Diffusion of Administrative Innovation: TQM Implementation and Effectiveness in a Global

The main objective of this dissertation is to create new knowledge on an administrative innovation, its adoption, diffusion and finally its effectiveness. In this dissertation the administrative innovation is approached through a widely utilized management philosophy, namely the total quality management (TQM) strategy. TQM operationalizes a self-assessment procedure, which is based on continual improvement principles and measuring the improvements. This dissertation also captures the theme of change management as it analyzes the adoption and diffusion of the administrative innovation. It identifies innovation characteristics as well as organisational and individual factors explaining the adoption and implementation. As a special feature, this study also explores the effectiveness of the innovation based on objective data. For studying the administrative innovation (TQM model), a multinational Case Company provides a versatile ground for a deep, longitudinal analysis. The Case Company started the adoption systematically in the mid 1980s in some of its units. As part of their strategic planning today, the procedure is in use throughout the entire global company. The empirical story begins from the innovation adoption decision that was made in the Case Company over 22 years ago. In order to be able to capture the right atmosphere and backgrounds leading to the adoption decision, key informants from that time were interviewed, since the main target was to clarify the dynamics of how an administrative innovation develops. In addition, archival material was collected and studied, available memos and data relating to the innovation, innovation adoption and later to the implementation contained altogether 20500 pages of documents. A survey was furthermore conducted at the end of 2006 focusing on questions related to the innovation, organization and leadership characteristics and the response rate totalled up to 54%. For measuring the effectiveness of the innovation implementation, the needed longitudinal objective performance data was collected. This data included the profit unit level experience of TQM, the development of the self assessment scores per profit unit and performance data per profit unit measured with profitability, productivity and customer satisfaction. The data covered the years 1995-2006. As a result, the prerequisites for the successful adoption of an administrative innovation were defined, such as the top management involvement, support of the change agents and effective tools for implementation and measurement. The factors with the greatest effect on the depth of the implementation were the timing of the adoption and formalization. The results also indicated that the TQM model does have an effect on the company performance measured with profitability, productivity and customer satisfaction. Consequently this thesis contributes to the present literature (i) by taking into its scope an administrative innovation and focusing on the whole innovation implementation process, from the adoption, through diffusion until its consequences, (ii) because the studied factors with an effect on the innovation adoption and diffusion are multifaceted and grouped into individual, organizational and environmental factors, and a strong emphasis is put on the role of the individual change agents and (iii) by measuring the depth and consistency of the administrative innovation. This deep analysis was possible due to the availability of longitudinal data with triangulation possibilities.

Multifactor Performance Study on Complex Systems for the Benefit of Management

The primary objective is to identify the critical factors that have a natural impact on the performance measurement system. It is important to make correct decisions related to measurement systems, which are based on the complex business environment. The performance measurement system is combined with a very complex non-linear factor. The Six Sigma methodology is seen as one potential approach at every organisational level. It will be linked to the performance and financial measurement as well as to the analytical thinking on which the viewpoint of management depends. The complex systems are connected to the customer relationship study. As the primary throughput can be seen in a new well-defined performance measurement structure that will also be facilitated as will an analytical multifactor system. These critical factors should also be seen as a business innovation opportunity at the same time. This master's thesis has been divided into two different theoretical parts. The empirical part consists of both action-oriented and constructive research approaches with an empirical case study. The secondary objective is to seek a competitive advantage factor with a new analytical tool and the Six Sigma thinking. Process and product capabilities will be linked to the contribution of complex system. These critical barriers will be identified by the performance measuring system. The secondary throughput can be recognised as the product and the process cost efficiencies which throughputs are achieved with an advantage of management. The performance measurement potential is related to the different productivity analysis. Productivity can be seen as one essential part of the competitive advantage factor.

The role of alliance capabilities in alliance portfolio management

The question of why some firms perform better in managing their alliances has raised interest among scholars and managers. Whereas inter-firm factors influencing the alliance performance such as strategic fit between partners and the existence of complementarities have been studied extensively, research on firm-level antecedents is rather scarce. Therefore this study investigates the role of firm’s alliance capability in the alliance success equation. Particularly it analyses the specialized mechanisms and processes set up by firm in order to facilitate alliancerelated know-how leverage organization-wise. Evidence from a cross-industry sample of R&D intensive Finnish companies supports the fact that firms which have invested in institutionalizing alliance capabilities outperform their counterparts in alliance portfolio management. Results also suggest that firms need to adjust alliance management tools depending on the alliance portfolio size, prior experience with inter-firm partnerships and the strategic importance of alliances. Furthermore, absorptive capacity is found to be crucial for successful alliance management, its role being complementary to that of alliance capability. Finally, firms that have successful alliances also enjoy higher financial, market and innovation performance.

