EnhancingCountryEnvir't for Innovation 2
Enhancing
Country Environment
for
Innovation
Clarence J Mann, JD, Dr. jur.
University of Maryland
University College
Exchange Faculty Program
Universitas Terbuka – University of Maryland University College
UPBJJ JAKARTA 4 October 2009
Enhancing
Country Environment
for
Innovation
Clarence J. Mann, JD, Dr. jur.
University of Maryland University College
Graduate School of Management & Technology
Innovation Imperatives
• For the Country –
Increasing Productivity and Standards
of Living for All
•For the Enterprise –
Increasing Productivity and Competitive
Advantage
in an
Intensely Competitive Global
Environment
National Comparative Advantage
“Innovation and Imagination give
an economy or a company that
extra edge. Today, wealth is
generated by new Ideas”
Goh Chok Tong, former Prime Minister,
Singapore
Difficult to Measure Innovation?
Countries Vary Significantly
• Quantitatively – e.g., patents, proportion of
scientists and engineers; different types (e.g.,
soft and hard)
• Qualitatively – e.g., innovation intensity
– Complex Process – i.e., ability to create and
then commercialize new products, processes
– shifting the innovation frontier (Porter)
– “Healthy rate of innovation” – Porter
– Effects – depend on users perspective
What is Innovation?
• New combinations applied in the
market place
• Ability of Individuals, Companies and
Entire Nations to Continuously Create
Their Desired Future
• Process of –
– Harvesting Knowledge
– Generating New Products, Services,
Processes & Business Models
– Applying to Change Existing “Ways”
Innovation Occurs
at
All Aspects & Levels of Society
•
•
•
•
•
•
R&D Centers
Enterprises
Government Agencies
Educational Institutions
Provincial & City Government
Rural Areas & Villages
Types of Innovation
• Products/Services & Processes
• Operations & Management
• Public & Private Sectors
• Sustainable & Disruptive Effects
8
Global Drivers of Innovation
Nations & Enterprises Alike
1. Intensifying Competition @ business
models, technology, value propositions
2. Diversity of Geography @ scattered
centers of excellence - transparency
3. Multiplicity of Value Networks @ chess
game, locking in advantages
9
Question to Consider
What Should Guide
Nations & Enterprises
in
Building Innovative Capacity?
• Holistic Systems Thinking
• National Priorities
Three Part Analysis
I.
Systems Models - addressing
issues holistically
II. Building Country Climate for
Innovation
III. Strengthening Enterprise
Innovative Capacity
11
Part I.
Systems Models
for Assessing the Climate
of
Innovation
1. Social Process Model @
Country Environments
2. Corporate Process Model @
Organizational Environments
Three Complementary
Societal Realms
Goods &
Services
Protect &
Structure
Cultural
Commonality
Market
Preferences
Economic
Commonality
Foundational
Pole
Significating
Pole
Social
Process
Model
Rules of
Conduct
Policy
Direction
Political
Commonality
Public
Infrastructure
Organizational
Pole
13
Social Process Model
Rationale
Comprehensive – all societal aspects
Universal – every society
Analytical – critical components
Relational – 3 functional perspectives
Interactive – 3 inter-dependent realms
Transparent – underlying dynamics,
not institutions
14
Component Subsets
Fractals of Parent Dynamic
Contain All Three Poles
Reveal Depth and Nuance
Enable Multi-Level
Analysis
Nine Dynamics
within Three Societal 9.
Symbol
Realms
Significating
Pole
Cultural
Commonality
7.
Wisdom
8.
Style
3.
Distribution
Societal
Dynamics
6.
Welfare
Economic
Commonality
3 Realms
Political
Commonality
1.
Resources
Foundational
Pole
2.
Production
4.
Order
5.
Justice
Organizational
16
Pole
Multi
Multi--level View of
Social Process
Dynamics
Symbol
Communication
Modes
Final
Meanings
Significating
Pole
Religious
Beliefs
Aesthetic
Expression
Cultural
Societal
Commonality Recognition
Style
Wisdom
Useful skills
Consumption
Preferences
Distribution
Property
Claims
Exchange
Mechanisms
Economic
Technological
Commonality
Resources
Resources
Natural
Resources
Foundational
Pole
Accumulated
Knowledge
Social
Process
Management
Systems
3 Realms
Production
Assets
Production
Processes
Significant
Engagement
Welfare
Secure
Existence
Legal Base
Production
Human
Resources
Decisional
Patterns
Basic Roles
Political
Freedoms
Political
Commonality
Executive
Authority
Order
Common
Defense
Justice
Domestic
Tranquility
Constructed using Fractals of each higher level
Legislative
Consensus
Judicial
Procedures
Organizational
17Pole
Significating
Dynamic
Symbol
Cultural
Commonality
Wisdom
Distribution
Social
Process
Economic
Commonality
Resources
Foundational
Dynamic
Style
Production
Corporations as
Mirror Images of
Society – with
Parallel Dynamics
Welfare
Political
Commonality
Order
Culture
Justice
Organizational
Dynamic
Corporate
Process
Operations
Administration
18
Part II
Country
Environment
Analysis
Country Innovation Indicators
9.
