THE INNOVATION ECONOMY
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1 COLLEGE OF BUSINESS THE INNOVATION ECONOMY Mitzi M. Montoya, PhD Sara Hart Kimball Dean, College of
2 What s the best way to innovate?
3 What s the best way to drive change?
4 Ok, I tried that last week, what else?
5 The Innovator s Dream Lions of Innovation!
6 The Innovator s Dilemma Lions of Innovation!
7 Why does this matter to CFOs? Innovation is driven by Investments in human capital (hiring and education) Informal knowledge creation Formal R&D Innovation occurs at the edges Of disciplines Of knowledge boundaries Of organizational boundaries
8 Entrepreneurship and innovation: it takes all kinds Driven by cost efficiencies; Global production network; Scale creating ability Large publicly traded companies E+I Tech startups / small and mediumsized enterprises Driven by creating new innovations; Reinvesting in the ecosystem after successful exits
9 Economic Fundamentals and Entrepreneurship & Innovation Sub-index score Econ E&I 0.1 0
10 Innovation is a public-private partnership Strategies Create capacity for innovation, technologies and advanced industries Enhance innovation ecosystem and built environment Establish regions as a hub for global trade and investments Future Strategies Initiative 1 Implementing Regional Regional Regional Export Initiatives Innovation Ecosystem Initiative 2. Ongoing process of intentional business planning for innovation and growth
11 REGIONAL INNOVATION Advanced Industry Investments Talent Development Cluster 1 Cluster 4 Cluster 1 Cluster 4 Cluster 1 Cluster 4 Science & Engineering Professional Functions K-12, Trades Ecosystem of core technologies and human capital (supply and demand) Identify and develop disruptive technologies in advanced industries Precompetitive cross-industry research and product development Contract research Targeted talent development aligned to advanced industries Train targeted technical workforce Prepare students for advanced industry careers
12 This is all so obvious. Why is it so hard?! Love affairs with the status quo continue well after the quo has lost its status. - Howard Stringer (Former CEO of Sony commenting on Sony s failure to change and Sony s loss of the mobile music market to Apple)
13 Innovation is a mash-up
14 Collaboration doesn t just happen
15 Innovation is a contact sport Managing innovation means orchestrating the contact
16 The preeminence of culture Cause of failure and impediments to success are not determined by models, formulae, technologies or resources, but rather by the soft, mushy, difficult-to-grasp, tough-to-master thing called culture. Internal culture is the most important driver of innovation capability. Internal means to the firm, the university, the city, the region, the state, the nation Spoiler Alert: It s not a Quick Fix Source: Tellis, 2013
17 Innovation = Culture Change
18 Dynamics and Components of an Innovation Culture INCUMBENT S CURSE Protect Products Avoid Risk Focus on present - + Innovation + Dominance PRACTICES Incentives for enterprise Internal Markets Cultivate Champions TRAITS Cannibalize current products Embrace risk Focus on future + + Source: Tellis, 2013
19 Unrelenting Innovation Sustaining an innovation culture is an infinite loop because success contains the seeds of failure. Traits are difficult to change Practices are more amenable to change and can engender traits Organizations (of every type) are paradoxical short-term and longterm. It is not a problem to be solved, but managed Think culturally
20 Culture Change = Coalition Building
21 The Nature of Organizations Organizations are complex: Like the kitchens in the best run restaurants, all organizations are messy and chaotic. Jack Welch Projects and Programs Culture and Climate Models and Frameworks 4 Managers don t like this mess. So we try to frame it in a net of formal, rational and structured processes, systems and procedures. People Change Strategy Technology Structure Systems and Processes Leadership Conventional management wisdom maintains that, if we do these things better and get them right, we will be successful. But we need to remember that organizations are not really like that. They re like this. And managers need to be able to engage effectively with these underlying (hidden, messy and informal) dynamics of the real-world. Chris Rodgers, Information Coalitions (2007)
22 Culture is King
23 The Incumbent's Curse Traits to Overcome for Innovative Culture 1. Fear of cannibalizing current successful products 2. Risk aversion 3. Focus too much on the present 85%
24 Innovators: Willingness to Cannibalize Successful Products Inhibitors Economic factors cost and margins thresholds wait-and-see acquisition Organizational factors resistance from internal stakeholders bureaucratic commitments and procedures perceived vulnerability biases of present over future Today s emerging giants face a paradox. Their continued success requires turning away from what made them successful. -- Khanna, Song & Lee Harvard Business Review
25 Organizational culture can be changed Assess Design Monitor Evolve
26 Read More
27 Our Portland MBA Flexible, hybrid format 80% online and 20% in-person Tracks: Business Analytics Innovation Management Supply Chain and Logistics Management Organizational Leadership photo Website: pdxmba.oregonstate.edu
28 THANK YOU. Mitzi M. Montoya, PhD Sara Hart Kimball Dean, College of business.oregonstate.edu
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