Table Of ContentMANAGING INNOVATION AND CHANGE
THE INTERNATIONAL INSTITUTE FOR APPLIED SYSTEMS ANALYSIS
is a nongovernmental research institution, brin'ging together scientists from around the
world to work on problems of common concern. Situated in Laxenburg, Austria, IIASA
was founded in October 1972 by the academies of science and equivalent organizations of
twelve countries. Its founders gave IIASA a unique position outside national, disciplinary,
and institutional boundaries so that it might take the broadest possible view in pursuing
its objectives:
To promote international cooperation in solving problems arising from social, economic,
technological, and environmental change
To create a network of institutions in the national member organization countries and
elsewhere for joint scientific research
To develop and formalize systems analysis and the sciences contributing to it, and promote
the use of analytical techniques needed to evaluate and address complex problems
To inform policy advisors and decision makers about the potential application of the
Institute's work to such problems
The Institute now has national member organizations in the following countries:
Austria Hungary
The Austrian Academy of Sciences The Hungarian Committee for Applied
Systems Analysis
Bulgaria
The National Committee for Applied Italy
Systems Analysis and Management The National Research Council
Canada Japan
The Canadian Committee for nASA
The Japan Committee for nASA
Czechoslovakia
Netherlands
The Committee for IIASA of the
The Foundation nASA-Netherlands
Czechoslovak Socialist Republic
Poland
Finland
The Polish Academy of Sciences
The Finnish Committee for nASA
France Sweden
The French Association for the The Swedish Council for Planning and
Development of Systems Analysis Coordination of Research
Gennan Democratic Republic Union of Soviet Socialist Republics
The Academy of Sciences of the German The Academy of Sciences of the Union
Democratic Republic of Soviet Socialist Republics
Federal Republic of Germany United States of America
Association for the Advancement The American Academy of Arts and
of IIASA Sciences
Managing Innovation
and Change
edited by
SVEN B. LUNDSTEDT
The Ohio State University, Columbus, Ohio, U.S.A.
and
THOMAS H. MOSS
Case Western Reserve University, Cleveland, Ohio, U.S.A.
111...
"
SPRINGER-SCIENCE+BUSINESS MEDIA, B.V.
Library of Congress Cataloging in Publication Data
Managing innovation and change.
Based on papers presented at the conference sponsored
by the International Institute for Applied Systems
Analysis.
Includes bibliogrpahies.
1. Technological innovations--Management--Congresses.
1. Lundstedt, Sven B., 1926- II. Moss, lllomas H.
III. International Institute for Applied System Analysis.
HD45.M326 1989 658.5'14 88-27344
ISBN 978-94-015-7837-0 ISBN 978-94-015-7835-6 (eBook)
DOI l0.l007/978-94-015-7835-6
AH Rights Reserved
© 1989 by Springer Science+Business Media Dordrecht
Origina11y published by the International Institute for Applied Systems Analysis in 1989
Softcover reprint of the hardcover 1s t edition 1989
No part of the material protected by this copyright notice may be reproducedor utilized in
any form or by any means, electronic or mechanical including photocopying, recording or by
any information storage and retrieval system, without written permission from the copyright
owner.
Contents
Foreword VB
Preface IX
Chapter 1 Introduction 1
Sven B. Lundstedt and Thomas H. Moss
PART I: Concepts
Chapter 2 The Draw Poker Theory
of Innovation Management:
Illustrations from the Automotive Industry 13
John Langrish
Chapter 3 Innovation Management in a Contract Research
and Development Corporation 23
David K. Snediker
Chapter 4 University-Industry Cooperation
as Industrial Strategy 35
Harvey Brooks
Chapter 5 Knowledge Centers, Technological Innovations,
and Regional Economic Growth 47
Stephen P. Dresch and Karol I. Pelc
Chapter 6 Knowledge Required for Innovation 63
Walter H. Goldberg
Chapter 7 Time, Space, Innovation Management,
and the Life Cycle Concept 85
Sven B. Lundstedt
VI Managing Innovation and Change
PART II: Cases
Chapter 8 Innovation Management within the Ford
Motor Company 111
Julius L. Sabo
Chapter 9 The Honda Way: An Innovative Approach
to Management and Production 123
Susan Insley
Chapter 10 The Elements of Innovation at IBM 135
Denos C. Gazis
Chapter 11 New Internal Ventures and Enterprises:
The Perspective from within Siemens AG 147
Gottfried A. Wolf
Chapter 12 Innovation Management in the Steel Industry 159
Richard S. Gray
Chapter 13 Transformation of Shipbuilding Companies
in Sweden 169
Anders Briinnstrom
Chapter 14 Strategic Options in the Automobile Industry 179
Christer Karlsson
Chapter 15 Robotomation: Challenges to Innovative
Manufacturing by the Industrial Robot 195
Akira Nomoto
Chapter 16 Space: The Ultimate Innovation and
Modernization Management Program 207
Alan L. Patz
Chapter 17 The Future of Innovation Management 221
Sven B. Lundstedt and Thomas H. Moss
About the Authors 227
Foreword
Technological innovations, as well as the social innovations needed to
provide adequate support systems for them, are among the important
foundations for economic and industrial growth in the world today.
Consequently, the discussions in this important volume of the emerg
ing "sociotechnical" trends in various industries around the world are
highly instructive and timely. We can learn much of value from oth
ers around the world who are facing similar problems of economic and
industrial development. Sociotechnical innovation requires a global set
ting to be fully understood and appreciated because so much new eco
nomic activity that serves the economy of the United States, as well as
the economies of other countries, is found in other parts of the world
including not only manufacturing innovations, but innovations in the
service industries. For all of our economic self-interests, we need to
view innovation globally.
