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CEFRIEL - The Challenge Of Innovation


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Innovation is today an overused and misused term.
In this InnoVision Paper, prof. Alfonso Fuggetta analyses the characteristics of Innovation with respect to Research. Morevover, he presents different models that facilitate the process from Research, fundamental for knowledge creation and development, towards Innovation for enterprises and public authorities.

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CEFRIEL - The Challenge Of Innovation

  1. 1. I N N O V I S I O N PA P E R June 2009, Ver. 2.0 THE CHALLENGE OF INNOVATION by Alfonso Fuggetta
  2. 2. Innovation is a misused and with “change”: if nothing chan- The question is not rhetoric, overused term. Nowadays, a ges, it is difficult to argue that and the answer is not obvious lot of people and companies we are innovating. at all. In particular, this is a qui- are describing themselves as te important problem for univer- “innovative” and “innovation- Innovation is often associated sities and academic institutions, driven”. Too often, unfortunate- also with the expression “ap- which are constantly challenged ly, plain conventional solutions plied research”. The idea is to make their research work are called “innovative” just as a that there are different types of closer to the needs and expec- gold-plating marketing strategy. research: long-term and explo- tations of industries, and of the The financial crisis that is stri- ratory research activities on one society in general. king worldwide economies has hand; medium/short-term and WHAT DO WE MEAN BY certainly diverted the attention market-oriented “applied rese- INNOVATION? of most media, opinion makers, arch” activities on the other. In the past years, the notion of politicians, and entrepreneu- “Applied research” is often innovation has been discussed rs to more urgent and critical considered as a synonymous of and studied extensively. There issues. Nevertheless, innovation “industrial research”, assuming are many studies illustrating the stands as one of the most cited that long-term research is typi- approaches and methods to be and important issues for any cally done by universities and used in a company to support company or organization that research centers, while industri- and promote innovation. There wants to compete in the worl- es are only or primarily intere- are economic studies illustrating dwide market. sted in short-term, application the benefits of effective innova- oriented research that can have tion practices and policies. Still, Innovation is often associated a direct impact on their markets the impression is that too often and/or confused with the word and performance. we miss a clear understanding “research”. For many people, of this notion: what is rese- “research” and “innovation”, Indeed, none of these obser- arch, what is innovation, what along with the term “develop- vations is completely wrong. is technology transfer, how do ment” (R&D) are more or less However, some of them are we characterize and relate these synonymous. “Doing research” confusing, some are misleading, notions to each other? and “innovate” mean to “create and others are unable to descri- something new”. Certainly, in- be the real nature of the inno- To answer these questions, it is novation is associated with the vation process. useful and interesting to consi- notion of novelty. By innova- der the thoughts and conside- ting, we change something and Therefore, to better understand rations made by some of the introduce a discontinuity: it can the facets and challenges of “fathers” of modern sciences. In be a new way of doing things, innovation, it is essential to particular, it is worthwhile men- or the introduction of new fea- provide a deeper characteriza- tioning a quite famous quote tures and products. Undoubte- tion of the term. What do we from Louis Pasteur (see http:// dly, “innovation” is associated really mean by innovation? 1
  3. 3. the different branches of tech- duces the notion of “application steur), often credited to Albert nology). At the same time, it is of science”, pointing out this Einstein, and cited by Nobel important to remember that the second important issue: how do prizes such as Carlo Rubbia: word “science” refers not only we exploit our body of know- to physics, maths, biology and ledge to improve our lifestyle There does not exist a catego- other areas of physical and na- and advance our society? This ry of science to which one can tural sciences, but also to social is not a marginal problem as it give the name applied scien- sciences and humanities (inclu- is not absolutely obvious how ce. There are sciences and the ding economics, history, …). to transform knowledge into applications of science, bound something practical and widely together as the fruit of the tree In general, we can say that used in the society. which bears it. science and, more in general, research are the human acti- Think of the penicillin. The Pasteur’s position is quite vities devoted to develop and beneficial effect of that mold simple and, at the same time, enrich our body of knowledge. was observed by many scien- extremely profound. It can A physicist (such as Einstein) tists and finally confirmed really represent the baseline will be interested in discove- by Fleming in 1928 (http:// to explore and characterize ring the laws and principles the nature of innovation. His governing the behavior of the It was a grand scientific disco- starting point is the notion of physical world. A philosopher very that happened as a combi- science (remember that Pasteur (such as Kant) will propose nation of observation and chan- was a chemist and microbio- principles and concepts that ce. It was the result of decades logist and therefore deeply explain our essence as human of studies and dedication. In involved in physical sciences). beings. A technologist and the years following Fleming’s The term “science” has two inventor (such as Edison) will discovery, pharmaceutical indu- important meanings: first, it is be interested in producing new stries have spent a lot of time used to identify a systematic ways to solve problems or to and effort to transform that body of knowledge; second, the carry out specific activities. In discovery into a product, usable term “science” identifies also all these different domains, by patients and physicians to the process through which this knowledge assumes different treat diseases. This was not a knowledge is produced. facets and characteristics. Ne- simple process: it was neces- vertheless, science and research sary to understand the type of In our society, the term “scien- aim at continuously developing drug to be produced (ointment? ce” is typically associated with this body of knowledge, in- intravenous treatment? …), the the notion of “research”, even dependently of its mass-scale balanced combination of the though the latter has a wider application to address practical different elements to be used meaning, as it includes di- problems and needs. in the drug, the proper dosa- sciplines that are not usually ge, and the assessment of the identified as “science” (e.g., all In his statement, Pasteur intro- side effects it may produce. The 2
  4. 4. transformation of a “research general, Edison’s invention took viewpoint, it was not (and still achievement” into a real solu- years to materialize across the isn’t) the best object-oriented tion, able to effectively treat whole society, as it demanded programming language. But it specific diseases, was a long the creation of a totally new had the merit of hybridizing and complex process. industry and business sector. object-orientation concepts with the most popular conventional Edison invented the light bulb As an additional example, let’s programming language: C. This in 1879. It was a brilliant, consider object-programming strategy is not what a resear- historic result that has chan- languages. In the 60s, object- cher or scientist would “natu- ged our lives forever. However, orientation was a pure “rese- rally” pursue (indeed, C++ was nineteenth century towns didn’t arch” result that had no prac- developed in an industrial lab have a power grid, which was tical impact. In the 70s, Xerox – Bell Labs). However, it was not even a concept at that time. PARC launched Smalltalk, which the right move to bring a new Edison’s invention was basi- had a huge impact in the rese- technology to market success. cally useless. To bring it to the arch community, but a limited market, Edison had to create market success. Eventually, the These examples support and and put in place all the other knowledge accumulated over explain Pasteur’s point of view: factors and “ingredients” ne- the years was exploited in the there are two distinct activities, eded to exploit the invention: 90s conceiving a new breed of knowledge creation and know- he conceived the electric power programming languages and ledge application. They have distribution grid and a com- systems, and bringing object- different characteristics and de- pany to build and manage it. orientation to market success mand for different approaches Eventually, in 1882 Edison was with C++ and, later on, with and methods. This is the cor- able to bring his new service to Java. In particular C++ had a nerstone to explain the nature 59 customers in Manhattan. In crucial role. From a scientific of innovation. RESEARCH INNOVATION Driver Intellectual challenge Market success Approach Specialization Cross-functional Perspective Medium-long Short-medium Typically public Typically private Funding Visionary Venture Key abilities Scientific excellence Ability to execute Non-functional Tailored to users’ needs Only those needed to prove the idea requirements and expectations Risk Intrinsic Systemic Table 1: Research vs. Innovation 3
  5. 5. Indeed, despite the complexity, tial stages in a classical and of the specific form that this differences, and possible ambi- rigid waterfall model. Neverthe- impact may eventually assume guities that a unique characteri- less, they do exhibit different (economic, social, cultural, …). zation of the term might induce, characteristics and intrinsic Of course, innovations such as the nature of innovation can challenges, “Doing research” is Apple iPhone are considered be defined quite easily: there different from “doing innova- big successes because they are is science and applications of tion”. It is therefore important having a deep technological science; or, also, research and and useful to compare these and economic impact on the applications of research; or, two notions in order to better market. But this has not to simply, research and innova- appreciate their role and cha- be always the case. For many tion. racteristics. supportes of Linux and Open Source Software, the goal is not Innovation can be defined as In general, the nature of inno- just “to make money”: rather, the application of research re- vation with respect to research it is to to affirm a principle and sults in the society. can be characterized using the a vision. For others, the impact factors and dimensions illustra- might be the ability to positi- This is not just an easy simpli- ted in Table 1. vely influence the evolution of fication or dialectic trick. It is underdeveloped countries, or really the hearth of the matter: Driver to introduce new environmen- research is the creation of The drivers for research and tally sustainable processes and knowledge; innovation is the innovation are quite different. practices. In other cases, the application of research results By driver, I mean the inner ultimate goal is to improve the to create new processes, pro- motivation and ultimate goal quality of life, even if this is not ducts, and services. In research, that inspire and guide the work producing a tangible and imme- the focus is on knowledge of people involved in a specific diate economic return. Therefo- creation and discovery; in