Enhancing
Country Environment for
Innovation
Clarence J Mann, JD, Dr. jur. University of Maryland
University College
Exchange Faculty Program
Universitas Terbuka – University of Maryland University College
Enhancing
Country Environment
for
Innovation
Clarence J. Mann, JD, Dr. jur.
Innovation Imperatives
• For the Country –
Increasing Productivity and Standards of Living for All
•For the Enterprise –
Increasing Productivity and Competitive Advantage
in an
National Comparative Advantage
“Innovation and Imagination give
an economy or a company that
extra edge.
Today, wealth is
generated by new Ideas”
Difficult to Measure
Innovation
?
Countries Vary Significantly
• Quantitatively – e.g., patents, proportion of scientists and engineers; different types (e.g., soft and hard)
• Qualitatively – e.g., innovation intensity
– Complex Process – i.e., ability to create and then commercialize new products, processes – shifting the innovation frontier (Porter)
What is
Innovation
?
• New combinations applied in the
market place
• Ability of Individuals, Companies and
Entire Nations to Continuously Create Their Desired Future
• Process of –
– Harvesting Knowledge
– Generating New Products, Services, Processes & Business Models
Innovation Occurs
at
All Aspects & Levels of Society
• R&D Centers • Enterprises
• Government Agencies • Educational Institutions
8
Types of Innovation
•
Products/Services & Processes
•
Operations & Management
•
Public & Private Sectors
9
Global Drivers of Innovation
Nations & Enterprises Alike
1. Intensifying Competition @ business
models, technology, value propositions
2. Diversity of Geography @ scattered
centers of excellence - transparency
3. Multiplicity of Value Networks @ chess
Question to Consider
What Should Guide
Nations & Enterprises
in
Building Innovative Capacity?
• Holistic Systems Thinking
11
Three Part Analysis
I.
Systems Models
-
addressingissues holistically
II. Building
Country Climate
for
Innovation
Part I.
Systems Models
for Assessing the Climate
of
Innovation
1. Social Process Model @
Country Environments
2. Corporate Process Model @
13 Economic Commonality Cultural Commonality Political Commonality Social Process Model Three Complementary Three Complementary Societal Realms Societal Realms Rules of Conduct Public Infrastructure Market Preferences Goods &
Services Protect &
14
Social Process Model
Rationale
Comprehensive – all societal aspects
Universal – every society
Analytical – critical components
Relational – 3 functional perspectives
Interactive – 3 inter-dependent realms Transparent – underlying dynamics,
Component Subsets
Component Subsets
Fractals of Parent Dynamic
Contain All Three Poles
Reveal Depth and Nuance
16 Significating Significating Pole Pole Foundational Foundational Pole Pole Organizational Organizational Pole Pole Economic Commonality Cultural Commonality Political Commonality 9. Symbol 7. Wisdom 8. Style 3. Distribution 1. Resources 2. Production 6. Welfare 4. Order 5. Justice Societal Dynamics 3 Realms
Nine Dynamics
Nine Dynamics
within Three Societal
within Three Societal
Realms
17 Cultural Commonality
Social
Process
3 Realms Economic Commonality Political Commonality Symbol Wisdom Style Religious Beliefs Communication Modes Aesthetic Expression Distribution WelfareResources Production Order Justice
Useful skills Accumulated Knowledge Final
Meanings RecognitionSocietal
Basic Roles Decisional Patterns Consumption Preferences Property Claims Exchange Mechanisms Technological Resources Natural Resources Human Resources Management Systems Production Assets Production Processes Common Defense Legal Base Domestic Tranquility Secure Existence Political Freedoms Significant Engagement Legislative Consensus Executive Authority Judicial Procedures Multi
Multi--level View oflevel View of Social Process Social Process
Dynamics Dynamics
Constructed using Fractals of each higher level
18 Economic Commonality Cultural Commonality Political Commonality Social Process Symbol Wisdom Style Distribution Resources Production Welfare Order Justice Significating Dynamic Foundational Dynamic Organizational Dynamic Corporate Process Administration Operations Culture
Corporations as
Mirror Images of
Society – with
Part II
Country
20 Economic Commonality Cultural Commonality Political Commonality 9. Symbol 7. Wisdom 8. Style 3. Distribution 1. Resources 2. Production 6. Welfare 4. Order 5. Justice COUNTRY ENVIRONMENT ANALYSIS
7. Scientific literacy,, R&D/Discovery- oriented [Experimental Mindset]
3. Market Size, [Sophisticated,
Demanding Buyers]
Country Innovation Indicators
Country Innovation Indicators
1. Skilled Labor, Tech-nological Readiness, Supporting Networks of
Industries [Reliable Infrastructure]
4. Transparent markets; consistent, predictable system of anti-trust law & property rights
[Effective Institutions]
5. Rationale, transpar-ent decision-making;
Stable, predictable system of governance;
[Stable Governance] 9. Societal Goals:
Improving Quality of Life for All
[‘Progress’ Mindset]
8. Societal Recognition,
