Redefine Innovation: Foundation for Strategic Innovation Leadership Development

(Unpublished, but copyright to Jeonghwan Choi 2008)

Jeong Hwan Choi, MBA, Doctorate Student, Human Resource Education

University of Illinois Urbana-Champaign, 351 Education, 1310 South Sixth Street, IL 61810

Abstract:

New Definition of Innovation?

Innovation is leader(s)’s strategic activities of 1) integrating and practicing people, 2) exploiting knowledge of science & technology , 3) creating and transforming new ideas, products, processes, services and mindsets to achieve economic values, sustainable competitive advantages as well as self-realization in a complex, non-linear and dynamic social system along with discontinuous time set.
 

Introduction

Innovation creates economic values, sustainable competitive advantages and growth (Kuczmarski, 2003; Lee, 2005; Romer, 1990). But the term “Innovation” is frequently accepted as a normative rhetoric or slogan without clear definition though it is widely used to explain many business activities. When the term emerged in early 20th century, it was much focused on economic functions (Lange, 1943; Schumpeter, 1934; Schumpeter, 1939). As the economic activities became diversified and complex, the definition of innovation expanded and now it is difficult grasp the exact meaning of it. Thus, a new and more rigorous definition of innovation is necessary to conduct academic and practical research for innovation.

Currently, many business leaders agree that innovation is one of the crucial activities to achieve business performance and strategy, but the companies’ approach to innovation is often informal and less confident in decision-making (McKinsey & Company, 2008). In one survey, many business leaders pointed out that the biggest challenge for innovation is “talent.”

Schumpeter (1947), the godfather of innovation, described the quality of personnel in innovation process to be a critical factor, which could determine its success or not.

Creative response - the frequency of its occurrence in a group, its intensity and success or failure - has obviously something, be that much or little, to do (a) with quality of personnel available in a society, (b) with relative quality of personnel, that is, with quality available to a particular field of activity relative to quality available, at the same time, to other, and (c) with individual decision, actions, and patterns of behavior.

Kanter (1983) stressed the importance of human resources in innovation as “Innovation, whether in products, market strategies, technological processes, or work practices are designed not by machines but by people.” Venture capitalists commonly decide their investment to a new venture company not because the company has a good business plan, but because that company is run by people with passion for realizing innovative ideas (Hender, 2004). Although the quality of human resources in innovation process is important, too little attention has been paid to developing human resources for innovation.

On the other hand, many researchers investigated the key role of strategic leadership in various innovation contexts and processes. In comparing innovative Telecommunication companies in the United States and Germany, Kuchinke (1999) found that leadership was important because it leads to a number of desired outcomes of innovation among individuals, groups, and organizational levels. Vera & Crossan (2004) suggested a conceptual model to describe how strategic leaders influenced learning systems believed to be the key element of knowledge generation for innovation, and Vicere (1992) proposed that strategic leadership could be developed in multi-staged innovation process, and the development of strategic leadership had reciprocal cycles. But these researches did not address the human factors such as identification of innovation makers, roles of innovation leaders in innovation process and the required competencies.

Therefore, this paper focuses on four key questions:

1. How can we define “Innovation?”

2. Who makes innovation and what are their roles in innovation?

3. What capabilities are required from innovation makers and how they can be developed in a strategic way?

In this explorative research, academic literature review was conducted as a research methodology to address these questions.

Literature Review

Purpose of Defining Innovation

Even though “Innovation” is widely used in general, there seems to be no universally accepted definitive statements that the meaning of innovation exists. Kuczmarski (2003) pointed out the problem of having no clear definition of innovation that “Perhaps innovation has been misunderstood and therefore its full potential not realized.… Now more than ever, companies need to be cultivating innovation within their organizations and implementing systems that will ensure its success and longevity. This begs the question, what is innovation really, and why are not more companies doing it?”

In order to define the term “innovation” in a rigorous way and possibly widely accepted in academy and practice, contemporary dictionaries and academic literatures are investigated with 5W+1H framework.