inno- activity. In research, the main re, the impact of an innovation vation, the focus is on transfor- driver is the intellectual challen- can be measured according to ming knowledge into something ge, the curiosity, and the desi- different criteria and viewpoints. usable by someone operating in re to excel from an academic, Still, it is impossibile to in- a specific market or, in general, scientific, and technological novate without some form of in some part of the society. standpoint. For someone, this concrete impact on the society. might even be just vanity or Certainly, even in research it is WHAT ARE THE CHARACTERISTICS personal career advancement. necessary to be consciuos of, OF INNOVATION? In innovation, the driver is and somewhat concerned with, Innovation is different from much simpler: market success, the potential application of research. Certainly, the two i.e., making a difference in research’s results. Nevertheless, concepts are connected and the market: an “innovation” is the driver remains substantially interrelated and they should successful if it has an impact on different. not be considered two sequen- the market/society, irrespective 4
  6. 6. Approach/Complexity wiki/Xerox_PARC) is systema- already been satisfied by com- The typical attitude of rese- tically mentioned as a classic peting solutions, possibly even archers is specialization: they case study: Xerox PARC was a less sophisticated. focus on the specific technolo- pioneer in inventing most of the gical and scientific topics and modern IT products and techno- It is interesting to note that challanges that characterize logies (graphical workstations, different domains may have their research agenda. This very mouse, Ethernet, …), but the different time-spans and dyna- often even does require a mul- company was unable to bring mics. In the biopharmaceutical tidisciplinary approach as, for them to the market timely and domain, bringing a new drug example, in bioinformatics; still, successfully. At Apple, Steve (i.e., the result of a research the mental attitude of resear- Jobs, an exceptional innovator, activity) to the market may chers is focused on the ultimate transformed those research re- require even years, as the trial scientific or technological goal sults in a market revolution. and certification processes have they are addressing, and tend specific constraints and requi- Perspective to ignore any other factor that rements. Nevertheless, also Typically, research activities re- may distract them from rea- in this case the “management quire long period of time to be ching the target. of time” during the research completed. In some cases, such and innovation phases is total- as nuclear fusion, researches Conversely, innovation requires ly different: in particular, the may even last decades. Certain- a wider range of cross-functio- innovation process is guided ly, it may happen that unfo- nal methods and disciplines. by a strict sequence of steps reseen or unexpected events Apple iTunes/iPod, just to and milestones that eventually may shorten the time needed mention a quite famous “inno- get the new drug approved for to achieve specific results. In vation”, is a masterful combi- market distribution. general, however, research nation of specific technologies, activities are long-lasting and Risk design skills, a smart business difficult to plan. Research is by definition risky: model, and a well-thought mar- keting strategy. In innovation, it many research initiatives fail Innovation is characterized by to reach their objectives or is not sufficient to “discover” or much more stringent time con- achieve unexpected and unan- “invent” something interesting: straints. Being innovation mea- ticipated results. It is difficult it is mandatory to put in place sured by the ability to achieve to “plan” a research activity, as all those actions that make it market success, time-to-market often it evolves in erratic ways. possible to successfully bring assumes a central and key role. In general, risks in research are that invention to the market. Even a clever and useful inno- high and difficult to anticipate The failure of Xerox in exploi- vation may become ineffective and handle. Nevertheless, in ting the many astonishing re- if it reaches the market too research risks are related, or sults produced by Alan Kay and late, typically, when customers’ intrinsic, to the scientific or Xerox PARC (Palo Alto Research requirements and needs have technological challenge ad- Center, 5
  7. 7. dressed by the researchers. In the former. on time and on budget. innovation, risks are systemic, Key abilities as they pertain to the complex Non-functional requirements What are the key abilities nee- interrelation of technological, Typically, the goal of a resear- ded to succeed in research and market, social, organizational, cher is to prove that an idea innovation? In research, the key and economic challenges that can really be useful to solve factor to achieve superior per- the innovator is requested to a specific problem. The rese- formance is scientific excellen- face. Thus, even if both activi- archer’s focus is on the intel- ce, i.e., the intellectual ability to ties are “risky”, each of them lectual challenge posed by the explore new areas and pro- has its specific facets and cha- problem, and his/her ability blems, exploit previous research racteristics. to tackle it. Namely, he/she is results, and create new know- focussed on the functional re- Funding ledge and scientific results. quirements that must be met in The specific characteristics of On the other side, to be succes- order to address the problem/ research and innovation have sful an innovator must possess issue successfully. In Innova- an impact also on the funding a strong ability to execute and tion, the focus is on making mechanisms. Typically, industri- deliver. This ability requires a specific solution available es are more and more intere- attitude and skills that resear- to the – often wide number sted in bringing new