Managers and policy makers are increasingly recognising that the 'linear model' of innovation i.e. an orderly progression from R&D to development to market exploitation, is over simplistic. In today's complex and changing business environment successful innovation is much more iterative and interactive, involving many people and processes. In short, commercial success depends on effective innovation networks.

Effective innovation networks bring the following benefits:

• Faster development of new products and services
• Better optimization of R&D investment
• Closer alignment with market needs
• More successful product introductions
• Better anticipation of customer needs
• Competitor differentiation

Innovation networks do not just happen. From our own practical experience, and from the results of leading edge research, we have identified some keys that can unlock your innovation potential. At their core is a systemic management approach, that combines understanding of innovation models and the integration of several factors -business strategy, information and knowledge resources, IT networking, performance measures and evaluation, organisational culture and structures, human and psychological factors.

1. Understand the levels of innovation.

We can help you assess which level of innovation you have reached in your present processes, based on a model that shows how the focus of innovation evolves through several levels:

• Level 1: Technology Transfer - tangible output is transferred
• Level 2: Knowledge Exchange - people are a transfer mechanism
• Level 3: Knowledge Collaboration - joint innovation e.g. with customers
• Level 4: Knowledge Innovation - systemic management of processes
• Level 5: Innovation Networks - a dynamic network of knowledge flows.

For a fuller explanation of this framework, see below

2. Develop Collaborative, Sharing Cultures

Innovation needs sharing collaborative cultures that reward experimentation and learning. Above all, support your champions - it is they who will drive innovation to a successful conclusion. We can provide insights on the cultural dimension.

3. Recognize Knowledge and Information as Important Assets.

Methods need to be developed to value and assess these assets and their exploitation. These methods do not need to be as detailed as skills data-bases or information audits, but something tailored to their effective management and growth as valued assets. We can provide check-lists and tools to help this process.

4. Use Appropriate Performance Measures and Evaluation Methods.

Some of the most successful innovations would never have been got past the starting post with financially oriented cost-benefit analyses. We can suggest other, more appropriate grids and checklists for evaluating opportunities.

5. Develop Networking Structures and Bridging Mechanisms

Innovation networks operate across department and organization boundaries. Traditional hierarchical structures and rules must be modified to allow innovation to flourish. We can identify appropriate bridging mechanisms and provide guidelines for managing in a networked organization.

6. Apply Computer Technology to Augment Knowledge Processing

Various groupware and conceptual mapping tools can significantly enhance creativity and the effectiveness of knowledge development for innovation. We can advise on appropriate socio-technologies for know-how and intelligence sharing.

This framework has been developed by Debra Amidon of ENTOVATION International. Debra was formerly the Global Innovation Strategist at Digital Equipment Corporation.

Phase 1 - Technology Transfer

Discrete movement of something from one place to another - technology push or demand pull. Something moves from labs to production, from university to industry. Most typically information (e.g. reports) or knowledge 'embedded' in prototype product.

Phase 2 - Knowledge Exchange

Recognizes the role of people as a transfer medium and of knowledge as information in a context. Ideas flow between researchers and users. Each informs the other. More of a two-way dialogue, though since it often starts late in the innovation cycle, much knowledge exchange has a one way emphasis.

Phase 3 - Knowledge Collaboration

Ideas are developed jointly. There is less certainty at the outset of 'what' will be developed. People from multiple disciplines work together to solve a problem, as in concurrent engineering processes. New ideas and insight are gained as a result of the interaction.

Phase 4 - Knowledge Innovation Systems

There is too much at stake to be left to serendipity. Management issues come to the fore. A more systematic and systemic approach is adopted. Socio-technical and business systems are aligned; priorities are continually reviewed in light of the progress of the innovation and the developments in the marketplace. The innovation system is a learning system.

Phase 5 - Knowledge Innovation Networks

Innovation is dynamic. Different strategic business partners are needed as the innovation moves into business development. Several strategic business networks (SBNs) intertwine, each with a different focus and purpose, though with many common partners. Networks ebb and flow. 'Knowledge flow' becomes the source of collaborative advantage.

© Copyright. David J. Skyrme. 1994. This material may be copied or distributed subject to the terms of our copyright conditions (no commercial gain; complete page copying etc.)

Innovation Strategy for the Knowledge Economy: The Ken Awakening, Debra M. Amidon, Butterworth-Heinemann (1997) - highly recommended; visionary yet very relevant and practical.

Managing Innovation, Joe Tidd, John Bessant and Keith Pavitt, John Wiley & Sons (1997) - excellent holistic perspective from policy level to enterprise; many tables, cases, guidelines and references.

Managing Innovation within Networks, Wim G. Biemans, Routledge (1992) - Results of studies of innovation networks within Holland; very insightful.

The Innovation Network, McMaster University innovation resources and an email newsletter.

See also the Innovation resources.

Related Insights on these pages include No. 22 Making Sense of Knowledge Management, No. 10 Knowledge Networking, No. 11 The Knowledge Asset, or see full list.

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Management Insights are publications of David Skyrme Associates, who offers strategic consulting, presentations and workshops on many of these topics.

Additional coverage of these topics can be found in our free monthly briefing I³ UPDATE/ENTOVATION International News, various articles, publications and presentations.

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