Innovation Strategy

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Taking a Value-Chain Perspective on Innovation

Market leaders have many advantages when adopting new technologies such as e-business, but they don’t always make the move. Why? It’s partly because new technology can be leveraged along a chain of related companies only if business partners also make the leap to adopt these changes. And research reveals that when large companies are significantly concerned about customer adjustment costs of new innovations, these powerful and otherwise highly capable organizations often resist change.


Unleashing Creativity With Digital Technology

In business, it’s costly to try something new, especially if it doesn’t work out. But in the digital era, technology can be deployed to augment the creative abilities of people and organizations. Today’s digital technologies have reached a level of maturation that enables cheap and rapid iteration to make new, invaluable forms of innovation possible.


How to Manage Alliances Strategically

Companies that lack the resources and knowledge to undertake key strategic growth initiatives often seek partners who can fill in the gaps. The skills that make such alliances work, however, aren’t well understood; executives often make flawed assumptions that prevent the partnership from achieving its goals. An integrative, holistic framework for alliance management helps executives avoid these pitfalls and create value via strategic alliances.


Navigating the Leadership Challenges of Innovation Ecosystems

Certain kinds of product or process creations involve not just one player but many to ensure success. Organizations working toward this kind of innovation need to think about the project’s innovation ecosystem, which includes identifying co-innovators, structuring project leadership, and potentially modifying how success is defined. “All these things need to be negotiated within the coalition” notes Ron Adner of the Tuck School of Business — a process that’s often under-appreciated or ignored.


When Innovation Meets the Language of the Corner Office

  • Blog
  • Read Time: 5 min 

Effectively communicating the innovation journey and output to executives requires translation. While innovation processes are becoming more widely used across organizations, they are not always fully embraced at the executive level. Innovationists need to become bilingual — able to present in the style that strategy consulting firms use when making formal recommendations and updates. When speaking to executives, innovation leaders should make sure they are not only heard, but understood.



How to Succeed with Radical Innovation

  • Interview
  • Read Time: 8 min 

New research by J.P. Eggers of NYU’s Leonard N. Stern School of Business and Aseem Kaul of the University of Minnesota’s Carlson School of Management looks at how companies pursue radical invention and the success of those efforts. The researchers found that highly capable firms have much less motivation to take risks because they’re already so successful — but that they’re the ones most likely to succeed when they try to innovate.


Improving Analytics Capabilities Through Crowdsourcing

Analytics capabilities can greatly expand a company’s ability to innovate — but what do you do when the talent you need just isn’t available? Agribusiness giant Syngenta, faced with an insurmountable analytics talent bottleneck, turned to crowdsourcing. Using a series of contests, it outsourced the development of a set of award-winning analytics tools to improve its decision making — and learned, in the process, some key factors supporting successful crowdsourcing.


Finding a Lower-Risk Path to High-Impact Innovations

Pursuing a high-impact innovation strategy can have terrific payoffs — but it’s also extremely risky, and most companies won’t do it. Yet a comparatively less risky, proactive approach that strings together “lily pads” of capability-building investments, technical and conceptual advances, and market explorations into “enabling innovations” can bring companies closer to their goal and provide a long-lasting competitive edge.


Navigating the Patent Minefield Through Consortia

Bringing high-tech inventions built on patented technologies to market can be complicated and risky. The threat of added costs from patent infringement lawsuits has led technology companies to pool their talents — and patents — in technology consortia. Joining a tech consortium requires managers to weigh intellectual property value against the value of future collaborations and assess the consortium’s pros and cons for innovation, competition, and market creation.



Foundations of Analytics Strategy

Competitive advantage from analytics is declining, according to the 2016 annual report about data and analytics by MIT Sloan Management Review. In this on-demand webinar, the authors of the report — Sam Ransbotham, an associate professor in information systems at Boston College and guest editor at MIT SMR; David Kiron, the executive editor of MIT SMR’s Big Ideas Initiative; and Pamela Kirk Prentice, the chief research officer at SAS Institute Inc. — discuss how analytically-sophisticated companies are managing to cultivate both innovation and competitive advantage with analytics.


