COURTESY OF KEVIN MARWA

KENYATTA UNIVERSITY
SCHOOL OF BUSINESS
DEPARTMENT OF BUSINESS ADMINISTRATION
BBA 204: TECHNOLOGY AND CREATIVITY

COURSE INSTRUCTOR : DR. NJERI NJUGUNA TELEPHONE

CONTACT : +254722961943
EMAI: [Link]@[Link]

1.0 COURSE DESCRIPTION AND PURPOSE

This course aims to equip students with a strong conceptual foundation for understanding the
dynamic process of technological innovation and its importance as a driver for value creation and
economic growth. The course aims to develop conceptual knowledge and practical skills regarding
technological innovation and gives you an opportunity to learn how innovation and technology are
interrelated. Students will gain an understanding of the main issues in the management of
technological innovation and an appreciation of the relevant skills needed to manage innovation
at both strategic and operational levels.

2.0 EXPECTED LEARNING OUTCOMES

By the end of this course, the learner should be able to:
i. Explain innovation as a core business process and how innovation can be managed.
ii. Select and apply disciplinary knowledge in discussing and creating innovative technological
solutions
iii. Identify and assess ethical, environmental and/or sustainability considerations of
technological innovation in business decision making and practice,
iv. Identify social and cultural implications of technological innovation on business.

3.0 COURSE CONTENT

TOPIC 1: Key terms used in the course
• Definition of key terms

TOPIC 2: Technology
• Roles of technology

TOPIC 3: innovation and creativity in small firms

• Levels of innovation
• Modes of innovation
• Types of innovation

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 • Models of creative process
• Creative and design thinking
• Relationships among technology, innovation and creativity

TOPIC 4: Technology and innovation plat forms

Who uses innovation platforms?
• How innovation platforms work
• Dynamic processes

TOPIC 5: Technology life cycle and process

• The four phases of technology life-cycle
• Assessing an Organization’s Technological Needs

TOPIC 6: Technology transfer

• Technology Transfer Process

TOPIC 7: Technology commercialization factors

TOPIC 8: Strategies and frameworks for technology and innovation environment

TOPIC 9: Strategic management of technology and innovation

TOPIC 10: Assessing business capability for technology and innovation

• Factors impacting on the management of technology and innovation

TOPIC 11: Cases in innovation and technology

• Special and emerging issues in technology and innovation.

4.0 MODE OF DELIVERY

The course will be delivered through class lectures, participative class discussions, individual and
group presentations.

5.0 CORE READING MATERIALS

1. Schilling, M. A. (2017). Strategic management of technological innovation.
2. Schilling (2012).Strategic Management of Technological Innovation (4th Ed.) McGraw-Hill:
New York, USA.
Recommended Reference Materials
1. Daim, T. U. (2017). Managing technological innovation: Tools and methods. New Jersey:
World Scientific.
2. Koronios, A., Shou, Y., Al-Hakim, L., & In Wu, X. (2016). Handbook of research on driving
competitive advantage through sustainable, lean, and disruptive innovation.

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 3. Osterwalder & Pigneur (2010) Business Model Generation,. Wiley Hoboken, NJ, USA.
4. Dodgson, M. Gann, D. and Salter A. (2008). The management of technological innovation:
strategy and practice, Oxford University Press.
5. Robin and Marnott (2007). Enterprise; entrepreneurship and innovation UK.
6. Chesbrough (2003). Open Innovation Harvard Business School Press, Boston, MA, USA.
7. Narin, F. (2001) Assessing Technological Competencies from Knowledge Management to
Strategic Competence, Imperial College Press, p. 155-196.

COURSE EVALUATION
1. Course Work 30%
2. Final Exam 70%
Total Score 100%

TOPIC 1: KEY TERMS AND CONCEPTS IN THE COURSE

Technology Related Terms

i. Innovation

This is the introduction of new techniques, product/production or distribution processes

that may be followed by a spread process of diffusion.

ii. Invention
Invention means discovery or devising of a new product, process or system. It is an
identifiable discrete contribution to technical knowledge and to technical change
although it is not the only way in which technology changes e.g. small improvements and
adaptations changes technology. It is usually a stage of technological development at
which an idea has advanced sufficiently for the inventor to draw up plans, construct a
working model or in some way establish technical feasibility. At this stage, technology is
patentable and technological research is the most important source of inventions.
Entrepreneurs should be exposed to research opportunities to develop inventive minds.

iii. Patent
This is a governmental legal register/gratuity for a specific period, monopoly (exclusive)
property rights for the exploitation of an invention. Patents only protect knowledge to
the extent that it is embodied in a tangible item which is patentable. Patents are
frequently appropriated and exploited by large businesses or Trans National
Corporations and Multi-National Corporations. Local entrepreneurs rarely enjoy their
technological inventions due to lack of awareness. For instance Kyondo and Kikoi in
Kenya.

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 iv. Creativity
Creativity is the process of bringing something new into being. Creativity requires
passion and commitment. It brings to our awareness what was previously hidden and
points to new life. The experience is one of heightened consciousness: ecstasy.” – Rollo
May, The Courage to Create
Is this possible in business? I believe so, but you have to be willing to take risks and
progress through discomfort to get to the finish line.
“A product is creative when it is (a) novel and (b) appropriate. A novel product is original
not predictable. The bigger the concept, and the more the product stimulates
further work and ideas, the more the product is creative.”

v. Difference Between Creativity and Innovation

The main difference between creativity and innovation is the focus. Creativity is about
unleashing the potential of the mind to conceive new ideas. Those concepts could manifest
themselves in any number of ways, but most often, they become something we can see,
hear, smell, touch, or taste. However, creative ideas can also be thought experiments
within one person's mind.
Creativity is subjective, making it hard to measure.
Innovation, on the other hand, is completely measurable. Innovation is about
introducing change into relatively stable systems. It's also concerned with the work
required to make an idea viable. By identifying an unrecognized and unmet need, an
organization can use innovation to apply its creative resources to design an appropriate
solution and reap a return on its investment. Organizations often chase creativity, but
what they really need to pursue is innovation.

vi. Technology management

This is the utilization of management techniques to support technological innovation
process. Technology management is where needs and opportunities are identified;
solutions are planned, designed, developed and implemented. It is a process whereby
technological research activities are managed and results are transferred to productive
units. What is important for competitiveness (and productivity) is the capacity to place
technological development (innovations, technical progress) within the framework of the
enterprise’s strategy. Small business entrepreneurs are faced with myriad of challenges
in managing technology.

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 vii. Technology assessment
Process of systematic analysis, forecasting and evaluation of a wide range of impacts in
society, the environment and the economy concerning the choice of techniques and
technological change, with the purpose of identifying public policy, investment and
production options. Technology assessment involves:-

a) Evaluation of the social environment and economic costs of existing technologies in the
form of pollution, social disruptions infrastructure cost etc.
b) Anticipation of probable detrimental effects of new technologies to businesses,
c) Devising methods of minimizing technology costs to businesses,
d) Evaluation of possible benefits of new or alternative technologies in connection with
social and economic needs etc.

viii. Organisational innovation has been defined as the adoption of an idea or behaviour
that is new to the organisation.
ix. Technology Innovation Vs technology invention
• Technology invention is the breakthrough in technology, product, and process, which
creates novelty that is totally, or to a great extent, different from the existing products
or existing methods. Technology invention merely refers to the technological
activities, seeing about the variation in technology rather than the success of profit
from commercialisation.
• Technology innovation is the new conception in technology, product, and process ,
which has been , after being researched and developed , applied to the practical use
and producing social and economic profits
• Technology R&D is only one of the cycles, which form the innovation. It also observes
the improvement in technology instead of commercial success of the research result.
• Technology innovation actually is the sum of activities: new conception formation,
research and development, practical application, and commercialisation that
produce both social and economic profit.

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 TOPIC 2: TECHNOLOGY

Technology is a body of knowledge devoted to creating tools, processing actions and the
extracting of materials.
Technology is the collection of techniques, skills, methods and processes used in the
production of goods and services or accomplishment of objectives such as scientific
investigation.
It can also be the knowledge of techniques, processes or it can be embedded in machines
to allow for operation without detailed knowledge of their workings.
Technology is also an application of science used to solve problems. But it is vital to know
that technology and science are different subjects which work hand-in-hand to
accomplish specific tasks or solve problems.

The words science and technology can and often are used interchangeably. But the goal of science

is the pursuit of knowledge for its own sake while the goal of technology is to create products that

solve problems and improve human life. Simply put, technology is the practical application of
science

Role of technology
It has become a vital and integral part of every business plan. From the MNC who
maintain mainframe systems and databases to small businesses that own businesses that
own a single computer, IT plays a role. Some of the roles include;
1. Communication – a number of communication tools have evolved that allow staff and
other stakeholders in businesses to communicate.
2. Inventory management – in management of inventory organisations need to maintain
enough stock to meet demand without investing in more than they require.
3. Data management – organisations or companies store digital versions of documents
on servers and storage devices.
4. Management information systems – storing data is only of benefit if that data can be
used effectively. Progressive companies use that part of data as part of their strategic
planning process as well as the tactical execution enable companies to track sales
data, expenses and productivity.
5. Customer relationship management
Companies are using IT to improve the way they design and manage customer
relationships. CRM systems capture every interaction a company has with a customer
so that a more enriching experience is possible.

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 TOPIC 3: INNOVATION AND CREATIVITY IN SMALL FIRMS

3.1 Introduction
Innovation is an essential constituent element of successfully marketing strategies in a
business. Businesses of all sizes and across the spectrum of industrial and commercial
activities need to plan for the systematic development of new products and services.
Experienced entrepreneurs who have the authority and skills to search for new ideas
and pursue them with energy and intelligence should direct these efforts towards these
tasks. Policy makers too should encourage and practically support these efforts by
entrepreneurs. The need for innovation is perennial in that few companies can exist for
long with same products and services and must be keen on new ideas and opportunities
for profitable existence/expansion.

Innovation is the heart of advancement in modern societies and can be seen to have
dramatic effect in many sectors such as medical science, computer
technology/information technology/processing, micro-technology, agricultural sciences
etc. In these sectors, there is great excitement as new products and services flows from
inventive minds of professional and technical experts.

The importance of innovation was clearly expressed by the president of the Massachutes
Institute of Technology who once remarked “one thing is clear, we have not run out
important problems. There is an urgent need for continuous innovation both to improve
quality of life and to further economic development. But even more important, we must
continue to innovate just to keep the stem we now have working properly to retain what
we had already achieved and to ensure that the quality of life does not drastically
deteriorate because technical and industrial capability cannot keep
up with our changing needs and resource base”.

The marketing environment for practically every business has changed rapidly since the
1990s – social and economic development has changed people orientations towards life
including the pressure exerted by environmental factors on business all call for
innovative ideas. According to Drucker, the purpose of a business is to create a customer
and that marketing and innovation are the two basic factors of any business enterprise.
He observed that innovation goes right through a business, may it be in pricing,
productions/product, distribution/channel management or customers care. Innovation
may be linked to positive changes in efficiency, productivity, quality, competitiveness,
and market share, among other factors.

3.2 Innovation Defined

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 Innovation is the application of existing ideas in a new way of the improvement of
something. It is a process that changes the yields of resources or changing the value of
satisfaction obtained from resources by consumers. Innovation can also be said to be the
modifications of a production or addition of values to a product. Mansfield, who
conducted notable research into industrial innovation regarded innovation as applied
invention which had no economic significance until it was commercially exploited. He
noted that the key to exploiting fully an innovation lay in successful innovation.

According to Rogers, the newness of an idea is related to an individual perception.

Therefore, it matters little as far as human behaviour is concerned whether or not an
idea is objectively new as measured by the amount of time elapsed since it first use or
discovery. According to Schumpeter, innovation could be traced back to some
theoretical or practical discoveries and thus it was possible to innovate without anything
– new products.
Innovation is the development of customer value through solutions that meet new,
undefined, or existing market needs in unique ways. Solutions may include new or more
effective products, processes, services, technologies, or ideas that are more readily
available to markets, governments, and society.
Innovation is easily confused with words like invention or improvement. They are,
however, different terms. Innovation refers to coming up with a better idea or method,
or integrating a new approach within a contextual model, while invention is more
statically about creating something new. Innovation refers to finding new ways to do
things, while improvement is about doing the same thing more effectively.
Bessant and Tidd (2007) summarize innovation as: the process of translating ideas into
useful – and used - new products, processes and services. They define innovation as the
successful exploitation of new ideas.

