Key Concepts of the Book
In this book, innovation involves processes, organizational elements (or resourcesiii), and Organizational Abilities (OA)iv that support the production and transformation of knowledge into new knowledge, processes, structures, technologies and products, goods and services. At the firm and industry levels of analysis, innovation can provide organizations with strengths relative to other firms, clusters, and nations and it is a key source of customer benefits and sustainable development. At the collective and societal levels of analysis, innovation can provide humanity with economic, social and environmental wealth through sustainable development.
The uniqueness of this book lies in the participants’ efforts to identify Organizations’ Creative Areas (OCA) that can provide core competencies for the organization in pursuit of dynamic innovation and sustainable development. In this perspective, innovation is a dynamic system and it is contingent upon a set of core competencies that couple to each other. Therefore, changing of even one competence can affect the organization’s ability to innovate.
Core competencies develop within Organizations’ Creative Areas (OCA) that include Sustainability, Organizational Networks, Entrepreneurship, Knowledge Management, R&D&T (Research, Development and Technology) Management, Marketing, Finance, Internationalization, and Information Systems. Core competencies are valuable and unique from a customer’s point of view, and also inimitable and non-substitutable from a competitor’s point of view (Prahalad & Hamel, 1990). Core competencies can represent collective knowledge that develops through learning and that provide strengths relative to other organizations (Nobre, Tobias & Walker, 2010; Nobre & Walker, 2011). The term dynamic refers to capacity of the organization to create new competencies and to adapt to the changing business environment (Teece, 2007).
The concept of competitive advantage refers both to the position that a firm occupies in its competitive environment and the firm’s ability to create superior value for its customers and superior profits for itself (Porter, 1998). The organization can sustain competitive advantage by developing strategic resources and core competencies (Lei, Hitt & Bettis, 1996). Although some chapters in this book support this economic concept of competitive advantage, that concept makes assumptions about economic supremacy that separate humanity from ecological and social developments. Therefore, this Preface avoids the term competitive advantage and adopts a more fruitful perspective of sustainable development-“the process of achieving human development... in an inclusive, connected, equitable, prudent, and secure manner” (Gladwin, Kennelly & Krause, 1995). An inclusive perspective sees traditional competitive advantage as occupying one extreme, whereas truly sustainable development occupies the opposite extreme. Sustainable development must benefit not only the organization and its customers, but also the whole society and the future of humanity through sustainability.” Most chapters of this book fall between these extremes.