Transcription

ijcrb.webs.comJANUARY 2013INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESSVOL 4, NO 9A Comprehensive Systemic Model of Innovation Management :Total Innovation Management ( TIM )Abbasali HajikarimiAssociate Professor of Business Management DepartmentShahid Beheshti University,Tehran - IranMohammad Reza HamidizadehProfessor of Business Management DepartmentShahid Beheshti University,Tehran - IranNasrin JazaniAssociate Professor of Business Management DepartmentShahid Beheshti University,Tehran - IranSayed Mahdi Golestan Hashemi *Research Center of Innovation Management and Engineering ,Tehran - Iran* Corresponding authorAbstractIn today's knowledge based economy, innovation is a crucial factor for success andsurvival of businesses. Therefore, all industries highly to be in need of effectiveinnovation management .In this research , a comprehensive model of innovationmanagement (Total Innovation Management – TIM ) have been designed on the basis ofan extensive theoretical review and according to the incorporated systemic approach . TheTIM model embraces the most main factors and aspects of a broad view of effectiveinnovation management in industrial organizations,included innovation resources ,innovation processes and outcomes ( 26 hypotheses ). The model was then examined andvalidated through an empirical and field study among industry managers .The datagathering instrument was a researcher-made questionnaire which its reliability coefficientwas accepted .The Structural Equation Modeling (SEM) analytical methodology byLISREL software was used to analysis the data. Research findings indicate that thehypotheses was supported and the model was validated .The TIM model embraces threemain comprehensiveness related to innovation resources, innovation processes andoutcomes. The model has suggested a comprehensive innovation management system,that included several sub-systems .Keywords : Innovation Management , Innovation Model , Total Innovation Management ,Organizational Innovation , Innovation SystemCOPY RIGHT 2013 Institute of Interdisciplinary Business Research1078

ijcrb.webs.comINTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESSJANUARY 2013VOL 4, NO 91. IntroductionToday, industry and business is knowledge based and innovation is the most vital factorfor creating value and competitive advantage. Thus the ability to innovate is one of themost important core competence of the organizations for survival . Numerous businessesare competing to survive in this ever increasing challenging and highly volatileenvironment , and innovation is the most important factor in shaping a corporation’ssuccess throughout the coming years.Today’s business challenge is to unshackle its innovation capacity to control growth andprofitability while achieving leadership in its targeted markets. Global economic forcesand financial constraints have made innovation-driven growth more essential . The needfor innovation is imperative ( Tidd and Bessant , 2005) . Innovation widely recognized byacademics and industry The body of literature around the topic of organizationalcreativity and innovation management is relatively young and grew considerably over therecent decades . The most literature on innovation management models has limitations .First , innovation is very narrowly defined and technology-oriented . In this narrow view,innovation focus on R&D, new product development , product innovation or theproduct/process dichotomy . Whereas innovation is not limited to this and a broad view ofinnovation is necessary . A second limitation of the literature is the lack of a rich typologyfor innovation . Most innovation typologies focus on the degrees or types of technologicalinnovation , while innovation is multifaceted and goes beyond technology , therefore anew innovation typology is needed ( Howells and Tether ,2007, Sawhney, et al ,2006 ).A comprehensive model of innovation management model needs to embrace all mainfactors and aspects of corporate innovation in an integrated way . This research proposedTotal Innovation Management model as a comprehensive , consolidated and systemicapproach to the innovation management .2.THEORETICAL BACKGROUNDAlthough there are different views and perspectives of innovation , a common theme in alldefinitions of innovation is that it is a new ideas that is put into practice while payingspecial attention to its usefulness . A broad , innovation define as an initiative in anydimensions of the business system to create substantial new value for customers and thefirm (Sawhney,2006). Innovation management define as the active and consciousorganization , control and execution of activities that lead to innovation ( Hanson andBirkinshaw , 2007).An overview of related literature shows that innovation management models developedover time . The main reason for this change is the change in the environment in whichinnovation take place. According to the Rothwell (1994), there are five generations ofinnovation management models. The first and second generation of innovationmanagement models are linear models explaining innovation as either being pulled bymarket needs (1950-Mid 1960s), or pushed by technology(Mid 1960s-Early 1970s). Thethird generation model(Early 1970s-Mid 1980s) is a coupling model that recognizes theinfluence of technological capabilities and market needs within the firm . The fourthgeneration model ( Early 1980s-Early 1990s) is an interactive approach that views theinnovation process as parallel activities across organizational functions . The fifthgeneration model (Early 1990s –now) emphasis on the network. Major characteristics ofthe network model are the influence of external environment and the effectivecommunication with external environment . Innovation happens within a network ofCOPY RIGHT 2013 Institute of Interdisciplinary Business Research1079

