Thu, September - 9 - 2010 |
(on a truly global perspective)
 |
|
|
|
The last newsletter provided a discussion about the need for revolutionary science to allow the continued increase in the global standard of living without catastrophic adverse impacts on the environment. It was noted that the forest products industry will not be a leader in developing this revolutionary science, but rather the possible role the industry could play is to build off the existing base of sustainability the industry has developed. To do this will require considerable innovation. To understand how innovation can play into this, it is necessary to understand what innovation is.
Considerable effort has been expended in trying to define innovation. Some have characterized innovation by providing classes of innovation. One set of classes is: Product, Process, Position and Paradigm. Others have identified types of innovation. This set includes but is not limited to: business model innovation, product innovation, service innovation, organizational innovation, financial innovation….. Others have classified innovation as either incremental or radical innovation. Still others have talked about manufacturer innovation (front end) versus end-user innovation (as highlighted and discussed by E. von Hippel in The Sources of Innovation, Oxford University Press, 1988). The truth of the matter is that most people only think about innovation when they see it (most often in the context of “Why didn’t I think of that?”), yet innovation surrounds us.
Many people believe that innovation flows from science or technology through some development process that ends up as a product that changes the way we do things. In this instance, science is taken in the broadest sense to include economic, social as well as other “sciences” outside of the physical sciences. For example, innovations in supply chain management do not depend so much on chemistry or physics as much as they do on business interactions and economic considerations such as cash flow, distribution channels and overall logistics of delivery (note that the actual name of the Nobel Prize for Economics is the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel).
An interesting aspect of innovation is that it can occur at almost any point along the path from scientific discovery to commercial product. If the innovation occurs near the science end of the commercialization path, it is more likely to be a disruptive innovation. That is, it has the potential for changing the entire market for a product; whereas an innovation closer to the commercial product end is more likely to provide an incremental change in the market. A product that demonstrates both kinds of innovation is the color television. Once color televisions became common household items in the mid to late 1970’s, the basic technology stayed pretty much the same for a relatively long time. Certainly there were incremental improvements like the introduction of solid state electronics, better phosphors and masks for the picture tubes, but a color TV made in 1972 looked much like one made in 1992. It still depended on a cathode ray tube for the picture, and while the picture tube size got larger, it was till recognizable as an outgrowth of the 1970’s TV. The major change that occurred over the time period was the cost of the TV. A 25” color TV in 1975 cost $500 in 1975 dollars, while a 32” TV in 2000 cost less than $500 in year 2000 dollars!
Recently disruptive innovations have occurred in the color television market. Development of liquid crystal displays, plasma displays and high definition television have changed the market. Picture size and quality have been increased substantially. In similar fashion, the sound quality as well as the price increased substantially with LCD and plasma HDTVs.
While large corporations are generally viewed as the source of most innovations, in many instances this is not the case. Quite frequently innovations in products or processes don’t originate in corporate R&D laboratories, but are thought of and developed by individuals outside of mainstream science. Joseph Schumpeter, an Austrian economist/political scientist, was one of the first to recognize the importance of entrepreneurs on innovation. Schumpeter argued that innovation and technological change in a nation comes from the wild spirits or entrepreneurs. He felt that entrepreneurship was vital in developing and expanding a nation’s economy.
Many people believe that entrepreneurship is on the decline in the United States. Whether or not that is true is not the point of this discussion, rather it is to make the point that innovation and entrepreneurship are important to the future of the paper industry and the economy of Wisconsin. For those entrepreneurs who operate outside the walls of a large corporation, there are many resources available to help you develop your innovations. There is the Wisconsin Entrepreneurs’ Network as well as the Wisconsin Innovation Network. These groups provide an opportunity to network with innovators and entrepreneurs. For more information about these groups see: http://www.wisconsintechnologycouncil.com/win/chapters/northeast/ and http://www.wenportal.org/ Additional resources include the Small Business Development Centers associated with most UW campuses. These provide assistance to individuals interested in starting/growing their business. There are also incubators that help startup companies get established. These business development incubators provide support services for fledgling companies to establish a market base. For a listing of Wisconsin business incubators see: http://vbi.biz/physical/index.php?PHPSESSID=aada4280146d4c28349f40e556a78277#brown
Innovation is important in driving the economy of a region, a state or a nation. There are many resources available to entrepreneurs and innovators in Wisconsin. Let’s make sure they are well used.
Share with:
to subscribe and receive automatically periodical updates about new articles and reviews >>
send comments, notes, thoughts to feedback@knowledgeforaction.info
to inquire about contributing to KnowledgeForAction.info write to: proposals@knowledgeforaction.info
edited and managed by Knowledge for Action & Action for Knowledge
technical support by eLabora