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2.1 Innovation Management

Modern research lab ~ a r ~ a d o n [ ' I2003

, defines Innovation
Management as a new structure to manage the technological innovation
process; intended to improve technological innovations.

Innovation Management is the specific tool of entrepreneurs, the

means by which they exploit change as an opportunity for a different
business or service; ~ r u c k e r l ~1985.

~awson''' & ~arnson'~',

2001 argue that innovation management
is an organizational condition that should permeate the entire
organization. They suggest that innovation management is a form of
organizational capacity and that the goal should be to make the service
firm an "innovation engine". If this innovation capacity is well
developed it can be one of the most important factors contributing to the
wealth creation of the service firm. An innovation capacity includes
formalizing a vision and strategy focusing on innovation, the
competence base and organizational intelligence needed, structures for
creativity and idea management, an innovative culture and climate and
investments in supporting technology.

Innovation Management is "something new being realised with

~ ] snijdersf4',2008.
added value; ~ a c o b s ' and

2.2 Measuring Innovation

Research has however shown that formalization of the innovation

management process and measuring of innovation is relatively seldom
in Information Technology Service firms, specifically in comparison
with manufacturing firms.
~ e l l y " ]& 2000 have investigated whether service firms
use systematic procedures to generate and screen ideas for new services.
They found that only half the sample of firms in different service sectors
in the UK has a formal new service development strategy.

~han["], 1998 arrived to similar results in a study of service firms

in Hong Kong where they find that the majority of the firms do not have
an established system to control the innovation process. Instead of
formalized processes to support innovation the service development
attempts are often ad hoc and integrated in the everyday operations.

~olfsma["],2004; ell^'^] & tore^^"], 2000 hrther argue that

specifically in small service firms the service development process is
largely unstructured and organized informally around specific
individuals in the service firm. These conditions support the
development of customized services in small service firms.

As a result, unstructured attempts to idea screening and

generation tend to fail to support the creation of service innovations
ell^['] & ~ t o r e ~ l2000).
~ ' , ~han[''], 1998 concludes that the lack of
established systems is linked to an attitude'among managers to confine
their service development to incremental or distinctive innovations and
do attempt to develop breakthrough innovations.

Also ~ r e n t a n i l ' ~ '2001

, has identified formal and planned
programs for launching service innovations as a success factor
governing the outcome of new service projects.

A key metric for measuring innovation is commitments to

research and development (R&D)..This is reflected in the prominence
given to R&D in the Lisbon Strategy aimed at enhancing Europe's
competitiveness. The prominence of R&D reflects the development of
standardised approaches to defining R&D, through the OECD's Frascati
~ a n u a l ' ' ~RBD
]. statistics therefore have the advantage of a long time
series and comparability between countries, although critics argue that
differences in incentives to undertake R&D and differences in methods
of data collection mean R&D statistics are rather less comparable than
their widespread use would suggest. It is also becoming increasingly
difficult to measure RBD, as innovation practices have become more
diffused and less dependent on the centralised R&D laboratories of
major companies which was the organisational model of innovation in
the late 1950s to early 1960s when the Frascati ~ a n u a l ' ' ~was
] first
developed. The fundamental criticism of RBD as a measure of
innovation is that, it is an input, not an output, and firms and countries
may differ markedly in their ability to convert that input into innovative

The other traditional indicator of Technological innovation is

patents. Patents are widely used because of the availability of large scale
patent databases especially from the US patent office and more recently
from the European Patent Office. To patknt, firms have to develop
things that are patentable and this varies between countries, particularly
with respect to software patents and business process patents. It is also
known that firms and industries differ widely in their propensities to
patent, and that patents are only really an effective defence mechanism
in the chemicals industry, and especially pharmaceuticals. Ultimately,
patents are not a measure of innovation, but invention - as many
patented devices are not coinmercialised. They are also only a partial
measure of invention, as many inventions are not patented.
Dissatisfaction with R&D and patents as measures of innovation
as opposed to inventive effort and invention led to the development of
new measurement approaches in the 1980s and 1990s. One was the so
called bbject-based approach ', which was based around identifying
innovations directly, either by asking experts in various industries to
identify major innovations, or by using trade journals to identify and
classify new product announcements. Although these approaches
showed a great deal of innovation does not flow directly from
investments in R&D, these methods tend to favour industries which
produce tangible things - as it is rather easier for experts to remember
new devices than new practices or procedures. Similarly, trade journals
are more likely to record the introduction of a new tangible product than
a practice, such as 'just in time'.

The other main approach to measuring innovation is the 'subject-

based approach' which is based on asking firm (the subjects) whether
they have introduced innovations. Although used by the European Inn
barometer amongst other ad hoc surveys, the main instrument that uses
the 'subject-based approach' is the European Community Innovation
Surveys (CIS) [I4], which were first undertaken in 1992.

In principle, subject-based approaches are equally applicable to

manufacturing and services, but in practice - and particularly as
operationalised through the European Community Innovation Surveys -
these have tended to favour manufacturing. Especially in the first edition
of the Oslo Manual (oEcD['~] 1992) - the OECD's guide to gathering
innovation data through surveys - the focus was on Technological
Product and Process innovation (or 'TPP innovation'), in which
innovation is conceived as a step change in product or process
performance. Scholars of innovati0.n in services argue that this is less
appropriate to services, as innovation in services is thought to be more
continuous, or wave-like, rather than based on occasional, step-changes.
Above studies are tabulated in Table 2.1.

Table 2.1 Approaches for Measuring Innovation studied by various

S.No Measuring Innovation Approaches Author's Studied
, Systematic procedures to generate and ell^''' & ~ t o r e ~ ~ l

development of customized services lolfsma["', 2004; ell yi"' &

-- ---"--* -- ~torey'g',2000
~ e l l f '& ~ t o r ~ , ~ 0 ~ " -
Creation of service innovations
- 2han'lo1,1998
Service innovations as a success factor 3rentani'Iz1,2001 -
object-based approach qrascati ~anual"" -___

/I1 subjectlased approach

uropean Community Innovation
urvevs (CIS)

2.3 Innovation Climate

This section explores the pattern of 'change' in the firms that

responded to the survey across the four service sectors. As indicated
above, it seeks to highlight the fact that by concentrating our attention
on product, process and technological indicators of innovation restricts
and narrows the view of innovation, ,it not only neglects the
sofkiorganisational side of innovation, but also the inter-relationships
between these technological and soWorganisational forms of innovation
as studied by Innovation ~ a b s ' ~ ~ ' .

The first four dimensions of change cover what might be

considered the Traditional, technological aspects of innovation
according to Innovation ~ a b s ' *are:
a) Changes to the products or services provided
b) Changes to the means of producing services
c) Changes to the means of delivering services and
d) Changes to the technologies used

~wann["],2006 studied that of these, the most widespread change

was found in the technologies used to produce or deliver services, with
almost half the firms reporting significant or complete changes, and only
1 7% claiming their technologies had remained unchanged.

Turning to other types of change studied by Cohen wl"l and

Levinthal D["],1989 which was considered sofVorganisationa1 aspects
of innovation, the following were considered:
a) Changes to the skills of the workforce used to produce or
deliver services;
b) Changes to the organisational structure of the business;
c) Changes to customer inter-relations; and,
d) Changes to other business inter-relations.

Connections between the various dimensions of change studied

by ~wann["],2006 are calculated on conditional probabilities that a firm
would have changed significantly or completely in one dimension given
that it had also changed in another dimension.