ijcrb.webs.comJANUARY 2013INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESSVOL 4, NO 9internal and external stakeholders . The establish links between all the role-players isimportant (Rothwell , 1994) .An extensive literature review by Researchers indicate that studies on the innovationmanagement in the recent decades, has provided us with a broad range and various typesof innovation management models, such as Tornansky and Fisher(1990),Ebert(1992),Taam (1992), 2002),Brandenberg(2002),Pan,BeersandKleinich(2003) , Sauber uffin itner(2006),Mage(2006),Kearney(2006),Chenand sawhney (2006),Preeze andlou(2008),Stamm(2008),Birkinshaw,Hamel and Mol (2008), Skarzinsky andGibson(2008). A depth overview of innovation management models by researchershows that all have their advantages and disadvantages , and no model can claim to becomprehensive , covering most main factors and aspects of innovation. All of the modelsare imperfect and ignore several aspects of the innovation management .Innovationmanagement models have become more complex, more inter-disciplinary and moreintegrated ( Eveleens , 2008 ).The relative importance of different models of innovationmanagement varied by time-period because of different external influences(Miller et al 2000). In support of a broader view of innovation , some researchers state thatnon-technological innovations are as important as technological innovation , and there aremany more dimensions to innovation such as organizational innovation and marketinginnovation (OECD,2005).According to Shapiro (2001), enterprises should try to realize24/7 innovation ( all time innovation) for rapid response to the needs of customers .Consequences of the innovations such as social and environmental consequences of theinnovations recently is an important topic. Environmental innovation or Eco-innovationrefer to the innovations that throughout its life cycle, in a reduction of environmental risk,pollution and other negative impacts of resources use compared to relevant alternatives(Speirs et al,2008).Golestan Hashemi (2002,2004,2009) proposeda concept ofTotal InnovationManagement (TIM) and the following related keynotes :1.Creative and exploratoryanalysis and distinguish of customer needs (value creation and answer to latent demandsof people ) , 2.Continuous and ceaseless creativity and innovation , 3.Replaceimprovement –orientation with innovation , 4. Creativity enhancing , 5. Knowledge/Innovation – based works ,6. Continuous creative re-engineering and Changes ,7.Participation of all employees as innovator , 8. Creative strategies , Forecasting andStrategic management of Innovation,9. Networking , 10. Creative Structure andculture,.11.Creative / Inventive Problem Solving and systematic innovation methodologiessuch as TRIZ .Xu et al (2002,2006,2007) proposed a theoretical framework of Total InnovationManagement based on tri-totality in innovation .The first , includes innovation in alltechnological and non-technological elements such as strategy, culture, organization,institution and market .The second relates to innovation by all individuals involved .The third is innovation at all time and in all space. The findings from the literature review,help to extract and articulate the main generic characteristics and components ofinnovation management towards a comprehensive model of innovation management.The process is dynamic and all of the components are amenable to a system-wide . Thedomain of such a model is broad .COPY RIGHT 2013 Institute of Interdisciplinary Business Research1080

