Strategy and Communication for Innovation

Business model innovation is a key task of an organization’s senior management team. Little is known, however, about business model innovation challenges that need to be addressed and how managers can structure the task of developing novel and commercially viable business models. This chapter analyzes the challenges an organization faces when changing the current business model and proposes visual solutions to overcome these challenges and develop new business models in existing firms. The argument supporting this proposition is developed in three stages: First, based on the existing management literature on business models, this chapter derives a set of challenges for business model innovation. Second, leveraging current visualization research, the chapter discusses several visual solutions to these specific challenges. Finally, we discuss how the characteristics of visual tools can practically support senior management teams in meeting the challenges of business model innovation.

In this chapter, we first argue that open innovation can be applied to situations where companies do not themselves develop new products or services. As a consequence, open innovation becomes relevant for a much larger group of organisations than hitherto. Second, we argue that open innovation scholars have failed to sufficiently differentiate open innovation initiatives in terms of their impact on companies’ growth: Some open innovation initiatives lead to incremental innovations in existing businesses while others are used to establish completely new businesses. Both arguments illustrate the need to integrate open innovation initiatives into the strategy of the firm.

Open innovation describes innovation processes that span across the boundaries of organizations or research and development (R&D) departments. It integrates different types of innovators regardless of their institutional affiliations to generate creative ideas, innovation concepts and novel solutions. The purpose of this chapter is to describe underlying mechanisms and strategic options for realizing open innovation. It presents three types of innovators and their functions in innovation endeavors and introduces five tools that facilitate open innovation. Finally, challenges and core tensions are discussed as a basis for the successful management of strategic open innovation initiatives.

Breakthrough innovations are important to the firm. They enable firms to challenge the existing technological order and shape new paths, allowing them to engage in corporate reinvention, growth and new business development. They represent rare, valuable and inimitable sources of competitive advantage for firms. Yet most established firms have too many obligations and too much to lose to justify the obvious risks of chasing radical possibilities. There are a number of causes for this risk averseness: under-investment in radical innovation, falling into competency traps, being constrained by core rigidities, and remaining overly committed to their main customers. Drawing on previous research in the field, we suggest that two fundamental enabling conditions can be identified for an established firm wishing to engage in breakthrough innovation. First, it must create an environment conducive to idea generation. Second, it must have the fortitude and risk tolerance to persevere and allow the most promising ideas to have a fair chance to succeed. Focusing on the latter topic, three types of organizational selection regimes are highlighted that have proven particularly effective to this purpose. These regimes are characterized as (1) individual driven, (2) lead user driven, and (3) application domain driven, with illustrative case examples provided from BAE Systems, Rolls-Royce and ARM respectively. While there is no single best way through which breakthrough innovation can be successfully pursued, given the multifaceted nature of the environment we suggest that the domain driven approach is the one that is most likely to be conducive to successful breakthrough innovations. High technology domains are subject to incredible uncertainty and offer some of the richest opportunities for experience based learning. In such settings the use of variegated feedback from multiple facets of the application environment may serve as superior selection mechanisms to the judgment of corporate headquarters.

Information and communication technologies provide firms with new opportunities to co-create innovations with their customers. The resulting trend towards “open innovation” has revitalized firm’s interest in systematically tapping into external innovation sources. Whereas the first open innovation cases typically dealt with product innovation, latest developments show that also intangible service innovation or corporate strategies can be co-developed with users, customers, or employees. As internet technologies are also increasingly pervasive in the public sector, virtual citizen co-creation systems also constitute an important but unexplored research area within the public administration research. This is especially relevant since real case examples in the public sector underline the need for more openness in governmental decision making. To tackle the research question, how an online co-creating approach may be designed to develop a political strategy together with experts and citizens, we conducted a 22-month research project together with the state chancellery of North Rheine Westphalia. A virtual co-creation system to rework an existing political strategy together with experts and citizens was created, implemented and evaluated. During the 3 month live-phase the platform attracted more than 60,000 visitors and about 270 active and registered members. Furthermore, 250 contributions, uploads of 236 additional documents and studies, about 500 evaluations, and over 1,050 written messages were counted. Our results show how intangible public innovations, which are tied to social welfare, public ethics, and legitimization, can be systematically co-created. These insights add relevant theoretical contributions to the research fields of service innovation, open innovation, and most importantly to the research community of public administration. From a practical and managerial point of view, our insights are of practical relevance for system designers and managers within public administration, politicians, and consulting agencies which intend to virtually integrate citizens, experts as well as politicians into co-creation processes.

