LITERATURE REVIEW
CHAPTER 2: LITERATURE REVIEW
2.4 De�inition of Terms
Review of secondary data and focus group activities on a variety of personnel from distinct industries has revealed several discrete de�initions of the innovation process in diverse companies and industries. It is critical to determine the meaning of every term and de�inition used in this survey so that the survey on chosen companies is �irmly based on clear and well de�ined premise. As for the terms and processes identi�ied for the survey, the team has deliberated on the de�initions of each of them based on Oslo Manual 3rd Edition (2005) as given in Table 2.1.
Table 2.1 De�inition of Key Terms
No Term Description
1 Innovation
Activities Innovation activities are all scienti�ic, technological, organisational,
�inancial and commercial steps which actually, or are intended to, lead to the implementation of innovations. Some innovation activities are themselves innovative; others are not novel activities but are necessary for the implementation of innovations.
2 Product
Innovations The introduction of goods or services that is new or signi�icantly improved with respect to its characteristics or intended uses. This includes signi�icant improvements in technical speci�ications, components and materials, incorporated software, user friendliness or other functional characteristics. Product innovations can utilise new knowledge or technologies, or can be based on new uses or combinations of existing knowledge or technologies.
Table continued to the next page CHAPTER 2: LITERATURE REVIEW
11
Due to the proven importance of innovation and organisational development relationship, a reliable technique for measuring innovation activities as an indicator of innovation is important for policymakers. Therefore, Malaysia needs to measure trends and activity levels of innovation in manufacturing and services sectors. The National Survey of Innovation 2015 was conducted to examine the effects of innovation and measurement indicators according to the Oslo Manual 3rd Edition (2005). Among the factors surveyed were:
i. Expenditure on innovation;
ii. Level of innovation;
iii. Objectives of undertaking innovation activities;
iv. Source of information for innovation;
v. Innovation cooperation;
vi. Factors hampering innovation; and vii. Intellectual Property Rights (IPR) status.
2.4 De�inition of Terms
Review of secondary data and focus group activities on a variety of personnel from distinct industries has revealed several discrete de�initions of the innovation process in diverse companies and industries. It is critical to determine the meaning of every term and de�inition used in this survey so that the survey on chosen companies is �irmly based on clear and well de�ined premise. As for the terms and processes identi�ied for the survey, the team has deliberated on the de�initions of each of them based on Oslo Manual 3rd Edition (2005) as given in Table 2.1.
Table 2.1 De�inition of Key Terms
No Term Description
1 Innovation
Activities Innovation activities are all scienti�ic, technological, organisational,
�inancial and commercial steps which actually, or are intended to, lead to the implementation of innovations. Some innovation activities are themselves innovative; others are not novel activities but are necessary for the implementation of innovations.
2 Product
Innovations The introduction of goods or services that is new or signi�icantly improved with respect to its characteristics or intended uses. This includes signi�icant improvements in technical speci�ications, components and materials, incorporated software, user friendliness or other functional characteristics. Product innovations can utilise new knowledge or technologies, or can be based on new uses or combinations of existing knowledge or technologies.
Table continued to the next page CHAPTER 2: LITERATURE REVIEW
12
NATIONAL SURVEY OF INNOVATION 2015
No Term Description
3 Process Innovations The implementation of a new or significantly improved production or delivery method. This includes significant changes in techniques, equipment and/or software. Process innovations can be intended to decrease unit costs of
production or delivery, to increase quality, or to produce or deliver new or significantly improved products.
4 Organisational
Innovations The implementation of a new organisational method in the firm’s business practices, workplace organisation or external relations. Organisational innovations can be intended to increase a firm’s performance by reducing administrative costs or transaction costs, improving workplace satisfaction (and thus labour productivity), gaining access to non-tradable assets (such as non-codified external knowledge) or reducing costs of supplies.
5 Marketing Innovations The implementation of a new marketing method involving significant changes in product design or packaging, product placement, product promotion or pricing. Marketing
innovations are aimed at better addressing customer needs, opening up new markets, or newly positioning a firm’s product on the market, with the objective of increasing the firm’s sales.
6 Research and Development Innovations
R&D are research and development activities that comprise creative work undertaken on a systematic basis in order to increase the stock of knowledge, which could then be used to devise new applications.
7 Significant
Improvements This is where existing products go through changes either in materials, components and other characteristics that will enhance the product or service performance.
8 New to the World An innovation is new to the world when the firm is the first to introduce the innovation for all markets and industries.
9 New to the Market An innovation is new to the market when the firm is the first to introduce the innovation for their market.
10 New to the Firm An innovation is new to the firm when the innovation is new to that firm only.
11 Closed Innovation Innovations developed internally by the company itself or company’s group.
12 Joint Innovation Innovations developed jointly by the company together with other companies or institutions.
13 Open Innovation Innovations developed mainly by other companies or institutions (externally).
14 Radical Technology
Innovation Results in a product that is so superior that existing products are rendered non-competitive.
Source: Oslo Manual 3rd Edition (2005) and other secondary sources
12
NATIONAL SURVEY OF INNOVATION 2015
No Term Description
3 Process Innovations The implementation of a new or significantly improved production or delivery method. This includes significant changes in techniques, equipment and/or software. Process innovations can be intended to decrease unit costs of
production or delivery, to increase quality, or to produce or deliver new or significantly improved products.
4 Organisational
Innovations The implementation of a new organisational method in the firm’s business practices, workplace organisation or external relations. Organisational innovations can be intended to increase a firm’s performance by reducing administrative costs or transaction costs, improving workplace satisfaction (and thus labour productivity), gaining access to non-tradable assets (such as non-codified external knowledge) or reducing costs of supplies.
5 Marketing Innovations The implementation of a new marketing method involving significant changes in product design or packaging, product placement, product promotion or pricing. Marketing
innovations are aimed at better addressing customer needs, opening up new markets, or newly positioning a firm’s product on the market, with the objective of increasing the firm’s sales.
6 Research and Development Innovations
R&D are research and development activities that comprise creative work undertaken on a systematic basis in order to increase the stock of knowledge, which could then be used to devise new applications.
7 Significant
Improvements This is where existing products go through changes either in materials, components and other characteristics that will enhance the product or service performance.
8 New to the World An innovation is new to the world when the firm is the first to introduce the innovation for all markets and industries.
9 New to the Market An innovation is new to the market when the firm is the first to introduce the innovation for their market.
10 New to the Firm An innovation is new to the firm when the innovation is new to that firm only.
11 Closed Innovation Innovations developed internally by the company itself or company’s group.
12 Joint Innovation Innovations developed jointly by the company together with other companies or institutions.
13 Open Innovation Innovations developed mainly by other companies or institutions (externally).
14 Radical Technology
Innovation Results in a product that is so superior that existing products are rendered non-competitive.
Source: Oslo Manual 3rd Edition (2005) and other secondary sources
13
14
NATIONAL SURVEY OF INNOVATION 2015
14
NATIONAL SURVEY OF INNOVATION 2015
15