Managing Redical Innovation

Source: The Journal of Product Innovation Management 19(2002) 424-438
Managing radical innovation: an overview of emergent strategy issues
By: Christopher M. Mcdermott*, Gina Colarelli O'Connor

I like this article. this is very interseting article about management of redical innovation. In this article authors describe radical innovation in much effective way. in this article they discuss in detail about redical innovation and it management.
Innovations are of two types incremental and radical. Incremental innovation relates to Refining existing products or processes .e.g. Next version of MS Word, Sony Ericsson or Nokia mobile while introducing totally new concepts .e.g. Transistors, instant photography, digital photography, I Phone shares to Radical innovations. Most breakthrough innovations requires long-term ( typically ten years or longer development time and millions of investment dollars). Management of these innovations is very critical to the long-term success of the firm. Unfortunately, research has shown that it is often difficult to get support for the radical projects in large firms. More than ten years ago, Tushman and Nader (1986) has also predicted that managing innovation would become the most important organizational task of the future.
There are three overarching themes for the management of radical innovations

1) The choice market scope.
2) Competency management.
3) The people side of radical innovation


The choice market scope.

There are two type of radical innovations . The first serves to strengthen the firm’s position with familiar markets by bringing breakthrough technologies to them and advancing the state of the art with big leaps.There are three sets of challenges with the familiar market all of which revolve around countering resistance and breaking down barriers, both within and outside the organization. These includes 1) ensuring delivery of a perceptible benefit, 2) managing the threat of cannibalization, and 3) overcoming market resistance to the technology.
The second type of innovations are those for which market has not been clearly identified or developed. The challenges of unfamiliar markets lie in the requirements to proactively invest in building and creating new domain both within and outside the cooperation. This type of innovation require investment not only in developing the new technology, but also another investment to develop the market as well.

Competency management.

Competency is the collective learning in the organization, especially how to coordinate diverse production skills and integrate multiple streams of technologies ( Prahalad and Hamel,1990 ). Three defining attributes of competencies are that they are not easily imitated and that they provide firms access to new markets. Competencies can either be enhancing, where they further a firm’s leadership position through extension of strengths, or destroying , where they replace existing strengths and incumbent firms ( Tushman and Anderson). Furthermore competency stretching make the firm moving to a new direction and It requires the creation of truly new abilities and knowledge within the firm. It is more than just enhancing and destroying the competencies.
There are three approaches to reduce the risk associated with radicals innovation process. These include 1) leveraging from known capabilities. Unique manufacturing knowledge and history in working with a material, for example ,acted to make developing the product less uncertain for the innovating firms than it would be for a competitor.,2) outsourcing, out sourcing is a second approach to manage risk. Alliances of some form or another are created to fill the competency gap. and 3) choosing not to face the issues of the uncertainty. This mechanism used to manage the risk is simply to ignore it.

The people side of radical innovation.

The role of individuals in managing radical innovation is of primary importance .This includes the leadership role, the composition of the team, and informal networks. Leadership role is very significant in terms of financing the radical innovation process and encouragement for the team members.
The members of the team are also very important. it depends what kind of experiences they have and how they share their experience with other team members while managing radical innovations.
Deep formal networks that could help access information at any time, and experimental knowledge of the most of their firms, business is also invaluable in developing and managing the radical innovations.