3.3 How does innovation differ from creativity?

Organisational creativity is often taken to refer to the generation of novel and useful
ideas, whereas organisational innovation is used to describe the realization of those ideas.
Organisation innovation is defined as the process by which a new element (originating
as a creative idea) becomes available within the market place or is introduced into an
organisation with the intention of changing status quo. Amabile et al., (1996) support the
above idea by stating that ‘creativity … is a starting point for innovation. From this
perspective, creativity comes first and provides impetus and content for many forms of
innovation.

3.4 Approaches to innovations

Innovation in a business can mean introducing new or improved products, services or
processes. Some of the approaches to successful innovation includes:-
1. Market analysis – there is no point considering innovation in a vacuum. To move
your business forward, study your market place and understand how innovation can
add value to your customers.

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 2. Identify opportunities for innovation. This could be by adapting your products or
service to the way your market place is changing e.g. health conscious consumers need
innovative products, fat free, vegetarian diet, adding value. Introduction of completely
new products to meet rapidly changing consumer needs and wants.
3. Introduction of new technology, techniques or working practices – perhaps using
better processes to give a more consistent quality of product e.g. Safaricom airtime 500,
250, 100, 50 Sambaza process. “Please call me service”
4. Change of distribution processes e.g. to a home delivery service, online service,
telephone ordering etc. 5. New pricing strategies
6. R & D
7. Create linkages with suppliers, consumers, research, universities and other sources of
new technologies.

3.5 Diffusion of innovation

Diffusion of innovations is a theory by Everett Rogers that seeks to explain how, why,
and at what rate new ideas and technology spread. He argues that diffusion is the process
by which an innovation is communicated over time among the participants in a social
system. The origins of the diffusion of innovations theory are varied and span multiple
disciplines.
Rogers proposes that four main elements influence the spread of a new idea: the
innovation itself, communication channels, time, and a social system. This process relies
heavily on human capital. The innovation must be widely adopted in order to self-
sustain. Within the rate of adoption, there is a point at which an innovation reaches
critical mass.
The categories of adopters are innovators, early adopters, early majority, late majority,
and laggards. Diffusion manifests itself in different ways and is highly subject to the type
of adopters and innovation-decision process. The criterion for the adopter categorization
is innovativeness, defined as the degree to which an individual adopts a new idea.

Elements
The key elements in diffusion research are;
1. Innovation
Innovation is a broad category, relative to the current knowledge of the analyzed unit.
Any idea, practice, or object that is perceived as new by an individual or other unit of
adoption could be considered an innovation available for study.

2. Adopters
Adopters are the minimal unit of analysis. In most studies, adopters are individuals, but
can also be organizations (businesses, schools, hospitals, etc.), clusters within social
networks, or countries.[15]
3. Communication channels
Diffusion, by definition, takes place among people or organizations. Communication
channels allow the transfer of information from one unit to the other.[16]Communication
patterns or capabilities must be established between parties as a minimum for diffusion
to occur.[17]

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 4. Time
The passage of time is necessary for innovations to be adopted; they are rarely adopted
instantaneously. In fact, in the Ryan and Gross (1943) study on hybrid corn adoption,
adoption occurred over more than ten years, and most farmers only dedicated a fraction
on their fields to the new corn in the first years after adoption.
5. Social system
The social system is the combination of external influences (mass media, surfactants,
organizational or governmental mandates) and internal influences (strong and weak
social relationships, distance from opinion leaders).[19] There are many roles in a social
system, and their combination represents the total influences on a potential adopter.

Process
Diffusion occurs through a five–step decision-making process. It occurs through a series
of communication channels over a period of time among the members of a similar social
system. Rogers' five stages (steps): awareness, interest, evaluation, trial, and adoption
are integral to this theory. An individual might reject an innovation at any time during
or after the adoption process. Rogers changes his terminology of the five stages to:
knowledge, persuasion, decision, implementation, and confirmation. However, the
descriptions of the categories have remained similar throughout the editions.
Stage 1: Knowledge
The individual is first exposed to an innovation, but lacks information about the
innovation. During this stage the individual has not yet been inspired to find out more
information about the innovation.
Stage 2: Persuasion
The individual is interested in the innovation and actively seeks related
information/details. Stage 3: Decision
The individual takes the concept of the change and weighs the advantages/disadvantages
of using the innovation and decides whether to adopt or reject the innovation. Due to the
individualistic nature of this stage, Rogers notes that it is the most difficult stage on
which to acquire empirical evidence.
Stage 4: Implementation
The individual employs the innovation to a varying degree depending on the situation.
During this stage the individual also determines the usefulness of the innovation and may
search for further information about it.
Stage 5: Confirmation
The individual finalizes his/her decision to continue using the innovation. This stage is
both intrapersonal (may cause cognitive dissonance) and interpersonal, confirmation the
group has made the right decision.

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 Categories of Adopters
According to C, Romjin (2004), the innovation process is linear and begins with research
and followed by development. Development then leads to production followed by
marketing of a technology, innovation theory explains why, how and the rate at which
innovation or new ideas spread through cultures. The classification scheme of adaptation
of new technology can be put in five categories.

a) Innovators or technology enthusiasts – usually venture oriented, educated and are

multiple information sources. These will easily adapt to new innovations. Innovators are
willing to take risks, have the highest social status, have financial liquidity, are social and
have closest contact to scientific sources and interaction with other innovators. Their
risk tolerance allows them to adopt technologies that may ultimately fail. Financial
resources help absorb these failures.

b) Early adopters or visionaries characteristically are social leaders, popular in the

society and educated. These individuals have the highest degree of opinion leadership
among the adopter categories. Early adopters have a higher social status, financial
liquidity, advanced education and are more socially forward than late adopters. They
are more discreet in adoption choices than innovators. They use judicious choice of
adoption to help them maintain a central communication position.

c) Early majority or pragmatists. This type of people has many social contacts and
does things deliberately. They will receive a new innovation because they have well
researched about it. They adopt an innovation after a varying degree of time that is
significantly longer than the innovators and early adopters. Early Majority have above

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 average social status, contact with early adopters and seldom hold positions of opinion
leadership in a system.

d) Late majority or conservatives – usually are skeptical, traditional and lower social
economic status. Takes time to accept new ideas. They adopt an innovation after the
average participant. These individuals approach an innovation with a high degree of
skepticism and after the majority of society has adopted the innovation. Late Majority
are typically skeptical about an innovation, have below average social status, have little
financial liquidity, in contact with others in late majority and early majority and little
opinion leadership.

E0) Laggards – these fear new ideas and are great critics. They will be the last to accept
new ideas. They are the last to adopt an innovation. Unlike some of the previous
categories, individuals in this category show little to no opinion leadership. These
individuals typically have an aversion to change-agents. Laggards typically tend to be
focused on "traditions", lowest social status, lowest financial liquidity, oldest among
adopters, and in contact with only family and close friends.

3.6 Basic principles of innovation

1. Always analyze opportunities – do not grab an opportunity as it comes, but you first
need to analyze to reveal the advantages and disadvantages. Study the opportunity
and understand how innovation can add value to your customers.
2. Listen and be on the lookout – marketers need to listen to all including employees,
customers, management for the right innovation.
3. Be simple in terms innovations. Do not be complex to confuse consumers.

4. Start small - innovation is best if it is started bit by bit. According to Schumacher, - if

you want to go places, start where you are - if you are poor, start with something cheap
- if you are uneducated, start with something relatively simple - if you live in poor
environment and poverty make market small, start with something small - if you are
unemployed start with your labour - we must learn to recognize boundaries of poverty.
5. Aim at leadership innovations - should be geared towards making you a leader in the
market.

3.6.1 What to avoid

1. Innovating for the far future.
2. Doing many things at once
3. Don’t try to be too clever – look at the reality and consult.

3.6.2 Benefits of innovation

1. Improve productivity/efficiency/effectiveness.
2. Reduce costs – power saving bulbs.

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 3. Be more competitive – distribution.
4. Build the value of your brand.
5. Establishments of new partnerships and relationships e.g. mergers.
6. Increase turnover and improve profitability.

3.6.3 Risks of failure to innovate 1.

Losing market share to competitions.
2. Falling productivity and efficiency.
3. Loosing key staff.
4. Experiencing steadily reducing profit margins
5. Going out of business.

3.7 Levels of Innovation

Innovations can range from fairly small-scale changes to more radical ground breaking
innovations associated with such developments as electricity, transportation, computer
etc. Numerous gradations could be made along this continuum and therefore for
simplicity, we have listed small, medium and large-scale innovations.
1. Incremental Innovations
These refer to small changes that are generally based on established knowledge and
existing products such as improvements to TV picture quality and the sound
performance of existing hi-fi music systems would be examples of incremental
innovations.
This also consists of small, yet meaningful improvements in your products, services, and
other ways in which you do business. These tend to be the "new and improved"
innovations we are all bombarded with every day: new flavors, shifts to better or
allnatural ingredients, packaging improvements, faster/slower functioning, just-in-time
supply chain enhancements, bigger/smaller sizing, cost reductions, heavier/lighter
weight. We see them every day and they help extend product, service, and business life
cycles and improve profitability. They can be easily visualized and quickly
communicated and give you something new with which to grab consumer attention in an
increasingly noisy marketplace.

2. Modular / Breakthrough Innovations

These refer to the middle-range innovations that are more significant than simple
product improvements. For example the transition from black and white to colour TV
sets marks a modular innovation in a well-developed product line, digital sound systems
associated with home entertainment systems.
This is also a meaningful change in the way you do business that gives consumers
something demonstrably new (beyond "new and improved"). Breakthrough innovation
produces a substantial competitive edge for a while, although the length of time anyone
can maintain such an advantage is growing increasingly shorter.

3. Radical / Transformational Innovations

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 These typically occur when current knowledge and capabilities become obsolete and new
knowledge is required to exploit unchartered opportunities for example introduction of
DVD players resulted in substantial changes in the organisation and control of work
(such as in the manufacturing, marketing and sales function). This is usually (but not
always) the introduction of a technology that creates a new industry and transforms the
way we live and work. This kind of innovation often eliminates existing industries or, at
a minimum, totally transforms them. For this reason, transformational innovations tend
to be championed by those who aren't wedded to an existing infrastructure.
Transformational innovation is exceedingly rare. Think about it: how many truly new-
to-the-world ideas happen in a year? In a lifetime? Not many!
Yet, in some ways, transformational innovation is easier to pursue because the change
required to achieve it usually doesn't rely on an existing entity that is committed to the
old way of doing things. That's why we often find transformational innovation coming
from start-up companies. But no company can survive by pursuing only
transformational innovation.

3.8 Modes of Innovation

In business and economics, innovation is the catalyst to growth. Fuglsang and Sundbo
(2005) suggest that there are three modes of innovation;
1. Entrepreneurial value-based mode where change is initiated by an individual’s
actions.
2. Technology-based functional mode in which the development of new technology
drives innovation.
3. Strategic-reflexive mode in which innovation results from individual’s interactions
with their organization’s set of common values and goals.

3.9 Innovation domains (types) classification

Disruptive innovation
This is an innovation type that get a great deal of attention particularly in the process
because markets appear from nowhere, creating massive new sources of wealth. It tends
to have it roots in technological discontinuities e.g. Motorollas rise to pronounce with the
first generation of cellphone, airbags in cars, pagers, poker games.

Application innovation Takes existing technologies into new markets to serve new
markets to serve new purpose e.g. Tandem computers which are fault tolerant were
taken to banking markets to create ATMs *Omo for brake fluid, etc.

1. Product innovation Takes established offers in established market to the next level
e.g. Toyota Cars – AE91, 100, 110, Premio etc., Peugeot – 404, 504, 505, 406, 306 etc.
or windows 98, 2000, XP, 2003, Nokia HP Inkjet Printers.

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 This is a good or service that is new or significantly improved. This includes significant
improvements in technical specifications, components and materials, software in the
product, user friendliness or other functional characteristics.

2. Process innovation Makes processes for established markets more effective or

efficient e.g. Streamlining of a supply chain, or order fulfillment systems, outline
trading, vendor managed inventory process etc. This is a new or significantly
improved production or delivery method. This includes significant changes in
techniques, equipment and/or software.

3. Business model innovation - Reframes an established value proposition to the

customers or a company’s established role in the value chain or both – e.g. Gillette’s
move from razors to razor blades, apple move to consumer retailing etc.

4. Marketing innovation - This is a new marketing method involving significant changes

in product design or packaging, product placement, product promotion or pricing.
Improves customers touching processes, be they marketing processes e.g. Use of the
web/e-commerce or consumer transaction, use of auction, e-commerce etc.