Finding the Right Role for Social Media in Innovation

Social media provides a game-changing opportunity to support new product development. But taking advantage of the opportunity requires more than just a Facebook presence with a loyal base of “friends.” To use social media for innovation, organizations need clear strategies and objectives. They also should look beyond social media used by the general public to lesser-recognized platforms, such as special user forums or expert blogs, for especially valuable user-generated feedback.


Now That Your Products Can Talk, What Will They Tell You?

Products connected to the Internet of Things are providing unprecedented levels of information that can be used to improve both products and customer experience. For instance, a company does not have to wait until a customer calls with a complaint to know that a product connected to the Internet of Things is not working correctly. Instead, the product could already communicate the information, giving the company the ability to provide proactive service. Result: more loyal customers.


Developing New Products in Emerging Markets

How can multinational companies turn ideas from their emerging-market subsidiaries into global products? A successful innovation developed by Cisco’s R&D unit in India offers practical insights into how to make that process work effectively. Key enablers in the Cisco case included well-developed R&D capabilities at a company center in Bangalore, a large market opportunity, and the support of executive champions. The process also demanded clarity about what product to develop, and how — including working on a shoestring budget.


How Crowdfunding Influences Innovation

Crowdfunding is changing how entrepreneurs bring new products to market. It has allowed thousands of innovating entrepreneurs to raise money, build brand awareness, and join a broader conversation with large numbers of potential backers — all while still in the product development process. But crowdfunding’s potential goes beyond financing and marketing. The people who back projects can also be important sources for product feedback and ideas.



Debating Disruptive Innovation

Few MIT Sloan Management Review articles garner as much attention as Andrew A. King and Baljir Baatartogtokh’s “How Useful Is the Theory of Disruptive Innovation?” After surveying 79 industry experts, King and Baatartogtokh concluded that many of the cases cited as examples of disruptive innovation by Harvard Business School professor Clayton M. Christensen and his coauthor Michael E. Raynor did not fit four of the theory’s key elements well. Here, three experts provide responses to continue the conversation.

“How Useful Is the Theory of Disruptive Innovation?” was the question raised by an article in the fall 2015 issue of MIT Sloan Management Review. In this issue, several more experts weigh in on the topic.


Keep Calm and Manage Disruption

Disruption can be averted, and many businesses manage through it by beating the new competition, joining them, or waiting them out. “To be sure, facing disruption is no picnic,” writes Joshua S. Gans, author of The Disruption Dilemma. “But it also isn’t the existential threat that so many see it as.” Many businesses are finding ways to weaken disruptive events, sometimes by investing aggressively in the new innovation after entrants had brought it to market or by acquiring the entrants and the actual disruption.


When Customers Become Fans

Beijing-based smartphone maker Xiaomi Inc. has actively involved enthusiastic customers — known as “Mi Fans” — in both software and hardware development processes. Tech-savvy users test interfaces and products as volunteers, doing much of their communication on the Internet. Customer involvement in the product development life cycle has not only helped Xiaomi reduce R&D costs but also enabled the company to cultivate a sense of participation and pride among lead users.

Image courtesy of Flickr user A. Strakey.

How Useful Is the Theory of Disruptive Innovation?

Clayton M. Christensen’s theory of disruptive innovation has been very influential. But how well does the theory describe what happens in business? The authors of this article surveyed industry experts for each of 77 case examples of disruptive innovation found in two of Christensen’s seminal books. The results suggest that many of the cases do not correspond closely with four elements of the theory of disruptive innovation — and the theory may not fit as many situations as is often assumed.


What to Know About Locating in a Cluster

A study of two industry clusters in Denmark shows that the factors that can make clusters attractive — easy people movement and knowledge spillovers — can also make it harder for individual companies to retain proprietary knowledge. The authors present two case studies that present starkly different experiences. They conclude, in part, that clusters with core platform strengths that span noncompeting sectors are exceptionally attractive and that healthy clusters have core institutions with scale and scope in relevant fields.

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