Laursen ICrX2',Salter A['~],2006 anal'ysed that firms that engaged

in one form of change are more likely to also engage in other forms of

OECD[~"],2005 & the results of the UK Innovation Survey of

2005 study that the low significance of technologies chimes has 'lack of
information on technology' was the least important barrier to
innovation, being identified as a barrier of high importance by just 3%
of firms ( ~ o b s o n land
~ ~ '~rtmans["~,2006). This proportion did not very
significantly between manufacturing and service firms.
Meanwhile, the existence of tax credits for R&D can be viewed
as an attempt to reduce the costs and risk of innovation as studied by
Tether. B [ and
~ Howells.
~ ~ J["~, 2007.

Breaking down the impediments of innovation is not likely to be

easy, and there is no single or obvious 'magic bullet' policy solution. As
studied by Tether. B["] and Howells. JfX5I.2007 there will always be
impediments to innovation as innovation implies risk and uncertainty,
and policy maker cannot be expected to break all of these down,
especially when the impediments are not simple but intertwined.

Langdon orris['^, 2007 studied that Innovation, by its nature,

embraces change because it is the stuff and process of change. The
innovator uses change as fuel for action and food for thought.

Innovation Labsrs6],study that Innovation does take a certain

frame of mind that tolerates and sometimes thrives on waves of change.

Scott 2008 studied that the key word is 'believe'. It's

fairly hard to predict the future, and in many cases, equally difficult to
predict whether some course of action will create pain or pleasure, least
of all whether in the convoluted interactions of a myriad of people it is
our actions alone that lead to the result.

According to Langdon Morrisi'"'', 2006 the first responsibility of

management is to mitigate fear, to instil and support fearlessness
throughout the company.

Boston Consulting Group["l, 2006 studied that trust is the first

law of the innovation culture. Command and control management is far
more able to inflict pain or the threat of pain on employees, not the other
way around as studied by Bryan offi in an^'^^, lnnov~tionLabs.

Table 2.2 Innovation Climate studies by various Authors

, $,No Innovation Climate Author's Studied
1 Dimensions of change ~wannl'~',2006, Cohen w'"'
~ n ~evinthal
d D~''',1989
Inter-relationshipsbetween llnovation Labs''".
2 technological aid softiorganisational
3 Changes to the skills of the workforce "ohen w'"' and Levinthal
wIX'aid Levinthal
hanges to the organisational structure
yf the business

?ohen w'~"and Levinthal

hanges to other business inter- ]I# 11

7 Climate as va~yingforms of change

2.4 Innovation Culture

A culture is an expression of a group of people. Every culture

reflects the current beliefs and behaviours of its people, as well as the
history that shaped them. History is an essential attribute of culture
because one of culture's defining characteristics is that it persists over
time; it gets transmitted from the present to the future with notable

Robson, S. and Ortmans, L. (2006)'K41

study that the innovation
culture, of course, is likewise an expression of people, their past, and
their current beliefs, ideas, and behaviours. They make innovation
happen, and they do so consistently over time.

Langdon Morrisloo],2008 portrays genius of firms like Apple,

Cisco, and Toyota have created a true innovation culture, which is
precisely what it means to make the creation of novelty a consistent
output of an organization's culture. At Toyota, the fruits o f innovation in
manufacturing have been tremendous breakthroughs in simplification,
resulting in a company that is universally recognized as the most
efficient auto manufacturer on the planet

TetherLx5',B. and H~wells[~",

J. (2007) studied the need for
innovation only in crisis situations when it becomes evident that
standardization has failed. Innovation pursued in this context means
change is driven when needed. Hence the strategic power of capitalism,
a remarkable self-organizing process of intrdduciq novelty into markets
through the dynamics of competition.

Innovation LabsrB6], in contrast observed that the purpose of

innovation is precisely to create a particular form of variation, variety
that is valuable novelty. Too often, however, the valued baby variety is
thrown out with the unwanted bathwater variation.

Schurnpeter (1934)[921was one of the first authors to emphasise

the role of innovation in business, identifying it as a process of "creative
destruction" through which wealth was created when existing market
structures were interrupted by the introduction of new products or

As studied by Mintzberg, 1979[931 open channels of

communication, decentralization and informal decision making, loosely
coupled decision linkages and loosely identified job descriptions, and
flexibility in processes and procedures are all associated with innovative

An organization's potential to unleash the creativity of its

members is to a great extent determined by its innovation culture
(Senge, 1990)['~].Other studies have also shown that if top management
is visibly and tangibly committed to innovation, R&D is clearly more

Pisano ( 1 9 9 4 ) ~ ~highlight
'~ that the integration of different
internal sources of technological knowledge (i.e., R&D, design,
engineering, and manufacturing) as a primary driver of lead time and

Leonard-Barton, ( 1 9 9 8 ) ' ~says

~ ~ that the successful adoption of
technology exploration, the entire innovation process requires "mutual
adaptation", mutually beneficial collaboration between producer and
customer, and successful conflict resolution. Romijn and Albaladejo
( 2 0 0 2 ) ~ ' illustrate
~~ that firms may also use financial institutions as
drivers for the development of new or improved products and/or
Innovation and knowledge creation are seen as interactive
processes, which are shaped by a varied repertoire of institutional
routines and social conventions. Potential innovators can become
interested in a particular issue that develops into an innovation for
several reasons. And one of those reasons is self-motivated,
entrepreneurial behaviour (Kanter, 2000)["'~.

Innovation Culture is a process which embodies the values into

enterprise culture and continues innovation and development according
to its own characteristics, in order to make the development of enterprise
match with the external environment (Xu qingrui Zheng gang Yu zida &
Shen wei 2003)[*],

Fig 2.1 Command and Control with Distributed Network

I Command and Control

I Distributed Network

Bryan Coffinanl'", Principal, 1nnovationLabs studied that

command and control is good at organizing top down, large scale
piloting and implementation programs. Networks are good at
proliferating dozens of experiments, testing them in ad-hoc fashion and
distributing the best of them in cascades across the organization. Culture
of innovation depends solely upon a network composed of most if not
all of the members of the organization and quite a few representatives
from outside its traditional boundaries customers, students, providers,
even competitors. In successfU1 and vibrant innovation cultures, the
number of members from outside the organization is likely to dwarf the
number of those inside.

The two types of structure as shown in Fig 2.1 according to

Bryan C~ffmanl'~'
can fight against one another. Command and control-
only organizations tend to respond to networks as if they were viral
infections and attempt to destroy them. By the same token, some
networks are quite good at subverting the goals of the command and
control organizations that are their hosts. This behaviour can escalate
into a cycle of aggression if it's not constantly addressed through honest

There's a role for command and control organizations. As we

move deeper into the 21st century, it's clear that command and control
organizations can muster resources and delegate and divide work. Each
level of authority helps to direct and manage resources more efficiently
while also serving as a bottleneck for ideas and a straitjacket for
M. Desilvio,
flexibility as studied by M.K. Malhotra[2q,V. Gr~ver'~",

Kamien MII3"', Schwartz NL"61. 1982 observcd that structures,

processes, and attitudes all can favour innovation or inhibit it. Other
inhibitors can include lack of attention from top management, lack of a
precise innovation methodology, and lack of time to pursue new ideas.
Kamien MIt361,Schwartz NLlJ6] , 1982 further studied that
managers who have identified the innovation culture as a target for
organization to achieve, then getting rid of the obstacles by
understanding and applying the three roles defined here should yield a
significant improvement in projects innovation performance.

