Tema 1 Conceptual frame

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Questions and Answers

What distinguishes innovation from invention?

Invention always leads to new processes or products.

Innovation includes diffusion through commercialization or public provision. (correct)

Invention focuses solely on scientific discovery.

Innovation is the introduction of entirely new technology.

What is the main goal of basic research?

To develop new scientific knowledge without specific applications in mind. (correct)

To provide immediate solutions to technical problems.

To improve existing production processes.

To create patents and new technologies.

Which of the following describes experimental development?

It involves analyzing previous research without creating prototypes.

It is focused on theoretical understanding without practical implications.

It leads directly to the creation of marketable products without testing.

It aims at solving technical problems to enhance a product or production process. (correct)

How does innovation impact business competitiveness?

It is essential for growth and enables adaptation to market changes. Signup and view all the answers

What is meant by 'creative destruction' in the context of innovation?

It describes how new firms can challenge existing markets and processes. Signup and view all the answers

What is a characteristic of process innovation?

It focuses on enhancing the way a product is manufactured. Signup and view all the answers

What role do generic technologies play in industries?

They can significantly impact multiple industries by either creating or destroying markets. Signup and view all the answers

What is often a result of successful experimental development?

The creation of a prototype that can undergo further testing. Signup and view all the answers

What type of innovation focuses on creating entirely new products or processes?

Radical Innovation Signup and view all the answers

Which innovation is characterized by less resource use and lower costs?

Frugal Innovation Signup and view all the answers

What challenge can established competencies present to a firm?

Neglecting new competencies Signup and view all the answers

In the linear model of innovation, what is primarily driven by scientific advancements?

Technological change Signup and view all the answers

What distinguishes Unicorn companies from Gazelles and Dolphins?

Valuation of 1 billion or more Signup and view all the answers

What does the 'chain-link' model emphasize in the innovation process?

Feedback loops and trial-and-error Signup and view all the answers

Which type of innovation is primarily focused on enhancing existing processes or products?

Incremental Innovation Signup and view all the answers

What defines competence-enhancing innovation?

It builds on existing knowledge Signup and view all the answers

What is a disadvantage of larger firms in the context of innovation?

Bureaucratic challenges Signup and view all the answers

What is a potential outcome of competence-destroying innovation?

Obsolescence of established skills Signup and view all the answers

Which type of innovation is aimed at enhancing social and economic wellbeing?

Social Innovation Signup and view all the answers

What plays a significant role in driving feedback in the chain-link model of innovation?

Market testing of ideas Signup and view all the answers

Which factor is NOT typically an advantage of small firms in competitive industries?

Financial capabilities Signup and view all the answers

Which model best represents the idea of scientific breakthroughs leading to innovation?

Linear Model Signup and view all the answers

Study Notes

Innovation Concepts

Innovation: A new or improved product/process, significantly different from the previous one, made available to users (product) or used by a unit (process). Not the same as invention; it involves invention plus commercialization/provision diffusion.
Technology: A subset of scientific knowledge with practical applications, arising from innovation.
Research & Development (R&D): Systematic creative work increasing knowledge stock and deriving new applications.
Basic Research: Aims to create new scientific knowledge, often carried out in labs or universities, resulting in scientific papers.
Applied Research: Uses existing scientific knowledge to solve specific problems, leading to technologies and patents.
Experimental Development: Focuses on solving technical problems for new or improved products/processes, potentially creating testable prototypes that can become innovations.

Innovation Implications

Competitive Advantage: Crucial for business competitiveness and growth (including start-ups).
Industry Transformation: Generic technologies can create or destroy entire industries (e.g., steam power, electricity, IT).
Economic Growth: Contributes to national economic growth by improving productivity.
Diversification: Facilitates economic diversification and structural change.
Sustainability: Leads to innovations for sustainable development.
Creative Destruction: New technologies challenge existing economic structures and organizations, renewing society and leading to higher economic development and welfare.

Types of Innovations

Process Innovation: Changes in the production process without altering the product. Aims to increase effectiveness and efficiency (e.g., reduce defects, increase production).
Product Innovation: Refers to changes in the product itself, often with shorter product life cycles requiring frequent replacement with improved versions or new variations.
Radical vs. Incremental Innovation:
- Radical: Significant changes, "doing something new" (e.g., voice recognition, hybrid cars, online share trading).
- Incremental: Small improvements, "doing what we do better" (e.g., Windows 7, improved phone services).
Social & Sustainable Innovation:
- Frugal Innovation: Lower cost, reduced resource use.
- Green/Eco-Innovation: Environmental protection and climate change solutions.
- Inclusive Innovation: Creates opportunities for marginalized groups.
- Pro-Poor Innovation: Innovation benefiting the poor.
- Grassroots Innovation: Developed by lower income groups.

Innovation Models

Linear Model (Science Push): Scientific advancements drive technological change. Emphasizes invention and public investment in basic research. Often associated with "closed" innovation strategies in large corporate labs.
Chain-Link Model: Shows interplay between market needs, design/testing, and feedback loops throughout the innovation process. Incorporates existing knowledge and necessary research to solve problems.

Innovation Management

Small Firms: Often major sources of innovation due to flexibility, dynamism, and less bureaucracy. Small, entrepreneurial firms are particularly adept at challenging established structures through "creative destruction".
Large Firms: Have resources for scaling up early breakthroughs and managing risks in concentrated industries.
Company Size Categories: Unicorns (startups valued at $1B+), Gazelles (rapidly growing small/medium-sized companies), and Dolphins (agile and adaptable, often science-based start-ups).
Resource-Based View: Competitive advantage stems from valuable, rare, inimitable, and non-substitutable resources (capabilities). These capabilities can be strengths or weaknesses.
Core Competencies: Differentiate a firm in a market, are difficult to imitate, and focus on what a firm does well. Can also create vulnerabilities by making firms less adaptable to radical change.
Competence-Enhancing vs. Competence-Destroying Innovation: Innovation impact on a company's existing knowledge and if it is obsolete.

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Description

Explore the fundamental concepts of innovation, including the distinctions between basic and applied research, and the role of R&D in technological advancements. This quiz will challenge your understanding of how innovations impact competition and market dynamics.