lOMoARcPSD|5677654

Module 4 Innovation Strategy Formulation

BS in Management Accounting (University of Makati)

Studocu is not sponsored or endorsed by any college or university

Downloaded by Romlan Durano ([email protected])
 lOMoARcPSD|5677654

UNIVERSITY OF MAKATI
J. P. Rizal Ext., West Rembo, Makati City
COLLEGE OF BUSINESS AND FINANCIAL SCIENCE

Department of ​MARKETING MANAGEMENT

Course Title Module No. 4 Title
IMPLEMENTATION IN INNOVATION
INNOVATION & STRATEGY
FORMULATION Module Leader
DR. DANIEL E. HEBRON, CPME

Module Contributors

Time Frame You are highly expected to accomplish and comply with all the
activities, assignments, and assessments of this particular module in
one week to two weeks.
 
1. Submission of two (2) assignments.
2. Submission and presentation of case analysis.
Module Requirements 3. Suggested Readings (please refer to Course Learning Plan)

Use of UMAK-LMS, Video Conferencing (google meet, zoom, FB

Teaching Strategies messenger, and others.) Voice-over PowerPoints, or video-recorded
lectures, Online links, and Online quizzes.

I This module is all about implementation in innovation which is considered as one of two
N principal means that a firm may use to pursue new technology (the other is obtaining it from
T external sources). Generally, firms use both approaches to some degree, but emphasize one
R over the other. If a firm chooses to pursue newness in technology through internal
O development processes, there are implications for the firm and for individuals in the firm.
D a. For the firm this means
U i. Incorporating processes that encourage exploration of new ideas
C ii. Using strengths and competencies of individuals and groups of individuals
T iii. Systems for gathering information about new trends and developing customer
I needs and wants
O
iv. Making long-term commitments to programs of research and development by
N
having strategic focus areas
v. Attracting and nurturing creative individuals
vi. Encouraging creativity and open communication of ideas
vii. Cultivating a fertile environment for success and failure
b. For the individual manager this means
i. Providing direction for innovation through strategy, focus and structure
ii. Allowing employees to think creatively
iii. Knowing when to say a project or idea needs to be put aside
iv. Creating an atmosphere where failure can happen and not punishing
others when it does happen
v. Adapting to a fluid environment that energizes idea flow
vi. Being open-minded and receptive to potential opportunities
vii. Developing cross-functional teams to enhance knowledge exchange
viii. Developing a tolerance for ambiguity

Downloaded by Romlan Durano ([email protected])

 lOMoARcPSD|5677654

L a. Explain the leadership’s role in bolstering innovation

E b. Understand how key personnel engage in the innovation process
A
R c. Appreciate how the organization achieves fit during implementation
N d. Comprehend how employees are encouraged to buy into the process of innovation
I e. Determine if the firm is achieving the desired outcomes
N
G f. Illustrate the periodic gap analysis
O g. Understand the appropriate controls for personnel: financial, strategic, and cultural
U
h. Describe the design of the support structure for evaluation and control processes
T
C
O
M
E
S
C
O I. INTRODUCTION
N Implementation focuses on how firms should organize systems, structures, people, and
T processes into a consistent synergistic whole to achieve innovative capacity, create value,
E develop sustainable competitive advantage profitably.
N
T
II. INITIAL QUESTIONS FOR IMPLEMENTATION
a. What Should We Be Doing? This involves prioritizing activities. The goals and objectives
that were established in the planning process are not all equally important are necessarily
temporal (timed in the same time frame).
i. Requires clear definition of criticality
ii. Environmental changes need to be monitored to see if are implementing what needs to be
done
iii. Monitor ―leapfrogging‖—when a new technology skips over the existing generation of
products to introduce a product with significantly new technology.
iv. Definition of ―important‖ activities is fluid and subject to change based on changes
internal and external to the firm
b. What Are the Requirements for Key Activities? Resource availability is a key to
successful innovation.
i. Timing—of resources requires they be where and when they are needed. Conflicts over
resource utilization are a major concern.
ii. Human resources—are typically developed internally. The firm needs to be aware of
tomorrow’s people needs today because it usually takes time to develop employees that ―pay
off for the firm.
iii. Effective use of existing platforms—because a firm is a composite of various resources and
knowledge bases, the ability to use lessons and resources from one area or product line in
another is important. This creates synergy. Technology platforms are the same.
c. What and to Whom to Delegate?
There are two benefits to delegation.
i. The person in charge will become the champion during the innovation process and can
advocate for resources.
ii. The person that is delegated authority learns about the innovation process. It is a
development activity that should benefit the firm more in the future.

III. KEY IMPLEMENTATION ISSUES

a. Leadership—must ensure that there is cooperative behavior, a culture of

collaboration and cross-functional initiatives to encourage innovation. Two areas of
particular interest.
i. Skill Mix—Innovation is accomplished most often by a team of individuals with different
skills.