ijcrb.webs.comINTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESSJANUARY 2013VOL 4, NO 93. Hypothesis Development and the Research ModelAs the result of an extensive literature review , as mixed findings are observed in priorstudies, null hypotheses are proposed. Constitution of the research framework is based onthe systemic approach. Thus the research model (Total Innovation Management Model)has a systemic structure that constitute inputs (innovation resources) , processes(innovation processes ) and outputs ( innovations and related aspects), as shown in figure1.3.1.HypothesisThe hypotheses are associated with inputs , processes, outputs and their relationships .Hypotheses related to inputs :H1: Creative ideas of employees is a component of the innovation resources .H2: Applied researches of employees is a component of the innovation resources .H3: Research and Development ( R&D) is a component of the innovation resources .H4: Marketing research is a component of the innovation resources .H5: Forecasting studies is a component of the innovation resources .H6: Creative ideas of customers(stakeholders) is a component of the innovationresources .H7: External research co-operations is a component of the innovation resources .H8: Purchase of innovation is a component of the innovation resources .H9: External information resources is a component of the innovation resources .Hypotheses related to processes :H10: Innovative organizational structure is a component of the innovation processes .H11: Innovative organizational culture is a component of the innovation processes .H12: Innovation in all of the value chain is a component of the innovation processes .H13: Innovation in all of the organizational processes is a component of the innovationprocesses .H14: Innovation in all times (24/7) is a component of the innovation processes .H15: Creativity and innovation techniques is a component of the innovation processes .H16: Information and communication technologies is a component of the innovationprocesses .H17: Managerial systems is a component of the innovation processes .Hypotheses related to outputs :H18: All types of the innovations is a component of the outputs .H19: The quantity of the innovations is a component of the outputs .H20: The rate of the innovations is a component of the outputs .H21: The quality of the innovations is a component of the outputs .H22: Consideration of the individual consequences of the innovations is a component ofthe outputs .H23: Consideration of the social consequences of the innovations is a component of theoutputs .H24: Consideration of the environmental consequences of the innovations is acomponent of the outputs .Relationships :H25: There is a significant relationship between input and process .H26: There is a significant relationship between process and output .COPY RIGHT 2013 Institute of Interdisciplinary Business Research1081

ijcrb.webs.comJANUARY 2013INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESSVOL 4, NO 93.2. Research ModelThe research model ( Total Innovation Management model) is the following :InputsProcesses(Innovation Resources)( Innovation Processes )- Creative ideas ofemployees---------------------------- Applied researches ofemployees------------------------------ R&D---------------------------- Marketing research --------------------------- Forecasting studies --------------------------- Creative ideas - External rchase ofinnovation---------------------------- External informationResources- Innovativeorganizational structure------------------------------ Innovativeorganizational culture------------------------------ Innovation in all of thevalue chain------------------------------ Innovation in all of theorganizational processes------------------------------ All time Innovation----------------------------- Creativity & innovationtechniques---------------------------- ------------------- Managerial systemsOutputs(Innovations)- All types of theinnovations---------------------------- The quantity of theinnovations--------------------------- The rate of theinnovations-------------------------- The quality of theinnovations-------------------------- Considerations of theindividual consequences--------------------------- Considerations of thesocial consequences -------------------------- Considerations ofthe environmentalconsequencesFigure 1. Research ModelIn this systemic model , components of the outputs are endogenous variables, andcomponents of the inputs and processes are exogenous variables . Also inputs , processesand outputs are as latent variables and related components are as manifest variables .4. Research Methodology4.1 Research DesignSurvey design method was used in this research . The data collection instrument wasa researcher-made questionnaire .4.2 QuestionnaireThe questions was based on the research model and theoretical backgrounds . Thus thequestionnaire embraces items related to the research model, all measured by using a fivepoint Likert-type scale . Cronbach's alpha was used to verify internal consistency reliability .Cronbach,s coefficients of questionnaire shows a significant reliability of 0.921.Thequestionnaire was pre-tested and revised .COPY RIGHT 2013 Institute of Interdisciplinary Business Research1082