5. Structural innovation Capitalizes on disruption to restructure industry relationships

e.g. Deregulation/liberalization of financial sector brought many players. Family
Finance, K-Rep, CFC etc. to offer broader arrays of products and services to
consumers becoming major competitors to established banks – Equity

6. Entrepreneurial Innovation The innovation dimension of entrepreneurship refers to

the pursuit of creative or novel solutions to challenges confronting a firm. These
challenges can include developing new products and services or new administrative
techniques and technologies for performing organizational functions (e.g.,
production, marketing, and sales and distribution).

7. Technological Innovation takes place when companies try to gain a competitive

advantage either by reducing costs or by introducing a new technology.
Technological innovation has been a hot topic in recent years, particularly when
coupled with the concept of disruptive innovation. Disruptive innovation is usually a
technological advancement that renders previous products/services (or even entire
industries) irrelevant. For example, the smartphone disrupted landlines, Netflix
made Blockbuster obsolete, and mp3s have marginalized CD players.

8. Strategic Innovation pertains to processes: how things are done as opposed to what
the end product is. Strategic changes can be disruptive but are more often
incremental. Incremental innovation is the idea that small changes, when effected in
large volume, can rapidly transform the broader organization.
.

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 9. Organisational innovation This is a new organisational method in business practices,
workplace organisation or external relations
10. Social Innovation refers to new strategies, concepts, ideas, and organizations that
extend and strengthen civil society or meet societal needs of all kinds—from working
conditions and education to community development and health.

Organizations, both for-profit and nonprofit, benefit enormously from incorporating

social innovation into their operations. Giving back to the community and empowering
the individuals you work with and sell to (i.e., stakeholders) improves employee morale,
grows wealth for potential customers, builds a strong brand, and underlines social
responsibility and high ethical standards as central to the organizational character.
The term “social innovation” has overlapping meanings. Sometimes it refers to social
processes of innovation like open-source methods and techniques. Other times it refers
to innovations that have a social purpose, like microcredit or distance learning. The
concept can also be related to social entrepreneurship (entrepreneurship is not
necessarily innovative, but it can be a means of innovation). On occasion, it also overlaps
with innovation in public policy and governance.

3.10 The process of innovation Innovation

occurs in phases.
1. An idea is generated, packaged and developed into a business plan. The plan is then
evaluated.
2. R & D. Research and development involves information gathering to enable further
development of the idea. This is through market research and competitor analysis.
This enables proper definition of the product.
3. Development of prototype. Once prototypes are developed, they are pilot-tested and
customers’ reactions evaluated. A review is then done.
4. Production. Once confirmed, the product is produced in mass for the market..
5. Phase five will involve distribution, pricing and market development through
promotion. An entrepreneur develops strategies to deal with competitors.
6. New innovations – to identify new opportunities.

3.11 CREATIVITY
Creativity is the act of turning new and imaginative ideas into reality. Creativity is
characterized by the ability to perceive the world in new ways, to find hidden patterns,
to make connections between seemingly unrelated phenomena, and to generate solutions.
Creativity involves two processes: thinking, then producing.
“A product is creative when it is (a) novel and (b) appropriate. A novel product is original
not predictable. The bigger the concept, and the more the product stimulates further
work and ideas, the more the product is creative.” —Sternberg &

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 Lubart, Defying the Crowd
This is the ability to produce original and unusual ideas or make something new or
imaginative. It is a unique human quality that differentiates us from the rest of the
animal kingdom.
Creative Process
Generation of ideas occurs within a social context and is linked to domains of knowledge
and understanding that are also in a constant state of change.
Individuals require a certain level of intelligence, be willing to think in non-traditional
ways and to be persistent over time.
It is argued that it is not simply the creation of new ideas that is important but the
translation of these ideas into realizable products and services. Wallas (1926) identified
four stages in the creative process namely;
1. Preparation – refers to the period when an individual may refine their goals in
response to a particular issue or question that they face.
This is also the period where relevant material from a wide range of secondary and
primary sources is collected. The aim of this stage is for the individual to conduct
research in order to broaden their view of the area under investigation.
2. Incubation stage - here individuals suspend their conscious concentration on the
problem and engage in a process of subconscious data processing.
3. Illumination stage – this is the period when someone suddenly becomes aware of a
core answer to the problem. It is characterised by an unplanned result that derives
from a unique combination of ideas or patterns of knowledge that occurs during the
incubation stage. It is during this period that creative individuals must use their
logical thought processes to turn sudden insight into a novel and valuable solution.
4. Verification stage - this is the transition of new ideas into a realizable solution. It is
when the individual needs to formally evaluate the resultant outcome against the
criteria set at the outset.

Basadur’s et al., (1982) three stage mode of process of creative problem solving
1. Problem finding
They argue that in order for creative process to begin there needs to be a problem that
requires a solution. This stage is important because the way one approaches a problem
will affect the quantity and quality of ideas generated in the stages that follow.
2. Problem solving
Focuses on generating as many ideas as possible, it is assumed that the number of ideas
increases the probability of someone coming up with an idea worth pursuing.
3. Solution implementation
This focuses on implementation of one of the solutions that were generated from the
previous stage.

NB: During each of the three stages a two-step process of ideation-evaluation occurs.
Ideation refers to the uncritical development of ideas.
Evaluation refers to the selection of the best of the generated ideas.
Amabile (1983) five stage-stage componential model
This model identifies key components of creativity at certain stages of the creative
process.

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 1. Problem or task presentation
The task to be undertaken or the problem to be solved is presented to the creative person.
It can arise from external stimuli (the supervisor may have assigned the task) or from
internal stimuli (one may particularly be interested in solving a specific problem).
2. Preparation
At this stage the creative employee develops or reactivates a store of data relevant to the
problem or the opportunity identified.
3. Response generation
Here the individual comes up with a diverse range of possible ideas appropriate to the
issue in question. It is at this stage that an individual’s creative thinking will determine
both the quality and quantity of ideas generated.
4. Response validation
This refers to the process through which new ideas are checked for their appropriateness
and validated.
5. Outcome assessment based on tests performed in the previous stage.
If the response is found to be wholly appropriate then the outcome will be accepted and
the process ends. If, however, the response is unacceptable or only partially acceptable
but shows potential then the process returns to the initial stage of problem or task
presentation.

Harvard business school Prof. Theresa Amabile identified five environmental

components that affect creativity. These are;
1. Encouragement of creativity (which encompasses open information flow and support
for new ideas at all levels of the organisation, top management through immediate
supervisors to work group).
2. Autonomy or freedom (autonomy in the day-to-day conduct of work; a sense of
individual ownership of and control of work).
3. Resources (the materials, information and general resources available for work).
4. Pressures (including both positive challenge and negative workload pressures).
5. Organisational impediments to creativity (including conservatism and internal
strife).

CREATIVE THINKING
This is a way of looking at problems or situations from a fresh perspective that suggests
unorthodox solutions (which may look unsettling at first). Creative thinking can be
stimulated both by an unstructured process such as brainstorming, and by a structured
process such as lateral thinking.

Design
The concept of design has been defined in different ways either focusing on design as an
economic activity or more general as the translation of the ideas generated by creativity
into new products and processes.

Design is the conscious decision-making process by which information (an idea) is

transformed into an outcome, be it tangible (product) or intangible (service).

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 “’Design’ is what links creativity and innovation. It shapes ideas to become practical and
attractive propositions for users or customers. Design may be described as
creativity deployed to a specific end.”

“… design can be approached as an economic sector of activity. Basically, design

definitions are based on design professions with the following outfits: fashion design,
graphic design, interior design and product design …. The list can be even more detailed,
encompassing industrial design, product design (furniture, toys, jewelry), visual,
communication, advertising, packaging, architecture design, landscape design, urban
design, etc.”

Creativity is defined as the generation of new ideas; design is defined as the shaping (or
transformation) of ideas into new products and processes; and innovation is defined as
the exploitation of ideas, i.e. the successful marketing of these new products and
processes. It should be emphasized that creativity, design and innovation are not limited
to certain sectors or professions, but apply across the economy.

DESIGN THINKING
Design thinking refers to the cognitive, strategic and practical processes by which design
concepts (proposals for new products, buildings, machines, etc.) are developed by
designers and/or design teams. Many of the key concepts and aspects of design thinking
have been identified through studies, across different design domains, of design cognition
and design activity in both laboratory and natural contexts.
Design thinking is also associated with prescriptions for the innovation of products and
services within business and social contexts. Some of these prescriptions have been
criticized for oversimplifying the design process and trivializing the role of technical
knowledge and skills.

As a process for designing

Design thinking encompasses processes such as context analysis, problem finding and
framing, ideation and solution generating, creative thinking, sketching and drawing,
modelling and prototyping, testing and evaluating. Core features of design thinking
include abilities to:
• resolve ill-defined or 'wicked' problems
• adopt solution-focused strategies
• use abductive/productive reasoning
• employ non-verbal, graphic/spatial modeling media.

Wicked problems
Design thinking is especially useful when addressing wicked problems, which are
illdefined or tricky (as opposed to wicked in the sense of malicious). Whereas for "tame"
or "well-defined" problems the problem is clear, and the solution is available through
applying rules or technical knowledge.

Problem framing

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 Rather than accept the problem as given, designers explore the given problem and its
context and may re-interpret or restructure the given problem in order to reach a
particular framing of the problem that suggests a route to a solution.

Solution-focused thinking
In empirical studies of three-dimensional problem solving, Bryan Lawson found
architects employed solution-focused cognitive strategies, distinct from the
problemfocused strategies of scientists. Nigel Cross suggests that 'Designers tend to use
solution speculations as the means of developing their understanding of the problem'.

Abductive reasoning
The creative mode of reasoning in design thinking is abductive reasoning, rather than
the more familiar forms of inductive and deductive reasoning.

Co-evolution of problem–solution
In the process of designing the designer's attention typically oscillates between their
understanding of the problematic context and their ideas for a solution in a process of
co-evolution of problem and solution. New solution ideas can lead to a deeper or
alternative understanding of the problematic context, which in turn triggers more
solution ideas.

Representations and modelling

Conventionally, designers communicate mostly in visual or object languages to translate
abstract requirements into concrete objects. These 'languages' include traditional
sketches and drawings but also extend to computer models and physical prototypes. The
use of representations and models is closely associated with features of design thinking
such as the generation and exploration of tentative solution concepts, the identification
of what needs to be known about the developing concept, and the recognition of emergent
features and properties within the representations.

As a process for innovation

A five-phase description of the design innovation process is described by Plattner, Meinel
and Leifer as: (re)defining the problem, need finding and benchmarking, ideating, building
and testing.
Plattner, Meinel and Leifer state: "While the stages are simple enough, the adaptive
expertise required to choose the right inflection points and appropriate next stage is a
high order intellectual activity that requires practice and is learnable."
The process may also be thought of as a system of overlapping phases rather than a
sequence of orderly steps: inspiration, ideation, and implementation. Projects may loop
back through inspiration, ideation, and implementation more than once as the team
refines its ideas and explores new directions. Inspiration
Generally, the design innovation process starts with the inspiration phase:
understanding the problem or the opportunity. This understanding can be documented
in a brief which includes constraints that gives the project team a framework from which

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 to begin, benchmarks by which they can measure progress, and a set of objectives to be
realized—such as price point, available technology, and market segment.

Ideation: Divergent and convergent thinking

Ideation is idea generation. The process is characterized by the alternation of divergent
and convergent thinking, typical of design thinking process.
To achieve divergent thinking, it may be important to have a diverse group of people
involved in the process. Design teams typically begin with a structured brainstorming
process of "thinking outside the box". Convergent thinking, on the other hand, aims for
zooming and focusing on the different proposals to select the best choice, which permits
continuation of the design thinking process to achieve the final goals.
After collecting and sorting lots of ideas, a team goes through a process of pattern finding
and synthesis in which it has to translate ideas into insights that can lead to solutions or
opportunities for change. These might be either visions of new product offerings, or
choices among various ways of creating new experiences.
Implementation and prototyping
The third phase of the design thinking innovation process is implementation, where the
best ideas generated during ideation are turned into something concrete.
At the core of the implementation process is prototyping: turning ideas into actual
products and services that are then tested, evaluated, iterated, and refined. A prototype,
or even a rough mock-up helps to gather feedback and improve the idea. Prototypes can
speed up the process of innovation because they allow quick identification of strengths
and weaknesses of proposed solutions, and can prompt new ideas.