For organizations in high-technology industries, knowledge is a critical resource that can be accessed through inter-organizational networks. However, for industries characterized by a heterogeneous set of actors, little is known about how different networks within the industry interact. Therefore, our research question is: How similar are the strategic network and the innovation network in the biotechnology industry? To answer our research question, we study two networks of interest. First, the Board-of-Directors-network serves as a proxy for the strategic network that fosters knowledge transfer between organizations. Second, we analyze the innovation network by using the patent network that emerged from collaborative innovation activities. Subject of analysis is the Flanders biotechnology industry, which is characterized by strong performing research institutions, large firms and innovative SMEs. We use social network analysis methods to measure the similarity of both networks and to identify their key actors. We find that a connection between two organizations in the strategic network increases the probability of forming a new connection between the same organizations in the innovation network, or vice versa. This shows that collaborations between two organizations on one network level can lead to an interlocking of the organizations at other network levels. Our results also suggest that few companies establish and maintain a strong position in the biotechnology innovation network. This network is dominated by academic institutions, which are the key producers of scientific knowledge. Interestingly, the BoD-network has a more balanced composition and power structure and knowledge on strategic issues is transferred across a wide range of industrial actors. We also highlight the strong position of spin-off companies in the BoD-network and the absence of large firms in both networks. Our findings call for more research on the causal mechanisms of network formation and on the relationship between multiple networks within one industry.

In order to gain and maintain innovation capability, organizations have to adapt their profiles and processes to perpetually changing environmental conditions. However, the resulting need for a high degree of flexibility, which includes avoiding an information undersupply by being stable but inflexible, entails the risk of an information overload. Therefore, a balance between an organization’s flexibility and its stability is needed. Top Management Team (TMT) cognitive diversity seems to constitute a promising resource, which under certain circumstances can be turned into an organizational competence, allowing for a high but stable level of organizational flexibility. Employing insights from complexity theory and adopting agent-based simulation is suggested as a further research method in order to deduce underlying causal inter-relations.

Innovation clusters continue to be an important focus of economic development policies in many nations. Leading innovation clusters demonstrate that regional concentration strengthens the innovative capability and can lead to successful competitiveness on a global level, as demonstrated by regions such as Silicon Valley (US), Cambridge (UK) and Sophia Antipolis (France). However the successful creation of clusters still presents a challenge to policy makers as efforts to do so regularly fail. The development of innovation clusters has therefore received much academic and policy maker attention. While past research has examined a variety of factors as drivers for clustering effects, the role of communication within the cluster—and, specifically, the role of key individual communicators—in underpinning successful cluster development has received almost no academic attention. In this chapter, we will draw upon the relevant literature to develop a conceptual framework that will underpin research on this important topic by investigating the role of communicators in innovation clusters. Building on communication theories, the framework suggests that there are four influence-levels that shape and impact the role of communications in innovation clusters: the Individual Level, the Organizational Level, the Cluster Level and the Context. The interdisciplinary view on clustering effects contributes valuable insight to both communication studies and cluster theories. The framework developed within this chapter provides a structure to aid future research on the role of communicators within innovation clusters.

As innovation processes become accessible to consumers and other interested public parties in the sense of Open Innovation, Innovation Communication faces new challenges. The interface existing between internal and external commercial interests must be systematically coordinated in order to ensure that the development process is efficient and effective and that the developed innovation is successfully implemented on the market. Innovation communication plays a key role here in securing that the points liaising internal and external interests are integrated over the length of the innovation process. This is a complex task and involves coordinating communication objectives and publicity, integrating communication instruments and, not least of all, aligning the numerous target groups—from the research specialists in R&D to the Internet bloggers. The present chapter uses impulses stemming from integrated communication to develop a phase-oriented concept for integrated innovation communication that is capable of guaranteeing a systematic coordination of the interfaces involved and providing a central support in promoting a satisfactory outcome for the innovation process.

