The themes of technological innovation, entrepreneurship, and organizing
Technological, Managerial and Organizational Core Competencies: Dynamic Innovation and Sustainable Development
David Walker
The editors have assembled this book around the topic of innovation, which they define very broadly. As a happy result of this broad definition, the book comingles the themes of technological innovation, entrepreneurship, and organizing. Usually, scholars have discussed these themes separately, and this separation has probably concealed opportunities for fruitful interdependence among the themes.
These are vital themes in economies and in societies more generally, and the themes intertwine. Technological innovation fosters the emergence of new ways of organizing. Advances in Information Technology, for instance, have transformed hierarchical, co-located business organizations into geographically distributed virtual networks. Yesterday’s organizations are turning into “dense spots in networks of contracts between sovereign individuals” (Davis & Marquis, 2005). People can break supply chains apart and distribute work to the most efficient producers wherever they are, and can assemble components wherever customers happen to be located today.
The three themes of technological innovation, entrepreneurship, and organizing share a concern with the emergence of new things - new concepts, new forms, new viewpoints. Emergence remains one of the persistent mysteries of science. An irony of Darwinian evolutionary theory is that despite the title of his book, Darwin did not attempt to explain “the origin of species.” His analyses began with established populations, and examined how differential survival led to gradual adaptation within these populations. Contemporary scientists - physicists, chemists, biologists, and social scientists alike - have generally followed Darwin’s example. Scientists avoid studying or even thinking about emergent processes, consigning them to the realms of philosophy and spirituality along with other phenomena evoking faith and magic. However, innovation, entrepreneurship, and organizing are inherently emergent, so scholars who study these topics find it hard to ignore emergence and the interactions that foster emergence.
The book itself emerged through an evolutionary process that broke through national and disciplinary boundaries, and drew energy from entrepreneurial editorial activities that extended around the world. The editors and reviewers subjected manuscripts to careful selection processes and the successful manuscripts reflect repeated revisions that improved their clarity and relevance.
The editors’ efforts to enlist diverse authors enhance the book’s usefulness. The authors come from many countries. People in different parts of the world see different issues and participate in different discussions, so distinct research topics and findings emerge all around the globe. A book that embraces a wide range of societies and perceptions helps readers to distinguish between observations that are more general and those that are more idiosyncratic. New technologies and organizational forms develop differently, and with experimental adventures over time, so their characteristics are disorderly. Efforts to understand very new technologies and organizational forms have to confront both the heterogeneity of the systems themselves and the researchers’ lack of effective filters for distinguishing important stimuli.
Observations that are more general are possible because some social trends have been widespread. For instance, throughout the 20th century, the so-called developed countries evolved from agriculture and manufacture toward services, and the latter part of the 20th century brought mounting emphasis on services requiring higher education. A large amount of global dispersion of expert services has been occurring. Companies have not only placed call centers for technical support around the world, they have located research laboratories and engineering design centers around the world. Knowledge-based activities have been at least as mobile as physical work. In the short run, this geographic dispersion increases the relative advantage of social skills over technical expertise. In the longer run, such dispersion undercuts the competitive advantage of knowledge-based activities by making expertise less esoteric.
In addition to intermingling technological innovation, entrepreneurship, and organizing, Professors Nobre, Walker and Harris have introduced another more contemporary theme - sustainability. In the book’s Preface, Nobre makes an important distinction between “competitive advantage” and “sustainable development”. “Competitive advantage” is a concept based in economic theories about competitive markets; it stresses the value to individual business firms of distinguishing themselves from their competitors by offering valuable and unusual products or services. However, economists and business scholars have defined competitive advantages solely in terms of the benefits to individual business firms and without concern for effects on consumers, communities, nations, societies, or humanity in general.
Nobre introduces the term “sustainable development” to describe a kind of business development that maintains a balance between economic and societal goals and between short-run and long-run goals. This is a timely distinction, since the modern global corporation, a brilliant social innovation that extended benefits of commerce around the globe, has become the world’s dominant social institution - and is helping to drive every living system on the earth into decline. We live in a time when humans are at the very peak of our technological power. We are making changes in the earth that will echo through the centuries. Sustainable development would seek to benefit not only individual firms but also their societies and the future of humanity.