Table 2.3 Innovation Culture studies by various Authors

S.No Innovation Culture Author's Studied
Flexibility in processes and
I procedures
Mintzberg 19791Y'J
1 1
2 Form of variation 'nnovation ~ a b s l " ~
3 Creation of novelty ~ n g d o ~n o n i s l ~ ~ ~
4 iobson, S. and Orhnans, L,
Expression of people
rether'"; B.and ~owells'~'~,
5 Standardization
- (2007)
6 Creative destruction - Gchum~eter
7 Organizations ienge7 I 990-:-~1
Integration of different internal isano (1994)

.. I

j processes
u qingmi Zheng gan Yu
12 External environment ida & Shen wei 2OO3k9l
13 ( Command and Control Bryan offm man""
h . ~~ a.l h o t r a l ~V.~ !

2.5 Processes of Innovation Management

The innovation management process is divided into four phases

as studies by ones son[^], 2007. In an initial phase ideas for new services
or processes are generated and chosen in line with a strategic plan for
innovation. Thereafler project teams for designing the innovation are
assigned and the innovation process is formalized. In a third phase the
new service or process is designed and tested. Finally innovation is
implemented which also includes training employees to deliver the
service and commercialization and launch on the market.

A big part of being innovative is to be able to manage and create

knowledge that results in new ideas for services or organizational
practices. ~ a r ~ a d o n l2002
~ ] , talks about "knowledge brokering" as a
practice that explains how some organizations are able to routinely
recombine their past knowledge in new ways and thus be continually

~ e i ~ o n e n [ (2005;
~ ] [ ~ ]2006) emphasizes the potential contribution
of collective knowledge in the service innovation process. In her study
of knowledge intensive business service firms in Finland she shows that
collective application of knowledge is more likely to lead to innovation
than individual application of knowledge. ~ e i ~ o n e n2005
' ~ ~ argues
, that
the likelihood of accomplishing innovation is higher if efforts are made
to acquire external knowledge from, for example, customers and
competitors than if innovation efforts are based only on internal
incremental learning. One way to acquire external knowledge, and
hence support service innovation, is to hire highly educated employees
who can bring knowledge into the organization.

Innovation happens through a process of exploring, trying and

adopting. The word, innovation means something new or perceived as
new. New solutions, products and services are only found through
exploration, often fiom far afield. As new ideas are uncovered, or
created through combination of existing ideas, it's incumbent on the
innovator to try them in a low-risk, localized experiment. The innovator
takes the successfhl ideas and builds a coalition of support around them
so that they improve their chances of being adopted and scaled up to full
implementation as studied by Bryan ~ o f i a n [ ' ~ ' Principal,

Bryan offm man['^' , InnovationLabs recommend that successful

experiments be copied on a limited scope if possible before broader
adoption is pursued. The innovator learns a great deal trying to transfer
his or her successfUl experiments to the control of others. Without this
learning, the adoption process assumes unnecessary risk.

Langdon orris''^], 2007 studied that networks are built of nodes

and connections between them. Nodes comprise a combination of
people and equipment. Nodes take in some combination of information,
matter and energy and convert them to outputs using internal rules. The
outputs also take the form of some combination of information, matter
and energy. In most organizations the informational component of the
output is the most important.

The company makes the basic rules for a market and provides the
mechanism for trading. Wikipedia, an bpen source collaborative.
Wikipedia is the largest online encyclopaedia and it's all created and
supported by users. Right now you could go to wikipedia.com and
create an article on whatever subject you fancied and post it. You could
even navigate to an existing article and make changes to what someone
else wrote.

To summarize Langdon orris'"', 2007 study, the four types of

networks are: (1) hub and spoke; (2) user-to-user marketplace; (3) open
source collaborative; and (4) project management intranet.
Network member
> Hub and spoke network defines boundaries and scope of
>. User-to-user network allows for direct interaction and
trading of ideas and resources
b Open source network allows for multiple individuals to
work on an idea collaboratively without direct interaction
)=. Project management allows individuals and teams to track
the progress of ideas, experiments and initiatives as they
grow, adapt, become adopted and achieve scale

Frederick ~ e t z ' ~ 201

~ ] ,1 observed that the ultimate network
required to support the innovation culture borrows features from all of
these types of networks. Like Amazon, some aspects of the network
should come fiom the centre and pervade the network. Organizations
can experiment but they can't move in all directions at once.

Table 2.4 Processes of Innovation Management studies by various


The following section summarizes influencing factors that lead to

Innovative project success according to literature presented in the above
2.6 Factors Influencing Innovation Management
2.6.1 Factors Related to Business Users Cost reductionlrelative price

According to ~ozijnsen'~'],2000 adequate management of time,

costs, information and decision making determines 60% of the
innovative projects' viability. In order to make the project better
manageable, most innovators split the project into constituent phases
rawfo ford''^], 1991). Six phases are distinguished. The project is
initiated by a phase of planning, followed by brainstonning, phases of
screening and evaluation, development and market research.

The relevance of a product's price relative to competing products

or substitutes remains undisputed. Moreover, the extent to which the
innovation reduces the customer's total-costs-of-use ( ~ o o ~ e r [&' ~
~ ~ , as well as the price-to-quality ratio are agreed
~ l e i n s c h r n i d t [ ' 1987)
to be important ( ~ a d i ~ u e l&
~ '~] i r ~ e r [ "1984).

It is ofken argued that successful innovations meet customer

needs on a number of features simultaneously. These may concern the
product's quality, the product's relative priCe, the product's total-costs-
of-use, convenience of use, after-sales services, and backward
compatibility ( ~ a d i ~ u e l "&" zirgert201,1 984).

Conversely, less successful innovations excel predominantly in a

reduction of total-costs-of-use only ( R O ~ ' &
~ ' ~] i e d e l ' ~ '1997).
], Value creation and progressive value add

The market's reaction to an event is a good proxy for whether .it

will create value. However, if valuation-difficulties arise, then the
market might miss value investments over short time-horizons ( ~ a l l [ ~
1993; 1992; wooldridge12'l, 1988). Thus, ow ell'^^] and
~tark'"' (2005) suggest that it is important to examine long-term value-
creation. Flexibility in process

In response to an increasingly global and competitive

environment, reengineering of fundamental cross functional processes is
being actively pursued by corporations. The flexibility to adapt to
changing market needs and develop innovative IT projects in such an
environment is quintessential[261 to success. This would make new
project development arguably one of the most critical cross functional
processes. Competitive advantage

The process of technological innovation is generated by the

science and technology infrastructure of a nation. This infrastructure
provides new technical knowledge to the economic and financial
infiastructure of the nation. Technological innovation is commercialized
in economic systems to add value to markefs and to international trade.
Technological innovation provides a competitive for
exports and for the businesses in a nation, thus contributing to wealth
creation. Increasing brand imaging

The forgotten dimension of innovation is branding, not applying

a name and logo but creating a brand supported by a strategy and an
actively managed brand building program. Unless an innovation is
branded, there is the risk that the innovation could fade into the crowded
marketplace and see its life shortened.

The return on investment could then be reduced by orders of

magnitude. Branding has the potential to own an innovation over time,
to add credibility and legitimacy to the innovation, to enhance its
visibility, and to make communication more feasible and effective.