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 TOPIC 4: TECHNOLOGY AND INNOVATION PLATFORMS

An innovation platform is a space for learning and change. It is a group of individuals (who often
represent organizations) with different backgrounds and interests: farmers, traders, food
processors, researchers, government officials etc. The members come together to diagnose
problems, identify opportunities and find ways to achieve their goals. They may design and
implement activities as a platform, or coordinate activities by individual members.

Innovation platforms are ways to bring together different stakeholders to identify solutions to
common problems or to achieve common goals. They ensure that different interests are taken into
account, and various groups contribute to finding solutions. Used by the private sector to gather
information and improve networking among key stakeholders in a particular economic sectors.
They are now increasingly common in research and development initiatives.

But innovation platforms can be difficult and time-consuming, so must be used with care.

Spaces for learning and change

An innovation platform is a group of individuals (who often represent organizations) with different
backgrounds and interests: farmers, agricultural input suppliers, traders, food processors,
researchers, government officials etc. The members come together to develop a common vision
and find ways to achieve their goals. They may design and implement activities as a group or
coordinate activities by individual members. Individual members can also innovate alone, spurred
by the coordinated group activities.

Innovation platforms may tackle challenges and opportunities at various levels: in a village or
community, in a district or nationwide, or throughout a value chain or economic sector. They may
work at a single level, or across several levels.

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 Innovation platforms are particularly useful in agriculture because agricultural issues tend to be
complex. They involve different biophysical, socioeconomic and political factors, and concern
various formal and informal institutions. By bringing together stakeholders in various sectors and
from different levels, innovation platforms may be able to identify and address common concerns
more effectively.

Innovation platforms can be used to explore strategies that can boost productivity, manage natural
resources, improve value chains, and adapt to climate change. Some innovation platforms focus
on single issues; others deal with multiple topics.

Who uses innovation platforms?

Various types of organizations use innovation platforms:

Agricultural research organizations use innovation platforms to help make their research more
relevant and to facilitate the adaptation and dissemination of findings. They force researchers to
look beyond their own disciplinary or commodity boundaries and consider the whole picture.

Development agencies and NGOs find them useful to identify areas for interventions, to ensure
that the interventions are appropriate for particular situations, and to enable stakeholders to
influence policy making and development activities.

Local and national governments use them to improve policy making, links with clients, and their
outreach services for citizens.

Donors regard innovation platforms as a way to improve the targeting and effectiveness of
development interventions. While they may sponsor innovation platforms, they are not normally
members themselves.

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 The private sector, including traders, input suppliers, service providers, processors, wholesalers
and retailers, can benefit from innovation platforms that aim to boost economic activities and make
value chains more profitable.

How innovation platforms work

Innovation platforms generally follow several steps.

1. Initiate.
Any stakeholder group can initiate innovation platforms, but it is usually a research or development
organization, a government agency or an NGO that does so. This organization identifies the broad
focus area of the innovation platform, identifies the various stakeholders, brings them together,
and convenes the first few meetings. It identifies someone to facilitate the innovation platform:
perhaps one of its own staff, or someone else from outside.

2. Decide on focus.

The platform members discuss the focus area and identify bottlenecks, problems and opportunities.
They may refine the focus further, expand it, or shift it to a different set of issues. They gather
information from various sources, including research findings, current practices, local knowledge
and policy guidelines.

3. Identify options.
The platform members decide what they want to do to solve the problems or take advantage of the
opportunities that they have identified. The range of options may be wide. For example, they may
decide to test new varieties of a crop, explore ways to improve supplies of inputs, promote the
marketing of a product, or press for a change in government policy.

4. Test and refine solutions.

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 Solutions must be tested and adapted to make sure they work. The innovation may be a new
technology (a new type of seed or farming technique), or an institutional change (a policy
adjustment or a new way to manage marketing). The innovation platform coordinates these
experiments and monitors whether they are successful.

5. Develop capacity.
In most cases, it is necessary to develop the capacity of different actors in order for the solutions
to succeed. In agriculture, for example farmers may need training in a new technique; cooperatives
may need help with organization and bookkeeping; new ways may be needed to multiply and
distribute seed or to manage the marketing of produce. The innovation platform identifies these
needs and finds ways to develop the capacity required.

6. Implement and scale up.

If the innovation is successful, the innovation platform works with its member groups to get it
adopted widely. That may mean documenting and publicizing the innovation, arranging training
and study visits, persuading other groups to adopt it etc.

7. Analyze and learn.

Learning what has succeeded and what has not is an important part of innovation platforms,
especially those with a research focus. This information is fed back to platform members so they
can identify further changes to be made.

Dynamic processes
Innovation platforms are a systematic attempt to facilitate change through joint action. While they
are structured, they are also flexible, changing in response to the current situation.

a) Changing focus

As problems are solved and new issues emerge, the activities and focus of an innovation platform
may change over time. It is the platform members who decide

b) Changing membership

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 The membership of an innovation platform may change over time as needs arise. The platform
may invite new members to join: for example, a platform focusing on agriculture may invite
someone with expertise in water to join if this emerges as a key issue in farm production. A
platform could bring in outsiders on a short-term or one-off basis to provide information or advice.

c) Changing responsibilities

The management of the innovation platform may shift over time from the initiating organization
to one or more of the members. For example, a farmer organization or government agency may
take over responsibility for coordinating the platform.

d) Temporary or permanent

Innovation platforms may be temporary: they exist only as long as necessary to solve a problem.
Or they may be extended as new issues and opportunities emerge. If so, it is necessary to find ways
to fund the platform and its activities after initial project funding ends.

e) Links to other bodies

The members of an innovation platform provide vital links to the organizations or groups they
represent. Each member represents his or her organization, and is expected to communicate the
platform’s suggestions and activities back to his or her peers.

Linking innovation platforms

Some problems cannot be addressed at one level: a district-level platform may identify a policy
that needs to be changed at a national level. It may be useful to form innovation platforms at several
levels (community, district, national) to address problems at each one. Innovation platforms at
each level should be linked to feed ideas and information up, down and sideways (Brief 9).

Benefits of innovation platforms

Strengths of innovation platforms include:

1. They facilitate dialogue and understanding among stakeholders and provide a space for them
to create a common vision and mutual trust. They offer a neutral space to air disagreements and
conflicts, and for members to state their needs and requirements.

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 2. They enable partners to identify the bottlenecks hindering innovation, and develop solutions
beyond what individual actors can achieve alone, for example, in infrastructure, institutional
change and policy development.

3. They create motivation and a feeling of ownership of the solutions that they develop: People
readily buy into solutions they have been involved in developing.

4. They facilitate upward communication. They enable weaker actors (such as small-scale
farmers) to express their views on an equal basis with powerful actors (such as processors or the
government). They empower communities to demand and negotiate for services from the
government and support organizations.

5. They lead to better-informed decisions. Innovation platforms enable joint learning and
cooperation among diverse actors to solve problems and reduce uncertainties. Farmers can learn
how to sell their products; policymakers gain evidence to use in creating a more enabling
environment where innovations can happen.

6. They contribute to capacity development. By improving communication, learning and

exposure to new people and ideas, innovation platforms help members to clarify their roles,
organize themselves, and adapt to unforeseen changes and new opportunities (Briefs 7 and 8).

7. They make innovative research possible. Innovation platforms create opportunities for research
to be demand-driven, to find critical issues for investigation, and to disseminate research outputs.
Platform members are involved in the research process, and are more likely to be convinced by
the findings.

8. They enhance impact. Farmers can improve their agricultural productivity and profitability and
improve how they manage natural resources. Value chain actors can engage more effectively in
the market. Policy making can be more participatory and appropriate for solving issues on the
ground.

Constraints

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 Innovation platforms are not the solution to all problems. Because they are not rigid or predictable,
they can lead a research or development program in unexpected directions (which may be a good
thing, but can be hard to justify to senior managers and donors).

Depending on the circumstances, other approaches, such as more traditional research coordination
meetings, stakeholder consultations, or participatory research methods, may be more appropriate.
All these methods can be used in conjunction with innovation platforms.

1. Progress and success depends on the full buy-in of the members.

Members have to be willing to work together and trust each other. Social and institutional conflicts,
lack of political will, and power structures can hinder the growth of the innovation platform (Brief
4).

2. Innovation platforms can be difficult and costly to implement.

They require a range of facilitation and research expertise—which may not be available. The costs
of fostering partnerships should be seen as an investment—requiring a long-term perspective
(Brief 10).

3. They require a long-term perspective: engaging actors and developing relationships takes time.
Necessary investments in infrastructure and policies are often long-term. Achieving visible
outputs may take longer than a project allows.
4. It can be difficult to monitor and evaluate innovation platforms in a systematic way. Their
outcomes depend on many factors, and many other factors may intervene to reinforce or mask
their effects (Brief 5).

5. Shortcuts are risky.

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 Developing and promoting innovation requires systems thinking, including technical as well as
institutional innovations and policy adaptations. There is a danger of regarding innovation
platforms merely as forums to transfer and disseminate technology.

6. Tangible outputs are needed to sustain the members’ interest and commitment to the innovation
process. Without them, they may lose interest.

TOPIC 5: TECHNOLOGY LIFE CYCLE AND PROCESS

TECHNOLOGY AND INNOVATION

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 Technology as a Driver and Enabler of Innovation

Technology is a powerful driver of both the evolution and proliferation of innovation.

Innovation is a primary source of competitive advantage for companies in essentially all industries
and environments, and drives forward efficiency, higher productivity, and differentiation to fill a
wide variety of needs. One particular perspective on economics isolates innovation as a core
driving force, alongside knowledge, technology, and entrepreneurship. This theory of innovation
economics notes that the neoclassical approach (monetary accumulation driving growth) overlooks
the critical aspect of the appropriate knowledge and technological capabilities.

Scaling Technology

Technology in particular is a powerful driving force in innovative capacity, particularly as it

pertains to both the evolution of innovations and the way they flourish. Technology is innately
scalable, demonstrating a consistent trend toward new innovations as a result of improving upon
current ones. Product life cycles shows how economic returns go through a steep exponential
growth phase and an eventual evening out, which motivates businesses to leverage technology to
produce new innovations.

Technology Hubs

The multiplying of innovation pertains to two important factors of technology driving innovation:
the creation of geographic hubs for technology and empowerment of knowledge exchange through
communication and transportation.

Communication and cumulative knowledge in these technology hubs allows for these innovations
to spread via technology to be implemented across the globe with relative immediacy. This spread
of ideas can be built upon quickly and universally, creating the ability for innovation to be further
expanded upon by different parties across the globe. Collaboration on a global scale as a result of
technological progress has allowed for exponential levels of innovation.

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 TECHNOLOGY LIFE CYCLE

The technology life cycle (TLC) describes the costs and profits of a product from technological
development phase to market maturity to eventual decline. Research and development (R&D)
costs must be offset by profits once a product comes to market. Varying product lifespans mean
that businesses must understand and accurately project returns on their R&D investments based on
potential product longevity in the market.

Due to rapidly increasing rates of innovation, products such as electronics and pharmaceuticals in
particular are vulnerable to shorter life cycles (when considered against such benchmarks as steel
or paper). Thus TLC is focused primarily on the time and cost of development as it relates to the
projected profits. TLC can be described as having four distinct stages:

Technology life cycle chart: This chart illustrates the stages in the technological life cycle.

The four phases of technology life-cycle

The TLC may be seen as composed of four phases:

1. Research and Development

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 During this stage, risks are taken to invest in technological innovations. By strategically directing
R&D towards the most promising projects, companies and research institutions slowly work their
way toward better versions of new technologies.

2. Ascent Phase
This phase covers the timeframe from product invention to the point at which out-of-pocket costs
are fully recovered. At this point the goal is to see to the rapid growth and distribution of the
invention and leverage the competitive advantage of having the newest and most effective product.

3. Maturity Stage
As the new innovation becomes accepted by the general population and competitors enter the
market, supply begins to outstrip demand. During this stage, returns begin to slow as the concept
becomes normalized.

4. Decline (or Decay) Phase

The final phase is when the utility and potential value to be captured in producing and selling the
product begins reducing. This decline eventually reaches the point of a zero-sum game, where
margins are no longer procured.

Product development and capitalizing on the new invention covers the business side of these R&D
investments in technology. The other important consideration is the differentiation in consumer
adoption of new technological innovations. These have also been distributed into phases which
effectively summarize the demographic groups presented during each stage of TLC:

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 Technology adoption life cycle: This adoption chart highlights the way in which consumers
embrace new products and services.