ijcrb.webs.comJANUARY 2013INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESSVOL 4, NO 94.3 Sampling and Data CollectionSampling was done by stratified random method from the 950 iranian medium and largeindustries. Data collection was done by approaching 360 employees from mention aboveindustries , mostly middle managers . 308 usable samples were obtained after excluding theincomplete ones, yielding a 85.5 % response rate .4.4 Data AnalysisData analysis involves descriptive statistics and structural equation modeling using LISRELstructural equation program . LISREL is designed to estimate and test structural equationmodels ( SEMs ) . SEMs are statistical models of linear relationship among latent (unobserved) variables and manifest (observed) variables . For this research LISREL wasused to investigate the causal relationships ,where the path coefficients are tested forsignificance and goodness-of-fit. The path diagram of the structural model specified isproposed based on the research model .5. Structural Equation Modeling (SEM) Results5.1 ModelsFigure 2. shows the significance ( t-test ) model , and Figure 3 shows the standard estimatedmodel, included path coefficients for research variables .Figure 2. The significance ( t-test ) modelCOPY RIGHT 2013 Institute of Interdisciplinary Business Research1083

ijcrb.webs.comINTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESSJANUARY 2013VOL 4, NO 9Figure 3. Standard estimated model ( Path coefficients )5.2 Goodness-of-Fit MeasuresTable 1. shows goodness-of –fit measures for estimated model .Regarding SEMapplications , the Likelihood- ratio chi- square and the goodness -of – fit index are basicmeasures of absolute fit of the model . In the present research, the chi-square value of17.66 with 250 degrees of freedom and ratio of chi-square to degrees of freedom value of0.66 was found to be statistically significant (acceptable range is 3 or less).The root meansquare error of approximation ( RMSEA ) is 0.00 ( acceptable range is 0.1 or less ). The rootmean square residual ( RMSR ) value is 0.013 ( acceptable range is 0.05 or less ).Anotherabsolute fit measures (fitting indexes) shows that the model is marginally acceptable at best(Table 1).COPY RIGHT 2013 Institute of Interdisciplinary Business Research1084

ijcrb.webs.comJANUARY 2013INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESSVOL 4, NO 9Table 1. Goodness of Fit Measures for the Estimated ModelGoodness- of-fit measuresEstimated AcceptablemodelrangeAbsolute fit measures17.660Likelihood –ratio chi- square ( χ2)0.066 3Ratio of chi-square to degree of freedom ( 2 df )P-value0.000 0.05Root mean square of approximation ( RMSEA )0.000 0.1Goodness-of-fit index ( GFI )0.995 0.9Adjusted goodness-of-fit index ( AGFI )0.994 0.9Root mean square residual ( RMSR )0.0135 0.05Standardized Root mean square residual ( SRMSR )0.0130 0.05Relative fit index ( RFI )0.908 0.9Normed fit index ( NFI )0916 0.9Non-normed fit index ( NNFI )0.912 0.95.3 Hypothesis ResultsApart from the model,s general fit for the data, it is also important to test its parameters.The significance tests for the structural model parameters are the basis for accepting orrejecting the proposed relationships between exogenous and endogenous constructs(Hair et al,1998).The results of the models shown in figure 2 and 3 provided strong support forhypothesis (Table 2). H1,H2,H3,H4,H5,H6,H7 and H9 were accepted that are componentsof the innovation resources(Table 2). H10,H11,H12,H13,H16,H17, and H18 were acceptedthat are components of the innovation processes in the research model.H19,H20,H21,H22,H23 and H24 were accepted that are components of the outcomes in theresearch model .( Furthermorenon-direct relationships of components related to H8,H14 and H15 confirmed by using the correlation technique ) . H25 and H26 were acceptedthat there is strength relationship between inputs and processes and between processes andoutputs (Table 2) .Table 2. Hypothesis results for the structural modelResearch hypothesis ( TIM model )Estimate t value ConclusionComponents of the Inputs ( InnovationResources)H1: Creative ideas of employees0.252.76SupportedH2: Applied researches of employees0.272.98SupportedH3: Research and Development ( R&D)0.192.18SupportedH4: Marketing research0.182.07SupportedH5: Forecasting studies0.273.04SupportedH6: Creative ideas of0.192.19Supportedcustomers(stakeholders)H7: External research co-operations0.242.76SupportedNotH8: Purchase of innovation0.161.80supportedH9: External information SupportedSupportedSupportedComponents of the Processes(InnovationProcesses)H10: Innovative organizational structureH11: Innovative organizational cultureH12: Innovation in all of the value chainCOPY RIGHT 2013 Institute of Interdisciplinary Business Research1085