Innovation marketing has become a sector of marketing science in its own right. The reasons for the high acceptance of knowledge and methods of innovation marketing are twofold: enormous investments in new products and numerous failures. The crucial question is: what determines the success of an innovation? Why does one innovation succeed on the market, while others fail miserably? Success factors research, founded in the 1960s and expanded ever since, has unanimously identified the competitive innovation advantage—or CIA—as the most important factor for success (Trommsdorff and Steinhoff 2013). The CIA represents a competition-beating performance that delivers benefit to the customer, is perceived by the customer as such, that the competition cannot catch up to easily, and that can hardly be invalidated in its environment. Innovations with a CIA are more successful than imitations and marginal innovations, because they are comparatively beneficial and, in particular, address a basic conscious or subconscious need of the target customers. Moreover, major components of the CIA can be subsumed under the key word “customer focus”. Although customer focus has become the dominant management credo in recent past, its implementation in the innovation process remains difficult. One reason for this is that traditional market research methods come up against their limits when it comes to innovations. Nonetheless, intelligent methods of innovation marketing are available to overcome this bottleneck factor. As such, the CIA really represents a meta-success factor; it is more the result of professional innovation marketing than its cause.

Commercialisation is the end point of the innovation management process. It needs to be recognised as being as much a social process as an economic one. Critical to the success of commercialisation is social capital, which is a nebulous and ill-defined concept, but one that has not been given sufficient recognition within the mainstream literature relating to the commercialisation of innovation. Connected with this is the role of word of mouth (WOM) communication that serves as a means of transferring information about new products and services throughout a market. This chapter examines the nature of social capital and WOM within the context of commercialisation. It argues that both have not been given sufficient attention in the role they play in the commercialisation process.

Nowadays, innovations are crucial for nations, the progress of societies and the success of companies. But only if they are noticed and appreciated by people in their daily lives, employees, customers, experts, academics, journalists and other opinion leaders, they can be fully effective. Therefore, communication management has to take into consideration, that the advantages of innovations can be re-evaluated from different points of view—employees worrying about their jobs, companies struggling for sustaining their competitiveness or customers who mistrust products with the label “innovative”. It is the balance between facts and figures on the one hand, and emotions on the other, which is often neglected in internal and external corporate communication. The article presents a balanced framework for creating a communication strategy for innovations and discusses results of surveys from communication directors in the top 500 companies in Germany.

Innovation is a broad range of new digital technologies, necessity for almost every organization involved in global business. In the age of information and digital technologies, the way of innovating, however, has changed and attaining a better understanding of communicating and informing for innovation is exceedingly decisive to strategic success. This chapter answers the question: How can companies re-think and re-design corporate communication to manage several new and traditional communication tools to successfully inform and communicate for innovation in the digital information age? After presenting a theoretical approach of innovation communication integrated into existing management concepts and frameworks, this book chapter introduces a new capability-based management framework of innovation communication. This framework is composed of three main phases: Phase 1. Re-/Design: Linking innovation communication management to a firm’s business model, organizational design & IT systems; Phase 2. Implementation: Implementing innovation communication planning, innovation communication tools, standards, and guidelines; and Phase 3. Controlling: Measuring & reporting innovation communication. In addition, the frame of this chapter Visual and Scent Communication will be described as a state-of-the-art communication tool to address stakeholder’s needs and desires for successful innovation in the information age.

Firms in intensive-technology industries need to constantly innovate and rapidly commercialize innovations to capture consumer needs and preferences, create value for shareholders, and sustain competitive advantage. Consistent with disruptive innovation theory, which places a great emphasis on the power of organizational processes and enabling technology to deliver products and services at lower costs than incumbent firms, innovative firms transform their markets by pulling in new customers (Christensen and Raynor 2003). Key organizational functions with important synergistic effects for successful innovation include marketing, R&D, and operations/production. However, it has long been recognized that without open communication and joint accountability, the tension among these functions that often is also triggered by conflicting communications with external stakeholders, might lead to lower levels of organizational performance. Indeed, resources and capabilities that are not translated into well-synchronized activities, best practices, or business processes cannot have a positive impact on a firm’s performance (Ray et al. 2004). Using the Competing Values Framework for Corporate Communication to examine communication relationships within and outside organizations (Belasen 2008), this chapter will focus on identifying characteristics of adaptive culture and innovation communication that contribute to effective inter-functional collaboration.

This chapter contributes to our understanding of interorganisational relationships (IORs) through the presentation of a relational communication strategy that incorporates a set of propositions about the features and mechanisms of the communication process in successful collaborative innovation. We propose that relational communication provides the lubrication to the process of collaborative innovation facilitating border-less interaction between parties. We examine the nature of collaborative innovation and the importance of communication to collaborative innovation’s effective functioning in relationships. Features of our relational communication strategy in densely knit partnerships considered to be important in a successful collaborative innovation setting, include: (1) high frequency, bidirectionality, informality, and indirect modalities; (2) high communication quality, dense participation, and openness of information sharing of tacit and implicit knowledge; and (3) a shared meaning base and an open communication climate. The mechanisms that we propose that firms can and do use to increase the effectiveness of communication in successful collaborative innovation include: (1) interpersonal modes of communication and affiliation; (2) loose team structures; (3) electronic virtual communities and open information repositories; and (4) interorganisational communities of practice. Numerous examples and case vignettes are presented in order to support the need to focus attention on these issues.

