Research paper published in Proceedings of the 17th International Product Development Management Conference IPDM.
A company’s ability to successfully introduce radically new products and services is a key success factor for sustaining competitive advantage. This is particularly true for the automotive industry, where smaller manufacturers with niche products struggle to compete with the large-scale efforts of their bigger competitors, and are thus in desperate need to innovate their way out of the current crisis. A key challenge for companies seeking innovation is how to better understand the role of risk in innovative practice. The purpose of this study is to investigate how managers within an automotive company perceive the concept of innovation and the relation between innovation and risk. The study is based on interviews with fifteen managers representing a cross-section of disciplines. The analysis of the informants’ answers resulted in two overarching themes, “novelty” and “value”, which were further broken down into seven sub-themes to highlight different facets of innovation that were raised by managers from these disciplines. While there were many similarities in the perceptions, the most striking differences related to; 1) innovation as being about the “combination of things to something new”, and 2) innovation as being about increasing “customer value”. Several informants noted that risk taking is a success factor to achieve innovation, but they also acknowledged that there are several inhibiting factors that are in contradiction with this approach, such as limited time and money. Further the paper has highlighted the crucial challenge of how to effectively balance risk and opportunity to invest in long-term opportunities, without risking short-term growth.
- Innovation, automotive industry, technology transfer, product innovation, radical innovation
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