IntroductionWe have moved from a knowledge based economy to a knowledge driven economy;

competition, intensity, and the global reach of firms brought about by advancements

in communication technology and supply chains, cost reduction, time to market,

customer satisfaction, and innovation are becoming the differentiating factors between

organisations. Innovation is not about being innovative but about adding value

through clear strategic objectives. In order to sole a problem you need to under the

need that is not being met by the the service or product, the desire to keep up with the

latest innovations will only be beneficial if it adds to the value of the business as a

whole. IT as well as well as improving staff productivity has led reduced the barriers

to entry inn many markets and industries that in turn mean intensification in

competition.

NB * within the project letters and numbers are used to identify capability building

blocks within the macro process i.e. IM A1 – vision.

Innovation“Innovation is the application of practical tools and techniques that make changes,

large and small, to products, processes, and services that results in the introduction of

something new for the organisation that adds value to customers and contributes to

the knowledge store of the organisation.”

O’Sullivan and Dooley (2009).

The four P’s of innovation as described by Francis and Bessant (2005) are;

Product

Process

Position

Paradigm

Although these are separate they are often interlinked within the development of a

product or service e.g. the iPhone and

iTunes. The invention of the telephone was a radical innovation while; mobile

communications was a disruptive innovation (disruptive innovations nearly always

start off as inferior to what is in the market) in the way it moved from a small market

share too near market ownership in the telephony sector. IOs and Google’s OS are

now incremental in the way that they are being improved to keep up with the needs

and wants of consumers. In contrast to these closed systems Ubuntu is to release a

mobile operating system with open innovation at its core, with its support of many

existing systems and open source project platform.

Figure 1 Tidd et al (2005, pp. 22)

Product InnovationProduct innovation refers to changes to a product or service that an organisation offers

to an end user. These occur in the mobile market place as incremental improvements

e.g. iPhone 4 versus the 4s; the product or service is improved to meet the needs and

expectations of customers. The same can be said of the Samsung Galaxy Note where

there was a perceived gap in the market between the phone and the tablet in the

market. Given the proliferation of individual devices running on different operating

systems and devices enterprise mobility is an issue. Here the issue of BYOD (bring

you own device) comes into play, using their own devices staffs are relying on them

for a range of enterprise tasks as well, from critical to basic operations.

“Transformative benefit of BYOD is employee-driven innovation — by allowing

employees to decide how, when, and with which tools work is done, companies can

unlock the next wave of value”

Bradley et al (2012).

The BYOD movement is quite new but the ability of the user to use a device of their

choosing (allowing for security concerns) gives the organisation scope to capitalize on

users outside of the working environment i.e. telecommuting and the cost advantage

in user support initiatives.

Process InnovationThis is a change to the way a product or service is delivered and or created. These

processes add value across the network and yield better returns for the company in the

long run. These processes reduce waste, time and increase returns on investment

across the product cycle. Dell used process innovation to gain competitive advantage

in the PC and laptop market by disintermediation, by elimination of the point of

physical contact with the product i.e. retailers, it moved the decoupling point into the

manufacturing facility which made postponement possible in the process. Dell

through the use of Lean processes, ERP, Six Sigma were able to deliver products built

to customer requirement cheaper and faster to their customers. By integrating supply

chains horizontally and vertically throughout the process and through the use of JIT

(just in time) inventory management, storage costs and inventory costs were reduced.

By using JIT the issue of redundant stock is not seen as stock is ordered on an as

needed basis, this level of optimization gave Dell a very flexible and agile supply

chain

Positioning Innovation “Are changes in the context in which products/services are introduced” Tidd and

Bessant (2009, pp. 21).

Apple have transformed from a company that produced personal computers to that of

a company more in line with the multimedia and entertainment industry. The

development of the iPod a platform business model too a multi sided one with iTunes

saw the introduction of a new ecosystem for the mass music market. Upon this

platform and incorporating the app store into iTunes (along with iTunes U, podcasts

books and movies). Apple saw an unarticulated consumer need and designed the

ecosystem to address the problem yet as a percentage of revenue Apple spend only

3.1 percent on research and development Jaruzelski and Dehoff (2010, pp. 12).