• Innovators – These are risk-oriented, leading-edge minded individuals who are extremely
interested in technological developments (often within a particular industry). Innovators are
a fractional segment of the overall consumer population.
• Early Adopters – A larger but still relatively small demographic, these individuals are
generally risk-oriented and highly adaptable to new technology. Early adopters follow the
innovators in embracing new products, and tend to be young and well-educated.
• Early Majority – Much larger and more careful than the previous two groups, the early
majority are open to new ideas but generally wait to see how they are received before
investing.
• Late Majority – Slightly conservative and risk-averse, the late majority is a large group of
potential customers who need convincing before investing in something new.
• Laggards – Extremely frugal, conservative, and often technology-averse, laggards are a
small population of usually older and uneducated individuals who avoid risks and only
invest in new ideas once they are extremely well-established.

Taking these two models into consideration, a business unit with a new product or service must
consider the scale of investment in R&D, the projected life cycle the technology will likely
maintain, and the way in which customers will adopt this product. By leveraging these models,

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 businesses and institutions can exercise some foresight in ascertaining the returns on investment
as their technologies mature.

Assessing an Organization’s Technological Needs

Assessing the internal technological assets and future needs of an organization prepares
management for successful technology integration.

Remaining competitive and remaining technologically vigilant are virtually synonymous at this
point in business development. Companies must prioritize their ability to assess their technological
needs, particularly as they may relate to achieving optimal efficiency and productivity. There are
various concepts that are typical of this managerial technology assessment strategy:

• Technology Strategy – identifying the logic or role of technology within the company.
• Technology Forecasting – identifying applicable technologies for the company, potentially
through scouting.
• Technology Road mapping – ascertaining the trajectories of technological advancement and
applying business or market needs to this assessment.
• Technology Portfolios – accumulating all technologies relevant to products or operations to
determine which are ideal for internal implementation.

All four of these strategies revolve both around information gathering and introspection into
business operations and processes. All four can be improved upon through technological advances.
Integrated planning in pursuit of optimization through new technologies keeps efficiency at or
above competitive levels. This internal technology assessment also includes noting when and
whether it is necessary to construct employee training programs for new technology.

UNDERSTANDING CURRENT TRENDS IN TECHNOLOGY

Understanding current technologies and trends allows a company to align and synchronize
operations to optimize returns on innovation. Businesses are tasked with the ongoing responsibility

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 of keeping up with evolving technology trends to stay competitive. Trends in technology extend
out like the branches of a tree: each new innovation creates the possibility for multiple new
innovations.

BUSINESS TECHNOLOGY MANAGEMENT

The field of business technology management (BTM) arose to provide businesses with the best
approaches for assessing and implementing these varying technological advances into their
strategies. These include;

1. Alignment

BTM provides a bridge between previously established tools and standards within a business
environment and newer, more operationally efficient tools and standards in technology. BTM does
this by creating a set of principles and guidelines for companies to follow as they pursue alignment.
Alignment, in this respect, can be defined as how an institution’s technology supports and enables
technology while avoiding constraints in direct relation to company strategies, objectives, and
competition. When companies accomplish this in any given technological environment, they have
attained BTM maturity relative to that time frame and industry.

2. Synchronization

Alignment is only the first step: the next step is synchronization. Like alignment, synchronization
enables execution, but it also helps companies develop the capacity to anticipate and adapt future
business models and strategies. This is generally accomplished by investing in research and
development and staying ahead of the standard technologies by anticipating or even innovating
past them. This business technology leadership role is long-term oriented and very effective in
maintaining competitive advantages in any given industry, but it is particularly important for
industries in the tech sectors.

Companies use four specific dimensions of BTM to achieve this understanding of current
technologies and trends:

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 • Process – Companies must execute a set of fluid and repeatable processes that can be
consistently scaled up through evaluation.

• Organization – Utilizing an organized business structure or corporate framework, often

through strategic business units (SBUs), provides substantial value in centralizing processes
and assessing needs.
• Information – Scouting and assessing the current technological environment through
extensive research teams is necessary to make the appropriate decisions (see “Sourcing
Technology” and “Assessing Needs in Technology” within this Boundless segment).
• Technology – Finally, improving upon these processes within SBUs via leveraging the
appropriate data and information will drive strategic acquisition of beneficial technological
improvements based upon current trends.

Taken together, these four dimensions applied to alignment and synchronization of new technology
can help businesses keep up with or ever stay ahead of current technologies and trends. Companies
can benefit from the intrinsic opportunities technological progress provides while offsetting the
intrinsic risks of external technological development.

Sourcing Technology

Technology sourcing involves isolating and implementing new innovations within an existing
business framework.

Technology Sourcing Strategies

Technology sourcing, or the pursuit of implementing new technologies within a businesses

strategic framework, involves isolating and applying new technologies to current models.
Technology can be developed internally or isolated through technology scouting and then
implemented through technology transfer. In deciding which approach is optimal for them,
organizations must consider such

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 Factors as the advantage of being first to market, research and developments costs and capabilities,
and market research and data gathering costs. Therefore the strategies behind sourcing technology
can be complex, varying by industry, company size, economic strength, and the availability of
easily implemented technology.

Technology Scouting

Technology scouting is essentially forecasting technological developments through information

gathering. Technology scouts can either be internal employees or external consultants specifically
designated to the task of researching developments in a particular technological field. This can be
loosely referred to as a three-step process:

1. Identify emerging technologies.

2. Channel and organize new technological data within an organization.

3. Provide a corporate context to support or refute the acquisition of said technology.

When technology scouting isolates new developments that could potentially provide advantages
for an incumbent, strategies to acquire or source this technology become a focal point. Technology
transfer, and the commercialization of technological abilities, is an enormous market both in the
U.S. and abroad. Though governments, universities, and open source websites (such as Source
forge, Wikipedia, and Boundless) often provide knowledge and technological knowhow free of
charge, most often technology is not free.

Technology Sourcing Pros and Cons

In the Information Age knowledge is power, and more than ever companies are trying to protect
their knowledge from competitors or freeloaders by using patents and trade secrets. Transfer of
technology is therefore expensive, from licensing the patented technology to requesting training
in new technological advances for staff. Despite the distinct advantages of staying ahead of the
curve relative to technological capabilities, there are some drawbacks to tech transfer. One strong
example of the drawbacks in technological transfer and sourcing can be illustrated by the image
below.

Courtesy of KEVIN MARWA

 Stages in technology development: Technology develops through a series of stages: basic
technology research, research to prove feasibility, technology development, technology
demonstration, system/subsystem development, and system test, launch & operations.

The first five levels of innovation, from basic research to technology demonstration, are often
where investment begins pouring in, alongside the attempt to implement in order to stay
competitive. As you may note, this is prior to the testing phases and therefore investors at this stage
must accept the inherent risk of the new technology presenting significant hurdles to optimizing
perceived potential or effective implementation. Early adopters and innovators suffer the risk of
employing a new technology that has not been fully debugged, minimizing what should have been
strong returns on investment (ROI). Technology scouts should therefore be highly circumspect and
meticulous in their research processes, ensuring that new technological innovations will indeed
provide what they promise

TOPIC 6. TECHNOLOGY TRANSFER

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 6.1 Technology Transfer Process
The transfer process of technology can be tied to the general innovation process. Technology
transfer is, however, not present in every step of the innovation process and we will only look at
those steps where transfer is involved. The steps can be defined as follow:
• Identifying appropriate technology
• Evaluate the technology
• Secure the technology
• Protect the technology
• Produce prototype
• Obtain technology awareness training
• Product specific training

In order to apply these steps in a more general environment Cooke and Mayes defined the major
steps of the technology transfer process as being:
• Searching
• Finding
• Evaluating
• Acquiring
• Customizing
• Operating

It is important to note that in the transfer process, extensive use is made of project management
principles. A transfer project is a unique endeavour until the technology is operational in the
company. Companies should therefore ensure that they are familiar with project management
principles in order to ensure a smooth transfer process.
.

6.2.1 Recognizing a need or opportunity

As mentioned before, the initial step in the transfer of technology process is the recognition of a
need. This need must be satisfied by current technology applied differently, or it must be satisfied
by new technology. Needs can arise from the following;
:
• Scientific changes
• Competition
• The market
• Legislation
• Human inquisitiveness
• Innovation as company policy

Scientific changes can bring about new products, utilizing new technologies. An example would
be the development of nylon, which made it possible to solve needs in a technologically advanced
way.

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 Competition together with the market may be one of the greatest initiators of the need to transfer
new technology. The market is becoming increasingly fragmented and more sophisticated. This
means that an organization’s products or services must be tailored to address the specific needs of
individuals. If an organization does not have the technological capability to do so, it will lose that
market to its competitors. Technology can give a business the competitive advantage it needs, to
secure its position in the market.

Legislation may also create a need that has to be solved by obtaining new technology. If we think
about the aviation industry in general there are, for example, restrictions on the noise levels of
aircraft over populated areas surrounding airports. This legislation disqualifies older aircraft from
using these airports. A new need arose and subsequently engine noise was reduced by developing
'hush kits', which at that stage was a new technology in the aviation industry. Human
inquisitiveness together with innovation as company policy (R&D) always ensures advances in
technology.

6.1.2 Searching for technology

After defining a need, an organization must search for appropriate technology that will best satisfy
the need. There are several strategies that can be followed and they can be divided into two major
groups. The first is developing the technology yourself and the second is looking for the
technology outside the organization. We will look in more depth at the second case.

Sources of information
Information plays a big role in the search for new, or the most applicable technology.
Organizations are particularly interested in information on products, research activities, finance
and patent information.

One of the successful sources of information and co-operation is higher education institutions in
the form of universities. Partnerships with these institutions help companies to:
• Access new technologies
• Keep abreast of new technologies
• Access consultancy skills
• Develop new technologies jointly

The transfer of technology from university to industry can be established in several ways. One
must keep in mind that knowledge, which is part of technology, is part of a person and resides in
their mind. Therefore technology can be transferred through the movement of people.

The transfer mechanisms include;

a) graduate employment
At university level people build up a knowledge base in their respective field and this knowledge
base is then transferred to industry by employing that person. Industry will often make grants
available for people to complete their university studies. In this way they assure a smooth transfer
process.

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 b) Sabbaticals
These enable university lecturers to work in a company. This is a reciprocal transfer mechanism.
The lecturer's knowledge is exploited in the company and the university is exposed to the industry,
through the lecturer's practical experience.
c) consulting services
these may be offered by the universities, contract research, industry/university research units,
university or industry liaison units and forums for the exchange of information.

Another major source of information and assistance is technology transfer agencies. These
agencies offer a wide variety of services from searches on information, products and patents, to
legal advice and consultancy. These agencies can be very useful for some of them specialize in
certain industry areas and therefore have extensive knowledge in that area of industry. For an
organization that does not have specialized skills in the area of technology transfer, this is an
excellent alternative to consider. In some cases an external party has a more objective view on the
industry and can therefore deliver a more objective opinion, as opposed to individuals inside an
industry.

A tremendous amount of research goes into universities, research bodies and industry. For any
organization it is essential that this research be exploited and transferred, in order to strengthen
their technological function. Organizations that do not have the capability of doing their own
research should seriously consider partnering with these institutions, in order to have access to
relevant research.

6.1.3 Identify and Monitoring Information

Before a technology can be identified that may satisfy a newly identified need senior personnel
must have an accurate knowledge of not only the company's technological position, but also
knowledge about the market and competitors. This strategy will ensure a well-organized approach
in obtaining new technology.

Cooke and Mayes identify the prominent roles found in companies concerning the knowledge of
technologies. The first is the godfather. This is the person, usually in a senior position in an
organisation that watches over the technology transfer process. This person often introduces other
senior staff members to the idea of new technology. This is the person that is up to date with the
latest developments in his field or market segment, although it is not part of his work description.
The role of the godfather may be limited to the development phase of transfer project, or even just
the role of initiator. The role might, however, continue throughout the whole transfer project.

The second role found in companies is that of champion. The champion is often found at the
middle-management level. The people in this role are often highly skilled and will most probably
oversee the implementation of new technology programs initiated by the godfather. The role of
champion may eventually mature into the role of godfather. The champion has excellent

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 knowledge on internal politics and skills. The person in this role also has great people skills and is
a good communicator.