Framework. The conventional 5W+1H framework is commonly used to conceptualize a problem (Ha, Jung, & Oh, 2006; Lee, 2004). The frame will be applied to compare different definitions of innovation in six different categories. As shown in Table 1, categories for analyzing definitions of innovation are presented with key questions. The purpose of using the framework is to analyze various definitions in a systemic way and in multi-facet point of views.

Table 1.

Framework for Analyzing Innovation Definition

Categories

Key Questions

Person

Who makes innovation?

Object

What are the objectives of innovation?

Reason / Purpose

Why is innovation practiced?

Space / Domain

Where does innovation occur?

Time

When can innovation occur?

Action / Method

What activities can make innovation and which methods are used?

Definitions from Dictionaries. Table 2 shows analyses of various definitions from contemporary dictionaries in the suggested framework. In general, dictionaries define the innovation in a very simple way without person, reason, and time. According to contemporary dictionaries, the objects of innovation are, “something new: idea, method (process), device, invention” by means of “improving, using, introducing, and creating.” Only two dictionaries define the domain of innovation: one is technology domain (Britanica, 2008), and the other is mind (Webster Online, 2008).

By synthesizing proposed definitions from contemporary dictionaries, innovation can be defined as “activities to improve, use, introduce and create something new idea, method, process, device and invention in technology domain or in mind.”

However, according to the definitions, there are no clear definitions about person, time, and reason in innovation, which means it is hard to utilize it academic research or practice of business rigorously.

Table 2.

Definitions of Innovation in Dictionaries

Dictionary

Definition

Person

Object

Reason / Purpose

Space / Domain

Time

Action / Method

Britanica

In technology, an improvement to something already existing

Something already existing

Technology

Improve

Cambridge Advanced Learner's Dictionary

(the use of) a new idea or method

New idea

New method

Use

Meriam-Webster Online

1. the introduction of something new

2. a new idea, method, or device

Something new

New idea

New method

New device

Introduce

Longman Dictionary of Contemporary English Online

1.[countable] a new idea, method, or invention

2.[uncountable] the introduction of new ideas or methods:

New idea

New method

New invention

Introduce

The American Heritage® Dictionary of the English Language:

1. The act of introducing something new.

2. Something newly introduced

Something new

Introduce

Webster's Online Dictionary

with Multilingual Thesaurus Translation

1. A creation (a new device or process) resulting from study and experimentation.

2. The creation of something in the mind.

New device

New Process Something

In the mind

Create by studying and experimenting

Synthesized definition of innovation from contemporary dictionaries:

‘Innovation is creating, improving or introducing new ideas, new method or something new in technology or mind domain’

Remarks: All dictionaries are accessed by online and retrieved on April 01 2008.

Definitions from Literatures. Since the emergence of the term ‘innovation’ in Schumpeter’s prominent article of ‘Theory of economic development: An inquiry into profits, capital, credit, interest, and the business cycle (Schumpeter, 1934),’ many scholars, institutes, and practitioners have defined it in various way. Table 4 shows various definitions of innovation from literatures in chronological order.

When the terminology of innovation was introduced in the academic field, it was an economic one. Economists commonly defined innovation as: commercialization or industrialization activity to change ‘production function’ to increase discounted value of maximum effective profit. (Lange, 1943; Schumpeter, 1934; Schumpeter, 1939). And the concept of innovation was expanded to ‘entrepreneur’s function’ such as: ‘doing of new things or doing something that has already been done in a new way’ (Schumpeter, 1947).

During the 1950’s, Drucker (1954) applied management concepts to innovation study. Marketing, technology change, and knowledge were adopted to explain the innovation activities. He explained that the purposes of innovation were to attain marketing objective, to keep up with technology change and to gain knowledge & skills to satisfy market goal. Then, his definition of innovation was widely accepted in the business field.