ijcrb.webs.comJANUARY 2013INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESSH13: Innovation in all of the organizationalprocesses0.262.14H14: Innovation in all times0.201.89H15: Creativity and innovation techniques0.201.87H16: Information and communication technologies 0.25H17: Managerial ported0.712.44Supported0.982.06SupportedVOL 4, NO 9SupportedNotsupportedNotsupportedComponents of the Outputs(ExpectedOutcomes)H18: All types of the innovationsH19: The quantity of the innovationsH20: The rate of the innovationsH21: The quality of the innovationsH22: Consideration of the individualconsequences of the innovationsH23: Consideration of the socialconsequences of the innovationsH24: Consideration of the environmentalconsequences of the innovationsRelationshipsH25: A significant relationship betweeninput and process .H26: A significant relationship betweenprocess and output .6. Discussion , Conclusion and ImplicationsThe proposed model of Total Innovation Management (TIM) has provided a usefulcomprehensive , incorporated and systemic framework for investigating key factors ofinnovation management .It consolidates main components of innovation resources , innovation processes andexpected outcomes under a more dynamic and systemic platform synergistically. The TIMmodel embraces three main comprehensiveness or totality : comprehensiveness in innovationresources, comprehensiveness in innovation processes, and comprehensiveness in outcomes.The model has suggested an extensive innovation management system , that included severalsub-systems with dynamic and synergetic interactions . The model also presented a newalternative extensive , integrated , developmental and systemic study and formulationapproach to all elements of organizational creativity and innovation . The model provides abetter understanding of innovation management . Several powerful theories such ascomplexity theory and social system theory supported the model . This paper has severalimplications for industrial managers. It leads to an applicable powerful managerial systemfor innovation . An important message to managers is that a more effective innovationsystem needs to be comprehensive , integrated and systemic . Hence, providing a TotalInnovation Management system in industries can help to development of corporateinnovation capabilities for creation of value and competitive advantages . Industry managersshould try to support TIM system . This paper also has several directions for future research .This study can be performed in service industries .Also this study can be performed in smalland medium enterprises (SME).COPY RIGHT 2013 Institute of Interdisciplinary Business Research1086

