrial requirements, the
innovation process and which innovations that can
lead to business opportunities.” (citation from the
Aims with the innovation constituent
• An awareness of how the PhD specialization in a
technological field relates to the innovation capability
of their company / institute
• An understanding of innovation systems (in which
technology is developed) and what makes some
companies’ able to explore and exploit opportunities in
such innovation systems
• PhDs will learn more about the relationship between
technology development and business development.
Aims (cont.)
• Complement technical expertise with an
understanding of the interplay between
technological development and business
• The aim is not to make them innovation
• EISIGS PhDs should be technology
experts/researchers with an understanding of the
business aspects of technological R&D
What is “innovation”?
• Invention = “Creating something new that has
never existed before” (The New Oxford Dictionary of English,
1998, p. 960)
• Innovation = “Making changes to something
established by introducing something new.”
(The New Oxford Dictionary of English, 1998, p. 942)
• Innovation = Invention + Diffusion/Exploitation
Why is innovation important (cont.)?
• Out of the 500 companies originally making up the
Standard and Poor 500 list in 1857, only 74
remained in 1997 (Foster and Kaplan, 2002)
• Of the top 12 companies which made up the Dow
Jones index in 1900, only one (General Electric)
survives today (Tidd and Bessant, 2013)
• Experiences of companies that are able to survive
(e.g. 3M, P&G, Siemens), show that much of their
longevity can be traced to a capacity to innovate on
a continuing bases.
• Many companies that survive, change their core
business over time. Innovation is key to this
Drivers of innovation
• Emerging technologies (e.g. digital
• Competitor actions (e.g. Ryan Air)
• New ideas from customers, strategic partners,
and employees (e.g. mountain bikes)
• Emerging changes in the external
environment (e.g. “the green movement”)
1. Product innovation
Introducing a new screen size for TVs
Changing from a CRT TV to a flat screen
Adding functionality such as Internet access to TVs
2. Process innovation
Building new systems that assemble a TV set faster and cheaper
Redesigning the assembly line so that TVs can be manufactured more
Outsourcing the production of the plastic covers on TVs so costs can
be reduced and quality improved
3. Service innovation
• Changing the way dealers sell new TVs in order to cut costs
• Changing the way customers get rid of their old TVs by a take-back
• Offering credit finance options to allow customers to purchase TVs
Incremental innovation
Low degree of “newness”
Improving the old
Builds on existing knowledge
Keeps companies competitive in a short term
Negatively correlated to breakthrough
Radical innovation
• High degree of “newness”
• Dramatically changes social or business
• Leads to knowledge destruction/disruption
• Creates new markets
• Leads to rapid growth
• Includes great uncertainties:
Incremental vs radical innovation
Innovation and R&D; what is the
• connection?
Innovation = Invention + Diffusion/Exploitation
• Develop something new that can be diffused on a
• R&D is critical to developing something new, but in order
for this “new” to be diffused firms need to understand the
factors affecting the diffusion of new products
(goods/services) and to “manage innovation”.
• To invent something takes certain skills (e.g.
technological expertise), and to commercialize this
invention takes another set of skills (e.g. taking it to the
How will the innovation parts of EISIGS be
• Continuous activities:
• Innovation-coaching: (1) thesis-oriented and (2) practice-oriented
• Study-visits with innovation focus
• Discrete activities:
1. Courses/course moments
Introduction course on innovation (September 2014)
Innovation courses (e.g. innovation management, innovation
dynamics in complex systems, corporate governance and
2. Seminars/workshops with innovation in focus
Innovation seminars with invited international guests from academia
as well as industry will be planned as a continual activity with
invitations to the industrial partners that the PhD students are
connected to.
How will the innovation parts be visible in
• No
general model for how this should be done
• The innovation aspects will be tied and adapted to
specific PhD-projects.
• Two examples of how the innovation aspect can
• A PhD student may write an article that applies an innovation
perspective on the technological content of the thesis subject
• A chapter in thesis (e.g., in the “kappa”) that applies an
innovation perspective.
Introduction course on Innovation Management
• A basic introduction to:
1. Technology and innovation strategy
2. Innovation methodology/technology
• Three meetings and homework between the
Thanks for the
attention! Questions?