Sociotechnical innovation is linked with the successful development
of cutting edge technologies, such as ultra large-scale integrated elec
tronic systems, new larger computers, the "myria-process" systems in
computing architecture that use thousands of processors, new biochem
ical solutions in high-cost feedstock, applications of genetic engineer
ing to crop improvement, and biotechnological improvements in the
pharmaceutical industries. There are also developments in the materi
als field: new fiber-reinforced plastics, rapid solidification technologies,
new polymers and ceramics. And there are advances in air transport
technologies that may replace current technologies [1].
A 1985 National Academy of Engineering study suggests that inno
vation-related national concerns of importance for the generation of
new technology and its application include "greater relative investment
in commercially oriented R&D; more rigorous education; more man
agement focus on long-term growth; more supportive and effective gov
ernmental policies; and more effective relationships between public and
private sectors" [2]. Implementing many of these policies will require
new social inventions.
As one reads these interesting chapters, one should keep in mind the
sheer complexity of industrial and economic development that simple
solutions dangerously obscure. The cross-cultural and cross-national
vii
Managing Innovation and Change
Vlll
perspectives contained herein remind us of our responsibility to see our
industrial and economic problems as they truly are - as part of exceed
ingly complex global systems, some of which have lost their resiliency
and forward movement. In Ohio we are striving to regain this momen
tum with the very best research, education, and business practices.
Richard Celeste
Governor of the State of Ohio
United States of America
Notes
[1] See National Academy of Engineering (1984), Cutting Edge Tech
nologies, Washington, DC: National Academy Press.
[2] See pp. 1-4 in Steele, L. W. and Hannay, N. B. (1985), The
u.s.
Competitive Status of Industry - An OvervIew, Washington,
DC: National Academy Press.
Preface
The idea for the conference, on which part of this book is based, was
conceived by Sven B. Lundstedt and jointly organized with Thomas H.
Moss. The Ohio State University, Case Western Reserve University, and
the International Institute for Applied Systems Analysis (IIASA) were
the principal sponsoring institutions with cosponsorship by the Ameri
can Academy of Arts and Sciences, the State of Ohio Thomas A. Edison
Program, the American Committee on US-Soviet Relations Univer
sity Circle Incorporated, the City of Cleveland, the Greater Cleveland
Growth Association, and the George Gunn Foundation. The indus
trial sponsors included Honda Manufacturing Corporation of America,
Ford Motor Company, Allen-Bradley Corporation, Eaton Corporation,
Abbott Laboratories-Ross Laboratories Division, East Ohio Gas Com
pany, Standard Oil Company of Ohio, and Cleveland Electric Illumi
nating Company.
We wish to thank our individual universities for their support of
this conference by providing the conference facilities. Special mention
should be made of the very generous financial support provided by the
President of The Ohio State University, Dr. Edward Jennings, who was
guided by his enlightened vision of the international role of the univer
sity in research and education. For many who attended from around
the world it was their first visit to Columbus, Ohio, and to Cleveland,
Ohio, thereby building a bridge of goodwill through the success of the
conference. We also want to recognize the fine contributions of the
other members of our distinguished planning committee: Professors Bo
Carlsson and Gerald Rosseger of Case Western Reserve University and
Dr. Jack M. Hollander and Professor Tetsunori Koizumi of Ohio State.
To them all, we give generous thanks.
To Professor Thomas H. Lee, former Director of nASA, we owe
much for his forward-thinking policies for nASA and for the logisti
cal and financial support provided. We are very grateful to Dr. Ti
bor Vasko of nASA for his advice and assistance, and to Dr. Boris
Segerstahl,who initially created an administrative mechanism in nASA
for the development of the conference. To all nASA staff who gave their
assistance: many thanks.
ix
x Managing Innovation and Change
To the many others who helped us to organize the meeting, we
also give grateful recognition. Jean S. Lundstedt, serving as Program
Associate, did an enormously effective job of handling the details of the
conference and made the atmosphere warm and supportive for everyone,
thereby increasing significantly the feelings of international goodwill in
all who came to participate. Roberta E. Riddle, from The Ohio State
University Office of International Affairs, provided a significant part of
the logistical support needed for smooth operation of the conference.
The staff of the Fawcett Center of The Ohio State University were most
helpful, especially Director Richard A. Weaver, who gave so freely of
his time. The Ohio State portion could not have been a success without
them.
We wish also to recognize the generous assistance of the staff of
the Office of Research and Graduate Studies of Case Western Reserve
University. We are grateful to all at Case who played a part in the
organization and success of this conference.
Needless to say, an important contribution to improved interna
tional understanding was made by this gathering of scholars and prac
titioners. It was clearly demonstrated that international cooperation in
the broadest sense is possible by working together on important com
mon agendas, purposefully made politically neutral, where all tend to
benefit from the deliberations. We can learn much from each other
about our common problems and our unique individual solutions to
them. While we discussed the importance of innovation management
for economic and industrial development in different countries, it is
clear that innovation management is a global economic concern with
problems common to all and solutions to problems that are dependent
upon the cooperation of all. As we learn to work together, while rec
ognizing unique individual cultural and national traditions, so too do
we live with one another in peaceful ways through mutual appreciation
and understanding.
Sven B. Lundstedt and Thomas H. Moss
February, 1988