When a transformational innovation that creates a new

subcategory is involved, a brand can help to define, position, and
dominate that new subcategory. Not all innovations should be supported
by a strong, actively-managed brand, but the brand decision should be
part of the innovation strategy1281. Sales improvementlraising high levels of sales

In the light of recent changes in the marketing environment, it is

now necessary to develop innovative business and sales activities that
adequately take into account the changing characteristics of customer's
who are seeking to break free from convention. If they are to be
successhl in the future, those involved *in global marketing must
develop an excellent quality marketing system that is impressive to users
and that will enable the consistent A marketing management system
must be established so that the divisions responsible for the development
and design of appealing products Business, Sales and Service divisions,
which are also the ones closest to customer, can easily acquirc
information on customer needs and preferences through the consistent
application of objective data and scientific Effective decision making

Various models have been developed to explain the factors

behind innovation decision making but most of them portray the process
by which firms select an innovation as economically and rationally

To understand institutional implications for innovation decision

making, two questions are important to develop: 1) what are the
mechanisms through which institutions shape the behaviour of firms and
2) who are the institutional agents responsible for this influence[""]. Vision improvisation

Leaders understand that they are expected to be 'creative' and

that 'creativity leads to innovation'. Improv~sation structures and
techniques are the methodology that link creativity and innovation.
Good plannlng is essential to all team projects and it's the leader's
ability to spontaneously respond to unexpected situations that helps keep
the team connected to the vision.

It is the 'in the moment' response that is the most difficult to

prepare lcaders to handle because it is, by its nature, the arrival of the
unexpected and, "the moment of risk1 is at hand. If dramalthcatrc is the
art of human communication then improvisation is the leadership tool
that encourages us to, "draw on our own resources, ~f we are open and
receptive, we can make discoveries both about ourselves and others""."

Leaders need to be taught how to improvise in a safe, creative

environment. The only way to learn about creativity is through
experiential practice. Once learned,' improvisation can be taught to the
team so they can improvise together. Once the team speaks the same
creative language, they will be able to apply creative collaboration to
solve problems, and meet the challenges of projects requiring
innovation. Ease of implementation in existing facilities

Innovation implementation is "the transition period during which

individuals ideally become increasingly skilful, consistent, and
committed in their use of an innovation. Implementation is the critical
gateway between the decision to adopt the innovation and the routine
use of the innovation" ( ~ l e i n [ ~&" ~ o r r a [,~ 1996,
'~ p. 1057). The
difference between adoption and implementation is fundamental:
Individuals, teams, organizations, and communities often adopt
innovations but fail to implement them successfully. Targeted users and
their managers may feel greater pressure to maintain pre-existing levels
of performance than to invest in the uncertain and long-term potential of
innovation implementation(Katherine J. Klein and Andrew P. Knigh,

While the traditional business logic was based on a high level of

structure and control, the dynamics of the new business environment
demands a different model of organization design. This model is
characterized by relative lack of structure and lack of external controls.

Differences in perspective may have a very positive role in

innovation that feeds new product and service definitions and business
models. This view encourages promotion of individual autonomy in
experimentation and learning. Instead of emphasising 'best practices'
archived in databases, it encourages continuous pursuit of better
practices that are aligned with a dynamically changing business
environment, Tony Proctor, 20 1o [~~~. Willingness to take risk I Accept risk and a climate

where mistakes are 0.k.

Albert Einstein once said, "If at first an idea doesn't seem totally
absurd there's no hope for it." Innovators understand that you have no
choice; you must take risks, often big ones, by moving toward the
absurd, the "seemingly" irrelevant, in order to create pre-emptive
competitive advantage while competitors move in the "obvious"
direction, M K ~ a l h o t r a [ ~ "~] ;o w e l l and
I~~~ ,2005. 1 See value in absurdity

Embracing the seemingly absurd and irrelevant, one can "create

pre-emptive competitive advantage while competitors move in the
'obvious' direction", ~ o r t e r [ ~ ~1992;
], ~], M K
~ o o l d r i d ~ e ' ~1988;
~ a l h o t r a ~ ~V' ] ,rover'^^], ~esilvio[~"]. Open-minded exploration of the marketplace drivers

of innovation

Organizational change is driven by marketplace factors:

customers, competition, government regulation, and science and
technology. Only by exploring these drivers of change can a company
begin to recognize what it must do to be relevant in its envisioned
future. Winning the resource/talent market

Empirical research on innovation and firm size confirms that

despite large firms' apparent advantages in scale and access to
complementary assets and capabilities (~eece'"], 1986), small firms are
more efficient at innovation, particularly radical forms of innovation
(ISarnien["] and ~ c h w a r t z [ ~1982;
~ ' , ~cherer'"~, 1965; ~ c h m o o k l e r [ ~
1972; ~ a n s f i e l d ' ~ ~1971).

Efforts by large firms to access the innovation producing virtues

of small size through both imitation and alliance formation hrther attest
to these advantages of small size. Through equity participation, contract
research, licensing, or simple outsourcing, large firms seek to acquire
small firm innovations directly. Equally important, through the
formation of small, cross-functional internal units, large firms seek to
mimic features of the small, autonomous firm (~urgelman'~~'],
lark[^'] and ~ h e e l w r i ~ h t ' ~1992).
' ] , Common to both of these emerging
models is an escalating reliance on small, autonomous firms and units to
generate innovation (Todd R. Zengera & Sergio G. Lazzarini, 2004)'"'.

2. 6.1.14 Relative quality

The literature unanimously addresses product quality as a

prerequisite for success (~inkl'", 1987; ~alantone['~I,1993; ~ultink['~
1998). oure el^" and ~ e e l e ~ ' ~1990
" , address it even as the only real
determinant of success. Timing market introduction

Timing should of course be ahead of competing products, and

early market introduction is considered to yield huge competitive
advantages ( ~ o ~ k i n s [ " ]1,98 1; ~ a i d i ~ u e '&
" ~~ i r ~ e r ' ~1984).
" , ~ohne["]
and h nelson[^'] (1988) estimate that a delay of six to twelve months will
reduce financial returns by half. Therefore, it is recommended to create
short-cuts in the innovation process that speed up market introduction
& ~ a h a j a n [ ' ~ ]1.988). Commercial viability

The first major investigation of factors affecting viability of

innovation projects has been the SAPPHO-study (Scientific Activity
Predictor from Patterns with Heuristic Origins), conducted in the early
1970s in the United Kingdom. The study compared 29 successful with
29 unsuccessful innovations in chemicals and scientific instruments and
found 27 characteristics of the innovation process that discriminated
between success and failure. These relate to the innovator's feeling for
customer needs, to marketing capabilities, to the efficiency of the
development process, the extent to which the firm is able to absorb
external information adequately and general managerial capabilities
h re em an["], 1972).

2. 6.1.17 Concentration of target market

One market related factor associated with the product's

commercial viability is the extent to which the product's potential
purchasers are concentrated in a single market, which eases
communication. However, the relationship does not need to be linear.
~ o u r e [ ' ~ ]and ~ e e l e ~ (1990)
' ~ ~ ] report evidence of a U-shaped
association between concentration of buyers and viability: high as well
as low degrees of buyer concentration add to the product's viability.
2.6.2 Factors Related to Technical Personnel Define standards of performance expected

It begins with an understanding of what constitutes best practices.