Out of these two roles we see that the godfather's role has knowledge on the internal (to the
organisation) state of technology, but even greater knowledge on the external state of technology.
If a need arise this is often the person you go to, to ask "How are we going to solve this?" A person
can fulfil the godfather role in an unofficial capacity, but with organisations, which realize the
importance of technology and the acquiring thereof, this is very often an official role. Where the
godfather's main role is over-seeing the transfer process from the external environment, the role
of the champion is mostly concerned with the internal environment. His role does not include the
identification of new technology, but he is an excellent evaluator of chosen technology, because
of his knowledge of internal affairs. The champion will be able to comment on the appropriateness
of the technology. Again, the champion's role can be official or unofficial. The role of the
champion can be seen as that of a gatekeeper, who not only has excellent technical knowledge, but
also has great people skills and excellent leadership qualities.

For organizations that are concerned with keeping up to date with technology, it is important to
identify people that might unknowingly fulfill these roles of champion and godfather and exploit
their capabilities. It might even be feasible to give these people official capacity in an organization
to fulfill these roles.

6.1.4 Evaluating the Technology

When identifying technology it should be evaluated in order to find the most suitable technology.
Aspects that should be addressed in the evaluation process include:
• Strategic implications
• Effect on market and customer
• Operational changes
• Personnel
• Training

Before starting the transfer process an evaluation criterion should be defined in order to evaluate
each identified technology. The team responsible for the transfer of the technology, should define
aspects to be evaluated and the measurement criteria for each aspect. It is important to involve as
many people as possible, especially those that will work with or will be affected by the new
technology. By involving all concerned, an objectively defined opinion should be possible and the
most appropriate technology can be selected. It must be stressed that the evaluation criteria should
consist of objectives and specifications already defined, after the identification of the need. This
will aid in the transfer process, for each aspect in the transfer process will be measured or evaluated
according to the defined criteria.

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 6.1.5 Transfer
Transfer of technology takes place via certain mechanisms. These mechanisms can be identified
per area of technology as follows:

Technology in the form of knowledge can be conveyed through the following mechanisms:
• In print through technical journals
• Scientific magazines
• Patents
• Orally at conferences
• In discussions with colleagues, acquaintances and consultants
• On television or radio
• Courses
• Service bulletins
• Data packs
• Specifications

Technology in the form of skills is acquired by doing something. It can be conveyed by:
• Watching someone doing something
• Watching a video of someone doing something
• Demonstrations at courses
• Hands on training

Technology in the form of equipment is conveyed via the following mechanisms:

• Products
• Trade magazines
• Trade conventions
• Sales representatives
• Advertisements
• Direct mail
• Contacts in other companies

[Link] Company-to-Company Transfer

Technology can be transferred between countries or regions, but most technology transfer happens
between companies. Not only is research and development done by institutions in the public
domain like universities, but also by private companies outside the public domain. Research done
by private companies not always delivers the results they anticipated. For instance technology was
developed to be used in a product that does not fit in with their current product portfolio, or the
return on a product is too small.
This potential product may however, be suitable to another company to develop further. Somehow
the cost of research must be covered and if a company cannot properly utilize a product, the cost
of research will be lost.

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 A good strategy would be joint ventures with other organisations, which benefits both parties.
Company-to-company transfer is usually beneficial to both parties, except in the case where
transfer is attempted between a large established company and a small start-up company. Larger
companies are reluctant to put effort into a smaller company to help with their development
without a proportional stake. Many governments, however, believe that the future prosperity of
their countries, will depend on the speed and effectiveness of small companies to implement
technology spin-offs from larger private and public institutions. The success will therefore be
dependent on the relationship between the companies.

It is clear that the collaboration between companies is the major technology transfer mechanisms
in the private to private domain. There are several forms of collaboration,
a) technical collaboration.
One form of technical collaboration is where partners increase their expertise through sharing
knowledge, skills and equipment.
b) Another form is where one partner is in possession of technology, which the other needs
for it's new product.
Cooke and Mayes5 identified the main aims of collaboration between companies as follows:
• Sharing risk and cost
• Growing of technological knowledge
• Helping in product development
• Developing industry standards together
• Acquiring and/or penetrating new markets
• Improving speed to market

Developing new products is a risky and costly business and therefore companies will rather share
the risk and cost involved in these projects.
Companies also feel more assured if they concentrate on a business area they are familiar with,
while leaving other aspects to partners that are more familiar with business in those areas.
Collaboration in itself can be risky because of the fact that companies differ in several aspects.
The biggest of the differences may be company culture.
Collaboration can be a major strategy in an organization in obtaining relevant technology. One of
the most promising collaboration agreements is one where you move away from the traditional
client vendor partnership, into a more mutually beneficial relationship. Remuneration will still be
sought, but the main benefits for both parties will be the technology transfer between the parties.
The transfer will not be one way, but both ways. This is called reciprocal technology transfer.
.
Each party will have an active role to play in negotiations and in decision making. These
partnerships are characterized by mutual goals. Often the one party will be strong in the knowledge
field and the other in implementing the knowledge. They will therefore not compete for the same
technology, but rather work together applying their specialized expertise to reach the communal
goal. These partnerships are often found between universities and industry. Universities need
industry in applying their knowledge, and industry needs universitites to effectively apply their

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 skills. Both parties need each other and this factor may have very positive effect on any
partnership.

[Link] Modes of Transfer

All transfer models can be divided into two major categories: passive and active. This classification
refers to the level of activity in applying the technology in the transfer process.

If the technology transfer mechanism presents the technology to the potential user, without
assistance regarding its application, then the mode is said to be passive. In the passive mode only
the knowledge part of technology is transferred. The skills surrounding the technology are not
transferred. These mechanisms can include presentations in a report.

If, on the other hand the provider of the technology assists with the application of the technology,
then the mode is said to be active. These mechanisms include training, etc. The boundaries between
passive and active are not easy to define and therefore a semi-active mode is also defined.

Technology
User/need
base Technology transfer
Modes
(Passive or active)

Figure 2.2: Transfer modes

(Adapted from: Louis N. Mogavero and Robert S. Shane')

Passive Mode
The most widely used mechanism in the passive mode is the instruction manual or "cookbook"
approach. This is the only contact between the originator of the technology and the user. Millions
of products are made and sold with transfer occurring in this form. Just think of one's own motor
car. These self-teaching manuals used in this mode all have one thing in common: they presume
that the user has some level of knowledge and competence in the specific technological area. It is
an important point in this mode of transfer. A mechanic can assemble a component perfectly from
an instruction manual. This becomes more intricate when we think of other technologies like
glassblowing, sheet metal work and woodwork. In these areas the skill that lies with the user must
be far greater. This is important to keep in mind if you want to transfer technology. The skill resting

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 in the user of the technology must be clearly defined by the originator, because this will have a
definite impact on the success of the transfer process. If you give someone who does not know
how to drive a motor car, that technology, it will be useless to the person, because it cannot be
used.

Technology Technical
user
base information

Publications
Computerised
Data basis
Personal contacts

Figure 2.3: Passive Technology Transfer Mode

(Adapted from: Louis N. Mogavero and Robert S. Shane2)
Semi-Active Mode
In the semi-active mode there is intervention from a third party in the transfer process. This is
usually in the form of a transfer agent. In the semi-active mode the role of the transfer agent is
limited to that of adviser. Very often in the semi-active mode, the transfer agent only screens
information in the relevant field of interest and passes it on to the final user. He therefore ensures
the relevance of the information, because of his knowledge, not only about the user's needs, but
also because of his knowledge about the technology. The role of the transfer agent is therefore one
of communicator between the technology and the user. If his role is beyond this, then the mode of
transfer becomes active.

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 Technology
Technology Technical
transfer User
base information
agent

Primary adopter publications secondary advisor

of technology computerised for application of
data basis technology
Personal contacts

Figure 2.4: Semi-Active Technology Transfer Mode

(Adapted from: Louis N. Mogavero and Robert S. Shane')

The most widely used source of technical information is in the form of written technical
documentation and therefore the passive mode of transfer is the most widely used. Because of this,
care should be taken in the writing of these documents. Very often data banks and published
material are searched in order to obtain information on relevant subjects. Experience has shown
that what the first would-be user wants to read is a non-technical description of the technology.
Because the reader will be trained in one or more technical disciplines, it will be easy for him to
judge the relevance of the document. Because of the increasing amount of data this becomes more
relevant. This is a time consuming effort and often it is 'outsourced' to a transfer agent. He will
then be responsible for identifying relevant information and transfering it to the user. The transfer
agent can be in the form of one or several people working in a team, each within their own field
of expertise. An additional benefit of using a transfer agent, is that the user of the technology may
have interpreted the problem incorrectly and this is leading them along the wrong path in their
search for a solution. Here the agent can be of help because of his knowledge of the user's needs.

The passive and semi-active modes are therefore recognised by the fact that no third party
participates in the application of the technology. Only limited assistance in identifying relevant
technologies is experienced in the semi-active mode.

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 Active Mode

Technical
Technology Champion
information User
base team

Publications secondary advisor primary adopter

Computerised for application of of technology
data basis technology

Personal contacts

Figure 2.5: Active Technology Transfer Mode

(Adapted from: Louis N. Mogavero and Robert S. Shane)

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 TOPIC 7: Factors Affecting Technology Innovation and Its Commercialization in Firms

Commercialization of innovative technologies is the heart of technology entrepreneurship. It is the

process of transforming an innovative technology into a commercial product/service or improving
an existing product/service by incorporating the innovative technology into it for commercial gain.
Although there is an emphasis on technological innovation in current business theory and practice,
the commercialization of it carries the same weight of importance

There are different elements that could affect technology innovation and its commercialization in
firms. These elements can be organized under a classification that is composed of nine major
factors and their constituents.

1. The first factor is ‘individual’ factor of a firm.

This factor is about characteristics of individuals in a firm who have a role in the general scheme
and process of technology innovation and its commercialization. This factor could be further
decomposed into its constituents that are:
• Social skills and teamwork: richness in social skills and ability to work in teams
• Education: educational background
• Diversity: demographic diversity and diversity in professional, personal and cultural background
and life experiences of these individuals.

2. The second factor is ‘ideology’ factor of a firm.

It deals with the foundation that a firm is built upon, the values it stands for, its approach toward
business, its configuration and constitution and in general, its philosophical approach toward
business. The constituents of this factor are:
• Vision and mission: the ideal image that the firm holds and aspires to become and what it wants
to fulfill by becoming that
• Values: the principles that the firm stands for and conducts itself based on
• Culture: the manner by which the firm’s employees carry themselves, handle social transactions
among each other and with outsiders • Flexibility: the degree by which the firm’s organization
structure could change to adapt itself to innovations and disruptive changes in the industry

3. The third factor is ‘organization’ factor of a firm.

It involves the structures and arrangements which put the ideology and philosophy of the firm into
effect and brings them into practice. The constituents of this factor are:
• Strategy: the business strategy that is formulated based on the firm’s long–term and mid–term
objectives by considering its resources and the industry’s environment and is implemented
through the firm’s organization
• Learning: the ability of the firm to learn continuously from the environment and its own doings
and moving the organization forward based on what is learnt

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 • Processes: the business processes which are implemented to carry out the firm’s activities
• Stakeholders: the cooperation between the firm’s stakeholders, their relationship, their
interaction, and their attitude and behaviour towards the firm and its objectives
• Social capital: the formal and informal network of connections among the firm’s stakeholders
and also their connection with members of other influential external entities and people

4. The fourth factor is ‘management’ factor of a firm.

It is about how the management of the firm handles different aspects of it and deals with different
situations. The constituents of this factor are:
• Style: the management’s type of approach toward making decisions and also dealing with people
• Knowledge management: capacity of managing knowledge–related activities and processes of
the firm, from knowledge production up to capturing and sharing it. Also, taking advantage of
external produced knowledge and knowledge spill overs
• IP management: the ability of the management to handle and make proper use of different types
of intellectual property such as patents, copyrights, trademarks and trade secrets
• HR (human resource management): ability to manage the employees and especially the firm’s
talents and also spotting talented individuals outside the firm and attracting and employing them
• Risk management: minimizing the impact of uncertainty in the internal and external
environment on the firm’s assets and resources
• Financial management: managing the firm’s financial resources to support and foster the firm’s
activities and also tapping into external financial sources if needed

5. The fifth factor is ‘technology’ factor of a firm.

It involves the technological domain in which the firm innovates. Moreover, it includes
technological aspects that influence the ability of the firm to innovate. The constituents of this
factor are:
• Complexity: the amount of complexity in a technology in different facets of it such as production
complexity, components numerousness and usage complexity
• Readiness level: the level of maturity of a technology from being still in basic research level up
to being ready for lunch
• Dependency: the reliance of a technology on other technologies and if those technologies are
internal or external to the firm
• Transfer: the level of facility by which the technology could be transferred from or to the firm •
Facilities: the technological facilities and instruments that the firm possess or have access to
which could help the firm in creation and production of technology from doing research and
development up to manufacturing