products and services to the market. chers do not necessarily exhibit: of – potential users. Users are indeed, researchers tend to not researchers: they should Therefore, industries are ready overlook all the issues related be enabled to use the solution to invest in innovation projects to time-to-market, engineering, ignoring most of its details, dy- that hold the promise to produ- production, usability, cost, relia- namics, limitations, or technical ce significant results affecting bility, marketing, and distribu- characteristics. As a consequen- their short-to-medium market tion. This is quite understanda- ce, it is necessary to consider performance. Industries are ble: researchers are challenged also a wide number of non- much less keen in investing in to produce new and novel functional requirements that longer-term, exploratory, and results, and publish their results are usually not so important for risky research projects. in scientific venues. They are a researcher. A first important For this reason, the role of certainly interested in producing non-functional requirement is public bodies and federal demonstrators and prototypes usability; others are reliability, government is crucial in sup- illustrating the effectiveness efficiency, safety, security, easy porting and promoting research and viability of their research of management and maintenan- activities. Innovation cannot work, but this kind of accom- ce, budget constraints, and pri- survive without a solid research plishments is quite different ce targets. These requirements background, as the latter pro- from the work typically done have a deep impact on the in- vide the “fuel” and the rough by innovators to bring a new novator’s approach, and marks material that is vital to support product/service on the market, a significant departure from the researcher’s typical attitude. 6
  8. 8. WHAT DO WE MEAN BY also, how can we quarantee Summing up TECHNOLOGY TRANSFER? that knowledge is eventually The above observations do not Frequently, the notion of inno- transformed into practical and want to introduce a sort of ma- vation is associated with tech- useful innovations? Indeed, thematical or formal definition nology transfer: innovation is too often this interaction is too of the terms “innovation” and supposed to be accomplished often poor and unfruitful: rese- “research”. Of course, there are by adopting and exploiting arch results produced by univer- situations where the differences some new technology. Is this sities and research centers are and distinctions between these true? What do we mean by rarely exploited by industries to two notions are not so sharp technology transfer and what is create/improve their products, and tend to disappear. Never- the real connection with inno- processes, and services. theless, the above characteri- vation? zations of research and innova- For this reason, over the years tion appear to be quite useful Wikipedia defines technology public bodies, industries, and and indicative of the nature and transfer as follows: academic institutions have stu- intrinsic dynamics of these two “Technology transfer is the pro- died the problem and pursued different, even if related, acti- cess of sharing of skills, know- a number of different strategies: vities. Undoubtedly, research ledge, technologies, methods and innovation are part of an of manufacturing, samples of Direct access to knowledge integrated, iterative feedback manufacturing and facilities This occurs when industries’ bu- loop, where the creation and among industries, universities, siness divisions and design cen- discovery of knowledge stimu- governments and other institu- ters are able to interact directly late innovation, which in turn tions to ensure that scientific with researchers to exploit their produces new stimuli and re- and technological developments work and results. This is typi- quirements to drive and enrich are accessible to a wider range cally the exception and not the the research agenda. However, of users who can then further rule. even if strongly related to each develop and exploit the techno- other, research and innovation logy into new products, proces- Patents and Technology Tran- do have specific differences and ses, applications, materials or sfer Offices (TTO) characteristics that need to be services.” Most universities have created carefully assessed and under- TTO, and associated patenting In practice, the notion of tech- stood. It is not just a sort of strategies and processes. Their nology transfer addresses a qui- intellectual or philosophical di- goal is to protect the know-how te important problem: how can stinction: research and innova- and intellectual property (IP) we guarantee that technological tion do require different metho- generated in the universities, knowledge and achievements dological approaches, expertise, and to formalize the process are shared among all the diffe- human capital, and operational through which companies can rent actors involved in research models. access and exploit such IP. and innovation activities? Or This approach is not able to 7
  9. 9. fill the gap between industry developer. dollar assigned by a company and academia completely, as to a university through a con- it does not change the nature Brokering services tract, the state adds one more of the information and know- Many public bodies have de- dollar to support the project. ledge being transferred, or the veloped organizations that act Again, this is very interesting capabilities of the industries as a sort of broker between and useful support to promote that should be exploiting such industry and academia. Their innovation and industry-acade- information and knowledge. goal is to help companies find mia interaction, but it does not Certainly, establishing a TTO those research institutions impact the operational charac- and IP management procedures that possess the know-how teristics and attitude of the two is an important and necessary and the technology instrumen- parties: if