Projektijohtamisen prosessit ja kriittiset menestystekijät, Case Lappeenranta Innovation Oy

Tutkimuksen tavoitteena oli kartoittaa case-yrityksen vakiintuneet projektijohtamiseen liittyvät prosessit ja selvittää miten projektipäälliköt ja -koordinaattorit näkevät projektijohtamisen menestystekijät. Projektijohtamiseen liittyvän kirjallisuuden perusteella koostettiin projektijohtamisen optimiprosessi ja prosessivaiheittain listattiin myös eri menestystekijöitä. Tätä kuvausta verrattiin case-yrityksen projektijohtamisen prosessiin ja koettuihin menestystekijöihin, ja näiden pohjalta pohdittiin case-yrityksen projektijohtamisen prosessin parantamista. Projektijohtamisen prosessin lähes kaikissa vaiheissa löytyi tekijöitä, jotka ovat osatekijöitä projektin menestyksen kannalta. Yksi keskeisimpiä havaintoja oli projektin tarvelähtöisyyden merkitys projektin onnistumisessa ja projektitiimin sitoutumisessa. Kumppaneiden sitoutuminen yhtenä tärkeänä tekijänä nousi myös esille. Tutkimuksen tuloksena syntyi myös mekanismi kohdennettujen projekti-ideoiden keräämiseen hajautetussa ympäristössä.

Management of interdependency in project portfolio

Project management has evolved in recent decades. Project portfolio management, together with multi project management, is an emerging area in the project management field in practice, and correspondingly in academic research and forums. In multi project management, projects cannot be handled isolated from each other, as they often have interdependencies that have to be taken into account. If the interdependencies between projects are evaluated during the selection process, the success rate of the project portfolio is increased. Interdependencies can be human resources, technological, and/or market based. Despite of the fact that interdependency as a phenomenon has roots in the 1960s and is related to famous management theories, it has not been much studied, although in practice most companies use it to great extent. There exists some research on interdependency, but prior publications have not emphasized the phenomenon per se, because a practical orientation practitioner techniques prevails in the literature. This research applies the method triangulation, electronic surveys and multiple case study. The research concentrates on small to large companies in Estonia and Finland, mainly in construction, engineering, ICT, and machinery industries. The literature review reveals that interdependencies are deeply involved in R&D and innovation. Survey analysis shows that companies are aware of interdependency issues in general, but they i have lack of detailed knowledge to use it thoroughly. Empirical evidence also indicates that interdependency techniques influence the success rate and other efficiency aspects to different extents. There are a lot of similarities in interdependency related managerial issues in companies of varying sizes and countries in Northern Europe. Differences found in the study are for instance the fact that smaller companies face more difficulties in implementing and evaluating interdependency procedures. Country differences between Estonia and Finland stem from working solutions to manage interdependencies on a daily basis.historical and cultural reasons, such as the special features of a transition country compared to a mature country. An overview of the dominant problems, best practices, and commonly used techniques associated with interdependency is provided in the study. Empirical findings show that many interdependency techniques are not used in practice. A multiple case study was performed in the study to find out how interdependencies are managed in real life on a daily basis. The results show that interdependencies are mostly managed in an informal manner. A description of managing the interdependencies and implementation procedures is given. Interdependency procedures are hard to implement, especially in smaller companies. Companies have difficulties in implementing interdependency procedures and evaluating them. The study contains detailed results on how companies have implemented working solutions to manage interdependencies on a daily basis

Application of Open Innovation Paradigm in Small and Medium Enterprises in Russia

The objective of this study is to explore how the Open Innovation paradigm is applied in by small and medium-size enterprises in Russia. The focus of the study is to understand how the processes of research and development and commercialization proceed in these kind of companies and to which extent they apply open innovation principles. Russian leadership makes certain steps for transition from the export of raw materials to an innovative model of economic growth. The research aims to disclose actual impact of these attempts. The closed innovation model and the erosion factors which lead to the destruction of an old one and emergence of new model are described. Features of open innovation implementation and intellectual property rights protection in small and medium enterprises are presented. To achieve the objective, a qualitative case study approach was chosen. Research includes facts and figures, views and opinions of management of studied companies related to innovation process in the company and in Russia in general. The research depicts the features of Open Innovation implementation by SMEs in Russia. A large number of research centers with necessary equipment and qualified personnel allow case companies to use external R&D effectively. They cooperate actively with research institutes, universities and laboratories. Thus, they apply inbound Open Innovation. On the contrary, lack of venture capital, low demand for technologies within the domestic market and weak protection of intellectual property limit the external paths to new markets. Licensing-out and creation of spin-off are isolated cases. Therefore, outbound Open Innovation is not a regular practice.