6. The sixth factor is ‘knowledge’ factor of a firm.

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 It incorporates all the aspects regarding the firm’s knowledge which is the essence and foundation
of technological innovation. The constituents of this factor are:
• acquisition: the ability of the firm in acquiring knowledge from external sources and benefiting
from knowledge spill overs
• production: the capacity of the firm in knowledge creation and production by different processes
such as research and development, know–how creation and organizational learning • HRD
(human resource development): the improvement of human capital’s knowledge by providing
proper and relevant education
• Capture: the capacity of the firm in recording the produced and acquired knowledge in a usable
and accessible manner
• Transfer: the ability of the firm to spread and share its knowledge capital among its human
resources

7. The seventh factor is ‘support’ factor of a firm.

It deals with the firm’s attitude toward technological innovation and how it embraces it and
provides for it. The constituents of this factor are:
• Encouragement: promotion of technology innovation in the firm and stimulating the employees
participation in its process with permissive policies
• Communication: supporting the communication of the firm’s technological requirements and
obstacles. Also, making an environment in which the employees easily communicate and ideas,
problems and solutions are discussed comfortably. Additionally, enhancing the communication
among different departments and teams of the firm
• Finance: supporting innovative technological initiatives and projects
• Facilitation: Assisting innovative technological initiatives and projects by facilitating
interdisciplinary relationships and enabling technological projects, events and programmes •
Reward: implementing a reward system for initiators and participants in commercially successful
innovations
• Failure: tolerating early failures in innovative projects and programmes and also ensuring that
failed projects and programmes do not discourage the employees from further participation in
innovation process

8. The eighth factor is ‘market’ factor’.

It is about keeping the firm’s technological innovative course in line with the market needs and
also learning from what is happening in the market and incorporating it in the innovation process.
The constituents of this factor are:
• Consumers: the firm understands of the consumers and their needs
• Competitors: the firms’ knowledge of its competitors and their strengths and weaknesses
• Trends: in which direction the market is moving and what kind of products and services are
desired • Position: the firm’s desired position in the market and also noticing unoccupied market
positions
• Demand: the appetite of market for a certain product or service
• Size: the total market size for a certain product or service

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 • Growth: the market’s potential size and demand for a certain product or service in the future •
Substitutes: products and services which could take the market away from a certain technology
and shrink the market size and demand.

9. The ninth factor is ‘environment’ factor.

This factor regards elements of the firm’s external environment which could affect the market or
how the firm performs. Also, this factor could create new opportunities or diminish them. The
constituents of this factor are:
• Political: political stability, the government’s involvement in the economy in general and,
especially the policies toward facilitation of technology innovation such as taxation policies and
providing financial support
• Economic: the economic factors which affect the market and the firm’s decisions, such as interest
rate and inflation
• Legal: the legal system affecting the firm, such as labour law, consumer law and environmental
law
• Social: the different aspects of the society in which the firm operates in and targets toward such
as cultural aspects, age distribution, educational level and workforce status

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 TOPIC8: STRATEGIC FRAMEWORKS FOR TECHNOLOGY AND
INNOVATION ENVIRONMENT

The process by which a firm adopts and implements technological innovations is influenced by the
technological context, the organizational context, and the environmental context.

The technological context includes the internal and external technologies that are relevant to the
firm. Technologies may include both equipment as well as processes.

The organizational context refers to the characteristics and resources of the firm, including the
firm’s size, degree of centralization, degree of formalization, managerial structure, human
resources, amount of slack resources, and linkages among employees.

The environmental context includes the size and structure of the industry, the firm’s competitors,
the macroeconomic context, and the regulatory environment.

These three elements present “both constraints and opportunities for technological innovation”.
Thus, these three elements influence the way a firm sees the need for, searches for, and adopts new
technology.
Diagram/schematic of theory

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 CREATIVITY

Creativity is a way to produce something new and different which has some value or to
do the same mundane thing or a new thing in a new way using a new technique which is
unique in itself to get better / positive results or simply to get more business.

CREATIVE THINKING
This is a way of looking at problems or situations from a fresh perspective that suggests
unorthodox solutions (which may look unsettling at first). Creative thinking can be stimulated
both by an unstructured process such as brainstorming, and by a structured process such as
lateral thinking.
Main Components of Creativity
1) Originality

The method or idea must be new and unique. It should not be the extension of something, which
already exists. However, one can take inspiration from the already existent methods and ideas to
fabricate something new and unique.

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 2) Functionality

Another important component of creativity is its functionality. A creative idea must work and
produce results, otherwise, the whole effort will be in vain.

Most of the time, people wonder how creativity happens. It has been seen that creativity become
another nature of some people whereas others have to spend hours on road or on a mountain to
think of a tiny idea. In the following paragraph, you will learn about when does creativity happen
and what kind of people called creative?

• People who are thought-provoking, curious and have a variety of uncommon thoughts are
known to be creative people. Sometimes these people don’t even know what they are doing
and how much importance does that innovation holds. Therefore, they usually fabricate new
ideas, which leave people flabbergasted.
• People who had important self- discoveries, who view the world with a fresh perspective
and have insightful ideas. These people make unique discoveries which they don’t share
with the outer world.
• People who make great achievements which are known to the world. Inventors and artists
fall under this category.

Creative people have numerous traits that influence their creative thinking. Followings are the few
personality traits of creative people.

Qualities of creative people

1. They are energetic – creative people tend to have a great amount of physical as well as
mental energy. They utilize their energy to invent new ideas. These people spend a great
deal of time in solitude to introspect and think.
2. They are intelligent - it is believed that intelligence plays a key role in creativity. According
to study high IQ is important for creativity. However, not all people with high IQ are
creative. To become creative, people should be smart and they should also have a child-
like attitude to view things.

3. Discipline – most of the people have wrong notion that creativity happens unexpectedly.
Therefore, they usually spend their time sitting around and to wait for the creativity to
happen to them.

Types of creativity
Dietrich has classified creativity in four domains using four discrete processing modes such as
emotional, cognitive, deliberate and spontaneous. He created a quadrant of creative types using
these four characteristics.

1) Deliberate and Cognitive creativity

People who possess deliberate and cognitive characteristics are purposeful. They have a great

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 amount of knowledge about a particular subject and combine their skills and capabilities to
. This type of creativity built when
prepare a course of action to achieve something people work
for a very long time in a particular area.

People who fall under this type of category of creativity are usually proficient at research, problem-
solving, investigation and experimentation. This type of creativity is located in the brain’s
prefrontal cortex, which is at the front part of the brain. These types of creative people spend a
great deal of time every single day testing to develop new solutions.

Thomas Alva Edison is one prominent example of this type of creative people. He ran experiment
after experiment before inventing electricity, the light bulb, and telecommunication. Hence,
deliberate and cognitive creativity requires a great deal of time, dedication and abundance of
knowledge about a particular subject.

2) Deliberate and Emotional Creativity

People who are categorized as deliberate and emotional let their work influenced by their state of
emotions. These types of creative people are very emotional and sensitive in nature. These
individuals prefer relatively quiet and personal time to reflect and they usually have a habit of
diary writing. However, they are equally logical and rational in decision making.
Their creativity is always a balanced product of deliberate emotional thinking and logical actions.
This type of creativity is found in the amygdala and cingulate cortex parts of the human brain.
Amygdala is responsible for human emotions whereas cingulate cortex helps in learning and
information processing. This type of creativity happens to people at random moments. Those
moments are usually referred to as “a-ha!” moments when someone suddenly thinks of a solution
to some problem or think of some innovative idea.

For example, there are situations when you feel low and emotional which distracts you from your
work. In those kinds of situations, you should take 5 minutes and point out the things which are
making you sad and keep them aside and focus on the work in hand. It will help you to get
improvised results and you will get work done easily. One should seek “quiet time” for deliberate
and emotional creativity to happen to them.

3) Spontaneous and Cognitive creativity There are times when you spend a long time to crack a
problem but can’t think of any solution. For example, when you want to make a schedule for a
month to get a job done, but you can’t seem to think of any possible way and when you are
watching television and having your relaxed time and suddenly you think of a solution and
everything falls in place. The same case happened with the great scientist Isaac Newton. He got
the idea about the law of gravity when an apple hit his head while he was sitting under a tree and
relaxing.

This is the “Eureka!” moments for Newton and an excellent example of a spontaneous and
cognitive person. This type of creativity happens when one has the knowledge to get a particular
job done, but he requires inspiration and a hint to walk towards the right path. This type of
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 creativity usually happens at the most inconvenient time, such as, when you are having a shower.
Spontaneous and cognitive creativity takes place when the conscious mind stops working and go
to relax and unconscious mind gets a chance to work.

Mostly, this type of creative person stops conscious thinking when they need to do “out of the box”
thinking. By indulging in different and unrelated activities, the unconscious mind gets a chance to
connect information in new ways which provide solutions to the problems. Therefore, to let this
type of creativity happen one should take a break from the problem and get away to let conscious
mind overtake.

4) Spontaneous and Emotional Creativity

Spontaneous and emotional creativity takes place in the “amygdala” part of the human brain.
Amygdala is responsible for all emotional type of thinking in the human brain. Spontaneous ideas
and emotional creativity happen when conscious and Prefrontal brain is resting. This type of
creativity is mostly found in a great artist such as musicians, painters, and writers etc. This type of
creativity is also related to “epiphanies”.

Epiphany is a sudden realization of something. Spontaneous and emotional creativity is responsible

for a scientific breakthrough, religious and also philosophical discoveries. This allows the
enlightened person to look at a problem or situation with a different and deeper viewpoint.

Those moments are defined as rare moments when great discoveries take place. There is no need
to have specific knowledge for “spontaneous and emotional” creativity to happen but there should
be a skill such as writing, musical or artistic. This type of creativity can’t be obtained by working
on it.

Creative Process
Generation of ideas occurs within a social context and is linked to domains of knowledge and
understanding that are also in a constant state of change.

Individuals require a certain level of intelligence, be willing to think in non-traditional ways and
to be persistent over time.

It is argued that it is not simply the creation of new ideas that is important but the translation of
these ideas into realizable products and services.

Wallas (1926) identified four stages in the creative process namely;

1. Preparation – refers to the period when an individual may refine their goals in response
to a particular issue or question that they face.
This is also the period where relevant material from a wide range of secondary and primary
sources is collected. The aim of this stage is for the individual to conduct research in order
to broaden their view of the area under investigation.

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 2. Incubation stage - here individuals suspend their conscious concentration on the problem
and engage in a process of subconscious data processing.
3. Illumination stage – this is the period when someone suddenly becomes aware of a core
answer to the problem. It is characterized by an unplanned result that derives from a unique
combination of ideas or patterns of knowledge that occurs during the incubation stage. It
is during this period that creative individuals must use their logical thought processes to
turn sudden insight into a novel and valuable solution.
4. Verification stage - this is the transition of new ideas into a realizable solution. It is when
the individual needs to formally evaluate the resultant outcome against the criteria set at
the outset.

Basadur’s et al., (1982) three stage model of process of creative problem solving

1. Problem finding
They argue that in order for creative process to begin there needs to be a problem that
requires a solution. This stage is important because the way one approaches a problem will
affect the quantity and quality of ideas generated in the stages that follow.
2. Problem solving
Focuses on generating as many ideas as possible, it is assumed that the number of ideas
increases the probability of someone coming up with an idea worth pursuing.
3. Solution implementation
This focuses on implementation of one of the solutions that were generated from the
previous stage.

NB: During each of the three stages a two-step process of ideation-evaluation occurs. Ideation
refers to the uncritical development of ideas. Evaluation refers to the selection of the best of the
generated ideas.

Amabile (1983) five stage- componential model

This model identifies key components of creativity at certain stages of the creative process.

1. Problem or task presentation

The task to be undertaken or the problem to be solved is presented to the creative person.
It can arise from external stimuli (the supervisor may have assigned the task) or from
internal stimuli (one may particularly be interested in solving a specific problem).
2. Preparation
At this stage the creative employee develops or reactivates a store of data relevant to the
problem or the opportunity identified.

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 3. Response generation
Here the individual comes up with a diverse range of possible ideas appropriate to the issue
in question. It is at this stage that an individual’s creative thinking will determine both the
quality and quantity of ideas generated.
4. Response validation
This refers to the process through which new ideas are checked for their appropriateness
and validated.
5. Outcome assessment based on tests performed in the previous stage.
If the response is found to be wholly appropriate then the outcome will be accepted and the
process ends. If, however, the response is unacceptable or only partially acceptable but
shows potential then the process returns to the initial stage of problem or task presentation.