A thorough literature review combined in-depth benchmarking studies
of best practices in other companies is one place to begin. Much has
been written in the literature on different approaches, prescriptions, and
methods to improve product development. So access it, chances are your
desired best practices have already been published and are in the public

Bench marketing studies of practices in other firms is also a

useful way to identify new methods and approaches. Some
benchmarking studies have been published riffin in'^'^ and pageL5']);but
likely you'll need a more in-depth look at practices, getting into the
details and how these processes really work within companies. Having
decided what are desired or expected practices, next, build these into
your new product process. Do this via defined stages complete with
explicit deliverables for each gate review. Idea generation

Virtually all innovation processes include the creation or

identification of opportunities and the selection of one or more of the
most promising directions.

The success of idea generation in innovation projects usually

depends on the quality of the best opportunity identified. In most
innovation project settings, an organization would prefer 20 bad ideas
and 1 outstanding idea to 21 merely good ideas.
In the world of innovation, the extremes are what matter, not the
average or the norm ( ~ a h a n [ ' ~&] end el so$'^^, 2001 ; ~ e r w i e s c h '&~ ~
~ o c h ' ' ~2004;
~ , ~erwiesch["~& ~ l r i c h [ ~ ',2009).
l This objective is very
different from those in, for example, manufacturing, where most firms
would prefer to have 2 1 production runs with good quality over having 1
production run with exceptional quality followed by 20 production runs
of scrap. Experimentation

Good experimenting takes time, and is DIVERGENT. Divergent

in the sense that as one experiment, one attempts new things and strays
from the "straight and narrow" since discovery and learning is part of
good experimentation. You can either experiment to prove something
false, or experiment to learn something. The mentality matters (Mark
~ e b e l l [ ' ~&] Jay ~ e n v i l l i g e r [201
~ ~ 1).

Good experimentation means you'll have lots of failures, but

obtain a lot of learning. However, no Six Sigma certified firm tolerates
"lots of failures" for long. Too often that experimenting looks like "non-
valued added" work which should be eliminated.

Outside of R&D most business functions don't have experience

with experimenting and don't understand the value proposition. It's as if
learning or attempting some new functions or offerings is verboten.
Only the h i l y expected and fully perfected are allowed. Skill enhancement

The role of skills has received remarkably little attention from

scholars of innovation in recent years (Tether, ~ O O S ) yet
' ~ ~it~is, clear
that skills have a hndamental bearing on innovation and firms 'wider
performance. Interaction with Business Users

Interaction with business user provides the technical group with a

clear understanding on the purpose of the services that they are
developing for. One may expect that the role of R&D in innovation is
reduced in these economies as their overall business expenditures on
R&D are comparatively quite low but the role of users and markets
should be important. (Slavo Radosevic & Esin Yoruk, 2012)'~". Functional Specification documentation

A clear understanding of the business requirements should be

adhered by the design personnel, which helps in developing the
appropriate Information Technology Service project. While converting
the business rules into functional specification a clear vision of the
scenario helps in reaching out the acceptance criteria (Roger S
Pressman, 2001 )["I.

2. 6.2.7 Technical Specification documentation

A clear understanding of the technical requirements should be

adhered by the technical personnel, which helps in developing the
appropriate Information Technology Service project. While converting
the functional specifications into technical specification a clcar vision of
the scenario helps in reaching out the acceptance criteria (Roger S
Pressman, 200 1 )["I. Seek cycle time reduction, but don't become a speed

Seek cycle time reduction, but don't become a speed freak. There
is a dark side to speed. It's fine to build flexibility into the process. For
example, to collapse stages, combine gates, and even overlap stages or
bring long lead-time activities forward. But make sure these detours arc
made consciously, in fill awareness of the risks, and at gate meetings
(Kleinschmidt, E.J. & Cooper, R.G, 1991)['".

Make it a rule: don't delete key tasks because you think you
know the answers. And for higher-risk projects, stay close to the
prescribed game plan not too many detours. Acceptance procedure

Proper exit criteria or acceptance procedure should be defined

and documented. Respective sign offys should be taken at each and
every stage of the sofiware developn~entlife cycle Roger Pressman,
2001 '63]. Emphasize exploratory thinking

Leaders must help individuals get past their stereotypical ideas of

what creativity is, and lead their people onto a path of discovery of their
own creative abilities, and they also must enhance those abilities on an
ongoing basis. They need to leverage the creativity of each person to
ensure high quality thinking across the organization. They need to
understand and communicate just what "creativity" is, and what thc
expectations are. The good news: We are all creative, with the ability to
look at things with new perspectives and generate fiesh solutions
" ~~aughton["l,
] 2009). 1 Implementation after trail

Implementation is the process of converting a new or revised

system design into an operational one, Implementation consists of
Conversion, post Implementation review and software maintenance. A
successful implementation of an increased if special attention is paid to
the following areas: Gaining management and user commitment to the
project, Gaining user commitment to any changes initiated in the new
system and Assuring that the project is well defined and plans are
clearly specified (~ozijnsen['~],
2000). Review of Functional Specifications Document

As per the defined project plan review of the functional

specification and its sing-off is mandated. This will help in having a
clear scope definition and identifying the in scope items for the related
work product (Roger S Prcssman, 2001)1671. Usage of appropriate technology to develop & create

the solution from specification document

Appropriate use of technology at the right stage as per the

feasibility study would provide a cost effective solution. Appropriate
technology is technology that is designed to be "appropriate" to the
context of its use. The most appropriate technologies are, Sustainable,
Small, Appropriate, Gales, 19951'*1;Danny Samson, 20 1o'~''. Rewards and recognition

Provide training for project team members as well as gatekeepers.

Don't assume that running a project, mentoring a project team, or gate
keeping is easy stuff. New product management is one of the most
challenges management tasks in business. So educate those involved!
And groom good project leaders, providing them with rewards,
recognition, and support, Gales, 1995[(*]; Danny Samson, 20 1 o"~'.

2. 6.2.15 Designers familiarity with innovation management

techniques and software

This is one of the key factors in determining the success of

Information Technology Service projects. This helps a lot in running the
projects on schedule and providing less scope for training the personnel
who are already acquainted with the required skills (Galhraith, 19771hXI
~ a l e s l ~1995).
~], Review of Technical Specifications Document

As per the defined project plan review of the technical

specification and its sing-off is mandated. This helps in reducing the
bugs down the lane in the project and thus saving costs that might have a
large impact on the business run (Roger S Pressman, 2001)103'. Creating resourced, multi-functional dedicated team

The best teams have three ingredients: project champions who

can make decisions during working sessions and advocate for them with
executive sponsors, relevant capabilities and expertise, and naive,
seemingly irrelevant diversity. Most often a breakthrough starts with the
naive and then the experts deternine how to do it (Mark ~ e b e l l "&~ Jay
~ e r w i l l i ~ e r ' 20
~ ' )1~1).,
2.6.3 Factors related to Management Personnel A well defined yet flexible execution process

Companies that have been in business for a while are good at

executing on small, incremental changes. And that's challenging enough.
What they don't know how to do is nurture, support, and modify
potentially big new ideas with a more flexible execution process. There
are three elements to innovation execution. First, build a dedicated team
for innovation, ~rnaro["]& dos ~antos~''',2008.