It is now widely acknowledged that innovation drives the knowledge economy, fuelling productivity and growth. It is innovation that essentially underpins successful entrepreneurship, creates jobs and contributes to the sustainable development of economies around the globe. It is not surprising therefore, that the topic of innovation continues to attract increased attention from academics and politicians alike.
While earlier literatures depict innovation as ‘creative destruction’ that erodes existing markets and industries (Schumpeter, 1934), more recent commentators refer to innovation in the form of ‘disruptive, radical technologies’ that allow entire markets and industries to emerge, transform or even disappear (Christensen, et el; 1997). Research has also been growing with regard to innovation in the workplace, its link to human resource management and how innovation relates to organizational structures (Scott and Bruce, 2008; West, 2002, as discussed in Foss and Henry, 2010). However, there remains a gap in the literature with regard to the study of innovation in the context of organizational competence building and the identification of key creative areas that can create and drive sustainable innovation processes.
In this book the editors have brought together a range of important topics under the heading of Technological, Managerial and Organizational Core Competencies. Nobre, Walker and Harris discuss knowledge management, networks, sustainability, marketing, R&D, Information Systems and internationalization across a range of geographical contexts and organizational settings. Strategically organized in nine sections, the editors combine empirically and theoretically based research contributions from leading commentators around the globe. The diversity of authors providing insights on innovation in different economies highlights the strong international dimension of the book. However, the unique contribution of the book undoubtedly lies in its identification of key creative and typically untapped areas within an organization that can build competencies towards dynamic innovation and sustainable development. Essentially, this book enhances current understanding of the innovation process and platforms its importance as a driver of 21st century entrepreneurship. The book will be of value to those studying and researching the broad field of innovation, particularly as it relates to dynamic organizational processes. The contributions will also be of interest to innovation educators, R&D managers and those working within the general innovation support system. This timely edited text offers a multidisciplinary perspective on innovation, reminding us that innovation is dynamic in nature and highly creative in its origins.
Colette Henry University of London, UK
This book represents the culmination of an international project to compile multi and inter-disciplinary research that most contributes to innovation. The book’s unifying constructs are innovation and the organization. The organization mediates between entrepreneurs and innovations. This preface presents a brief overview of developments concerning the organization and innovation.
Organizations have gradually grown in importance throughout human history. They matured after the Industrial Revolution began in Europe in the 18th century and later spread to the United States of America in the 19th century. The gradual transition from a non-industrial to an industrial society has marked the frontiers between periods of evolution and industrial development of organizations. Here, the term evolution assumes that changes in society are relatively unpredictable, whereas industrial development denotes a more predictable sequence of planned modernization (Richter, 1982). Evolution characterizes processes of organizing in ancient and the Middle Ages civilizations, and the Renaissance supported development of the Industrial Revolution in Europe.
Many modern principles of organizing emerged during ancient civilizations (5.000 B. C. - 500 A. C). It is probable that organizing processes began in the family, later extending to the tribe, and finally reaching formalized political units (Wren, 1987). After the fall of the Roman Empire and the emergence of Feudalism in Europe, new principles of organizing evolved as solutions to economic and political crises. An increasing record of writings about organizing characterized the Middle Ages. Nevertheless, economies and societies were essentially static, management practices were still largely antihuman, science was only a philosophical rather than a technological concern, and political values involved unilateral decisions by central authorities. These conditions were unfavorable for developing an industrialized society.
Crises in Europe during the 14th and 16th centuries brought a revolution in thinking and culture, together with religious, social, economic and political strife, giving genesis to the Renaissance (Delouche, 2001). The Renaissance brought a new focus on reason, discovery, exploration and science. Overseas expansion of Europe between the 15th and 18th centuries strengthened the confrontation and integration of cultures on different continents and gave birth to Mercantilism. Globalization and a worldwide economy evoked new technologies and more complex principles of organizing. Additionally, there was increasing need and call for practices that could bring ethics to individual liberty and to markets. Political philosophers began to disseminate new ideas about equality, reason, justice, the rights of citizens, governance by consent of the people, and decentralized of political power.