Harvard business school Prof. Theresa Amabile identified five environmental components that
affect creativity. These are;

1. Encouragement of creativity (which encompasses open information flow and support for
new ideas at all levels of the organisation, top management through immediate supervisors
to work group).
2. Autonomy or freedom (autonomy in the day-to-day conduct of work; a sense of individual
ownership of and control of work).
3. Resources (the materials, information and general resources available for work).
4. Pressures (including both positive challenge and negative workload pressures).
5. Organisational impediments to creativity (including conservatism and internal strife)
DESIGN
This is a structured process that transforms creative ideas into concrete products, services and
systems and as such links creativity to innovation. As part of innovation process, design has the
potential to substantially contribute to improving the brand image, sales and profitability of a
company. It has also emerged as a key differentiator for businesses.

As a result of the growing access to technology, firms increasingly have to compete at equal prices
and functionality. Design increasingly assumes a new role, one of competitive advantage and
differentiator, creating new markets by linking technology with commercial and user
considerations whether linked to functionality, aesthetics brand or other intangibles.

The concept of design has been defined in different ways either focusing on design as an economic
activity or more general as the translation of the ideas generated by creativity into new products
and processes. It links creativity and innovation. Design definitions are based on design
professions with the following ensembles; fashion design, graphic design, interior design, product
design etc.

Creativity on the other hand is defined as the generation of new ideas but the number of ideas is
an unobserved statistical phenomenon. Creativity is multidimensional and three different ‘type’
can be distinguished; technology creativity (invention), economic creativity (entrepreneurship)
and artistic/cultural creativity.

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 Creativity is the generation of new ideas, design is the shaping (or transformation) of ideas into
new products and processes and innovation is the exploitation of ideas i.e. the successful marketing
of these new products and processes.
NB: Creativity, design and innovation are not limited to certain sectors or professions, but apply
across the economy.

THE DESIGN PROCESS

1. Identify the problem -

This step is important because it informs the rest of the design process and defines how success
will be measured.

2. Do research
After a problem has been identified, the next step is to conduct a research. This research may
include finding articles in books, magazines, or on the Internet to help formulate ideas and
recognize constraints for their designs. During this stage, one is required to examine existing
designs, which can provide a starting place and help to formulate questions.
Research is also the step in which one discovers and explores the important elements of a design.
Guided questions encourage critical thinking about aspects of the problem that must be addressed
in order to develop a successful design.

In each activity, the research step includes the question, What are your design constraints? This
question helps one recognize the limits of his/her solutions and to eliminate solutions that would
be inefficient, costly, or physically impossible.

3. Develop possible solutions

Next, employees brainstorm possible design solutions that address the problem they have
identified. Possible solutions may include variations on one design using the same or different
materials. They also may include completely different designs. This step allows employees to
recognize the pros and cons of each design.

4. Choose one solution

In this step, employees choose one of their proposed designs and describe it in detail. They may
be asked to draw or diagram their design and to explain why they chose it. Having as much
information as possible about each possible solution and keeping the problem or task in mind is
helpful for choosing a successful design. The chosen design should represent the solution that
employees think best meets the need or solves the problem that was identified at the beginning of
the design process.

5. Design and Construct a Prototype

At this point in the design process, employees gather materials, build a prototype, and record the
particular details of a design that are required for replication. These requirements—such as
dimensions, measurements, materials, processes, and so on—are described in a detailed

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 description or assessment. Anything that someone studying or replicating the prototype would
need to know should be included in this section.
At the end of this step, employees have a prototype that is ready for testing. By definition, a
prototype is the original or base model.

6. Test the Prototype

After building their prototypes, employees will test it. Some of the activities produce prototypes
that can be tested within a short period of time; others involve several days of testing. Testing the
prototype usually involves asking questions that are based on observations, and assessing the
prototype in terms of how well it solves the problem or task.

7. Communicate Results

Sharing results is an important step in any developing design. Employees are encouraged to use a
variety of approaches to communicate their results. Examples include sketches, photographs,
detailed diagrams, word descriptions, portfolios, computer simulations, computer slide shows, and
video presentations. Employees may also present evidence that was collected when the prototype
was tested. This evidence may include mathematical representations, such as graphs and data
tables, that support the design choice.
Communicating the results of an experiment or test has practical and ethical importance for
scientists and engineers. Practically, communicating results opens a conversation in which other
scientists or engineers can make suggestions and help improve a design. The design also might
help the other engineers solve problems they are having with their own designs or inspire them
with a new design. Ethically, communicating results opens an experiment or design to accurate,
unbiased evaluation. It also helps protect the intellectual rights of the scientists or engineers sharing
the design.

8. Evaluate and Redesign

The last step allows employees to evaluate what worked and what did not work about their designs
and why. They may be asked to rate their prototype designs with a rubric of design constraints.
They are also encouraged to explain their ratings and, if needed, brainstorm design improvements.
Some activities allow the employees to redesign their prototype.

The elements and principles of design

The elements and principles of design are the building blocks.
The elements of design are the things that make up a design.
The Principles of design are what we do to those elements. How we apply the principles of design
determines how successful the design is.
The elements of design

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▪ LINE – The linear marks made with a pen or brush or the edge created when two shapes meet.
▪ SHAPE – A shape is a self-contained defined area of geometric (squares and circles), or organic
(free formed shapes or natural shapes). A positive shape automatically creates a negative shape.
▪ DIRECTION – All lines have direction – Horizontal, Vertical or Oblique. Horizontal suggests
calmness, stability and tranquillity. Vertical gives a feeling of balance, formality and alertness.
Oblique suggests movement and action
▪ SIZE – Size is simply the relationship of the area occupied by one shape to that of another.
▪ TEXTURE – Texture is the surface quality of a shape – rough, smooth, soft hard glossy etc.
▪ COLOUR – Colour is light reflected off objects. Color has three main characteristics: hue or its
name (red, green, blue, etc.), value (how light or dark it is), and intensity (how bright or dull it is).

The Principles of Design

1. BALANCE –. Balance provides stability and structure to a design. It’s the weight distributed in
the design by the placement of your elements.
2. PROXIMITY – Proximity creates relationship between elements. It provides a focal point.
Proximity doesn’t mean that elements have to be placed together, it means they should be
visually connected in someway.
3. ALIGNMENT – Allows us to create order and organisation. Aligning elements allows them to
create a visual connection with each other.
4. REPETITION – Repetition strengthens a design by tying together individual elements. It helps to
create association and consistency. Repetition can create rhythm (a feeling of organized
movement).
5. CONTRAST – Contrast is the juxtaposition of opposing elements (opposite colours on the
colour wheel, or value light / dark, or direction – horizontal / vertical). Contrast allows us to
emphasize or highlight key elements in your design.
6. SPACE – Space in art refers to the distance or area between, around, above, below, or within
elements. Both positive and negative space are important factors to be considered in every
design.

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 REVISION QUESTIONS

1. a) Define the term creative metrics.

Creative Metrics.

These are standards of measurement by which efficiency, performance, progress or quality of a

plan, process on can be assessed. They are meaningful measurements and calculations used to
direct and control an organization.

b) Identify and explain at least four types of creative metrics

Types of creative metrics;

a) Goal metrics.
Many organizations have established the principle that strategy and performance goals need to be
measurable. They are developed the purpose of strategic management, goal setting and
performance management (Spacey, 2017).

b) Key performance indication (KPI)

This is a term for a metric that is critical to an organization. Common for organizations,
departments and teams to develop a large number of metrics. Used to distinguish metrics are
critical to strategy. KPI is used to measure goals.

c) Qualitative metrics
Based a human judgment such as a rating for example customer satisfaction is typically a
qualitative metric that result from asking customers to rate their satisfaction with a product,
service or experience.

d) Quantitative metrics
They are a class of metrics that are based on numbers. Can be financial or non-financial in nature.
They include revenue, customers’ counts on electricity usage measured in watts.

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 e) Actionable metrics.
Can be directly used to make decisions and optimize want. Common for organization to mandate
that all metrics be actionable.

f) Information metrics
This a metric that is not actionable. People find this interesting and may develop metric that are
unlikely to change course of decisions. It is widely considered a distraction and unnecessary
expense. For example, if a case displayed the temperature of its muffler on its clash, some people
might find it interesting but this isn’t actionable like a fuel gauge or speedometer. As much as it
might be considered an unnecessary distraction.

g) Vanity metrics.
Are designed to be impressive as opposed to useful.

2. Identify and explain four types of creativity.

Types of creativity (Dietrich, 2004)

Deliberate and cognitive creativity.

Creative types who are deliberate and cognitive are based on purpose. They possess a lot of
knowledge about a particular subject and combine that with their skills and abilities to put a plan
into action. People with this type of creativity are usually adept at research, experimentation and
problem solving. This type of creativity lies in the brains prefrontal context toward the front of
the brain. For example, Thomas Edison the inventor of electric light bulbs, was a deliberate and
cognitive creator. He ran experiment before he could come up with an invention.

Deliberate and emotional creativity.

According to Dietrich, those people let they work be influenced by emotions. They are more
sensitive and feeling individuals who might prefer lots of quiet time for personal reflection or
writing a diary. They are also equally logical and rational making deliberate actions with
emotional creativity.

This type of creativity lies in the brain’s amygdala, responsible for human emotion and cingulate
cortex which combines learning and information processing. An example of this might come
following a personal incident like bankruptcy where you are reflecting on the decisions that got
you to that point and using deliberate and emotional creativity to reflect and overcome your
challenge.

Spontaneous and cognitive creativity.

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 Appears when individuals have knowledge necessary to get the job done, but perhaps need
inspiration to drop from the sky, for example the Newton’s Law of Gravity. This type of
creativity may appear at the most inconvenient time like coming up with a unique way to finish a
story while you are in the shower or envisioning a solution to a problem at work while you are
driving on the weekend.

Spontaneous and emotional creativity.

Comes from the amygdala. The amygdala is where basic emotions are processed. When the
conscious brain and the PCF are resting, then it is possible for spontaneous ideas and creations to
emerge. This is the kind of creativity that you think of when think about great artists and
musicians comes into you mind.

Often these kind of spontaneous and emotional creative moments are quite powerful such as an
epiphany, or a religious experience. There is not specific knowledge necessary for the type of
creativity but there is often skills needed to create something from spontaneous and creative
ideas.

3. Discuss the relationship between technology, innovation and creativity.

Relationship between creativity, innovation and technology.

Creativity refers to an individual’s ability to use imagination or original ideas to create

something. The potentiality to find connection between seemingly unrelated things and use it to
develop something new.

Innovation is the process of taking an idea, invention or recognition of a market and developing a
useful product, technique or service to point where it gains initial commercial acceptance.
Innovation is more related to creativity since it is the process that transforms the forward looking
new ideas into real world commercial products, services or processes of enhanced value. The
result of this transformation is either incremental, evolutional or radical in its impacts on the
status quo. It represents a step forward in a concepts development, a leap to the next generation
of that concept or a completely new and different way of doing something altogether. It is
impossible to develop innovations without creativity for they work hand in hand and using
technology.

The efficiency and effectiveness of innovation developed from creativity is enhanced by

technology. For productivity needs, technology is a concept that is critical in every innovation. It
is the application of skills and knowledge to make goods or to provide services. It includes the
tools and machines and methods by people to covert natural resources into items they need. It
involves scientific advancements, wider engineering knowhow, and availability of better
materials, improved industrial processes and design techniques.

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 Technology base allows proper innovation of creative ideas to achieve the various economic and
social goals. The three concepts are related in such a way that for a successful idea to be
accomplished the three must be put in practice and work hand in hand.

The Apple founder used his creativity to put together already invented products such as mp3
music players, cameras and mobile phones in order to create an iPhone. Though the products
existed, the iPhone was completely a new concept. It was later marked as an innovation in
technology industry for it added value. He was creative as he had the forward-thinking ability to
imagine new ideas for products and also to see new connection between different things. The
Apple Company is innovative in the manner in which they interpret and execute these ideas to
create better products.

Innovation brings a new idea it being, technology provides the necessary techniques, skills,
methods and processes to carry out creativity or the creation of something new.

Reference

Sherman, Gee. Technology Transfer, Innovation and International Competitors. Canada:

Interscience Publishers, 1981.

Arue, Dietrich. The Psychonomic Bulletin Review. 2004.

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