Application of the scrum framework in non-software project management

Scrum is an agile project management approach that has been widely practiced in the software development projects. It has proven to increase quality, productivity, customer satisfaction, transparency and team morale among other benefits from its implementation. The concept of scrum is based on the concepts of incremental innovation strategies, lean manufacturing, kaizen, iterative development and so on and is usually contrasted with the linear development models such as the waterfall method in the software industry. The traditional approaches to project management such as the waterfall method imply intensive upfront planning and approval of the entire project. These sort of approaches work well in the well-defined stable environments where all the specifications of the project are known in the beginning. However, in the uncertain environments when a project requires continuous development and incorporation of new requirements, they do not tend to work well. The scrum framework was inspiraed by Nonaka’s article about new product developement and was later adopted by software development practitioners. This research explores conditions for and benefits of the application of scrum framework beyond software development projects. There are currently a few case studies on the scrum implementation in non-software projects, but there is a noticeable trend of it in the scrum practitioners’ community. The research is based on the real-life context multiple case study analysis of three different non-software projects. The results of the research showed that in order to succeed within scrum projects need to satisfy certain conditions – necessary and sufficient. Among them the key factors are uncertainty of the project environment, not well defined outcomes, commitment of the scrum teams and management support. The top advantages of scrum implementation identified in the present research include improved transparency, accountability, team morale, communications, cooperation and collaboration. Further researches are advised to be carried out in order to validate these findings on a larger sample and to focus on more specific areas of scrum project management implementation.

On Innovative Search: the use of internal and external sources of innovation among Finnish innovators

This dissertation explores the use of internal and external sources of knowledge in modern innovation processes. It builds on a framework that combines theories such as a behavioural theory of the firm, the evolutionary theory of economic change, and modern approaches to strategic management. It follows the recent increase in innovation research focusing on the firm-level examination of innovative activities instead of traditional industry-level determinants. The innovation process is seen as a problem- and slack- driven search process, which can take several directions in terms of organizational boundaries in the pursuit of new knowledge and other resources. It thus draws on recent models of technological change, according to which firms nowadays should build their innovative activities on both internal and external sources of innovation rather than relying solely on internal resources. Four different research questions are addressed, all of which are empirically investigated via a rich dataset covering Finnish innovators collected by Statistics Finland. Firstly, the study examines how the nature of problems shapes the direction of any search for new knowledge. In general it demonstrates that the nature of the problem does affect the direction of the search, although under resource constraints firms tend to use external rather than internal sources of knowledge. At the same time, it shows that those firms that are constrained in terms of finance seem to search both internally and externally. Secondly, the dissertation investigates the relationships between different kinds of internal and external sources of knowledge in an attempt to find out where firms should direct their search in order to exploit the potential of a distributed innovation process. The concept of complementarities is applied in this context. The third research question concerns how the use of external knowledge sources – openness to external knowledge – influences the financial performance of firms. Given the many advantages of openness presented in the current literature, the focus is on how it shapes profitability. The results reveal a curvilinear relationship between profitability and openness (taking an inverted U-shape), the implication being that it pays to be open up to a certain point, but being too open to external sources may be detrimental to financial performance. Finally, the dissertation addresses some challenges in CISbased innovation research that have received relatively little attention in prior studies. The general aim is to underline the fact that comprehensive understanding of the complex process of technological change requires the constant development of methodological approaches (in terms of data and measures, for example). All the empirical analyses included in the dissertation are based on the Finnish CIS (Finnish Innovation Survey 1998-2000).

Service innovation development and knowledge integration practices - a comparative case study on KIBS sector

Academic research on services and innovations on services has significantly grown during recent years. So far research concerning management of knowledge intensive work on service development activities is very limited. The objective of this study was to examine knowledge integration practices that support service innovation development and to the best of knowledge such studies have not been previously published in academic literature. In the theoretical part of the study a review of state‐of‐the‐art literature was conducted, research gap was indicated and a framework for analysis was built. In the empirical part an explorative comparative multi‐case study was carried out in KIBS sector. Four companies were selected and four service development projects were inspected. The service development activities and knowledge integration practices were identified. The cases were carefully compared and results formed. The empirical results indicated that service innovation development is partly linear and partly incremental flow of activities where knowledge integration practices have important role supporting the planning and execution of tasks. Knowledge integration practices supporting planning and workshops are close interaction, interpretation, project planning and sequencing of work tasks. The identified knowledge integration practices supporting building service solution were careful role and competence management, routines and common knowledge. The main implication is that to manage knowledge intensive service innovation development a firm should carefully develop and choose relevant knowledge integration practices to support the service development activities.

