INNOVATION MANAGEMENT

Innovation Management and the Challenges it Presents

Innovation Management and the Challenges it Presents

Innovation has been defined as the adoption of a new product or process that reflected the application of information technology. Information-technology innovations that required hands-on interaction with a computer-based system through a computer keyboard were examined in this study. Three criteria for selecting these innovations were established in light of the importance of clearly specifying the type of innovation to be sampled, in order to overcome the empirical instability and theoretical confusion arising from research on innovation in complex organizations (Downs and Mohr, 1976 89; Bigoness and Perreault, 2001 102). The first criterion was that the technological innovations had to have been designed for use by managers and/or professionals. At management levels, adoption of information technology is typically voluntary rather than mandatory. Consequently, certain persons may be needed to promote the introduction and implementation of these technologies. Moreover, to ensure more accurate recall of the innovation process by participants, the second criterion was that the innovation had to have been implemented within the 18 months prior to the study. The third criterion was that the innovation had to have represented a significant financial investment to the company. This criterion ensured that the innovation was visible in the organization and had a potentially important impact on managerial work.

Prior research evidence suggests that significant benefits can be reaped by firms that integrate technological and innovation considerations with corporate-wide strategic development (Fusfeld 2009 56; Erickson et al. 2000 92; Pavitt 2000 29; Adler, McDonald, and McDonald 2002 125; Carrier 2006 62). Specifically, process improvements can help firms benefit from increased productivity and adaptability (Burgelman and Maidique 2008 98), and product innovation can increase a firm's sales by providing unique or higher-performance products (Burgelman and Maidique 2008 145; Harms 2000 214; Guimaraes and Liska 2003 236). Moreover, innovation, is as well viewed as the creation, development, and introduction of new products and services, or product and service components, or a new procedure or process for doing things to benefit one or more of the stakeholders in an organization (Birchall, Chanaron, and Soderquist 2006 89). According to Drucker (2005 98), systematic innovation involves the purposeful and organizational search for changes and the systematic analysis of the opportunities such changes might offer for economic or social innovation. He cites seven sources of innovation, among which are innovation based on process needs, changes in industry or market structure, and new knowledge.

Several research studies have pointed out the need for innovation as a key source of competitive advantage for organizations. In today's competitive environment, the challenge for all businesses is not only to innovate in existing markets to survive and remain profitable, but also to innovate in new markets in order to stay in front of competitors. Similarly, the factor representing structure for managing innovation is significant for both product and process innovation. This factor adds to the management system identified above by encouraging development of new technologies or adaptation of emerging ones to both products ...