Achievement & Risk-Oriented; income inequality acceptable; [Collaborative Linkages]
6. National Commitment: Favorable Regulatory
Regime, Incentives, [National Strategy]
2. Risk Capital, unfet-tered competition; results-oriented mngt., e.g., kaizen, Six Sigma [Management Systems]
21 Economic
Commonality
Rule of Market
Competitiveness
Cultural Commonality
Rule of Effectiveness
Collaborative Trust
Political Commonality
Rule of Law
22
Three Complementary Realms
in Tension
Economic Commonality Cultural Commonality Political Commonality Social Process Complementary Complementary Dynamics Dynamics Rules of Conduct Public Infrastructure Market Preferences Goods &23
Ideological Tension
Among the Three Realms
• Economic Realm – functional rationality:
Efficiency vs. fairness
• Political Realm – legitimacy: informed
Consensus vs. coerced acceptance
• Cultural Realm – harmony, identity
24
Economic
Creative Destruction
Political
Shifting Alliances
Significating Pole
Foundational Pole
Organizational Pole
Societal Tensions
Cultural
Traditional Values
Innovating
Society
Harmonizing 3 Realms
•
Supportive Industry Clusters
•
Promote Centers of Excellence
•
Encourage FDI Inflows
•
Align Institutions
•
Societal Commitment –
Part III
27 Economic Commonality Cultural Commonality Political Commonality Social Process Symbol Wisdom Style Distribution Resources Production Welfare Order Justice Significating Dynamic Foundational Dynamic Organizational Dynamic Corporate Process Administration Operations Culture Corporations as Mirror Images of Society – with
28 Corporate Process Corporate Administration Corporate Operations Corporate Culture
Organizational Profile Indicators
Organizational Profile Indicators
What standards must resources meet?
How to ensure improving productivity?
How are decisions monitored & controlled?
How are critical decisions made? What values guide
the decisional process? How do employees
& stakeholders interrelate? What symbolizes
organizational identity?
How are skills and innovation enhanced?
How is customer
value delivered? Marketing
Resources Production Controlling Policy-Making Mission
Performing a Corporate
Innovation Audit
Aligning Nine Dimensions
of
Organizational Dynamics
with
Innovation Organizational Audit
Four Steps
1. Practical Vision – Images of Success
2. Assess Future-Critical Gaps/Needs Especially Core Competencies
3. Assess Country-Specific
Environmental Constraints
31 Economic Commonality Cultural Commonality Political Commonality Country Environment Symbol Wisdom Style Distribution Resources Production Welfare Order Justice Significating Dynamic Foundational Dynamic Organizational Dynamic Triangulating the Triangulating the Corporate Future Corporate Future for Innovation for Innovation Corporate Process Administration Operations Culture Corporate Process Administration Operations Culture
Envisioned Corporate Profile
Present Corporate Profile
32
Triangulating
Future Organizational Requirements
Two Assessments
1. Present Capacity of Firm
vs. Future-Critical Needs
2. Future Organizational Needs
33 Corporate Process Corporate Administration Corporate Operations Corporate Culture
Organizational Innovation
Organizational Innovation
Indicators
Indicators
1) Improving quality standards for all inputs
2) Continually im-proving productivity
4) Tracking and controlling decisions
5) Building credible leadership
6) Future-oriented guidance of risks/
returns across portfolio
8) Promoting synergy among employees. & stakeholders
9) Building an
organizational ethos of innovation
7) Continually enhancing skills and
innovative thinking 3) Improving customer value? 3 Marketing 1 Resource s 2 Production 4 Controlling 5 Policy Making 6 Mission/ Vision 7 Learning 8 Style 9 Identity
34
Part I
Organizational Constraints
• Limited Vision
• Reluctant Leadership
• Short Term Thinking
• Investment Costs
35
Strategic Innovation Dimensions
1. Internal Focus – strengthen innovative
capacity of the firm
2. Location Focus – leverage the firm’s
environment - multiple locations?
3. Alliance Focus – build the firm’s
36
Consider Now
the Nine Corporate Dynamics
for Building Innovation
37
Org’l Innovation Dynamics
Corporate Operations
• Resources Dynamic – quality standards
• Production Dynamic – kaizen, Six Sigma
38
Org’l Innovation Dynamics
Corporate Administration
• Controlling Dynamic – measuring
appropriate results
• Policy-Making Dynamic – credible
leadership
39
Org’l Innovation Dynamics
Corporate Culture
• Learning Dynamic – enhancing
skills and creative thinking
• Style Dynamic – promoting synergy
• Identity Dynamic – building
40 Economic Commonality Cultural Commonality Political Commonality Country Environment Symbol Wisdom Style Distribution Resources Production Welfare Order Justice Significating Dynamic Foundational Dynamic Organizational Dynamic Triangulating the Triangulating the Corporate Future Corporate Future for Innovation for Innovation Corporate Process Administration Operations Culture Corporate Process Administration Operations Culture
Envisioned Corporate Profile
Present Corporate Profile
41
