The chapter provides a conceptual analysis of the general notion of innovation, informed by empirical results and with an eye to practical applications. Innovation is distinguished from creativity on the one hand and entrepreneurship on the other, but defined broadly enough to comprise much more than technological inventiveness (for example social innovation). The popular two-step model of innovation processes is criticized and instead an integrated model is proposed as a superior alternative. The notions of macro- and micro-innovation are supplemented by a notion of still subtler, process-immanent improvements. Finally, the close relationship between innovation and learning is examined.
Søren Harnow Klausen
This chapter addresses the questions of how an Indian firm in the IT services sector acquired the capabilities to succeed in a highly competitive global marketplace and which factors contributed to their success. To answer these questions, a detailed study of Hindustan Computers Limited (HCL), a leading and pioneering Indian IT firm, is presented. An evolutionary account of HCL’s experience examines how the capability-building strategies of HCL grew and evolved in response to environmental changes, which were both national and global in nature. The study suggests that continuous learning and the ability to change are essential traits for a successful IT firm. It also suggests that a key role was played by the Indian state in the emergence of the IT industry, contradicting the generally held view that the absence of state engagement enabled this sector. In fact, the study highlights the complementary roles played by the state and the private sector in the development of the sector and the success of HCL. The chapter also presents a model to explain the nature of the Indian IT industry.
Bin Guo, Qiang Li and Xiaoling Chen
This chapter analyses the rise to market leadership of Geely, a privately held domestic automotive producer in China. Geely presents an interesting case of a company that was able to survive and grow in the face of market competition from joint ventures and state-owned enterprises. The chapter aims to contribute to the literature on technological catching up in two ways. The first is to examine the impacts of the context-specificity of China on domestic firms’ capability building and technological catching up. The other is to analyse the role of low-cost manufacturing capability and to explore how such a capability may be used as an initial step to support subsequent growth within the context of a large and emerging economy. The study highlights the impact of context-specificity in terms of the size and segmented nature of the domestic market on the ability of firms to learn and accumulate capabilities. This study also suggests that in technological and capital-intensive sectors, the rise of new market leaders is favoured when technological knowledge is largely embodied in machinery or other physical artefacts for production processes and when the industry structure is highly modularized and has evolved into an integrated and mature production system along the industry value chain.
Edited by Franco Malerba, Sunil Mani and Pamela Adams
Edited by Eric Shiu
Traditionally functionality and aesthetics are two main aspects that product designers use to design innovate a product. With the increasing emphasis on environmental sustainability, in recent years sustainability has gradually become another important aspect that product designers also consider in the product design innovation process. This study focuses on scrutinizing the trade-offs of functionality, aesthetics and sustainability from the consumer perspective. Results of consumer experiments demonstrate that these trade-offs are more complex than originally thought. The self-identity theory has been used to help explain these trade-offs.
One main reason why Homo sapiens rule the world is because they are being more creative than other tribes. By the same token, organizations that are more creative can survive longer and better than their less creative counterparts. In this study, the author provides her insights into the meaning of creativity, the myths of creativity, and the recipe for creativity.
Luiz Ricardo Cavalcante and Bruno César Araújo
The aim of this chapter is to analyse the factors that explain the industrial leadership of a Brazilian manufacturer of bus bodyworks, a niche segment within the broader automotive industry. This study suggests that specific contextual factors regarding the Brazilian market led the large automobile manufacturers to leave this market in the hands of Brazilian incumbents in the sector. In fact, the lower technological requirements and the high labour intensity of the bus bodywork segment left room for the entry and growth of emerging countries like Brazil. Within this context, Marcopolo was able to gain a leadership position through the strategies of its entrepreneurial founders and its focus on capability building. This case study provides important insights for policy-makers by showing how a nationally owned global leader was able to emerge in a relatively neglected segment in terms of explicit industrial policies.
This chapter analyses the case of Cipla as a market leader in India’s pharmaceutical industry, which itself is a leader in India’s manufacturing industry. Cipla meets all the three conditions of market leadership: market dominance, global reach and innovation. Cipla has had a significantly long history of development and has enjoyed success in serving both domestic and foreign markets better than many of its domestic rivals. It has been a trailblazer for pioneering low-cost, lifesaving drugs and, as a result, it is a highly respected company in India. The chapter seeks to explain the source of leadership in terms of firm-level and sector-level factors. Knowledge-intensive entrepreneurship is a key factor. The firm has a strong vision and focused corporate strategy. Cipla has also taken advantage of three sector-level factors, namely the patent regime, technology contributions from public research institutes (PRIs) and the higher-education sector. In a number of ways, the origins of Cipla’s leadership are similar to those discussed in the Tata Motors case: a key factor common to both is the knowledge-intensive entrepreneurship. Although the founding entrepreneurs wield overall control, the management of both companies is in professional hands. In both cases, the contribution of both sectoral and country-level factors have been important.
Bruno César Araújo and Rodrigo Abdalla Filgueiras de Sousa
This chapter examines the firm, sector and country factors that supported the emergence of two market leaders in specialized fields of the information and communications technology (ICT) sector in Brazil. The first company is Totvs, a software house dedicated to the Enterprise Resource Planning (ERP) segment. The second company is Positivo, a producer of personal computers (PCs), which emerged as a spin-off from a firm focused on educational services. In both cases, the characteristics of the national context have supported the emergence and consolidation of each company as a market leader. Notwithstanding that economies of scale and scope are essential sources of competitive advantage in the ICT sector in general, both cases exhibit a combination of two other factors that counterbalance their initial disadvantages with respect to their international competitors. First, government support has been crucial, although different policies were applied in these two cases: Totvs’s leading position has been reinforced by financial support from the Brazilian National Development Bank (BNDES), while Positivo has benefited from trade protectionism, under the ‘infant industry’ argument. Second, both companies have achieved market leadership through the development of customized products and solutions targeted to specific market segments that have not been properly addressed by world industry leaders. These strategies required the combination of strong technological and marketing capabilities. Recently, both companies have made efforts to enter the global market by focusing on countries with cultural, idiomatic and institutional similarities with Brazil.