Breakthroughs cannot happen inside the performance engine - - it

is built for efficiency, not for innovation. Second, link the dedicated
team to the performance engine so that it can leverage key assets of the
core business. Third, evaluate the innovation leader for managing
disciplined experiments, not for hitting short-term profit goals. Visible senior management involvement

Incremental innovation can be pushed down into the organization

where the strategy is clear, decision metrics are understood, and
management models like Stage-Gate create a level playing field.
However, for game-changing innovation it's the opposite, ~othwell'~"
1992; ~ a ~ e ' " '1993.

The strategy is fuzzy, and traditional metrics can't be applied

early in the process, because that which is truly new has neither frame of
reference nor benchmark. So Stage-Gate models can unintentionally kill
potentially big ideas. 'The pursuit of game-changing innovation only
works when the person who can say yes to big spending visibly sponsors
and participates in the work and provides air cover to the work team. A compelling case for innovation

Unless people understand why innovation is necessary. it always

loses to core business or the performance engine in the battle for
resources. The performance engine is bigger, is the centre of power, and
can justify resources based on short term financial results. So the case
for innovation has to be made, and it better be compelling, ~ r a d $ ~ '&
~ o d e r l u n d '2008;
~ ~ ~ ,Mark ~ e b e l l ~&
~ 'Jay
' ~ e r w i l l i ~ e ~20' ~11.
', Good interpersonal relationships through channels of


Strategic communication, in contrast to everyday public relations,

concentrates on the core drivers of organizational success. It also
expands the traditional set of institutionalized communication measures
in order to manage meaning in all kinds of interactions with internal and
" , (Wesley M. Cohen; Daniel A.
external stakeholders, ~ i n t z b e r ~ l ~1979;
Levinthal, 1 9 9 0 ) ~ ' ~ ~ . Innovation must be aligned with mission and goals

Most companies anticipate the future based upon the past. Not
surprisingly, the company always looks relevant in that fbture. However,
if the past is suspended and a holistic view of the future is envisioned,
then it's easier to recognize tidal forces of change and (surprise!) the
company may not look so relevant in that future. For this process, it is
best to take a 10-20-year perspective. It is not about predicting the
future. It is about developing hypotheses about the future, Andersen
Grude K v I ~ " 1 Haug TI^", 2004. Healthy teamwork support

Breakthroughs cannot survive without a decision-making model

that is different fiom the one used for incremental innovation. It's not
about metrics; it's about "the educated gut." Old models don't work.
Autocratic decision-making fails to engage all of the critical
stakeholders, while consensus sinks every decision to its lowest possible
common denominator. It doesn't work without a passionate champion
who can make decisions and engage the team to support those decisions,
Watts S ~ u r n ~ h r e ~ [ ~ ~~ei~onen"'
1997; ], , 2005. Cross-functional collaboration & communication - use

all of your varied resources

Lacking a renaissance man or woman as a team member or

leader, the next best thing is a cross-functional team comprised of
members fiom various functions and with complementary skills. Our
research shows that a true cross-functional team dramatically improves
both times to market and success rates. 1 emphasize the word "true,"
simply because there are so many "pretend" or dysfunctional project
teams in existence. Here's what winning teams have in common in this
study: An assigned team of players-it is clear who is on the team too
often, team membership was vague and unstable; such teams did not
perform as well, Robert G Cooper, 1999'"'.

Cross-functional, fiom many departments and functions in the

business, with each member having an equal stake in the project as
opposed to a leader fiom one department dictating to the other team
members and departments.
A dedicated, accountable team leader-that is, not doing too
many other projects or other assignments at the same time, and held
accountable for the project's results. Accountable for the entire project
as a team: from beginning to end not just one phase of it. Other facets of
an effective cross-functional team include genuine commitment of
resources to the team by management.

The functional bosses become resources providers and give

defined release time to team members. Once resources are committed to
a project, functional bosses cannot arbitrarily overrule the team and
renege on resource commitments Use of all varied resources

Most businesses have too many projects and not enough

resources to do them properly, ~ubenstcin''~~,
1976. This is the result of
two management failures:
(1) Management doesn't provide the necessary resources to
achieve the business's new product goals; or
(2) They approve too many projects for the limited resources
available. Indeed, the performance of project teams often is jeopardized
by senior management. Confidence of management group on Technical


Some management practices also appear to reflect the belief that

an excessive degree of overlap in functions may reduce the firm's
absorptive capacity and that diversity of backgrounds is useful. The
practice of rotating R&D personnel through marketing and
manufacturing operations, while creating knowledge overlap, also
enhances the diversity of background of their personnel. ~ o t h w e l l ' ~ "
1992; pagel5I1,1993.

Involving the assignment of technical personnel to other

functions for several years, this practice also suggests that some
intensity of experience in each of the complementary knowledge
domains is necessary to put an effective absorptive capacity in place and
the confidence of management on technical personnel (A. Kusiak and
C.-Y. Tang, 2 0 0 6 ) [ ~ ~ ]

2. 6.3.10 Extent of consultation by Technical Personnel in

designing of Innovation Management Projects

There will always be a value add when the technical group gets
involved in RFP(request for proposal's) and during the estimation of the
IT Projects and this will help the management in having a broader and
clear idea, Howes, NR 200 117". Determined, energetic, dynamic leadership

As the Cheshire cat said to Alice, "If you don't know where
you're going, any road will get you there." Innovation is a journey into
the unknown and there are many paths open to the innovator. Before
starting it is essential to know things like: what businesses are we in
now and want to be in going forward. What is our risk tolerance for
pursuing big, game-changing ideas, ~ o t h w e l l ~ " ' 1992;
, ~ a ~ e ' " 1993.

2. 6.3.12 Risk Valuation

Good management of projects involving risk and unpredictability

is highly valued, even when things don't turn out according to plan,
& dos ~antos'~",
1 06 Sense of customer focus and value creation

Innovation is not just great thinking or great creativity in a

vacuum. It is creativity that is active, that delivers something new and
better. And also, it implies new and better for a purpose that adds value.
The customer is a person - or an organization, or a society - that has a
need that will be met by the innovation, ~ a i d i ~ u e1
' ~~~i r"~ e r l ?1984.

Focusing on the customer thus becomes a way of figuring out

how to make innovation happen. In other words, the customer is a
person - or an organization, or a society - that has a need that will be
met by the innovation. Focusing on the customer thus becomes a way of
figuring out how to make innovation happen (Fred Hassan, 2006)'~'~ Readiness for regular change

The idealization starts with the company's competitive strategy

and its desire for innovation. Change includes triggers, targets, and types
of change that occur in companies. Change is always occurring in
companies, Rogers E, 2003 '"'; Drucker, 1985121.