IBM’s transition from a hardware company to a solutions deliverer was a positioning

innovation but also more so a business model innovation.

Paradigm InnovationThese may manifest in two

different ways type A and B.

Type A) Inner directed

This type off innovation is intra

organisational and cultural,

Semco is an example of a

company that is at the fore of

intra organisational innovation

as can be seen from their management and structure. Semco have a flat as opposed to

hierarchical layered management, which means that each individual employee is

responsible for most decisions made in the organisation that relate to themselves and

their peers e.g. setting wages, working hours, holidays etc. this in turn means more

commitment from staff to the organisation and each other as a whole.

Type B) Outer directed

The old system in the telecommunications industry was a pay per use or package

model on which tariffs were based this business model was reversed by Skype. Skype

since it’s foundation turned the traditional business model around by adopting the

free-mium model. This is where the basic services were given to customers for free

i.e. free calling though the use of V.O.I.P. (voice over internet protocol). By using

already available infrastructure, the customer hardware, and the Internet this mean

that Skype’s management costs were nominal as the have minimal network costs and

minimal infrastructure. This change in value proposition (free voice and video calls)

and in revenue stream (hardware sales (Skype Handsets) and subscription packages)

had server affects on the telecoms industry.

Figure 2 Sisi N. (2011)

Figure 3 IVI (2012)

IT Capability Maturity Framework and Innovation ManagementThe IT CMF is an end-to-end integrated framework that allows for the measurement

of capabilities within the IT department and to place them on a maturity curve based

on industry best practices with empirical data. Within each of the macro capabilities

lay the critical processes.

Innovation Management is a

micro capability lies within the

Managing IT like a business

capability.

Innovation management (IM)

“encompasses

identifying, creating, funding,

and measuring innovations that

are based on information technology in order to generate business value” IVI (2012).

The three classes of innovation given are

Driving core business products into new markets

Providing innovative solutions to business

Innovating within IT

IM while not including research/creativity methods and intellectual property does

cover the role of IT and also the methods and best practices to advocate and spur

innovation within the company.

Innovation management and ProductsThe area of intellectual

property while out of the

scope of the IT department

and IM CC (critical capability)

may be addressed through the

open innovation. The synergy

created by sharing ideas and

licensing ideas generated

allows for additional revenue streams within the organisation and allows technologies

that are developed in house to permeate the industry and to be adapted to the need of

the user while at the same time retaining intellectual property rights. The inflow of

knowledge and acquisition of knowledge from outside the organisation can also be

leveraged to provide a better end user experience. It could be said here that

encouraging an innovative environment and a reward scheme instead of increasing

innovative ideas, it will only serve to filter out the ideas that are considered the less

creative ones. Vision, planning and strategy are all important a company however a

perceived the gap in the market does not constitute a market in the gap, Microsoft

were the first to introduce a tablet PC to the market in 2000 which ultimately failed

because of a lack of understanding of customer needs (weigh and form factor) and

legacy issues (running on the Microsoft OS), their were no specific supports and the

lack of clear OS integration led to it not being successful, other examples of this can

be seen in music (iPod, Diamond Rio and Creative) industry.

Figure 4 Chesborough (2003)

Innovation Management and Process

Process is the most clearly addressed innovation capability within the framework, as

the IM CC processes, tool, and metrics are tangible and can demonstrate a return on

investment in the near term. Key performance indicators (KPI’s) may be put in place

to measure any process innovations introduced by the company. Lean, Six Sigma,

TQM, ERP, and JIT are all capable of being quantified within the supply chain and in

the organisation as a whole. In many cases organisations are IT systems dependent

i.e. inventory control and waste reduction, and due to current economic conditions

programs to innovate have to compete for resources within the budget.

