MANAGEMENT OF TECHNOLOGY
BTMU 1023
Lecture 6
Technological Innovation
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Lesson outcome
At the end of the lesson, the student should be
able to:
• Understand the context of TLC
• Describe how TLC is essential for strategic
planning and strategic analysis.
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Innovation
• Comes from the Latin, innovare, and is all about change
• The practice of changing a process or product that significantly increases its value or
usefulness.
• It can happen in technology, politic, agriculture, environment, social and legal
• It is not always necessary to use technology.
• NOT ALL INNOVATION ARE TECHNOLOGY BASED
• Example of innovation in politics
• Allowing the younger generations to represent themselves at the national level,
• A new method of engaging the citizens.
• Example of innovation in social
• Baby hatch
• Example of agricultural innovation
• Durian triple planting
Technological Innovation
new or improved product or process whose technological characteristics are
different from the previous version.
It is a process that converts knowledge into useful products and services that
have socioeconomic impact. It requires the integration of inventions and
existing technologies to bring innovations to the marketplace
Development of a flat screen tv
( technology based innovation)
Development of new sales channel for flat screen tv
( marketing/ non-technological innovation)
First car invented Model T by Ford Improved the production to mass
production so that it can become available and affordable to the people.
Stages of technological innovation
Basic research- study and research technology that has impact on the organization
Applied research –research towards solving customer need
Development- prototyped is developed and tested
Engineering- turn it into a scalable product and service
Manufacture- finding the best way to deliver effective and quality product to the customer
Marketing- concept testing , market research
Promotion – rapid launching of the product and service
Continuous improvement – constantly measured, analyzed and improved
Types of technological innovation
Service innovation
• A service is “placing a bundle of capabilities at the disposal of the consumer”. There are
four dimensions of service innovations:
1) New service concept: the creation n and development of an entirely new kind of
service.
2) New client interface: major changes in the interaction between the service provider and
the client.
3) New service delivery system: finding a new way of delivering the service.
4) Technological options: when the emergence of new technologies make a new service
possible.
Radical and incremental innovation
• Radical versus Incremental Innovation.
The radicalness of an innovation is the degree to which it is new and different from
previously existing products and processes.
Incremental innovations may involve only a minor change from (or adjustment to)
existing practices.
The radicalness of an innovation is relative; it may change over time or with respect
to different observers.
• For example, digital photography a more radical innovation for Kodak than for Sony.
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Competence-Enhancing versus Competence-Destroying
Innovation
• Competence-Enhancing versus Competence-Destroying Innovation
• Competence-enhancing innovations build on the firm’s existing knowledge base
• E.g., Intel’s Pentium 4 built on the technology for Pentium III.
• Competence-destroying innovations renders a firm’s existing competencies obsolete.
• E.g., electronic calculators rendered Keuffel & Esser’s slide rule expertise obsolete.
• Whether an innovation is competence enhancing or competence destroying depends on the
perspective of a particular firm.
Architectural versus Component
Innovation
• Architectural versus Component Innovation
• A component innovation (or modular innovation) entails changes to
one or more components of a product system without significantly
affecting the overall design.
• E.g., adding gel-filled material to a bicycle seat
• An architectural innovation entails changing the overall design of the
system or the way components interact.
• E.g., transition from high-wheel bicycle to safety bicycle.
• Most architectural innovations require changes in the underlying components
also.
Disruptive Innovation
Disruptive innovation, a term of art coined by Clayton Christensen, describes a
process by which a product or service takes root initially in simple applications
at the bottom of a market and then relentlessly moves up market, eventually
displacing established competitors.
PLATFORM INNOVATION
Megatrend in business – transformation
towards digitalization
• Digital transformation is the integration of digital technology into all areas of a
business, fundamentally changing how you operate and deliver value to customers
• Customer eccentricity
• Digital technologies will drive globalization to the next phase
• COVID-19 is the driving force
• Effecting small business and enterprises ( ADOPT OR DIE
• Continuation of innovation and development of artificial intelligence (AI), the
internet of things (IoT), virtual and augmented reality (VR/AR), cloud computing,
blockchain, and super-fast network protocols like 5G.
• Hybrid work place( even post covid)
• enterprises to adopt different digital tools to manage their operations smoothly
Digital innovation – App revolution
Rising number of technoprenuers
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Digital innovation – App revolution
Omnichannel experience
Disney.com
MyDisney experience to book in park dining reservation
MagicBands are used as room keys. FastPass allows park guests to skip lines for
Just tapping your wristband unlocks three attractions per day. Using the My Disney
the door. Guests can also order food Experience smartphone app in the park, guests
with their wristbands at Disney can check and change their FastPass choices and
restaurants and food carts. check other attraction wait times while on the go
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Digital products
“Synthetic Media” functions as a collective term for
media such as video, images, and audio that are
manipulated or even created using technologies
from the field of Artificial Intelligence (AI).
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Digital innovation – for Ecommerce.
From B2C to C2C
• The Rise of Platforms, the Sharing Economy, and Crowdsourcing
• Example UBER, ETSY, Apple, Alphabet, Amazon, Facebook, Tencent,
and Alibaba.
• New business that facilitate connections between relevant parties.
• Interactions
• Transactions
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