they were unable to step to facilitate the interaction tal to solving their problems. talk and interact on the speci- between industries and acade- Again, these initiatives are fic technological issues to be mia, but it does not address certainly useful to improve the solved, they still remain in the the main facets of the problem relationship between indust- same condition, despite the in a radical and comprehensive ry and academia, but they do financial support. way. not change the characteristics and operational behavior of As a general comment, we may Spin-offs and start-ups the “endpoints”: matching is observe that all of the above They are initiatives that aim at useful, but it is insufficient if approaches show the same exploiting a specific piece of the “matched endpoints” are underlying characteristic: they technology or IP developed in structurally unable to interact support the interaction betwe- a research center. Technology effectively. en industry and academia by transfer is achieved by creating matching interests and pro- a company that operates on Public funding blems, but they all assume that the market, selling the products Funding innovation and rese- the result of the research activi- and services associated with arch is of course a critical issue. ty carried out by the university the know-how generated by the Public bodies and federal agen- is more or less “ready-to-use” research activity. This is another cies have developed a number or, conversely, they take for important form of technology of different strategies to sup- granted that once some know- transfer. However, a start-up port companies and universities ledge is made available to aims at promoting and selling in accomplishing innovation industries, they will be able to its specific asset and, in gene- and research activities. Some of adopt it and make it usable for ral, does not directly impact these initiatives are specifically their own needs and purposes. the majority of companies that designed to facilitate interaction This approach does not work, need to be assisted in selec- and technology transfer. For or does not work in many situa- ting and adopting the most instance, in the US some state tions and contexts. appropriate technology able to governments have established a fulfill their needs, whoever is its dollar-match program: for each Our experiences have demon- 8
  10. 10. strated that the most effective cal examples are joint consortia and patents) are intrinsically means to support technology and framework programs. based on a sort of push mo- transfer are based on shared del (from research to industrial experiences that make it pos- Technology scouting exploitation), the three models sible to (re)combine and refine There are many solutions and introduced above exploit a the expertise, knowledge, and technologies already availa- pull attitude, where the needs, competence of the involved ble on the market. Often, the challenges, and requirements parties. In particular, the most problem is not to invent new of the exploiter drive the se- effective models to support “things”, but to adapt, integra- lection, integration, and further technology transfer appear to te, and exploit existing techno- development/refinement of be the following ones: logies and solutions to address technology. In reality, techno- the specific needs of the target logy scouting, and technology Technology transfer by head company. Technology scou- transfer by head and by project In this scenario, knowledge is ting is the practice that focus go even further, as they help exchanged by allowing people on identifying the technolo- establish a bidirectional, mutual of one organization to work gies and solutions that can be enrichment, consolidating a within projects and initiatives instrumental to solve a specific common ground of cooperation of the counterpart. By working innovation problem. Technology and development. side by side, the know-how of transfer by head and by project an expert can be refined and usually include also some Of course, the above observa- adapted to the needs and re- form of technology scouting to tion does not want to confute quirements of the partner. identify the existing technolo- the value of the other form of gies and solutions that can be technology transfer such as TTO Technology transfer by project exploited in the project, at least or start-ups. Simply, the obser- This an advanced form of coo- as a starting point. vation points out that in many peration, where there is more contexts and circumstances than just people exchange: the Two are the key characteristics conventional forms of technolo- two parties engage in a joint of these approaches. First, they gy transfer are unable to effecti- project, where teams of the two adapt the knowledge availa- vely tackle the deep nature and parties are committed to achie- ble on one side so that it can complexity of the problem. ving joint goals and milestones. be received and exploited by the counterpart. Second, this INNOVATION = TECHNOLOGY TRANSFER? Structured cooperation adaptation is accomplished Technology transfer is instru- This is the evolution of tech- by considering the needs and mental, and in some case cen- nology transfer by project. It is requirements of the receiver, tral, in supporting a successful based on joint labs and ventu- and not just the attitude of the innovation initiative. However, res that provide a continuous producer. Basically, while most innovation is more than just and systematic cooperation fra- conventional approaches to adopting and exploiting some mework among partners. Typi- technology transfer (e.g., TTO 9