Rogers (1962 pp. 206~207) definition: “An innovation is an idea perceived as new by the individual…Innovation might include, for example, social movement, clothing fads, the twist, compact cars, and the steel ax….Most, but not all, innovations discussed here are technological innovations.” He suggested four elements of diffusion of innovation: 1) the innovation, 2) its communication from one individual to another, 3) in a social system, and 4) over time and these were elevated by deviation. He also explained innovation makers as “the first individuals in a social system to adopt new ideas, who are necessarily deviant in their time of adoption.”

1980’s was an era of ‘In search of excellence’ (Peters & Waterman, 1982). Peters and Waterman suggested eight themes to achieve ‘excellence,’ especially they focused on the importance of innovation activities, of entrepreneurs, and productivity improvement through people. The importance of people or human resources in innovation was supported by Kanter and Drucker as well. .

Kanter (1983) stated the importance of people in innovation process as ‘Innovation - whether in products, market strategies, technological processes, or work practices, are designed not by machines but by people.’ On the other hand, Drucker (2002) pointed out the importance of ‘capability’ of entrepreneurs in innovation and he suggested that the concept of ‘innovation is an economic or social than a technical term’.

Meanwhile, some scholars focused on the role of science and technology in innovation process. Freeman (as cited in Tidd, Bessant, & Pavitt, 1997 p.66) researched importance of science and technology capability in innovation process, and he defined the innovation as “technical, design, manufacturing, management and commercial activities involved in the marketing of a new product or commercial use of a new process or equipment.” However, Rothwell and Gardiner (as cited in Tidd et al., 1997 p.66) claimed that commercialization of a major advance in the technological state of the art not only in innovation, but small scale changes in technological know-how was also an output of innovation. They expanded their innovation study into a national level, and it explored researches on the national policy of innovation, especially in Science Policy Research Unit (SPRU) Science and Technology Policy Research. In sum, during the 1980’s, two major themes of innovation arose: one was people centric innovation and the other was science and technology centric innovation.

Since the 1990’s, competitive advantage is a keyword in the business field. Porter (1990) insisted that the competitive advantage could be achieved by innovation, and this concept of innovation was supported by many business strategists. Lee (1999) stated that innovation was the primary basis for competitive advantage and Tidd (1997) specified it as ‘entrepreneurs will seek to use technological innovation to get strategic advantage.’

In parallel with the competitive advantage, a concept of learning organization was presented by Senge (1992). He explained innovation as “Engineers say that a new idea has been ‘invented’ when it is proven to work in the laboratory. The idea becomes an ‘innovation’ only when it can be replicated reliably on a meaningful scale at practical costs. If the idea is sufficiently important it is called ‘basic innovation’ and it creates a new industry or transforms an existing industry.” Then he suggested five disciplines for learning organization for innovation: systems thinking, personal mastery, mental models, building shared vision, and team learning.

A new theme in innovation also emerged during 1990’s. Mindset of people involved in innovation was addressed. Kuczmarski (2003) defined innovation as “a mindset of welcoming risks to gaining competitive advantage” by referring to the statement ‘motivated staff’ and ‘instinctive understanding of customer want’ should be combined with good ideas to achieve innovation.

Meanwhile, a longitudinal and integrative approach for innovation study started in 1983 at University of Minnesota, named as Minnesota Innovation Research Program (MIRP). Van de Ven & Angle (2000) suggested a framework to conduct innovation researches in an integrative way, and summarized MIRP observations as Table 3. They defined innovation as “Innovation requires more than the creative capacities to invent new ideas; it requires managerial skills and talents to transform good ideas into practice.” Then, they suggested interdisciplinary process model for innovation study (p. 3). The final research output of MIRP was published in 2000.

Table 3.