Downloaded by Romlan Durano ([email protected])

 lOMoARcPSD|5677654

1. Skills needed vary by project and place in the organization. At the very least, there needs to
be idea generators and champions for innovation to take place.
2. Leaders can be formal (with official title) and informal (based on knowledge, respect, etc.).
ii. Actions of the Leaders
1. Create a supportive environment
a. Avoid paralysis of analysis—too much analysis can bring decision making and action to a
halt. There is a ―law of diminishing return‖ on trial runs and information gathering. Perfect
information is not possible so risk taking skills are important for the leader.
b. Delegate effectively—the leader is a delegator and facilitator. If the leader is not doing the
leader’s job, then employees do not develop needed skills and the project is not being effectively
managed.
2. Create mechanisms for innovation—leadership is responsible for installing systems
that are supportive of innovation.
a. Establish a knowledge-exchange atmosphere that encourages the questioning and
openness needed to promote innovation.
b. Keep policies and procedures flexible enough to allow innovation.

3. Allocate ample resources to critical activities—the leader needs to review several

questions periodically.
a. Is there an open, questioning attitude among employees?
b. Is the firm avoiding ―ruts‖ in processes and procedures?
c. Does everyone feel free to express opinions? And believe they will be listened to?
d. Are there strategic gaps between where we are now and where we want to be? Are we
closing them?
e. Is there a vision of where the firm wants to be in the competitive environment?

b. Engagement—the central question is how to get the various entities moving in the
same direction. Culture is the pivotal element in determining the level of engagement.
i. Problems in engagement
1. Inertia—the tendency to keep on the same track is strong. IBM continued as a mainframe
manufacturer for too long—the personal computer and software development trends were
evident long before IBM became aware they were losing position and needed to change.
2. Fear—for individuals, there is a fear of loss of personal power, respect, job, or feeling of
competence to name a few. Fear is best managed by success.
3. Complacency—is similar to inertia but deals more with satisfaction with the status quo. To
overcome this need to capture and locate knowledge and expertise, transfer and share
knowledge and enable individuals to develop new ways of thinking. To start the organization
moving away from mainframes, IBM set up a new team (of people who were viewed as different
from most IBMers), and moved them to Florida to work on the IBM PC.
ii. Overcoming the problems in engagement
1. Building a knowledge-based culture—have to create an organization where transformation
is acceptable
2. Training and development should be characterized by:
a. Informed opportunism
b. Directed empowerment
c. A turning prism—view changing
3. Mentoring—allows individuals in the organization to share lessons learned through
one-to-one interaction.

c. Extension—is concerned with firms having sufficient knowledge of product and

market competencies so new ideas lead to action through a filter of experience.
There are three key actions:
i. Knowledge sharing within the organization
ii. Monitoring competencies
iii. Looking for new opportunities through diffusion. The elements of diffusion are:
1. an innovation or new idea
2. that is communicated through certain channels

Downloaded by Romlan Durano ([email protected])

 lOMoARcPSD|5677654

3. over time and in a timely manner

4. among members of a social system (like an organization)

d. Alignment—represents a fit among the systems within the firm as they support the
firm’s strategy and a fit of the firm with its external environment.
Three key activities that are necessary for alignment include:
i. Build fit both internally and externally.
1. Internal groups are most important.
2. Should consider fit a within group and a between group phenomenon.
3. External constituencies are important to the firm’s innovative capabilities.
ii. Tie rewards and incentives to the achievement of goals. To see if that is being done in the
organization, the following questions need to be examined.
1. What happens to creative mavericks in the firm? Are they encouraged or swept out?
2. What happens when someone fails? Failure is a learning process also.
3. What are the employees hearing? Is it what management intends?
iii. Craft the structure to encourage innovation
IV. CRAFTING PORTFOLIOS FOR INNOVATION ( please watch
https://www.youtube.com/watch?v=kZhE-wtba8A​)

V. MANAGERIAL GUIDELINES
The pitfalls to avoid in the implementation of an innovation strategy include:
a. Applying process innovation too broadly; the proper scope of the process to be changed
should be appropriate to the goal.
b. Overlooking people challenges associated with the changes.
c. Being overconfident about the ability to lead the change process.
d. Forcing changes to coexist with some existing ―sacred‖ element of the organizational
structure or process.
e. Avoiding elimination of processes and people (or eliminating them) to prove something is
happening. If you cannot answer ―why?‖ it may not be a good idea.
f. Relying on technology to fix all systemic problems.
g. Failing to communicate.
A
S
S
I
G
N
M
E
N
T

A
S
S
E
S
S
M
E
N
T

Downloaded by Romlan Durano ([email protected])

 lOMoARcPSD|5677654

R
U
B
R
I
C
S

R • Trott, P. (2002), “Innovation Management and New product Development”, Prentice Hall.
E • Cagan, J. and Vogel, C.M. (2002), “Creating Breakthrough Products: innovation from
F product planning to program approval”, Prentice Hall.
E • Goldenberg, J. and Mazursky, D. (2002), “Creativity in product Innovation”, Cambridge
R University Press
• Mann, D. (2002), “Hands-On Systematic Innovation”, CREAX Press
E
• Klostermann, J.E.M. and Tukker, A. (1998), “Product Innovation and Eco-Efficiency”, Kluwer
N Academic Press
C • French, M. (1994), “Invention and Evolution: Design in Nature and Engineering”, Cambridge
E University Press
S

Downloaded by Romlan Durano ([email protected])