Technology-Innovation Relationship PDF

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Technology-Innovation Relationship Most people often interchange the word technology with innovation. However, each word has its own definition. According to Posadas (2013), technology is the “system of infrastructure, know-how, and process by which humans make tools and other useful stuff and accom...

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Technology-Innovation Relationship Nyker Matthew C King

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Technology-Innovation Relationship Most people often interchange the word technology with innovation. However, each word has its own definition. According to Posadas (2013), technology is the “system of infrastructure, know-how, and process by which humans make tools and other useful stuff and accomplish other tasks.” Whereas, innovation was defined by Joseph Schumpeter (1947) as “doing of new things or the doing of things that are already being done in a new way” in his essay. Schumpeter’s definition matches the Oxford dictionary etymological definition of the word innovate (Innovate, n.d.) which is the Latin word innovare, composed of in- ‘into’ + novare ‘make new’. Using Schumpeter’s definition as a guide, Sundbo (1995) emphasized the innovation formula, ​Innovation = Invention + Commercialization + Social Adaptation​. The said formula was also backed by a similar formula, ​Innovation = Invention and Creativity + Realization + Implementation​, developed by Mentz (1999) in his thesis. Despite the difference of definitions of technology from innovation, both go hand in hand in technological innovation. According to Mentz (1999), technology innovation is said to have the following purposes: ● “To conceive and produce a new solution (from a scientific and technological knowledge) to a real or perceived need” ​(Invention) ● “To develop this solution into a viable and producible entity” (Realization) ● “To successfully introduce and supply this entity to the real or perceived need” ​(Implementation) Mentz’s identification of technological innovation purposes clearly uses the know-hows or the technological knowledge in doing innovation. Furthermore, Mentz (1999) described technological innovation as a process of focusing and embodying technology successfully in products, services, and processes. To sum up all aforementioned formulas, we can take a look at Betz’s (2011) proposed formula for technological innovation, ​Technological Innovation = Invention + Innovation​. Hence, as shown in the diagram in Figure 1, technology is a sub-system inside the innovation sub-system. The innovation sub-system is inside the technological innovation. The diagram was adapted from Betz’s (2011) innovation process wherein he also acknowledges Hughes’s (1997) statement regarding the technology complex systems being revealed by the innovation process.

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Figure 1. ​Technological Innovation System (adapted from Betz 2011) Smirti Bam (2018) discussed the eight stages of technological innovation which is similar to Figure 1 and somehow resembles the technology-push model of the innovation process. The eight stages are (1) basic research, (2) applied research, (3) technology development, (4) technology implementation, (5) production, (6) marketing, (7) proliferation, and (8) technology enhancement. Technological Innovation System (TIS) is defined by Carlsson and Stankiewicz (1991) as “a dynamic network of agents interacting in a specific economic/industrial area under a particular institutional infrastructure and involved in the generation, diffusion, and utilization of technology.” TIS is also defined by Bergek, Hekkert, Jacobsson, Markard, Sandén, and Truffer (2015) as a “set of elements, including technologies, actors, networks, and institutions, which actively contribute to the development of a particular technology field.” The aforementioned definitions of TIS best describe the relationship of technology to innovation. Figure 1 suggests that technology is the heart of innovation. Since technology has always been at the core of innovation, one must leverage technology, which is regarded as the sub-system in the innovation system, to propel a firm’s innovation. This and several empirical studies summarized by Daştan and Kurt (2017, p. 231) prove the strong and positive impact of technology to innovation. In essence, technology plays a significant role in innovation. Dubey (2017) described the interdependencies and the role of technology in innovation in his book in five points which are the following: ● technology as efficiency and cost-reduction driver, ● technology as cost-mitigator, Page 2 of 6

● technology as opportunity and enhanced value creator, ● technology as innovation enabler, and ● technology as driver of business model innovations. Technology as an innovation enabler and as a driver of business model innovations were further discussed by Akaka and Vargo (2013). Based on Orlikowski’s (1992) structurational model of technology, Akaka and Vargo (2013) described that “innovation can occur through the development, design, appropriation or modification of a technology.” The framework, as shown in Figure 2, illustrates the duality of technology in TIS, both as an operand resource, or the tangible assets used in production (IGI Global, n.d.), and as an operant resource, or the intangible assets—knowledge and skills (IGI Global, n.d.).

Figure 2.​ Role of Technology in Service Innovation Ecosystem (adapted from Akaka & Vargo 2013) Innovations are not always technology-push. It can also be market-pull. Kampbell (2015) and Dubey (2017) used Domino’s Pizza to elaborate on the key role of technology in their market-pull TIS. The need for innovation came from criticisms on their pizza and its ordering-delivery system. Domino’s Pizza then leveraged technology by using data science technologies in listening to their customers, by revamping their menu, by creating an online Pizza ordering system, and by conducting new marketing campaigns. The use of such product and process technologies paved the way to the TIS of Domino’s Pizza which resulted in an enhanced customer experience and enhanced value for customers. In turn, all aforementioned five points can be seen and are evident in the TIS of Domino’s Pizza. Page 3 of 6