A Comparison of the conventional wisdom and MIRP observations

Literature Implicitly Assumes:

But We See This:

Idea

One invention, operational

Reinvention, proliferation, reimplementation, discarding, and termination

People

An entrepreneur with fixed set of full-time people over time

Many entrepreneurs, distracted, fluidly engaging and disengaging over time in a variety of organizational roles

Transactions

Fixed network of people/firms working out details of an idea

Expanding and contracting network of partisan stakeholders diverging and converging on ideas

Context

Environment provides opportunities and constraints on innovation process

Innovation process constrained by and creates multiple enacted environments

Outcomes

Final result orientation; a stable new order comes into being

Final result may be indeterminate; multiple in-process assessments and spinoffs; integration of new orders with old

Process

Simple, cumulative sequence of stages or phases

From simple to multiple progressions of divergent, parallel, and convergent paths, some of which are related and cumulative, others not

Hatcher & Guerdat (2008 p. 1) defines the innovation as

Innovation can be thought of as an embodiment or synthesis of knowledge within an original and valued new approach, practice, service, product, or even theory. Innovation can be a breakthrough that is immediate, revolutionary, or radical, resulting in something that is absolutely new, departing from what is or is. Or it can take a long time to accomplish, be it evolutionary and incremental in nature, improving and building on existing knowledge. In either case, innovation is all about change. Technology-based organizations view innovative advances through the number of patents or expenditure on R&D as ways to account for innovation.

As shown in definitions of Kuczmarski, Van de Van & Angel and Hatcher & Guerdat, recent definition of innovation becomes more complex and interdisciplinary terminology.

The chronological change of innovation definitions and schools of innovation study are summarized in Table 5. It shows that the definition of innovation has historical interconnections, and it has evolved in various ways.

Table 4.

Definitions of Innovation in Literatures

Literature (Year)

Definition

Person

Object

Reason / Purpose

Space / Domain

Time

Action / Method

Schumpeter (1934, p. xix)

Commercial or industrial application of something new - a new product, process, or method of production; a new market or source of supply; a new form of commercial, business, or financial organization

Something new

New product, process method of production

New market

New source of supply

New form

Commercialize

Industrialize

Schumpeter (1939)

We will simply define an innovation as the setting up of a new production function

New production function

Setup

Lange (1943)

Innovations are such changes in production function, i.e., in the schedules indicating the relation between the input of factors of production and the output of products, which make it possible for the firm to increase the discounted value of the maximum effective profit obtainable under given market condition

Production function

Increase discounted value of profit

Market

Change

Schumpeter (1947)

The entrepreneur and his function are not difficult to conceptualize: the defining characteristic is simply the doing of new things or the doing of things that are already being done in a new way (innovation)

Entrepreneur

New things or New way

Do

Drucker (1954)

1. New products or services that are needed to attain marketing objectives

2. New products or services that will be needed because of technological changes that may make present products obsolete

3. Product improvements needed both to attain market objectives and to anticipate expected technological changes

4. New processes and improvements in old processes needed to satisfy market goals

5. Innovations and improvements in all major areas of activity so as to keep up with the advances in knowledge and skill

New product or services

Activities

Attain marketing objectives

Keep up with technology change, and

Knowledge and skill

Satisfy market goal

Improve

Satisfy

Keep up with

Continued

Literature (Year)

Definition

Person

Object

Reason / Purpose

Space / Domain

Time

Action / Method

Rogers (1962)

An innovation is an idea perceived as new by the individual…Innovation might include, for example, social movement, clothing fads, the twist, compact cars, and the steel ax….Most, but not all, innovations discussed here are technological innovations.

Freeman C. (1982)

Industrial innovation includes the technical, design, manufacturing, management and commercial activities involved in the marketing of a new (or improved) product or the first commercial use of a new (or improved) process or equipment

New (improved) product,

New (improved) process

Activities (technical, design, manufacturing, management, commercial)

Marketing

Kanter (1984)

Innovations, whether in products, market strategies, technological processes, or work practices, are designed not by machines but by people

People (not machines)

Product, market strategies, technological processes, work practices

Design

Drucker (1985)

Innovation is the specific tool of entrepreneurs, the means by which they exploit change as an opportunity for a different business or service. It is capable of being presented as a discipline, capable of being learned, capable of being practiced. Innovation, then, is an economic or social rather than a technical term. Innovation is a practice not science or arts

