SMTI an der Universität Marburg

• Researchers and scientists at university or publicly financed
  research institutes (e.g. Max Planck-Institutes, Fraunhofer
  Institutes in Germany)
• Engineers, technicians and scientists in companies (95%, prime driver)
• Private inventors and handymen (less than 5% of inventions)

• latin origin, incorporates "NEW" (nova): a new idea that has not existed before
• first commercial use of an invention/technical discovery
• innovations are either new products or new production processes
  
  
• Innovation i.n.s.
  • first market introduction of a new product or production process
• Innovation i.b.s.
  • wide diffusion of an invention
    (like the iPhone or the iPod).

Invention is a pre-requiste for Innovation.

• no commonly accepted definition of technology
• devision into 3 modalities/construct of three levels: 
  1. knowledge
  2. skills and experience
  3. artefacts

1. Technology as a body of knowledge: 
   • formal, abstract representation in a codify-able and verbalized form (Nummern etc.)
2. Technology as skills & experiences 
   • know-how (experienced based knowledge)
   • involves individual and organizational skills and experiences 
3. Technology as embodied in artifacts
   • manifestation of knowledge in physical objects 
   • tangible and visible
   • manifested in services 

Technology has both, material and immaterial components

• fundamental element of the corporate management
• determines a company‘s approach against competitors.

Market focus:

• Strategies define the basic, long-term oriented direction of the business in
  the market. (traditional)

Resource focus: 

• determines the internal and external resources that have to be built (accumulated) and deployed in order to achieve the future goals. (lays the ground for being successful in the market)

Corporate Strategies: 

• which markets should be entered by the business, 
• which products should be used 
• which core competences a company will have in future.

Business Strategies:

• define a competitive strategy to operate in a market (e.g. cost leadership or differentiation).

What is a good strategy? 

Firms have to decide on several innovation strategy parameters

e.g.

• Prospective new technology fields / prospective new markets / new business model
• Product vs. process vs. business model innovation
• Timing of innovation (pioneer vs. early follower vs. me too)
• Radicalness of innovations (breakthrough / radical versus incremental)
• Market pull versus technology push strategies
• Make-or-Buy Decision

What are the steps of strategic planning?

• development process of innovation strategies within companies
• also focuses in organizational responsibilities e.g. 
  • division of labor between top management, 
  • planning departments,
  • internal and external consultants
  • operative business units in the course of determining targets and strategies
• Strategy development comprises usually 3-4 steps:
  1. Innovation audit and analysis of the current situation (how it came about and how it might change in future);
  2. Development of a general strategic route;
  3. Determining the innovation strategy content;
  4. Planning – Which resources are required to execute the innovation strategy.

2&3 strategic planning i.n.s.

-> How can firms apply their technologies/products to compete successfully in attractive industries?

Michael Porter: companies are successful if they enter attractive markets with the right strategy

1. Generic competitive strategies of attitudes: 
   • comprehensive cost leadership 
   • differentiation 
   • concentration on core areas (niche strategy) 
2. Porters five forces
   • threat of new entrants 
   • bargaining power of suppliers
   • bargaining power of buyers
   • threat of substitute product or services
   • rivalry among existing competitors

exploration and exploitation

• two fundamentally different patterns of activities requiring controversial and conflicting capabilities

exploration = exploring new resources and markets

• processes are targeted towards the search of new types of knowledge and technologies 
• involve the diversification into new and known product-markets
• associated with higher costs + risks, but opens up long term potentials for sustainable development of the firm 

exploitation = ability to make efficient use of already existing resources bundles (including minor reconfigurations)

• builds on incremental innovation, the refinement of existing knowledge and the differentiation of existing product offers
• secure strategy exhibiting moderate risks and offering immediate advantages that can be realized in the short run 
  

We discover what before existed, though to us unknown; we invent what did not
before exist Noah Webster (1828): An American Dictionary of the English Language