In the 18th century, new economic theories challenged Mercantilism and the controlling power of the landed aristocracy and initiated the Industrial Revolution. In his Wealth of Nations, Adam Smith (1723-1790) established the classical school of liberal economics and he proposed that only markets and competition should be the regulators of economic activity. The transition from pre to post-industrial organizations was gradual. The transition created new social, economic, technological and political conditions and brought new societal challenges. Continuous advances in science and technology, especially in electricity, energy and information, made possible large combinations of humans and machines, giving origin to new kinds of organizations. Principles of organization and management had to be improved and extended to a new and increasingly dynamic environment. Theories of organizations have developed systematically since the beginning of the 20th century. Organization theorists have advanced in knowledge through the 20th century (Grusky & Miller, 1981; March, 1965; March & Simon, 1958; Pugh, 1997; Nobre, Tobias & Walker, 2009: 236-289; Scott, 1998; Simon, 1997).
With advances in capitalism and liberal economics, philosophers, historians, political economists and sociologists proposed opposing ideologies and models of political, economic and social thought. Perhaps, Marxism was the most revolutionary political ideology. Marx and Engels supported the idea that capitalism inevitably produces internal tensions that lead to its collapse or destruction/ This Marxist process has been called Creative Destruction (Reinert & Reinert, 2006: Chapter 4). Later, the concept of Creative Destruction was revisited and popularized by Joseph Schumpeter (McCraw, 2007), and became most associated with his economic development and innovation theory, particularly from his books The theory of economic development: An inquiry into profits, capital, credit, interest, and the business cycle (1912/1934) and Capitalism, Socialism and Democracy (1942/1950). Despite being sympathetic to Marxian Doctrines, Schumpeter placed entrepreneurship and innovation at the center of his economic development theory. He said destruction, transformation, and renewal of a social-economic system are rooted in entrepreneurs’ decisions and actions that introduce innovations. Therefore, entrepreneurs, and innovations, are core elements that can disturb the equilibrium of any social-economic system and that accelerate economic growth (Schumpeter, 1939).
However, to think about innovation, and especially technological innovation, only as synonymous with economic growth is to overlook its broad significance for humanity. While innovation and technology can benefit humans with artifacts that raise living standards (Easterlin, 2000; Johnson, 2000; Tidd, 2006; Tidd, Bessant & Pavitt, 2005), innovation and technology can also have negative results.” Innovation and technology affect political power (Kipnis, 1990; Scarbrough & Corbett, 1992) and power-holders of innovation and technology can control resources and decisions (Suarez-Villa, 2009).
Strongly influenced by the Corporation (Drucker, 1993) and by the hegemonic power of 20th century neo-Corporatism (Hagger, 2004; Suarez-Villa, 2009; Wiarda, 1996), society has entered the 21st century with the strongest desires for capital accumulation ever seen in history. These desires have accelerated environmental degradation and the destruction of natural resources (Leff, 1995). Egocentrism, individualism, and consumerism characterize contemporary society, and a political and economic model of maximization of production and consumption is generating cultural alienation and intense materialism. These have, in turn, destroyed environmental resources and eroded the values and social conditions of humanity (Nobre, Louren? o & Fagundes, 2010). Education and innovation stand out as processes that should be changing human behavior to develop a sustainable future (Dunne & Martin, 2006; Wals, 2009), and innovation offers a key to sustainability by contributing new alternatives (Hart & Milstein, 2003; Nidumolu, Prahalad & Rangaswami, 2009; Rainey, 2006).
One day, organizations, nations and executives may be able to perceive and act based on models grounded in systemic sustainability. These new models will have to reconcile environmental, social and economic demands (Gladwin, Kennelly & Krause, 1995; Korten, 2006) - the “three pillars” of sustainability defined by The United Nations General Assembly during the World Summit Outcome, in 2005. Organizations and their participants, especially entrepreneurs, will have to create dynamic innovation and competitive advantages without disrupting the balance needed for survival of the human species (Nobre, Tobias & Walker, 2010:391).
