Managing Change,

Creativity &
innovation
© Patrick Dawson, Constantine
Andriopoulos

The Process of Innovation

Chapters 2 …..
Lecture objectives

• Understand the concept of innovation.

• Gain greater awareness of the key theories, concepts, and
models of innovation.
Innovation
Innovation – what is it?

• Bessant and Tidd (2007: 12/29) ‘innovation is the successful

exploitation of new ideas’ and is ‘the process of translating ideas
into useful – and used – new products, processes and services’
• Innovation involves the utilization of ideas in solving problems,
developing processes and improving the way we do things in
creating new products, services and organizations (Dawson and
Andriopoulos, 2017:615)
• Amabile et al. (1996: 1155) creativity ‘is a starting point for
innovation; the first is a necessary but not sufficient condition for
the second’. Creativity comes first and provides the impetus for
many forms of innovation.
• Short, thoughtful – what is innovation?
• https://www.youtube.com/watch?v=IiyMkOfycOg
 A good question ……..
Change, creativity
and innovation are
dynamic processes,
shaped by an
unfolding context
(the past), ongoing
events and activities
(the present) and
the expectations and
aspirations of what
is to come (the
future)
(Dawson and
Andriopoulus, 2017)
The process of innovation
• Innovation is the multi-stage process whereby
organizations transform ideas into new/improved
products, service or processes, in order to advance,
compete and differentiate themselves successfully in
(the) marketplace. (Source: Baregheh et al., 2009:
1334)
• Innovation involves the utilization of ideas in solving
problems, developing processes and improving the way
we do things in creating new products, services, and
organizations. (Source: Dawson and Andriopoulos,
2014: 10)

• Understand the problem: (very short)

• https://www.youtube.com/watch?v=R5Zjq7a3ImU
Managing the process

• Search and assessment: scan environment to identify

changes (especially those that may pose threats or offer
opportunities).
• Selection: choose an innovation.
• Implementation: developing a strategy to make it happen
(resolve problems as they occur).
• Capture: ensuring a gain in achievable benefits from the
innovation i.e. focus on the wider value of innovation for
company (profit motive) or people (social, well-being focus).
 A process model of innovation
Stages

Search: how
can we find
opportunities
for
Capture: how
innovation? Select: what Implement: how
are we going to
are we going to are we going to
get the benefits
do and why? make it happen?
from it?

Figure 2.6 A process model of innovation (Source: Tidd, J. and

Bessant, J. 2013. Managing Innovation: Integrating
Technological, Market and Organizational Change. Chichester:
John Wiley & Sons, p.89. © John Wiley & Sons)
Levels of innovation

• Incremental innovations: small changes, refinements, and

modifications to existing products, e.g. picture quality, hi-fi
sound.
• Modular innovations: middle-range innovations e.g.
transition from black-and-white to colour television, digital
sound systems.
• Radical innovations: new knowledge, exploit uncharted
opportunities e.g. telephone, steam engine, motor car,
internet.
• Short, clip – adds more detail to levels of innovation
• https://www.youtube.com/watch?v=Pne2YdZuAtA
 Transformative innovation …
• … is not an innovation within the system, it is an
innovation of the system. Rather than propping up the
old system and making it work better, transformative
innovation points to a very different system, a new
vision. It is difficult to reach such a vision through
incremental improvement in what already exists. You
cannot invent the microwave by improving a toaster. You
need transformative innovation.
• Source: http://www.internationalfuturesforum.com/s/99
The 4Ps of innovation
• Product: iPhone and flat-screen televisions.
• Process: supply chain integration, cellular work
arrangements, continuous flow assembly line.
• Paradigm: reframing e.g. air flight expensive way to
travel until challenged with the emergence of low-cost
airlines.
• Position or market: repositioning e.g. Lucozade as a
health drink (for sporting activities) rather than as a
medicinal drink (for sick children).
• Model explained (11.25 mins – but worth it!)
• https://
www.youtube.com/watch?v=UlF8GDeW80c&list=PLiYW
qhto4Lb4YfYOEoS9yU45lnDobhxEA
Management, service & open
innovations
• Management: e.g. JIT, BPR, TQM generally linked to
process innovations.
• Service: e.g. Hotmail offered the first free web-based
email service.
• Open innovation: shift from closed models (internal
control focus) e.g. NPD cycles that operate within
organizations towards open approaches that tap into
wider knowledge networks that may include strategic
alliances, customers, competitors, and the wider public.
 innovation

For Chesbrough (2003) more rapid access to wider

forms of knowledge should not be restricted as they open
up different organizing principles for research and
innovation. He maintains that different industries can be
located along a continuum that range from those in which
entirely closed conditions prevail to those that embrace
open forms of innovation
Chesbrough, H. W. (2003). Open Innovation: The New
Imperative for Creating and Profiting from Technology.
Boston, Massachesetts: Harvard Business School Press.
Chesbrough’s open innovation

Difference between closed and open innovation

https://www.youtube.com/watch?v=SuuAUsPRDvQ
P&G’s Connect + Develop

• Innovation beyond normal areas of expertise

• Access to a wider range of innovative ideas
• Reduces risks by transforming potential competitors
into collaborators
• Provides faster returns (monetarisation of value)
through the manufacture, marketing, and distribution
of new products (see, www.pgconnectdevelop.com).
The rise of the social and social innovations
• What is social innovation? (3 mins)
• https://www.youtube.com/watch?v=2vdWZ-Fu078
• Social innovations seek to provide socially useful
solutions to ongoing problems
• Social entrepreneurs seek innovations that can make a
social difference, are socially valuable
• Social business pays no dividends, sells products at
prices that make it self-sustaining. Any profit stays in
the business – to finance expansion, to create new
products or services, and to do more good for the
world (Muhammad Yunus, 2007)
Muhammad Yunus: Social Business

Social Business – 5
minute video
http://www.youtube.
com
/
ForaTV version at:
http://www.youtube.
com/watch?
v=0C3XQ3BTd4o
Bower and Christensen (1995: 44)

The research shows that most well-managed, established

companies are consistently ahead of their industries in
developing and commercializing new technologies – from
incremental improvements to radically new approaches – as
long as those technologies address the next-generation
performance needs of their customers. However, these
same companies are rarely in the forefront of
commercializing new technologies that don’t initially meet the
needs of mainstream customers and appeal only to small or
emerging markets.
Christensen: three technology
driven innovation roads

• Improve existing products for high-margin customers.

• Introduce cheap alternative products to customers at the
low end of the market, especially if they feel that they are
paying more than they need.
• Create a new market for non-consumers who are not
currently in the market at all (Christensen et al, 2004).
• Moving towards disruptive innovation – the topic for the
next lecture!
 Enterprising Potential
• Take a test …..

• http://www.get2test.net/get2test.html
Assignment 2 – sections
relevant to innovation
• Terms are explained ……
• Effective use of evidence as a basis for potential
knowledge transfer drawing on a synthesis of innovative
theory and outcomes to demonstrate a transformative
outcome (what does this mean? Over to you …. )
• However a strategic innovation should be transformative
in its outcomes with an effect beyond itself. Present a
critical judgement of the way in which Food Fixed could
embrace innovative transformation, I expect this to
require funding!
Recommended Reading

Innovation
• Bessant, J., & Tidd, J. (2015). Innovation and Entrepreneurship (3rd
ed.). Chichester: John Wiley & Sons.

• Stephen Denning, (2005) "Transformational innovation: A journey by

narrative", Strategy & Leadership, Vol. 33 Issue: 3, pp.11-16, 
https://doi.org/10.1108/10878570510700119