Entrepreneur

Different business or service

Exploit

Change

Learn

Practice

Rothwell & Gardiner (1985)

Innovation does not necessarily imply the commercialization of only a major advance in the technological state of the art (a radical innovation) but it includes also the utilization of even small-scale changes in technological know-how (an improvement or incremental innovation)

Technological state of the art

Technological know-how

Commercialize

Utilize

Porter (1990)

Companies achieve competitive advantage through acts of innovation. They approach innovation in its broadest sense, including both new technologies and new ways of doing things

Companies

Activity

New technology

New way of doing things

Achieve competitive advantage

Act, Approach

Continued

Literature (Year)

Definition

Person

Object

Reason / Purpose

Space / Domain

Time

Action / Method

Senge (1992)

Engineers say that a new idea has been “invented” when it is proven to work in the laboratory. The idea becomes an “innovation” only when it can be replicated reliably on a meaningful scale at practical costs. If the idea is sufficiently important it is called a “basic innovation,” and it creates a new industry or transforms an existing industry.

(Engineer – invention)

New idea

New industry

Existing industry

Replicated on a meaning scale at practical cost

Create

Transform

Lee S. (1999)

Innovation is the successful development and commercialization of new product, services, or business system. In many industries, innovation is the primary basis for competitive advantage and the principal driving force of industry structural change

New product, New service, business system

Develop, commercialize

Van de Ven & Angle (2000), p.3

Innovation requires more than the creative capacities to invent new ideas; it requires managerial skills and talents to transform good ideas into practice

Good ideas into practice

transform

Armstrong et al (2001)

The creation, development and introduction of new products/services or product/service components, or a new procedure or process for doing things to benefit one or more of the stakeholders in the organization. The product, service, procedure, or process need not be completely novel, but it must be new to the organization itself

New product

New service

New procedure

New process

Benefit of stakeholders

Create, develop, introduce

Kuczmarski (2003)

Innovation is a mindset. Innovation is the art of welcoming risk. Innovation is a key to gaining competitive advantage

Mindset

Gaining competitive advantage

Welcoming risk

Hender (2004)

The product, service, procedure, or process need not be completely novel, but it must be new to the organization itself

Product, service, procedure, process

New to the organization itself

UK department of trade and industry (2004)

Innovation is the successful exploitation of new ideas

New idea

Exploit

Continued

Literature (Year)

Definition

Person

Object

Reason / Purpose

Space / Domain

Time

Action / Method

Tidd (2005, p 7)

Entrepreneurs will seek to use technological innovation (a new product/service or a new process for making it) to get strategic advantage For a while this may be the only example of the innovation so the entrepreneur can expect to make a lot of money – what Schumpeter calls ‘monopoly profits’

Entrepreneurs

New product

New service

New process

Get strategic advantage

Discontinuous, but imperative

Hatcher & Guerdat (2008)

Innovation can be though of as an embodiment or synthesis of knowledge within an original and valued new approach, practice, service, product, or even theory. Innovation can be a breakthrough that is immediate, revolutionary, or radical, resulting in something that is absolutely new, departing from what is or is. Or it can take a long time to accomplish, be evolutionary and incremental in nature, improving and building on existing knowledge. In either case, innovation is all about change. Technology-based organizations view innovative advances through the number of patents or expenditure on R&D as ways to account for innovation.

New approach, practice, service, product, or even theory.

Knowledge

Patent

Expenditure of R&D

Immediate, revolutionary, radical or take long time

Improve

Build

* Remarks: UK department of Trade and industry (2004), Freeman (1982), Rothwell & Gardiner (1985), Drucker (1985), Porter (1990), Branson (1998) are excerpted from the book of Tidd’s ‘Managing Innovation’ (2005, P. 66)

Table 5.

