4490: Chapter 7

Markets and Technology Framework

A conceptual model to categorize innovations along the market (existing/new) and technology (existing/new) dimensions.

Absorptive Capacity

A firm's ability to understand external technology developments, evaluate them, and integrate them into current products or create new ones.

Patent

A form of intellectual property, and gives the inventor exclusive rights to benefit from commercializing a technology for a specified time period in exchange for public disclosure of the underlying idea

Open Innovation

A framework for R&D that proposes permeable firm boundaries to allow a firm to benefit not only from internal ideas and inventions, but also from external ones.

Architectural Innovation

A new product in which known components, based on existing technologies, are reconfigured in a novel way to attack new markets.

Standard

An agreed-upon solution about a common set of engineering features and design choices.

Radical Innovation

An innovation that draws on novel methods or materials, is derived from an entirely different knowledge base or from recombination of existing knowledge bases with a new stream of knowledge.

Crossing the Chasm Framework

Conceptual model that shows how each stage of the industry life cycle is dominated by a different customer group.

Invention

Describes the transformation of an idea into a new product or process, or the modification and recombination of existing ones.

Innovation

The commercialization of any new product, process, or the modification and recombination of existing ones.

Disruptive innovation

an innovation that leverages new technologies to attack existing markets from the bottom up.

Reverse Innovation

an innovation that was developed for emerging economies before being introduced into developed economies - frugal innovation

Entrepreneurship

describes the process by which change agents (entrepreneurs) undertake economic risk to innovate - to create new products, processes, and sometimes new organizations.

Strategic Entrepreneurship

describes the pursuit of innovation using tools and concepts from strategic management.

Industry Life Cycle

five distinct stages: introduction, growth, shakeout, maturity, and decline

Process Innovation

new ways to produce existing products or deliver existing services

Entrepreneurs

the agents who introduce change into the competitive system. They do this not only by figuring out how to use inventions, but also by introducing new products or services, new production processes, and new forms of organization.

Idea

the innovation process begins with an idea. The idea is often presented in terms of abstract concepts of as findings derived from basic research

Innovation

the successful introduction of a new product, process, or business model - a powerful driver in the competitive process.

Social Entrepreneurship

Social entrepreneurship describes the pursuit of social goals while creating a profitable businesses.

Incremental Innovation

Innovation that squarely builds on an established knowledge base and steadily improves an existing product or service.

Winner Take All Markets

Markets where the market leader captures almost all of the market share and is able to extract a significant amount of the value created.

Product Innovation

New or recombined knowledge embedded in new products

Closed Innovation

New products discovered, developed, and commercialized internally.

Network Effects

The positive effect (eternality) that one user of a product or service has on the value of that product for other users.

Trade Secrets

Valuable proprietary information that is not in the public domain and where the firm makes every effort to maintain its secrecy.