ijcrb.webs.comINTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESSJANUARY 2013VOL 4, NO 9ReferencesAlkemade,Floortje and et. (2007).Analysing emerging innovation systems : a functionsapproach to foresight. International Journal of Foresight and InnovationPolicy,vol.3,no.2,2007. Alves,Jorge and et.(2007).Creativity and Innovation throughMultidisciplinary and Multisectoral Cooperation.Journal Comilation,Volume 16,No.1,2007.Andriopoulos,Constantine and Dawson,Patrick (2009).Managing Change, Creativity .High-Involvement Innovation .Wiley.-Birkinshaw, Julian andHamel,Gary(2008).Management Innovation. Academy of Management Review , 2008 ,Vol.33,No.4,825-845.Chaturvedi,Mukesh.Kumar,Aseem & Rahul, Manmohan(2009).Managing Innovation andNew Product Development, Concepts and cases .PHI Learning.European Innova (2008). The European Eco-Innovation Platform (Eco-IP). Innova.Eveleens,Chris(2010).Innovation Management ; a literature review of innovation processmodels and their implications .Lecture-NL.Eversheim ,Walter(2009).Innovation Management for Technical Products ; Systematicand integrated product development and production planning . Springer.Fischer,Bruce D(2001).Managing Innovation-An Analysis of the Literature. MidwestBusiness Administration Association Conference.Goffin,Keith & Mitchell, Rick (2010) . Innovation Management , Strategy andImplementation Using the Pentathlon Framework . Palgrave Macmillan .-Golestan Hashemi , Sayed Mahdi ( 2002).An Organizational Creatology Approach : TotalInnovation Management. Journal of Creatology and Inventive Problem Solving .No.5,October 2002, (in Persian).Golestan Hashemi,Sayed Mahdi .(2004).TRIZ,TQM & TCIM . TRIZ Journal ,Dec.2004.Golestan Hashemi,Sayed Mahdi(2009).A Creatological Approach to the Creativity andInnovationManagement and R&D:Total Creativity&Innovation osiumonManagementofTechnology(ISOMOT2009) . Lawson,Benn & Samson,Danny (2001).Developing InnovationCapability in Organizations A Dynamic Capabilities Approach.International Journal ofInnovation Management, Vol.5, No.3,pp,377-400.OECD(2002).Oslo Manual ,OECD Guidelines for Collecting & Interpreting InnovationData.OECD.OECD(2008).Systematic Eco-Innovation Report. OECD.O'Sullivan,David and Dooley ,Lawrence(2009). Applying Innovation .SAGE Publication,Inc. Panne,Gerben . Beers,Cees & Kleinknecht,Alfred (2003).Success and Failure ofInnovation , A literature Review . International Journal of Innovation Management,Vol.7,No.3, pp.1-30. Preez ,Niek & Louw, Louis (2008). A Framework for Managing theInnovation Process. Portland International Conference on Management of Engineering &Technology, PICMET ).Innovation Management- An Overviewand some Best Practices.C-LAB Report,Vol.4(2005)No.3.Rothwell,Roy(1994).Towards the Fifth-generation Innovation Process .InternationalMarketing Review,Vol,11,No.1, 1994,pp,7-31.Sauber, Tim and Tschirky, Hugo(2006).The Next Generation of Innovation StrategyFormulation Process .IEEE.Schiederig,Tim.Tietze,Frank and Herstatt,Cornelius (2011).What is Green Innovation?A quantitative literature review.Humburg University of Technology,Working Paper No.63.Silverstein,David.DeCarlo,Neil and Slocum , Michael (2008).Insourcing Innovation; How toAchieve Competitive Excellence Using TRIZ.Auerbach Publications, Taylor & Francis.COPY RIGHT 2013 Institute of Interdisciplinary Business Research1087

ijcrb.webs.comINTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESSJANUARY 2013VOL 4, NO 9Group. Skarzynski , Peter and Gibson , Rowan (2008) . Innovation To The Core , ABlueprint for Transforming the Way Your Company Innovates . Harward Business Press .Smith , Marisa(2008).Factors Influencing An Organisation's Ability To Manage Innovation:A Conceptual Model . International Journal of Innovation Management,Volume 12 , Issue 4(2008),pp.655-676.Song, Gang . Zhang,Nan & Meng,Qingguo(2009).Innovation2.0 as a Paradigm Shift:Comparative Analysis of Three Innovation Models . International Conference onEngineering Management and Services (EMS2009).Stamm,Bettina Von.(2008).Managing Innovation , Design and Creativity .Wiley.Sundbo,Jon.Fuglsang,Lars.(2002).Innovation as Strategic Reflexivity.Routledge .Tidd,Joe(2006).A Review of Innovation Models. University of t al(2002).Towards capability-based Total Innovation ManagementThe emerging new trend of innovation management- a case study of Haier Group.Isomotand ICMIT02 Proceedings.Zhejiang Univ.Press.Xu,Qingrui.Zhu,Ling and Zhen,G.(2004).The measurement of total innovation capacityCase study of several Chine firms . Engineering Management Conference.Xu,Qingrui and et.(2006).Total Innovation Management : a novel paradigm of innovationmanagement in the 21st century .Journal of Technology Transfer (2007) 32:9-25.Xu,Qingrui and et.(2007).Haier Tao of Innovation: A Case Study of the Emerging TotalManagement Model. Journal of Technology Transfer, (2007)32:27-47.Wagner and et. (2006).The firm as innovation system: applying complexity Principles todrive new product development. IAMOT2006.COPY RIGHT 2013 Institute of Interdisciplinary Business Research1088

innovation management in industrial organizations,included innovation resources , innovation processes and outcomes ( 26 hypotheses ). . .The relative importance of different models of innovation management varied by time-period because of different external influences ( Miller et al 2000). In support of a broader view of innovation , some .