Schallmo, Brecht, and Ramosaj (2018, pp. 2–4) narrated Business-to-Consumer (B2C) sector leveraging technologies in a firm’s TIS such as Nespresso coffee machine’s use of Bluetooth technology to brew a coffee, IKEA’s use of RFID and e-payment technologies to check-out a product, and Nike’s use of e-commerce technologies to customize a pair of shoes. They also discussed Business-to-Business (B2B) cases like KSB’s use of machine learning technologies in determining a water pump efficiency (Schallmo et al., 2018, pp. 4–7). There are many other cases where a firm leveraged the utilization of technology in their TIS. But one of my favorite examples is the Sakay.ph app made by the By Implication, Inc. Sakay.ph is an innovative web and mobile app platform that helps its users commute by giving efficient and accurate directions—like the Philippine commute version of Waze app. The app can tell its users the most effective route and the best time to commute. Its product innovation is fueled by several following interlapping technologies (Cheang, 2016) based from an observer’s standpoint: ● CARTO, MapTiler, OpenStreetMap - mapping platform ● Traincheck - image recognition and data science technologies from Philippine Department of Transportation (DOTr) ● Google Places API - recommendation system The aforementioned bullets are just few of the technologies being used by the By Implications, Inc. These technologies introduced the app as a product innovation and their API as process innovation. Undeniably, technology plays a strong and positive impact on innovation—whether it be product innovation or process innovation. Technology is indeed interwoven as the heart and core of TISs.

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References Akaka, M. A., & Vargo, S. L. (2013). Technology as an operant resource in service (eco)systems. ​Information Systems and E-Business Management​, 12(3), 367–384. https://doi.org/10.1007/s10257-013-0220-5 Bam, S. (2018, April 10). Different stages of technological innovation. Management Notes. Retrieved March 9, 2019 from https://www.managementnote.com/stages-of-technological-innovation/ Bergek, A., Hekkert, M., Jacobsson, S., Markard, J., Sandén, B., & Truffer, B. (2015). Technological innovation systems in contexts: Conceptualizing contextual structures and interaction dynamics. ​Environmental Innovation and Societal Transitions​, 16, 51–64. https://doi.org/10.1016/j.eist.2015.07.003 Betz, F. (2011). ​Managing technological innovation: Competitive advantage from change​ (3rd ed.). Hoboken, New Jersey: John Wiley & Sons. Carlsson, B., & Stankiewicz, R. (1991). On the nature, function and composition of technological systems. ​Journal of Evolutionary Economics​, 1(2), 93-118. doi: 10.1007/bf01224915 Cheang, P. (2016, November 22). Predicting MRT crowding with Traincheck. Retrieved March 13, 2019 from https://blog.sakay.ph/predicting-the-mrt-with-traincheck/ Daştan, İ., & Kurt, Ö. E. (2017). The role of new technologies in innovation. In Enterprise & Business Management​ (pp. 215–248). Tectum – ein Verlag in der Nomos Verlagsgesellschaft. https://doi.org/10.5771/9783828868427-215 Dubey, S. S. (2017). Technology strategy. ​Technology and innovation management​. Delhi, India: PHI Learning. Hughes, T. P. (2012). The evolution of large technological systems. In W. E. Bijker, T. P. Hughes, & T. Pinch (Eds.). ​The social construction of technological systems: New directions in the sociology and history of technology​ (Anniversary ed., p. 45). Cambridge, Massachusetts & London, England: MIT Press. IGI Global. What is Operand Resources? Retrieved March 13, 2019 from https://www.igi-global.com/dictionary/value-co-creation-in-faculty-led-st udy-abroad-programs/56175

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IGI Global. What is Operant Resources? Retrieved March 13, 2019 from https://www.igi-global.com/dictionary/operant-resources/56176 Innovate. (n.d.). In ​OxfordDictionaries.com​. Retrieved March 9, 2019 from https://en.oxforddictionaries.com/definition/innovate Kampbell, K. (2011, September 15). The role of technology in innovation. Retrieved March 13, 2019 from http://www.iticentral.com/innovation/2011/9/15/the-role-of-technology-in -innovation.html Mentz, J. (1999, November). ​Developing a competence audit for technological innovation​ (Master’s thesis). Retrieved March 9, 2019 from http://hdl.handle.net/2263/30490 Orlikowski, W. (1992). The Duality of Technology: Rethinking the Concept of Technology in Organizations. ​Organization Science​, 3(3), 398-427. Retrieved March 13, 2019 from http://www.jstor.org/stable/2635280 Posadas, R. (2013). The nature and classification of technology [PowerPoint slides]. Schallmo, D. R. A., Brecht, L., & Ramosaj, B. (2018). ​Process Innovation: Enabling Change by Technology​. Springer Berlin Heidelberg. https://doi.org/10.1007/978-3-662-56555-1 Schumpeter, J. (1947). The Creative Response in Economic History. ​The Journal of Economic History​, 7(02), 149-159. doi: 10.1017/s0022050700054279 Sundbo, J. (1995, December). Three paradigms in innovation theory. ​Science and Public Policy​, 22(6), 399-410. doi:10.1093/spp/22.6.399

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