In the last few years, there has been a major paradigm shift in the innovation process with the rise of a “collaborative innovation” process where an increasing proportion of innovative firms now rely heavily on external support for innovation. Technology companies are at the forefront of this revolution and this chapter analyzes how those firms have dramatically modified their communication strategy within the innovation process. The priority is now on a “pull” communication strategy in order to get new ideas from different sources in the environment but there is also a change in the “push” communication strategy with the offering of open access technology in order to help external partners to develop complementary solutions. The collaborative innovation is also redefining the branding strategy for innovation, which has often been the favorite communication strategy of successful technology companies. Finally collaborative innovation is impacting the global commercialization strategy of innovative technology companies, another proven way to accelerate market dominance. The chapter concludes on the managerial implications of the new collaborative innovation trend with the dominant role of communication.

This chapter responds to the question “What are the strategic considerations in using social media platforms and open source practices such as crowdsourcing as tools in innovating organizations?” The following arguments are put forward in response to this question: (1) Organizations have moved from a learning to a sharing paradigm. (2) The most valuable organizational asset is social capital, accessible through social media and open source practices such as crowdsourcing. (3) Communicators have a role to play in accessing this social capital for purposes of innovation. (4) Changing conceptions of audiences underlie strategic communication planning. (5) Strategic planning for innovation must reflect the character of audiences fashioned by social media. In responding to this last question, the chapter explores seven characteristics of audiences that should be taken into account in planning for innovation and suggests theories that support a user orientation.

The process of innovation involves at least three stages: leveraging knowledge to generate ideas (idea creation), communicating about the adequacy of novel ideas to the top management based on the firm’s strategic objectives (idea translation) and actually making innovative products and processes a reality (idea implementation). This chapter explores the channels and the conditions under which social media can improve the innovation process in enterprises. The analysis is based on a multi-disciplinary review of academic literature to explore how social media can impact the first two stages of innovation: the creation and the translation of ideas. The findings are complemented by data collected from a survey about the uses of social media in private companies and by insights drawn from case studies of multinational companies that analyze the readiness of organizations to benefit from social media use. The central argument of this chapter is that social media help create “narratives” of innovation that provide companies with a common and clear innovation strategy for realizing the maximum potential from novel ideas. Organizations can be understood as ‘networks of conversations’ and much of the actual doing of strategy and innovation in organizations takes place via the process of sense-making across teams and business networks and communities. There are at least three channels in which the corporate use of social media can help the innovation process: by connecting people, which helps produce and communicate knowledge; by creating a new mindset, in which people are more engaged and willing to innovate; and by making sense of knowledge in the context of the firm overall strategy. These benefits can only occur when the use of social media is complemented with organizational enablers such as structural decentralization and individual empowerment.

In the early 1990s the Nordic countries Sweden, Norway and Denmark went through a major financial crisis where for example the Swedish Krone was devalued with 26 % and both in Sweden and Norway did the governments have to rescue their banking sector by nationalizing it. In Denmark the banking crisis didn’t go as deep as in the other Nordic countries. This meant that Danske Bank, one of Denmark’s and the Nordic region’s leading banks, had a special situation and an open window of opportunity for expansion to becoming one of Northern Europe’s leading regional banks. In this chapter the story is about how Danske Bank’s innovation focus from back in the late 1990s and later on with its communication strategy derailed the bank’s leading market position in the Nordic region and Denmark. The case applies the Innovation Radar, a business model innovation framework, and reputation management to show how even a very focused innovation strategy neglecting the customer over time can be lethal if the strategy becomes static and is not reviewed. The case also looks into why a communication strategy in order to be effective should be an integrated part of a company’s overall business innovation strategy.

Radical innovation may root its basic ideas in user values of unforeseen futures. Still, pursuing great opportunities with high risks creates new management challenges. Involving valuable sources of knowledge from the early phases of innovation projects into engaging interactions is a critical success factor for innovation strategy. The chapter describes and reinterprets the concept of user-centered radical innovation and how it is applied within the open innovation approach of Telekom Innovation Laboratories—the corporate research and innovation centre of Deutsche Telekom. The approach is based on tools tailored to three innovation phases: initiation, value proposition and market driving. An initiation project combining scenario analysis with futures workshops demonstrates methods to explore and ideas to address new solution beyond the beaten tracks in the design space of mobile payment.