  11. 11. novel and interesting techno- procedures. logy. Potentially, innovation Unexpected occurrences involves technology, know-how, This occurs when something Process needs organization, business models, happens that changes the “rule Many processes in our society marketing strategies, business of the game” in a really unex- do exhibit problems and issues. process reengineering, cultural pected and radical way. Internet By analyzing them, often it is change, talent management and was designed to be decentrali- possible to identify solutions still more. A company innovates zed and flat because it had to that really change the game when it is able to introduce a survive any massive missile at- rules. A quite famous example discontinuity in its operation, tack in the Cold War era. It had is the introduction of advertise- behavior, and presence in also to be able to interact with ments in published material to the market. Take Apple as an the different networks already increase the revenues deriving example. They have innovated in place in the US Department from selling newspapers or to through technology with multi- of Defense. These features have distribute them free of char- touch interfaces on the iPhone, turned out to be extremely use- ge for readers. This idea was through new business models ful and successful in allowing initially conceived by Pulitzer, with iTunes, through design and a widespread, quick, and easy Hearst, and Ochs; nowadays, marketing with the iPod, just to dissemination of Internet tech- free press and most Internet mention a few examples. They nologies for non-military purpo- services have radically innova- have also radically changed the ses. ted the market by exploiting customers’ and public opinion’s advertisement and free distribu- perception about the company. Incongruities tion as key business practices. In 1995, Apple was considered Ship builders invested a lot of Even more, digital advertise- a “dead-man walking”. A few money to make ships faster ment has originated totally new years later, Apple became one and faster. The assumption was businesses, as giants such as of the most admired companies that by increasing the cruising Excite and Google have clearly worldwide. speed, the cost of operating a demonstrated, by integrating ship would decrease. In reality, advertisement and Internet In general, innovation is a cohe- the analysis of actual operating search. rent combination of different costs of ships revealed that ingredients. It does not happen the major problem was the Industry and market changes just because there is some new inactivity periods associated The rise of netcomputers, small technology at hand. Indeed, as with the ship “sitting idle in notebooks sold for a few hun- Peter Drucker suggests, there the port”, as Drucker explains. dred euros, and the decline in are different elements and The solution was to introduce desktop PCs are typical exam- phenomena that come into play containers onto ships, to speed ples of changes in the industry and influence the innovation up the loading and unloading and in the market. The diffusion process:1 1 Peter Drucker. “The discipline of innovation”, HBR, Best of 1985. 10
  12. 12. and availability of affordable wi- iPhone. factors or some variations of reless technology have enabled them show up as the results of ubiquitous and universal ac- Changes in perspective further changes in our society cess to the Internet. Hardware Computers and IT are a classical and in technology. Certainly, cost is decreasing dramatically, example of this phenomenon. this classification is useful to along with the physical dimen- Originally, they were designed understand the wide range of sions of digital components and and used for military applica- cultural, social, and technolo- products. People want to be tions, e.g., to compute the gical areas to be taken into ac- able to access Internet and use route/path of a rocket. Then, count to capture the complexity and access information where- someone realized that compu- of the issue. ver they are. These phenomena ters could also be used in a are radically transforming the company to store information Drucker’s classification is also market, reducing the role of and to automate a large num- instrumental to understand the more expensive desktop machi- ber of procedures and trivial relationship between innovation nes and supporting the incre- tasks. A change is perspective and technology transfer. Inno- dible rise of cheap, light, and caused a radical evolution of vation is more than just tech- small netbooks. This is a typical the IT market and of the com- nology selection or adoption: example of innovation caused panies adopting that kind of innovation is related to the ove- or promoted by changes in the technology. rall approach and strategy used industry and the market. by a company to approach the New knowledge market. It is a complex ende- Demographic changes Finally, a crucial factor enabling avor where knowledge, ideas, Generations change, and so do innovation is the creation and contributions, stimuli, and their habits, abilities, and cultu- availability of new knowledge, context information have to be re. 15 years ago almost nobody being it a technology advance collected, adapted, integrated, had a cellular phone. Nowa- or some scientific discovery or and blended. It is not just a days, in countries such as Italy, a social/economic analysis that matter of acquiring a patent or the penetration of digital SIMs sheds some lights on unknown selecting a specific technology is about 1.5 times the popula- or misunderstood problems and or purchasing some innovative tion. As a consequence, there is issues. product developed by a clever a new generation of customers start-up. Usually, innovation re- who are producing new needs Of course, the classification quires a careful reconsideration and requirements and, conse- proposed by Drucker is an of business operations and stra- quently, dramatically changing attempt to identify some of the tegies, and of the weaknesses the market. Obvious examples most important factors affecting and strengths of a company. illustrating this trend are iTunes innovation. There are many dif- This explain why technology and Apps Store, associated with ferent situations, in which these transfer by head and by project the diffusion of the new gene- factors are combined together are in many situations the most ration of iPod Touch and the and mixed, or in which new effective approaches to support 11