Companies usually benefit more from change they are prepared

for versus change that is imposed on them. In addition to preparing for
change, companies should also learn how to identify the need to change
and to manage it successfully. This learning capability will allow
companies to address future problems and take advantage of
opportunities more quickly and effectively than their competitors[5vJ. Creating work-life balance among employees

Firm encourages high performance projects that add value, foster

innovation and offer skilled resources with rewards and additional
bonuses, Reimers-Hild, Connie 1, 201 1"'. Flexible working has evolved
from being the exception to being the norm. It is important to note that
not all employees are entitled to request the right to work flexibly["]. Involving partners from outside the organization:

open innovation works

Partnering with other companies, even competitors, for access to

their complementary resources can allow firms to offer products or
services that they could not otherwise offer. Partnering successfLlly
requires development of negotiation and collaboration skills, and
probably some shared decision-making, Watts S ~ u r n ~ h r e ~ [ ' *1997;
~ ~ ~ . doing this is challenging and may cause
Roger Pressman, 2 0 0 1 ~ While
apprehension about loss of independence, self-sufficiency can foster
stagnation, which ultimately may he riskier to long-term survival than
partnering to pursue opportunities for growth and innovation"*. Involvement of Management Personnel in finalizing

user's requirements

From the innovation standpoint, user requirements are not easily

captured, especially for those that are beyond the mundane ones, Danny
Samson, 2010~"~.What makes an innovator different is the ability to
grasp those implicit needs and transform them into technical
1.7 Research Gap

From the literature review in previous section it is found that

there is an obvious need to assess more systematically factors behind
success and more often failure of innovation management in information
technology services. Not surprisingly, a considerable literature has
emerged during the past 20 years. However, at first view, it seems as if
this literature is far from providing a conclusive picture of the most
important factors that determine success and failure of innovation

From the above discussions, Information Technology services are

considered as growing part of the economy and in many countries a
dominant source of employment. Research has also been scarce when it
comes to understanding and developing the processes by which new
services emerge in service firms, even though research on service
innovation and new service development has grown into a respectable
and vibrant field of its own in the past 20 years. This growth of research
has gone hand in hand with a change in the view of Information
Technology services, from being seen as non-innovative, to a view that
highlights innovation potential in services. Information technology has
been a strong driver in this development ( ~ i l e s ' ~2000).

The research available till now discusses various issues

concerning innovations of product development in manufacturing

There are very few studies available across the 'globe in

Information Technology Service Enterprises where especially measuring
the success or failure of the Innovation before implementing the
Information Technology Service Projects.
2.8 Need of the Study

A paradigm shift in information Technology Services firms is

observed across geographies due to globalization & privatization.
Innovations have become important for long survival and competitive
growth among Information Technology Service firms.

Innovation means new service ideas or new Information

Technology processes that lowers deliver costs, with good quality. It
includes new processes of design, development and Implementation, and
Technology exploration. These concepts lead to innovation management
in Information Technology Service Enterprises. This drives the present
research study of innovation management in Information Technology
Enterprise Services.

2.9 Research Problem

From the above section the research problem can be summarised

as: What are the crucial success factor's from a technical personnel,
business user and management personnel perspective in determining the
innovation management success rate in information technology service

2.10 Objectives of the Current Study

To study the above research problem the following objectives are

1. Identifying the dimensions of success of Innovation
2. Modelling of Innovation Management Project success
3. Testing the Model of Innovation Management Project

2.1 1 Hypothesis

The above objectives were tested using the hypothesis stated

1. Intensity and Dimensions of Innovation Management is
different for Design Personnel, Business User, and
Management Personnel.
2. The success of Innovation in Information Technology
Projects can be modelled with technique of fuzzy logic
using neural networks.

2.12 Conceptual framework of the Study

The Conceptual framework is described in the following section.

Fig: 2.2 Conceptual Frame Work of the Study

Design Imporlance

N N Modellrng

success score
It can be said that the implementation of Innovation Management
Project of Information Technology Services is evaluated in terms of
success factors relevant to various category of personnel involved in
defining, developing and managing the innovations in Information
Technology Service enterprises are identified and depicted in Fig 2.2.

2.13 Type of Research Method

The study explores the factors of success of innovation

management, in information technology service enterprises, develops a
models using the using Neural Networks. So, it uses explorative
research methodology.

2.14 Sources of Data

This research requires both primary and secondary data. The

primary data is collected from the group of design personnel, business
users and management personnel from various Infonnation Technology
Service enterprises.

Secondary data about innovation management in information

technology service firms was gathered from various books, journals and
websites of Information Technology Service Enterprise and various
supporting organisations.

The data for the study is collected using sample survey method
by administering the questionnaire.
2.15 Sampling
2.15.1 Sampling Technique

The sample was selected by using judgment sampling technique

among the information technology service enterprises based on
Involment in innovation projects they implement.

Information Technology firms are selected on the basis of CMM

(Capability Maturity Model) levels defined by SEI (Software
Engineering Institute). From each CMM level (1 to 5 ) two firms are
selected based on their involvement in innovation projects.

2.15.2 Sample Size

A total of 50 Information Technology enterprises are identified

according to CMM levels. The Table 2.5 shows the list of organisations
considered for the study.

Table 2.5 List of IT Enterprises considered for the study

S. No Name of the Orpanhation CMM Level
1 IBM lndia Pvt Ltd 5
2 Tata Consultancy Services India Pvt Ltd 5
3 Hewlett Packard India Pvt Ltd 5
4 Cognizant Technology Solutions Pvt Ltd 5
CGI Information Systems and Management 5
Table 2.5 List of IT Enterprises considered for the study
8. No Name of the Organization CMM hvGm7
I7 Vcentric Technologies Pvt Ltd 4
18 Mapples India Pvt Ltd 4
19 Datamatics Pvt Ltd 4
20 Helios & Matheson India Pvt Ltd 4
21 ValueLabs 3
22 SP Software (P) Limited 3
23 _InfotechIndia Pvt Ltd ----- "." ----3 "-

24 Sierra Atlantic Software Services Limited --- 3 - --

25 VSoft Technologies Pvt Ltd - - 3
1 26 1 Zen Technologies Ltd - 3 1
1 27 1 CMC Limited U--1

From each firm 2 Project Samples consisting of 30 responses

each are collected from the three groups (Technical Personnel -12,
Business users -8, Management Personnel - 10, respectively).
In total 3000 responses by administering the questionnaire are
collected from 50 lnnovative Information Technology Service firms.
Responses are categorized into Control data and Test data.

2.16 Period of the Study

The responses are collected during the year 20 12- 13.

2.17 Limitations

Factors considered are concerned to Information Technology

Service Enterprises only, may not be applicable for other sectors.

2.18 Design of Questionnaire

Questionnaire constitutes two parts. Part A consists of questions

related to demographic variables such as name, designation, experience,
and department. Part B consists of the factors of success according to
Technical Personnel, Business Users and Management Personnel. Table
2.6 depicts about factors related to business users, Table 2.7 relates to
management personnel and Table 2.8 with regard to technical personnel.

2.19 Data Analysis

The collected data is analysed using SPSS 20.0. To test
Hypothesis 1 (H 1 : Intensity and Dimensions of Innovation Management
is different for Design Personnel, Business User, and Management
Personnel) ANOVA analysis is used.

According to design personnel, business users and management

personnel in Information Technology Service Enterprises perception
scores of intensity of success factors is measured and at the same time
importance of each factor are also measured. ANOVA analysis is
applied on the intensity of success data set.