Chronological Change of Innovation Definition and Schools of Innovation Study

Period

1930~40s

1950s

1960s

1980s

1990s

2000~

Schools

Economics

Management

Socio-technical change

Excellence

Competitive advantage

Integrative approach

Chronological Changes

Key phrase

Innovation is to get economic gain

Innovation is a management practice by integrating people, technical change, and knowledge

Innovation is a socio-technical change

Innovation is to achieve excellence through people and science & technology

Innovation is strategic approach to guarantee competitive advantage by learning and knowledge management

Innovation is an integrative approach , including psychological factor

New definition of innovation

A new definition of innovation can help utilize the full potential of people or an organization in achieving successful innovation.

From the definition of contemporary dictionaries, innovation is summarized as: creating, improving or introducing new ideas, new method or something new in technology or mind domain. However, it seems quite limited to utilize or address the whole potential of people or an organization in innovation processes or activities.

On the other hand, from the definitions of academic literatures, innovation can be synthesized as purposeful human activities of creating, synthesizing, and changing ideas, products, processes and services to achieve economic incentive or competitive advantages. But, still, this definition is not vividly addressing the strategic utilization of potential resources such as people, science & technology, social system, knowledge, environment and mind power.

Based on the proposed frame work (5W+1H), elements of new definition is suggested as Table 6.

Table 6

Elements of New Definition of Innovation

Categories

Key Elements

Person

Innovation leaders (e.g. Entrepreneur, Intrapreneur, Extrapreneur, Change agent, Change masters)

Object

New idea, product, process, service, and mindset

Reason / Purpose

To achieve economic value, sustainable competitive advantage, self-realization

Space / Domain

In a complex, non-linear, dynamic social system

Time

Discontinuous (disruptive innovation)

Action / Method

By strategic integrating and practicing people, knowledge, and Science & Technology

Person. Innovation is practiced by dedicated innovation leaders such as entrepreneurs, intrapreneurs, extrapreneurs, change agents, or change masters (Hender, 2004; Kanter, 1983; Rogers, 1962). As Pinchot & Pellman (1999 p. 16) suggested, innovation could not happen unless someone took on the innovation leadership role. Even though many people participates in the innovation activity, there is at least one dedicated innovation leader who persists it at the end and it is a necessary condition to realize innovation. Therefore, we can say that innovation is made by innovation leader(s).

Object and Action / Method. Innovation is strategic activities of integrating and practicing people, knowledge and science & technology to exploiting, creating or transforming new ideas, products, processes, services and mindsets. As Kuczmarki insisted (2003) that “a truly innovative organization has developed a mindset that permeates every aspect of its business. That is because innovation is a pervasive attitude, a feeling, an emotional state, an ongoing commitment to newness. It is a set of values that represents a belief in seeing beyond the present and making that vision a reality.” Therefore, objects of innovation are not only tangible or intangible resources such as new ideas, products, processes or services but also the mindset.

Reason / Purpose. The purpose of innovation is gaining economic value, sustainable competitive advantage and self-realization of innovation leaders. According to Lee (2005 p. 210), many entrepreneurs started their business not only for tracing economic incentives but also for realizing the ‘self’ or achieving the dream. So, self-realization is one of the critical reasons of innovation.

Space (Domain) and Time. Innovation occurs in a complex, non-linear and dynamic social system along with discontinuous time set. In Van de Ven’s article, Foster (2008) he summarized the domain of innovation as “a complex, non-linear, dynamic process.”

Meanwhile, Hatcher & Guerdat (2008) presented the time of innovation as immediate, revolutionary, radical or takes long time, and it can be translated into “discontinuity” which is the major source of innovation(1997 pp. 18~40).

In sum, innovation can be newly defined as Innovation leader(s)’s strategic activities of integrating and practicing people, knowledge and science & technology of exploiting, creating or transforming new ideas, products, processes, servicse and mindsets to achieve economic values, sustainable competitive advantages as well as self-realization in a complex, non-linear and dynamic social system along with discontinuous time set.