  13. 13. innovation. Indeed, they promo- tion process. te the exploitation of technolo- Most of these initiatives have gy by assessing the state of the SUPPORTING INNOVATION EF- not achieved the results and art in the market (technology FECTIVELY impact that the promoters had scouting), by analyzing custo- Universities and academic insti- envisaged. In particular, the mers’ needs and requirements, tutions are requested to faci- results of many research pro- and by jointly working with the litate and promote their rela- grams have failed to reach the customer in the same project tionship with industries, so that market. Why? Is it because the to develop a solution that take the benefits of research can be projects were unfeasible or the into account all the different more easily transferred to the partners inadequate? Certain- factors and issues that have market. The European Union, ly, in a number of cases these been identified. for instance, has always deve- were the difficulties faced by loped its research and develop- many projects. However, the- These forms of technology ment funding programs with a re are also other problems to transfer promote a constructive strong emphasis on university- consider. In many situations, approach to solution identifica- industry collaboration, industrial the real issue is the lack of tion and deployment that goes exploitation of research results, alignment and fit between the well beyond generic product and maximization of the market results of a research initiative selection or plain consulting. In impact of each funding initiati- and the ability of the receiving general, these forms of tech- ve. A similar attitude has gui- company to exploit them in the nology transfer are intrinsically ded many federal and state pro- market. Typically, the situation and operationally coherent with grams launched in the US and is illustrated by the diagram the deep nature of the innova- in other developed countries. above, which represents in a 12
  14. 14. quite simple form most of the diagram. Many universities and taking into account the custo- observations proposed in pre- research centers claim that they mer’s timeframe and econo- vious sections. are focussing on innovation. mic constraints. However, they often do not re- Universities tend to focus on alize that innovation is different An organization of this kind is research activities, where the from research (as discussed in much more similar to a con- main goal is to explore new detail in the previous sections) sulting company, rather than a areas and problems. The re- and consequently requires Technology Transfer Office or a sults of their work are typically people, resources, and orga- brokering service. Universities papers, algorithms, theories, nizations that are significantly usually do not have this kind methods, prototypes, formulas different from classic academic of structures. Even if with some or new materials. Most of these units (departments, institutes, differences, the same occurs in results cannot be directly used schools, …). Innovation is also industries. by companies. They are either more than just supporting pa- too immature or too specific, tent creation and registration, This is the deep motivation for i.e., not aligned with the poten- or brokering of competences. so many unsuccessful attem- tial exploiter’s needs, require- An organization that wants to pts to promote innovation and ments, and market constraints. support and promote innova- support universities-industries On the other side, industries tion must exhibit a number of cooperation. Universities and are seldom involved in research characteristics: industries approach innovation activities. They mainly focus • It must be staffed with pro- with the same organizations on production and distribution fessional that have a deep they use in their mainstream of their goods and services. In knowledge of technology and activities. reality, the same problem arises that understand the market. in the relationship between It is not sufficient to have We need new approaches and the research departments of a just a generic expertise on models to support innovation. company and its own business innovation processes. What should they look like? units directly involved in market • It must have the right connec- operations. tions into the research world. THE CEFRIEL EXPERIENCE • It must be able to accomplish CEFRIEL ( is Thus, the problem is not just technology scouting on a a leading Italian ICT center for academia vs. industry: rather, it worldwide scale. Research, Innovation, and Edu- is research vs. industrial deve- • It must be able to design, de- cation. CEFRIEL shareholders lopment (even within the same velop, and deploy solutions are universities (Politecnico di company). or components of solutions, Milano, University of Milano, not just to sketch proposals, University of Milano-Bicocca, Innovation can be seen as the ideas, or prototypes. and Università dell’Insubira), activity that aims at bridging • It must be organized to ac- public administrations (Regio- the gap illustrated by the above complish challenging projects, nal Council of Lombardy), and 13