Table 2.6 Various success factors studied for Business Users

Factors Studied for
Business Users Author's Studied
2ozijnse1d'~',2000; crawfordrI9,
1 Cost reduction/relative price 199 1 ; ~ o o p e r " & ~ ' ~leinschmidt"",
1987; ~ a d i q u e [ ~ O Zirl & err2"'
1984; R O ~ ' ~ & 8 *
' ' ~ i e d e l I,' ~1997

Value creation and progressive value q a l ~ ' ~ '1993;

~ , porteP3l, 1992;
add ~ o o l d r * ~ ~ , ow ell^^^^ and
i d ~ e l 1988;
@tark[25', 2005
3 Flexibility in process
bl K ~ a l h o t r d ~V~ rover^^',
', M
pm --
4 Competitive advantage prederick ~ e t z " ~201 ', 1
5 Increasing brand imaging >avid ~ a k e r ~ '2006 ~',
ti Sales improvementlraising high levels 2hina-USA, Business Review,
of sales Volume 8, Number 3, March 2009~'"~
- ---
7 Zahier de December
Effective decision making
-.. - ,2003,
8 Vision improvisation Hodgson
Ease of implementation in existing a"", 1996; Katherine
facilities ~ ' Andrew P ~ n i ~ h t " "
~ e i n " and
10 Willingness to accept risk
~orter"", 1992; ~ o o l d r i d ~ e ' ~ ~ ' ,
11 See value in absurdity 1988; M K ~ a l h o t r a l ~V~ ' ,
3roveti2", ~ e s i l v i o ~ ~ " ~
Perception regarding apprec~ationin Tony Proctor, 2 0 1 0 ~ ' ~ ~
implementation of innovation systems
Teecel'", 1986; ~amien'""'
~chwartzl'~',1982; ~chererl"'. 1965;
"~hmooklerl'~~, 1972; ~ansfield~'"',
13 Winning the resourceitalent market
;97 ; Burgelman[401, 9R3; C l a r k ~ 4 ~ 1
& ~ h e e l w r i g h t ' ~ "1992;
, Todd R.
~ e n g e r a ' ~&Seryio
~' G ~azzarini'~
1987; ~ a l a n t o n e ' ~1993;
14 Relative quality ~ ~ ~ , oure el^"' &
- ~ u l t i n k ' 1998;
- - -- <ee~ey[~'', 1990 -- --
~opkinsM7', 1981; ~ a i d i ~ u e&" ~
irgerl2('l,1984; ~ o h n e ' ~& *]
15 Timing market introduction
~nelsonl~" , 1988; &
~lahajanl~", 1988
16 Commercial viability +eeman'50', 1972
17 Concentration of target market pourem & ICeelePJ , 1990- - -
Table 2.7 Various success factors studied for Management Personnd

S.No Success Factors Studied for

Management Personnel Author's Studied
A well defined but flexible execution ~ m a r o l ' ~&' dos ~antod'"', 2008
1 process

Visible senior management ~othwell"'~,1992; page1" I], 1993

2 involvement

~rady"" & ~oderlund['". 2008;

A compelling case of innovation Mark ~ebell'"] & Jay ~erwilli~er'~'
201 1

Innovation must be aligned with Andersen ES'~",Grude KV'~"&

4 mission and goals Haug T [ ~ ' I , 2004

Good interpersonal relationships ~ i n t z b e r g ' ~1979;

~ ' , Wesley M.
5 through channels of communication Cohen; Daniel A. Levinthal, 1990~'"~

Watts S ~ u m ~ h r e ~ l 1997;
6 Healthy teamwork support
~ e i ~ o n e n,'2005

Cross functional collaboration and Robert G Cooper, 1999'661

7 communication
---- --
8 Use of all varied resources ~ u b e n s t e i n ' ~1976

Confidence of management group ~ o t h w e l l [ ~1992;

' ~ , Pagei5'I, 1993; A.
9 on Technical Personnel Kusiak and C.-Y. Tang, 2006'~"

Extent of consultation by Technical Howes, NR 2001'~~'

Personnel in designing of Innovation
Management Projects

Involvemerlt of Management Watts S ~ u r n ~ h r e ~ '1997;

" ' , Roger
Personnel in finalizing users Pressman, 2001'"'
-- -
Detem~ined,energetic, dynamic Rothwel-992; ~age'W3----
12 leadership
- -. --.-"--*.-- -
Risk Valuation ~ m a r o ~ ~ ~ ~ a n2008
t o s ~
Sense of customer focus and value ~ a i d i ~ u e-
&' Z
14 creation Hassan, 2006'"'

Rogers E (2003) r781; Drucker,

15 Keadiness for regular change 198512]

Creating work-life balance among Reimers-Hild, Connie I, 201 11791

16 employees
Involving partners from outside the Danny Samson, 2010'"'
17 organization: open innovation works
"- ---" -- --
Table 2.8 Various success factors studied for Technical Personnel

Functional Specifications Docu~nent /Roger Pressman, 2001'~"
Technical Specifications Document Roger Pressman, 2 0 0 1 ~
1 Seek cycle time reduction I
IRobert G Cooper, 1991r66'
Skill enhancement Tether, 2 0 0 5 ~ ' ~ ~
I I --
6 Acceptance procedure Roger Pressman, 2001m

Emphasize exploration thinking


Kacanaghl" & ~augh~on'"".

8 Implementation after trail ~ozijnsen"~',


Review of Functional Specifications Roger Pressman, 2001'""'

9 Document

Familiar with Innovation Gales, 1995'"~';Danny Samson,

,, Management Techniques &
201 ol"'

Usage of appropriate technology to Galbraith, 19771"1; Galedh4', 1995

12 develop & create the solution

Define standards of performance Robert G Cooper, 1991"~'

13 expected

Creating resourced, multi functional Mark ~ e b e l l&l ~Jay

~ ~~envillige&"~,
14 dedicated team 201 1
Vandenbosch B, Saatcioglu A & Fay
Idea generation S, 2006; Kellf' & ~ t o r e ~ l "2000;
~alesl"', 1995

Mark ~ e b e l l ' ~65." Jay ~ e n v i l l j ~ e ~ " ' ,

Experimentation 201 1

, I
Rewards and recognitioli 1 ~ a n Samson.

n ~ 201 0"'
In order to solve the problem of non-linear relationships that
exists in factors of success of Innovation Management, a technique of
Neural Networks is applied and tested in the present study. To test
hypothesis two H2: "The success of Innovation in information
Technology Projects can be modelled with technique of Neural
Networking model is used".

The responses are divided into test data set and control data set.
Let Xij be the success factor perception score according to ith respondent
which indicates degree of intensity of success factor in association with
the control data responses, where X , will take fbzzy number fkom 1 to 5.

YI be success factor perception score according to iih respondent

which indicates success factor score of test data responses.

Where i - 1 to 3 represent the type of personnel, i = 1 represents

Technical Personnel, 2 - Business User, 3 - Management Personnel

j = 1 to n, where n is the number of important success factors. n

also represents number of neurons in input as well as output layers of
neural networks; and W , is the loading of the factor identified as
important by the business users, technical personnel and management

Let f, be the input function, f2 the output function and E the

relative error. Then the equations of input function, output function and
error are described as below:
E = fl- f2,

If E <= 0.1 Innovation Project is Success, else Innovation Project

is not success.

Fig 2.3 Neural Network Modelling

Control Data Test Data

---+ to Factor
' to

Error is determined for each of the Technical Personnel, Business

User and Management Personnel based on the control data response, test
data responses using Xij, Wu or Yil, Wii This is estimated by the three
way neural networks which have Input Variable Set Layer, Factor
Weight Layer, and the Output Layer as show in Fig 2.3.

2.20 Scope of the Study

This study is applicable to information Technology Enterprise

Service projects.
2.21 Chapterisation

The overall study was divided into five chapters. Chapter 1 gives
introduction to theoretical aspects of Innovation Management in
Information Technology Services. Chapter 2 consists of survey of
literature and objectives, hypothesis & research methodology adopted
for the study. Chapter 3 explains about measuring innovation
management. Chapter 4 portrays results and discussions of the study.
Chapter 5 provides conclusions and suggestions.
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