Discussion

Role of HRD for Innovation

According to the new definition of innovation, developing innovation capability and innovation leaders are two crucial factors in achieving innovation success.

Hender (2004) categorized the types of innovation leader(s) into 1) Intrapreneur, 2) Entrepreneur, and 3) Extrapreneur. Intrapreneurs turn ideas into realities inside the organization. Entrepreneur develops the product or service into a money-making proposition. Extrapreneurs are leaders of venture process team or individual venture, who places externally-generated ideas into business. She also characterized seven imperative capabilities of innovation leaders: creating a climate for innovation; recruiting for innovation; team building; managing innovation teams; developing skills; and finding and working with supporters. Then we have to ask the question, “How can we develop innovation capabilities in people?

McLean & McLean (2001) defined human resource development (HRD) as: “HRD is any process or activity that, either initially or over the long-term, has the potential to develop adults, work-based knowledge, expertise, productivity, and satisfaction, whether for personal or group/team gain, or for the benefit of an organization, community, nation, or, ultimately, the whole of humanity.” McLean (2005) identified the importance of organization culture which can be developed or moderated by HRD to foster creativity and innovation performance. Foster (2008) stated, “The role of HRD in innovation includes developing human capacity and cultivating an organization environment conducive to innovation.” He then suggested HRD interventions to promote efficiency of innovation process based on Van de Ven’s MIRP innovation journey model.

Therefore, HRD can take a crucial role for innovation by developing innovation capabilities, innovation leader(s) in an organization, and cultivating new organizational culture that are conductive to innovation.

Systems Approach of HRD for Innovation

A systems approach of HRD can be applied to developing innovation capability and innovation leader(s).

According to Swanson (2001), “systems theory captures the complex and dynamic interactions of environments, organization, work process and group/individual variables operating at any point in time and over time.” Instead of defining systems theory, he described it in scope and meaning. The scope of systems theory is composed of four fields: general systems theory, cybernetics, chaos theory and complex adaptive systems. He also categorized the meaning into ontology: the nature of the world and systems; and an epistemology: a way to view the world; a unifying theory (R. A. Swanson & Holton, 2001 pp. 114~116). Swanson insisted that if HRD professionals or researchers agreed that they serve those in organizations, they should adopt the science of systems.

In addition, a systems approach can provide more rigorous and practical evaluation and measurement of HRD interventions for innovation (Wang, Dou, & Li, 2002). In comparison with the systems model, process model lacks empirical research to substantiate their validity, and have simple unitary progression of phases or stages of development over time (Van de Ven et al., 2000 pp. 108~113). As Cheng (1996) said a systems approach was appropriate to analyze non-linear and dynamic patterns of innovation, and it was effective to study a complex, nonlinear and dynamic HRD for innovation.

According to the proposed new definition of innovation and roles of HRD, innovation capability and innovation leaders should be developed by HRD professionals and researchers to help achieve innovation goals in a dynamic social system.

By the way, we have to ask how the system based HRD study can contribute to promoting innovation. A cross-section of the systems leg of the three-legged stool was proposed by Swanson & Holton (2001 pp. 117~118). The model was composed of: 1) information-knowledge or data about systems, 2) capabilities – the potential to act, and 3) direction-guidance for fields’ activities and development. They described systems theory for HRD as, “the primary goal of systems theory is to uncover information about systems.” The systems approach can provide HRD with capabilities - the potential to act as well as serve as a guiding force that offers direction for a discipline’s activities and future.

Therefore, systems approach HRD can be said to be capable of addressing the development of innovation capability and leadership as well as change organizational culture.

Innovation Capability Model

Lawson & Sampson (2001) defined innovation capability as “the ability to continuously transform knowledge and ideas into new products, processes and systems for the benefit of the firm and its stakeholders,” and they explained dynamic innovation capability as, “a higher-order integration capability, that is, the ability to mold and manage multiple capabilities. Organizations possessing this innovation capability have the ability to integrate key capabilities and resources of their firm to successfully stimulate innovation.”

