Summary: Innovation Management In Multinationals

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• Introduction to innovation management

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• What do  R.D. Ireland & J.W. Webb (2007) mean with 'Strategic Entrepreneurship'?

  They discuss strategic entrepreneurship as the means through which firms simultaneously exploit their current competitive advantages while exploring for future opportunities to achieve continuous innovation.

• What are the challenges of strategic entrepreneurship according to  R.D. Ireland & J.W. Webb (2007)?

  * Although exploration contributes to strategic flexibility, often it doesn't appeal stakeholders and employees, due to the uncertain outcomes and the 'unknown'.
  * Transaction from exploration to exploitation takes difficult operational, structural and cultural changes.

• Describe the view of an expanded view of strategic entrepreneurship, according to R.D. Ireland & J.W. Webb (2007), by dissecting each part and putting them together.

  
  Strategy: firm’s long-term development decisions 
   Designing the firm’s scope 
   Managing the firm’s resources 
   Exploitation: developing competitive advantages & advantage-seeking behaviours 
  
  
  Entrepreneurship: 
   Creating newness 
   Creating organizational units 
   Organizational renewal 
   Exploration: opportunity-seeking behaviours 
  
  
  Strategic entrepreneurship: a value-creating intersection between strategy and entrepreneurship 
   Balancing exploration and exploitation 
   Balancing resources between exploration and exploitation 
   Continuous streams of innovation 

• What does effective strategic entrepreneurship result in, according to R.D. Ireland & J.W. Webb (2007)?

  Effective SE results in efficient (process and structural innovations as the firm wisely uses its resources) and effective newness (product innovation as a result of satisfying market expectations).

• What are the exploration activities according to R.D. Ireland & J.W. Webb (2007)?

  Positioning in one or more market spaces (outcome). Acquire new, diverse knowledge and integrate with existing knowledge (learning process). 
  
  *  Knowledge breadth: seeking diverse from external sources to add to internal knowledge 
  *  Knowledge depth: increase its store of both internal and external knowledge in focal areas 

• What are the operational mechanisms for exploration according to R.D. Ireland & J.W. Webb (2007)?

  * Mergers and acquisitions (M & A) to increase knowledge diversity
  * Corporate Venture Capital programs (sharing risks and investments with more firms)
  * SA's: Alliances allow firms to tap more external resources than possible with M&A's, but less than with CVC prorams.

• What are the structural mechanisms for exploration, according to R.D. Ireland & J.W. Webb (2007)?

  *Decentralized authority: provides autonomy to individuals and allows the firm to effectively pursue a larger number of opportunities
  * Semi-standardized procedures and semi-formalized processes: efficient use of resources when exploring.
  
  Both mechanisms balance the efficiency and effectiveness of a company.

• What are the cultural mechanisms for exploration, according to R.D. Ireland & J.W. Webb (2007)?

  The link between exploration and exploitation highlights the need for an organizational culture valuing experimentation, the acceptance of uncertainty, and a tolerance of failure.

• What are the operational mechanisms for exploitation, according to R.D. Ireland & J.W. Webb (2007)?

  * Internal development: The intimate knowledge held by employees involved with exploitation activities is often sufficient to lead the firm's incremental innovation.
  * SA's: Alliances enable firms to expand their knowledge and resources to accurately and quickly target global opportunities
  *M&A: M&A's allow firms to gain full control over valuable distribution channels and establish economies-of-scale and -scope

• What are the structural mechanisms for exploitation, according to R.D. Ireland & J.W. Webb (2007) ?

  * Centralized authority: defines a clear locus of control, facilitating the focus and quick decision necessary for exploitation succes.
  * Standardized/formalized: Routines should focus on one or two competencies, as opposed to exploiting numerous capabilities, which may slow the firm's activities.