This article describes a company case from the ICT industry and illustrates how collaborative innovation involving several actors is realized and why communication plays a crucial role within this process. Taking a social structural perspective on innovation and communication, it becomes clear that meaning and reality, which are the prerequisites of novelties, are constructed in communicative interactions between companies and their internal and external stakeholders. Consequently, communication cannot be considered as an instrument of innovation management that might be used or dropped in different innovation phases like a tool. The theoretical perspective also underlines that innovation-related actions are influenced by structures: rules and resources enable, modify, and limit innovation actions. The Global Co-Innovation Lab Network (COIL) of SAP, analyzed in the case study, can be seen as a corporate, communicative resource due to its role as an interface between internal and external stakeholders of the company. It enables all parties involved to define framework conditions of a shared co-innovation project and to execute it. Structurally, COIL connects stakeholders across the globe, such as certified or potential SAP partners, users or internals, such as existing and potential business units. Therefore, collectively shared structures, like co-innovation projects, are created. They are considered as a prerequisite for future innovation and communicative actions. Based on previous expertise and experiences, COIL helps to specify shared structures for each project and thus enables successful co-innovations.

Online Research Communities (ORCs) have ushered marketing research into a new era and are one of the fastest-growing segments in the industry. ORCs offer a selected number of consumers a closed online environment in which they interact and co-create with the company not only in “one-off” projects but over an extended period of time. The approach distinguishes itself by the flexibility and diversity of market research methodologies that can be applied. In our case study we describe the set-up, live phase and post-processing of the Vorwerk Thermomix Research Community. Over the duration of 3 weeks, Thermomix invited customers, who are also registered users of the brand’s official online recipe community, to participate in a moderated ORC. There were two major goals. First, Thermomix wanted to understand consumers’ “cooking journeys”, i.e. learn how they decide what to cook, plan their cooking, buy groceries etc. Second, Thermomix aimed to co-create with its customers and develop new features and functionalities for the Thermomix recipe community which serves as a central meeting place for cooking enthusiasts and brand fans. In the study, we show how the ORC was designed to answer our research questions and what methodological benefits the method yields. Furthermore, we investigate the user types that contributed to the platform most and provide insights into how to boost activity levels on the platform. In today’s social media context, ORCs are a valuable tool for brands to connect with their customers and engage them in value creating activities. This chapter sheds light on this new research approach and unveils the potential of brand community members for insight generation and co-innovation.

It is now well-documented that social media can play an important role in supporting the innovation process. Social approaches are most commonly thought to be useful in either idea generation, as in open innovation approaches, or in idea diffusion. However, while the connection between social media and innovation success has been established, the mechanics of how social media supports innovation are less well understood. This is the issue that we investigate in this chapter. We use data from two case studies. One firm has been very successful in using social media to support organizational innovation, the other less so. After describing the cases in some detail, we discuss how social media use affects all phases of the innovation process. We then also look at how social media use addresses innovation capability at an individual level. We draw several conclusions and key learnings from the data presented. It appears as though social media best supports innovation when social approaches are effectively integrated into the day-to-day activities of an organisation. Instead of simply “adding some social” and hoping to see improvements, the use of social media must be integrated with the strategy and objectives of the firm. The selection of the best social media channels to use then follows from this integration with strategy. There is no absolute must-use channel—the correct tools will depend on the value proposition and target market of the organisation. At a personal level, social media can be leveraged to strengthen important innovation capabilities, such as exploration, connection and network building. Using social media to support innovation is only worth the effort for both organisations and individuals when there is a clear outcome desired, accompanied by a suitable strategy for reaching these objectives.

This chapter considers innovating on networks as they pertain to marketing, promoting and selling independent music. The focus is on emerging musicians, although without loss of generality. That is, it is believed that the proposed framework and application is applicable across the entertainment sector and beyond. Following the Introduction, Section II of the chapter sets forth key concepts including a seven-point business process. The authors’ understanding of network is described and the concept of value is introduced. Section III places the primary focus on “orchestration” defined in terms of efforts to achieve success by finding and managing creative combinations for value. Section IV of the chapter elaborates on the artist’s touch points and value in the context of orchestration. Section V offers a summary and conclusions.