Transition management and the sustainable nutrients economy in the Netherlands; positioning paper

In this positioning paper transition management (TM) and the sustainable nutrient economy are addressed. We discuss TM from its scholarly origins in the 1990’s to its implementation as a comprehensive sector-wide policy program on sustainability in The Netherlands during the first decade of the 2000´s. Although the program was innovative and provoked a new approach to environmental policy and governance, the program at large failed to set the right conditions under which sustainable transition take place. Lessons from the Netherlands, both successful and less successful, are addressed in this positioning paper to inform Finnish governmental and knowledge institutes on how (not) to implement TM on environmental issues. When looking at sustainable nutrient economy the paper takes a historical view at how problems with nutrients (especially phosphates) were dealt with in the Netherlands during the post World War II era. This transition did not occur easily. In the agricultural sector environmental policies to prevent nutrient problems were not easily accepted, as large agricultural economic interests were at stake and the sector’s main actors were generally opposed to (radical) environmental transition. Currently, sustainable nutrient economy initiatives are starting to receive attention on the political agenda once again. In 2011 a sector- and chain-wide covenant was signed, showing that sustainable nutrient transition goals get commitment from stakeholders throughout the nutrient chain. We judge that TM provides useful elements that are applicable to Finnish governance modes to support sustainable nutrient economy transition. However, the Finnish government should be careful when implementing TM to prevent making the same mistakes the Dutch government made in previous years.

The Russian National Innovation System - an International Perspective

Russia inherited a large research and development (R&D) sector from the Soviet times, and has retained a substantial R&D sector today, compared with other emerging economies. However, Russia is falling behind in all indicators measuring innovative output in comparison with most developed countries. Russia’s innovation performance is disappointing, despite the available stock of human capital and overall investment in R&D. The communist legacy still influences the main actors of the innovation system. The federal state is still the most important funding source for R&D. Private companies are not investing in innovative activities, preferring to “import” innovations embedded in foreign technologies. Universities are outsiders in the innovation system, only a few universities carry out research activities. Nowadays, Russia is a resource-depended country. The economy depends on energy and metals for growth. The Russian economy faces the challenge of diversification and should embrace innovation, and shift to a knowledge economy to remain competitive in the long run. Therefore, Russia has to tackle the challenge of developing an efficient innovation system with its huge potential in science expertise and engineering know-how.

Open innovation model for a large company in the ICT industry: Case Ericsson LMF

Open innovation paradigm states that the boundaries of the firm have become permeable, allowing knowledge to flow inwards and outwards to accelerate internal innovations and take unused knowledge to the external environment; respectively. The successful implementation of open innovation practices in firms like Procter & Gamble, IBM, and Xerox, among others; suggest that it is a sustainable trend which could provide basis for achieving competitive advantage. However, implementing open innovation could be a complex process which involves several domains of management; and whose term, classification, and practices have not totally been agreed upon. Thus, with many possible ways to address open innovation, the following research question was formulated: How could Ericsson LMF assess which open innovation mode to select depending on the attributes of the project at hand? The research followed the constructive research approach which has the following steps: find a practical relevant problem, obtain general understanding of the topic, innovate the solution, demonstrate the solution works, show theoretical contributions, and examine the scope of applicability of the solution. The research involved three phases of data collection and analysis: Extensive literature review of open innovation, strategy, business model, innovation, and knowledge management; direct observation of the environment of the case company through participative observation; and semi-structured interviews based of six cases involving multiple and heterogeneous open innovation initiatives. Results from the cases suggest that the selection of modes depend on multiple reasons, with a stronger influence of factors related to strategy, business models, and resources gaps. Based on these and others factors found in the literature review and observations; it was possible to construct a model that supports approaching open innovation. The model integrates perspectives from multiple domains of the literature review, observations inside the case company, and factors from the six open innovation cases. It provides steps, guidelines, and tools to approach open innovation and assess the selection of modes. Measuring the impact of open innovation could take years; thus, implementing and testing entirely the model was not possible due time limitation. Nevertheless, it was possible to validate the core elements of the model with empirical data gathered from the cases. In addition to constructing the model, this research contributed to the literature by increasing the understanding of open innovation, providing suggestions to the case company, and proposing future steps.

