Innovation & KM

1. Innovation & KM Dodie Tricahyono (dtricahyono@yahoo.com d o d i e t r i Institut ManajemenTelkom 2013

2. Creativity.... in general, this is the production of new ideas or combining old ideas in a new way. It is also the main driver for innovation. Innovation.... this is the transformation of a new ideainto a new product or service, or an improvement in organization or process.

3. ‘the spark of innovation is not in what we do, butin how we do it.’Tom Kelly, author of The Art of Innovation(2001)

5. According to Schumpeter (1934) Innovation is the introduction of new elements or anew combination of elements in the production or delivery of manufactured an service products. New product/service New process New organization/management New delivery/distribution New market New raw material Product Process Management

6. Principles of Innovation (Peter F. Drucker) Purposeful, systematic innovation begins with the analysis of the sources of new opportunity. Because innovation is both conceptual and perceptual, would-be innovators must also go out and look, ask, and listen. … They look at figures. They look at people. … Then they go out and look at potential users to study their expectations, their values, and their needs. To be effective, an innovation has to be simple, and it has to be focused. It should do only one thing; otherwise it confuses people. … Indeed, the greatest praise an innovation can receive is for people to say, “This is obvious! Why didn’t I think of it? It’s so simple!” Even the innovation that creates new users and new market should be directed toward a specific, clear, and carefully designed application. … … the successful innovation aims from the beginning to become the standard setter, to determine the direction of a new technology or a new industry, to create the business that is--and remains--ahead of the pack. …, innovation is work rather than genius. It requires knowledge. It often requires ingenuity. And it requires focus. There are clearly people who are more talented as innovators than others, but their talents lie in well-defined areas.

7. Within a company or industry In social & intellectual environment Sources of Innovation (Peter F. Drucker) Most innovations, however, especially the successful ones, result from a conscious, purposeful search for innovation opportunities, which are found in only a few situations. • The opportunities exist in such areas: • Unexpected occurrences • Incongruities • Process needs • Industry & market changes • Demographic changes • Changes in perception • New knowledge

12. Innovation Space (Tidd, Besssant, & Pavitt, 2005) Paradigm (mental model) Incremental...radical Inno-vation Product (service) Process Incremental...radical Incremental...radical Incremental...radical Position

13. Degree of Newness Imitative Really New Incremental Radical Discontinuous

14. Types of Innovation • Product versus Process Innovation • Product innovations are embodied in the outputs of an organization – its goods or services. • Process innovations are innovations in the way an organization conducts its business, such as in techniques of producing or marketing goods or services. • Product innovations can enable process innovations and vice versa. • What is a product innovation for one organization might be a process innovation for another E.g., UPS creates a new distribution service (product innovation) that enables its customers to distribute their goods more widely or more easily (process innovation)

15. Types of Innovation • Radical versus Incremental Innovation • The radicalness of an innovation is the degree to which it is new and different from previously existing products and processes. • Incremental innovations may involve only a minor change from (or adjustment to) existing practices. • The radicalness of an innovation is relative; it may change over time or with respect to different observers. E.g., digital photography a more radical innovation for Kodak than for Sony.

16. Types of Innovation • Competence-Enhancing versus Competence-Destroying Innovation • Competence-enhancing innovations build on the firm’s existing knowledge base E.g., Intel’s Pentium 4 built on the technology for Pentium III. • Competence-destroying innovations renders a firm’s existing competencies obsolete. E.g., electronic calculators rendered Keuffel & Esser’s slide rule expertise obsolete. • Whether an innovation is competence enhancing or competence destroying depends on the perspective of a particular firm.

17. Types of Innovation • Architectural versus Component Innovation • A component innovation (or modular innovation) entails changes to one or more components of a product system without significantly affecting the overall design. E.g., adding gel-filled material to a bicycle seat • An architectural innovation entails changing the overall design of the system or the way components interact. E.g., transition from high-wheel bicycle to safety bicycle. • Most architectural innovations require changes in the underlying components also.

18. A Framework for Innovation CORE CONCEPTS AND COMPETENCIES Reinforced Overturned MODULAR INNOVATION Unchanged INCREMENTAL HOW LINKED ARCHITECTURAL INNOVATION RECONFIGURATION OF COMPONENTS NEW INTERACTIONS AND LINKAGES RADICAL INNOVATION Changed

19. Three Dimension of Innovativeness

20. Innovation Management Encourage Implementation From Ideas to Profit Learning Learning Learning Human/talent Incentives Networks Wikicapital Finance R&D Value added Culture System Competitive Advantage Creativity Profit Beware of the bounded mentality! “While innovation can occur by serendipity, sustainable innovation from which collaborative and competitive advantage emerges, needs a systematic and effective management approach based on knowledge and learning” (De Sousa, 2006: 398)

21. There are core rigidities to consider........ So,...we are learning and at the same time ....unlearning.

22. Knowledge Management is an Organizational Capability that allows an individual (knowledge worker) within a firm to add value by creating, capturing, and leveraging knowledge objects. VC(individual w KM) > VC(individual w/o KM) Unlike other resources that get depleted with use and follow the law of diminishing returns, the knowledge bank gets constantly renewed and enriched with use by knowledge worker.

23. The D, I, K, W Quartet Data as everyone knows is discrete content and does not make much sense by itself. Information is processed and collated data. Knowledge is highly contextualized information enriched with individual interpretation and expertise. Knowledge lives in its context. Wisdom is in different realm altogether with profundity born out of intuition and deep insight being the key pre-requisites. Transformedby: Add Valueby: Contextualisation Experience Interpretation Discussion Analysis Correlating Summarizing DATA INFORMATION KNOWLEDGE

24. Knowledge Utilisation Knowledge Store KnowledgeGeneration Key Processes of Knowledge Management Knowledge Generationincludes: Knowledge acquisition Knowledge synthesis Knowledge creation Knowledge Storage (or K-codification)includes: Determining the knowledge typology Knowledge capture Maintaining the knowledge bases Creating knowledge maps Knowledge Utilisation includes: Knowledge dissemination and sharing Knowledge Spiral

25. Knowledge Typology • Tacit Knowledge Explicit Knowledge • experiental & localized available in some • in people heads documented form • The other classification are: • General or Context Specific Knowledge • Individual or collective knowledge • declarative (knowledge about), procedural (know how), causal (know why), conditional (know when), & relational (know with) • process, factual, catalog, & cultural • Database Info-baseKnowledge-bases • K-Bases: Information + Inter-relationship + Context Infobase+ Advanced search capabilities

26. Knowledge Transfer Articulation Tacit/Individual Explicit/Individual Combination Internalization Tacit/Group Explicit/Group

28. The Janusian organization

29. A model for creative leadership Focus on Tasks CHANGE Leading on the edge of chaos Leadership practices and strategies Management competencies Focus on People

30. Management Concerns.....

31. Integrated view of organizational innovation Creativity in Organization Individual Team Structural and process characteristics Creative Environment Capacity to innovate Organizational Learning Capability Organizational Innovation Organizational Innovativeness Emotional Dynamics Other cultural aspects Competitive advantage and performance Cultural/climate characteristics d o d i e t r i Feedback & Reinforcement

32. Q & A d o d i e t r i