They adopted the resource base view (RBV) approach of strategic management of innovation capability and explained it as “RBV assumes that performance differences across firms are due to differences arising from valuable, rent-generating, firm specific resources and capabilities that cannot be easily imitated or substituted.” By combining resource base view of strategic management and dynamic capability model, an integrated model of innovation capability was proposed as shown in Figure 1.

Figure 1. Model of Innovation Capability

Although the model of innovation capability comes from the empirical case study of CISCO, it has some limitations with regards to HRD point of view.

First, the model did not explain the mechanism of learning for innovation in an organization. Authors proposed that learning occurs when an organization interact with customers and competitors. But learning for innovation does not only occur by communicating externally but also interacting internally. Internalization of learning is as important as external learning.

Second, the model did not specifically address the motivation and psychological factors in innovation process. Authors addressed the motivation with respect to extrinsic compensation approach. But intrinsic motivation or psychological compensation should be addressed to explain the motivation of innovation.

Third, authors did not explain the relationship between innovation capability and applying it into the real world. Innovation capability can not guarantee the success of innovation. Innovation leaders should be counted on the most critical factor of practicing or realizing innovation by integrating and utilizing innovation capabilities. In this sense, new innovation capability model which has strong bases of theoretical bases and empirical studies is required to address HRD for innovation.

According to expectancy theory (Vroom, 1964), performance can be described as the function of ability and motivation.

The relationship between ability and motivation is multiplication, which means both of them are necessary for performance.

Lewin (1951) proposed the field theory to explain the human behavior. According to Lewin’s model, human behavior can be described as a function of the person and the environment.

DeSimone et al (1998) described the trainability in HRD as function of motivation, ability and perceptions of the work environment.

However, socio-technical theory proposed the socio-technical system which have two fundamental premises: 1) organization/work unit is combined with social and technical system 2) socio-technical system is open in relation to its environment. (Cummings & Worley, 2004 pp. 340~341). The socio-technical system (or STS) is applied to improving organizational performances by integrating social context of people and technical work design. The importance of socialization is supported by Korte’s empirical research (2008). He described that “socialization is an important development strategy for organizations looking to increase the capacity of their work, improve their competitive advantage and develop future capabilities by bringing new talents into the organization in the form of current and potential expertise.”

In sum, innovation capability is a function of technical skills of people, motivation, social ability and perception of environment.

A new systems approach model of HRD for innovation, then, is proposed as Figure 2. As Drucker (2002) proposed, the inputs of innovation were three outside factors and four inside factors. In addition to the Drucker’s innovation source, initial innovation capability is included the model. A firm’s outputs are divided into four elements: economic performances, competitive advantage, self-realization, and reinforced innovation capability. Innovation leadership is also included the model to explain the transformation of innovation capability into real innovation. Feedback process is also crucial for innovation process to reinforce innovation capability.

Figure 2.

A Systems Approach Model of HRD for Innovation

Conclusions and further researches

This paper proposed 1) a new definition of innovation for HRD study, 2) roles of HRD for innovation, and 3) the construct of a systems approach model of HRD study for innovation.

The new definition of innovation addressed cultivating new opportunities for HRD professionals and researchers by providing multi facets of HRD study in innovation. Suggested HRD roles for innovation were anticipated that it would be useful to deepen the knowledge of HRD capability for studying innovation.

The proposed systems approach model of HRD for innovation requires further research in identifying and refining measures for different forms or degrees of innovation capability. For example, there may be different emphasis on elements required for innovation capability development versus innovation leadership development. This would provide a fuller picture of innovation within organizations and more specific strategies for developing human resources. The innovation capability construct has the potential to be developed to make a significant contribution in furthering the knowledge of human resource development of innovation.

Next step, the researcher will address 1) constructing a refined model, 2) developing hypotheses and instrument to evaluation validity and effectiveness of the model, and 3) conducting an empirical study to address strategic innovation leadership development.

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