Trust Embedded Open Innovation: Human-Centricity in the Financial

Globalization and interconnectedness in the worldwide sphere have changed the existing and prevailing modus operandi of organizations around the globe and have challenged existing practices along with the business as usual mindset. There are no rules in terms of creating a competitive advantage and positioning within an unstable, constantly changing and volatile globalized business environment. The financial industry, the locomotive or the flagship industry of global economy, especially, within the aftermath of the financial crisis, has reached a certain point trying to recover and redefine its strategic orientation and positioning within the global business arena. Innovation has always been a trend and a buzzword and by many has been considered as the ultimate answer to any kind of problem. The mantra Innovate or Die has been prevailing in any organizational entity in a, sometimes, ruthless endeavour to develop cutting-edge products and services and capture a landmark position in the market. The emerging shift from a closed to an open innovation paradigm has been considered as new operational mechanism within the management and leadership of the company of the future. To that respect, open innovation has been experiencing a tremendous growth research trajectory by putting forward a new way of exchanging and using surplus knowledge in order to sustain innovation within organizations and in the level of industry. In the abovementioned reality, there seems to be something missing: the human element. This research, by going beyond the traditional narratives for open innovation, aims at making an innovative theoretical and managerial contribution developed and grounded on the on-going discussion regarding the individual and organizational barriers to open innovation within the financial industry. By functioning across disciplines and researching out to primary data, it debunks the myth that open innovation is solely a knowledge inflow and outflow mechanism and sheds light to the understanding on the why and the how organizational open innovation works by enlightening the broader dynamics and underlying principles of this fascinating paradigm. Little attention has been given to the role of the human element, the foundational pre-requisite of trust encapsulated within the precise and fundamental nature of organizing for open innovation, the organizational capabilities, the individual profiles of open innovation leaders, the definition of open innovation in the realms of the financial industry, the strategic intent of the financial industry and the need for nurturing a societal impact for human development. To that respect, this research introduces the trust-embedded approach to open innovation as a new insightful way of organizing for open innovation. It unveils the peculiarities of the corporate and individual spheres that act as a catalyst towards the creation of productive open innovation activities. The incentive of this research captures the fundamental question revolving around the need for financial institutions to recognise the importance for organizing for open innovation. The overarching question is why and how to create a corporate culture of openness in the financial industry, an organizational environment that can help open innovation excel. This research shares novel and cutting edge outcomes and propositions both under the prism of theory and practice. The trust-embedded open innovation paradigm captures the norms and narratives around the way of leading open innovation within the 21st century by cultivating a human-centricity mindset that leads to the creation of human organizations, leaving behind the dehumanization mindset currently prevailing within the financial industry.

Lean management implementation in Horizontal Technology Transfer projects

The importance of Technology Transfer activities of companies is underpinned by the changes in technological and economic environments. However, there is still a significant gap in defining possible ways for Technology Transfer projects effectiveness improvement. The Master’s Thesis overviews common problems faced by the companies in implementation of Technology Transfer projects and examines Lean management principles as possible way to improve its effectiveness. Based on the analysis of the relevant scientific literature and results of the survey, conducted among the firms of different types, the approach to Technology Transfer projects implementation with the use of Lean management principles is proposed. The approach serves to solve some of the important problems faced by the managers of Technology Transfer projects. It is envisaged that this approach can help to increase overall Technology Transfer projects’ effectiveness.

Catching up with competitiveness in emerging markets – An analysis of the role of the firm’s technology management strategies

Emerging markets have experienced rapid economic growth, and manufacturing firms have had to face the effects of globalisation. Some of the major emerging economies have been able to create a supportive business environment that fosters innovation, and China is a good example of a country that has been able to increase value-added investments. Conversely, when we look at Russia, another big emerging market, we witness a situation in which domestic firms struggle more with global competitiveness. Innovation has proven to be one of the most essential ingredients for firms aiming to grow and become more competitive. In emerging markets, the business environment sets many constraints for innovation. However, open strategic choices in new product development enable companies in emerging markets to expand their resource base and capability building. Networking and close inter-firm cooperation are essential in this regard. In this dissertation, I argue that technology transfer is one of the key tools for these companies to become internationally networked and to improve their competitiveness. It forces companies to reach outside the company and national borders, which in many cases, is a major challenge for firms in emerging markets. This dissertation focuses on how companies can catch up with competitiveness in emerging markets. The empirical studies included in the dissertation are based on analyses of survey data mainly of firms and their strategies in the Russian manufacturing industry. The dissertation contributes to the current strategic management literature by further investigating technology management strategies in manufacturing firms in emerging markets and the benefits of more open approaches to new product development and innovation.