  15. 15. industries (Alcatel-Lucent Italia, CEFRIEL is organized and staf- needs, and create and deploy RCS, Compunetix Inc., Elettro- fed quite differently from a multidisciplinary solutions, nica Industriale, Engineering university department, a generic exploiting the best technologies Ingegneria Informatica, Fastweb, consultant, or a brokering agen- and practices available on the Hewlett-Packard Italiana, Italtel, cy. The human capital of the market. In this respect, CEFRI- Microsoft, Pirelli Broadband center includes 140 professio- EL is a design shop similar to Solutions, Siemens, Industrie nals (with the highest education IDEO, one of the most suc- Dial Face, STMicroelectroni- degrees). They are highly quali- cessful innovation companies cs, Telecom Italia, Vodafone). fied experts, project managers, created in the past years. CEFRIEL mission is to fill in developers, and support staff the gap between the universi- able to carry out innovation IDEO ( ty research activities and the projects, taking into account defines itself as follows: innovation needs of industries customers’ constraints (time, Founded in 1991, IDEO is an and public administrations. The resources, ...) and requirements. innovation and design firm that focus is on exploiting ICT as a CEFRIEL actively cooperates uses a human-centered, design- strategic factor to innovate pro- also with non-ICT researchers based approach to help organi- ducts, processes, and services. and experts to ensure the cove- zations in the business, gover- Multidisciplinarity, evaluation of rage of all the skills needed to nment, education, healthcare, customers’ needs and require- carry out complex multidiscipli- and social sectors innovate and ments, and execution effective- nary projects. grow in three ways: ness are the key factors guiding CEFRIEL operations. CEFRIEL is organized and Identify new ways to serve and managed as an independent support people by uncovering The activities carried out by the company, with a budget that is their latent needs, behaviors, center can be summarized as totally made through contracts and desires. follows: and research grants. CEFRIEL • Assessment of customers’ activities are carried out for Visualize new directions for products, processes, and ope- center shareholders and also companies and brands and rations. for other companies. All the ac- design the offerings - products, • Technology scouting. tivities carried out in the center services, spaces, media, and • Applications of research re- are managed through specific software - that bring innovation sults and innovative techno- contracts, with the required and strategy to life. logies to new processes and agreed level of IP management products. and protection. Enable organizations to chan- • Development of components ge their cultures and build the and solutions. In general, CEFRIEL has been capabilities required to sustain • Innovative education pro- conceived, organized, and ma- innovation. grams. naged to work with customers’, understand their problems and IDEO is a project-oriented com- 14
  16. 16. pany. It is not just a supporting the previous sections: it is an rent approaches, human capital, organization, linking industries advanced organization, driven and organizations. The failure in and academia, or providing by the analysis of customers’ understanding these differences market analysis and forecasts. needs, and the ability to create and constraints explain most IDEO is able to set up teams solutions and bring them to the the of unfruitful experiences of of highly qualified designers market. Even if with different the past decades. and innovators who actively background and constituencies, work with the client and for both IDEO and CEFRIEL have Innovation requires a focus on the client in order to identify innovated the way innovation is execution and delivery in the and develop a solution to its conceived and carried out. short-to-medium timeframe. innovation need. Indeed, IDEO Innovation requires a multidisci- employs more than 500 people CONCLUSIONS plinary, cross-functional atti- operating in the a wide number Innovation is certainly one of tude, able to help companies of areas: Branding, Business the most important challenges identify convincing and practical factors, Communication Design, our society has to address. We solutions to address their pro- Electrical engineering, Environ- need to innovate not just to blems and expectations. Inno- ments design, Food science, increase the competitiveness of vation forces universities and Healthcare, Human factors, our companies and industries, public organizations to rethink Industrial design, Interaction but also to improve the quality the strategies that have been design, Mechanical engineering, of life, and to address the many pursued so far, and to identify Organizational design, Software problems our society is facing. new means, models, and opera- engineering. IDEO is a proactive tional approaches. entity able to work with custo- Many initiatives have been lau- mers on their problems, and to nched to support and promote We need to innovate the way inject new ideas and innova- innovation. Too often, the re- we see and pursue innovation. tions in their business: a design sults of this effort appear to be It a major challenge that we shop able to shape innovative insufficient and not aligned with cannot afford to miss or lose. ideas and concepts to support expectations, needs, and inve- ACKNOWLEDGEMENTS its customers’ growth. sted resources. To improve and propose more effective appro- The author wishes to thank Certainly, IDEO’s main focus aches, it is essential to under- Umberto Bertelè, Emanuela and characterization is its de- stand the real nature of inno- Colombo, Luca De Biase, Gior- sign-driven approach. Moreover, vation: while research aims at gio De Michelis, Dave Parnas, IDEO is a for profit organiza- creating knowledge, innovation Antonio Santangelo, Ian Som- tion, while CEFRIEL is a not-for- aims at applying it to develop merville, Gigi Tagliapietra, and profit, reinvesting profits and new products, processes, and Andrea Valboni for their useful margins in its own operations. services. Even is strongly rela- comments to the first draft of Still, IDEO holds all the charac- ted to each other, innovation this paper. teristics and traits discussed in and research do require diffe- 15
  17. 17. CEFRIEL This paper is covered by a Creative Commons License. Via R. Fucini, 2 20133 Milano Some rights reserved: T +39 02239541 Attribution. You must attribute the work in the manner specified by F +39 0223954254 the author or licensor. No commercial. You may not use this work for commercial purposes. No Derivative Works. You may not alter, transform, or build upon this work.