With the internet the possibility to involve the users in the research and development

process has been made much easier, lead user development and solutions delivery are

a much more fluid process which can happen in real time. IT departments can

develop tool to help streamline tools to improve the innovation process itself,

Unilever have done this through the Inoplan service which gathers and collates

information which allows for collaboration (IM B3), coordination and the sharing of

innovation initiatives throughout the organisation and beyond challenging the

traditional boundary of communication, 176 companies are using it and 1450 brands

Rumyantseva et al (2007). Portfolio management (IM A4) is the building of

continuous alternatives and taking high quality risks and implementing them quickly,

where feasible to maximize return on investment. This is very much a people and

process issue and having both aligned with the business strategy, through IM CC this

can be achieved through frameworks and tools.

Innovation Management and Position

Amazon, IBM, and Google have all transitioned from their core market entry into

other products and services; they have done this successfully due to their

competencies and those that were developed during their business processes. This

change in market stance and positioning came about due to the foresight of

management and staff in these industries. HTC transitioned from a device

manufacturer (for Orange T-Mobile etc.) to becoming a device company, by working

in house on the components and devices (HTC Touch) they were manufacturing and

then capitalized on collaboration (IM B3) and capability development (IM B4) to

transition into a brand name.

HTC’s manufacturing ability and the skills it had built up in its work force framed the

decision; this transition was achieved through strategic planning (IM A1, A2) and the

people and culture (IM B1 – B5) within the organisation. By creating a culture of

choice and pursuing a portfolio of balanced innovations i.e. radical and incremental

you can make savings and changes through a cumulative effect as well as coming up

with ideas which can alter the course of the organisation. Flickr started off as an

online gaming site with a photo sharing capacity, through the leveraging of existing

technologies at its disposal Flickr transformed itself into an on line photo sharing site

through an organic process.

Innovation Management and ParadigmInner directed innovation looks at the organisation and its people and leadership; in a

knowledge-based economy this means that people are a firms most valuable asset.

The key components of an innovative organisation are

Shared vision and leadership (IM A1/B1)

Structure (IM C2)

Key individuals (IM B4/B5)

Organisation wide participation (IM C4)

Positive approach to innovation and support (IM B5/B6)

Tidd and Bessant (2009)

These components need to work in tandem with each other to establish an innovative

environment in which to work, the IM critical capability does give varying degrees of

support to an environment that supports them however it gives a way to manage

measure and sustain it within the organisation. This mean that using the IM CC an

organisation which wish to be innovative but which lacks the vision and leadership

will not be in a position to capitalize on this, as it is a management led process i.e.

CEO and CIO. When you train employees to be risk averse then you are letting the

organisation become reward challenged. Commitment to the ethos may also have a

damaging effect as with Lou Gerstner and IBM, while Gerstner was the CEO of the

oganisation at the time it was an initiative by Dave Grossman that took IBM on its

course to being a leader in e-business (bottom up innovation). It also does not address

the issue of core competencies, which can become core rigidities, Nokia saw their

handsets as their core strength and within a few years it’s European and North

American markets were cannibalized by the smartphone. While a company may want

to divest its interests the approach of a new technology or service may disrupt the

business model i.e. purchasing of music moved from bricks to clicks within a few

years.

ConclusionThe truth seems to me that it neither does nor does not address any of them, but gives

varying degrees of support to an environment that supports each of them, innovation

management has no particular interest in the type of an innovation, but wants to

manage, measure, and sustain the value of it. The IT CMF tells an organisation how

to put the framework into action through the use of tools, standard processes, and

documents and lets the organisation benchmark itself against the best practices in the

industry, which may themselves be near obsolesce, case in point is the large market

failure to see the emergence of the touchscreen smartphone. It can lead to cost

reduction in the through innovation in IT which can then funneled back into the

innovation process itself.

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[Accessed: 19.1.2013].

Chesbrough, H. (2003) “The Era of Open Innovation”, Sloan Management Review,

Volume 44, Issue 3, pp. 35-41. 

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Jaruzelski, B. Dehoff, J. (2010): "How the Top Innovators Keep Winning", Strategy &

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