Foundational Business Concepts: Innovation & Organizational Dynamics

Basic Concepts of Technology

Technology

The branch of knowledge that deals with the creation and use of technical means and their interrelation with life, society, and the environment, drawing upon such subjects as industrial arts, engineering, applied science, and pure science.

Understanding the Innovation Process

Technology Push

Emphasis on research and development (R&D).

Market Pull

Emphasis on market and user issues.

Interactive Models

Characterized by an interactive nature, feedback between phases, multidisciplinary teams, and the implication of functional departments throughout the process.

Key Technological Functions

Patents

Exclusive rights for the production and distribution of a particular invention.

Organizational Strategy Frameworks

Strategic Management

It results in higher organizational performance. It requires that managers examine and adapt to business environment changes, coordinates diverse organizational units, and is very much involved in the managerial decision-making process.

Core Competencies

Based on the collective learning of an organization. They deal with its specific operational and technological abilities.

Freeman's Innovation Strategies

1. Offensive Strategy: Technological leader.
2. Defensive Strategy: Technological follower.
3. Opportunistic Strategy: Niche focus.
4. Dependent Strategy: Relies on patents.
5. Imitative Strategy: Minimum innovation.
6. Traditional Strategy: No innovation.

Organizational Structure and Learning

Organizational Structure

The formalization of interactions that link a firm's tasks, technologies, and people.

Spin-off

A new organization or entity formed by a split from a larger one.

Alliance

An agreement between two or more parties, made in order to advance common goals and to secure common interests.

Knowledge

Contextualized and subjectively interpreted information. It is affected by previous knowledge and by values and beliefs of the individual. It is the outcome of the learning process.

Exploitation

The process that includes refinement, choice, production, efficiency, selection, implementation, and execution.

Exploration

The process that includes search, variation, risk-taking, experimentation, play, flexibility, discovery, and innovation.

Exploitative Learning

Refinement and deepening of existing technology.

Explorative Learning

Questioning actual standards, procedures, and technologies.

Exploration

Implies experimentation with new alternatives.

Organizations

Hierarchies and bureaucracies created for controlling; structures built to obtain stability.

The Learning Organization

Able to adapt to new environmental factors and also able to benefit from diversity coming from its employees. Organizational culture favors doubt generation and dialogue.