Achieving innovation and development speed in large structured organizations : an ecological view and case study

Abstract

Innovation has been long known to be difficult to accomplish in large companies that have well structured processes. Structured processes (such as the use of Six Sigma) can provide significant benefits in terms of efficiency and productivity. However, it can also hinder innovation in that it zones in on local, incremental solutions too quickly. This thesis explores different strategies corporations may take in incorporating innovation at their organizations. First, background and theory are presented to guide the discussion, grounded on ecological psychology. Second, a case study (VisionPRO Thermostat) is presented that provides insight in how innovation can work in large structured organizations; in this case, outsourcing and the use of common tools were used as the innovation strategy and transfer mechanism. Third, the discussion is expanded to broader corporate strategies that can inject innovation in product development processes. Innovation and structured processes are at odds with each other and need to be managed with different approaches. Innovation processes require creative isolation from high structure to open degrees of freedom and the design space; this can be accomplished through multiple strategies such as outsourcing, buying, injecting, incubating, co- locating, spinning-off, and distributing. Structured processes should rely on a high level of constraints that are highly predictable to push productivity and efficiency; this can be accomplished through Six Sigma and lean processes. Interfaces between the two sets of processes are critical to mediate effective transfer and insertion in product lines; in the case of the VisionPRO, common language (i.e., the common use of certain Six Sigma tools) and people played the interface role. Finally, conclusions, contributions, limitations, and future research are presented.