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TopIntroduction
Innovation refers to the capacity to apply new knowledge or to recombine existing knowledge in order to improve/enhance productivity, or to create new products and processes (Utterback, 1994; Rosenbloom & Burgelman, 1989). Therefore, innovations are considered the engines of productivity, competitiveness and employment growth for individuals, organizations, regions and countries. For any innovation, apart from the creation, equally important is its diffusion and adoption that dents the economic system. Also recognized is the fact that innovation is a complex process that involves not only the innovative individual or firm but also a system of interactions and interdependencies between that individual or firm and other people as well as organizations and institutions.
While innovation is recognized as a basic requirement, it is now evident that managing innovation demands management of both continuity and change. Firms need to change continually on several fronts to make innovation a staple happening leading to enhanced performance. With globalization having set in, the need to make world class products or services that meet the customer’ needs is being emphasized, requiring focus on new technology creation and implementation. Changes in business situations are inevitable, calling for a balance across current and future areas of focus and a dynamic strategy to manage the resultant diverse forces that are in play at any point of time.
As customer needs as well as technologies are continuously evolving, it is imperative for firms to create value that is perennially relevant to the customer. Complementary assets are essential to enable value enhancement/creation; they need to be continually relevant with changes in customer or technology. Uniqueness, developed so assiduously in the form of skills, or culture, or technology ownership, is difficult to maintain with the inevitable changes in the environment, necessitating a dynamic approach. Carving a growth path calls for continuously developing and nurturing competences to utilize these assets to fend off competitors, meet customer demands and react appropriately to technology developments.
From a holistic perspective, the need is to have a strategy in place to manage innovation that can cope with both continuity and change.
TopInnovation And Its Management
The word ‘innovation’, reportedly, originates from the Latin word innovare meaning to review, to make new or to alter. Alternatively, the word innovation can be said to be derived from novus or new, leading to the same meaning. Innovation is a widely defined term both in the popular press and in the academic literature.
As used in this paper, innovation is the mechanism by which firms produce new products, processes and systems required for adapting to changing markets, technologies and modes of competition (Utterback, 1994; National Knowledge Commission, Government of India, 2007). Innovation consists of all these things acting in an integrated fashion. Thus, innovation is not a single action but a total process of interrelated sub processes (Myers & Marquis, 1969). It is neither just the conception of a new idea nor the invention of a new device; it is also not just the development of a new market, but all of these in an interlinked manner.