9.
Symbol
Societal Goals:
Improving Quality
of Life for All
[‘Progress’ Mindset]
Cultural
Commonality
7. Scientific literacy,,
R&D/Discovery- oriented
[Experimental Mindset]
7.
Wisdom
3. Market Size,
[Sophisticated,
3.
Demanding
Distribution
Buyers]
8.
Style
COUNTRY
ENVIRONMENT
ANALYSIS
Economic
Commonality
1.
Resources
1.
6.
6.
Welfare
National Commitment:
Favorable Regulatory
Regime, Incentives,
[National Strategy]
Political
Commonality
2.
Production
Skilled Labor, Technological Readiness,
Supporting Networks of
Industries [Reliable
Infrastructure]
8. Societal Recognition,
Achievement & Risk-Oriented;
income inequality acceptable;
[Collaborative Linkages]
2. Risk Capital, unfettered competition;
results-oriented mngt.,
e.g., kaizen, Six Sigma
[Management Systems]
4.
Order
5.
Justice
4. Transparent markets; 5. Rationale, transparent decision-making;
consistent, predictable
Stable, predictable
system of anti-trust law
system of governance;
& property rights
[Stable Governance] 20
[Effective Institutions]
Author – Dr. Clarence J. Mann, UMUC – Oct. 12, 2008
Three Rules
Significating
Dynamic
for Assessing
Country
Environments
Cultural
Commonality
Rule of Effectiveness
Collaborative Trust
Social
Process
Economic
Commonality
Political
Commonality
Rule of Market
Rule of Law
Competitiveness
Stability/Predictability
Foundational
Pole
Organizational
21
Pole
Three Complementary Realms
in Tension
Complementary
Dynamics
Goods &
Services
Protect &
Structure
Cultural
Commonality
Market
Preferences
Policy
Direction
Social
Process
Economic
Commonality
Rules of
Conduct
Dynamics
in Tension
Cultural
Commonality
Political
Commonality
Public
Infrastructure
Significating
Dynamic
Social
Process
Economic
Commonality
Foundati onal
Dynamic
Political
Commonality
Organizational
Dynamic
22
Ideological Tension
Among the Three Realms
• Economic Realm – functional rationality:
Efficiency vs. fairness
• Political Realm – legitimacy: informed
Consensus vs. coerced acceptance
• Cultural Realm – harmony, identity
High vs. low trust
23
Innovating
Society In Transition
Significating
Pole
Cultural
Traditional Values
Societal
Tensions
Economic
Creative Destruction
Foundational
Pole
Political
Shifting Alliances
Organizational
Pole
24
Harmonizing 3 Realms
• Supportive Industry Clusters
• Promote Centers of Excellence
• Encourage FDI Inflows
• Align Institutions
• Societal Commitment –
“Running in a New Direction”
Part III
Enterprise
Analysis
Significating
Dynamic
Symbol
Cultural
Commonality
Wisdom
Distribution
Social
Process
Economic
Commonality
Resources
Foundational
Dynamic
Style
Production
Corporations as
Mirror Images of
Society – with
Parallel Dynamics
Welfare
Political
Commonality
Order
Culture
Justice
Organizational
Dynamic
Corporate
Process
Operations
Administration
27
Organizational Profile Indicators
What symbolizes
organizational
Identity
identity?
Corporate
Culture
How are skills and
innovation enhanced?
How is customer
value delivered?
Learning
Marketing
What standards must
resources meet?
Style
Corporate
Process
Corporate
Operations
Resources
How do employees
& stakeholders
interrelate?
Production
Mission
What values guide
the decisional
process?
Corporate
Administration
Controlling
Policy-Making
How are critical
How to ensure improving
How are decisions
productivity?
monitored & controlled? decisions made?
28
Performing a Corporate
Innovation Audit
Aligning Nine Dimensions
of
Organizational Dynamics
with
Corporate Vision
Innovation Organizational Audit
Four Steps
1. Practical Vision – Images of Success
2. Assess Future-Critical Gaps/Needs
Especially Core Competencies
3. Assess Country-Specific
Environmental Constraints
4. Build Strategic Pathway
Significating
Dynamic
Symbol
Culture
Cultural
Commonality
Wisdom
Corporate
Process
Style
Operations
Country
Administration
Environment
Distribution
Economic
Commonality
Resources
Foundational
Dynamic
Production
Welfare
Political
Commonality
Order
Justice
Organizational
Dynamic
Envisioned Corporate Profile
Gaps
Culture
Triangulating the
Corporate Future
for Innovation
Corporate
Process
Operations
Administration
Present Corporate Profile
31
Triangulating
Future Organizational Requirements
Two Assessments
1. Present Capacity of Firm
vs. Future-Critical Needs
2. Future Organizational Needs
vs. Country Environment
32
Organizational Innovation
Indicators
9
Identity
Corporate
Culture
7) Continually
enhancing skills and
innovative thinking
3) Improving
customer
value?
7
Learning
3
Marketing
8) Promoting synergy
among employees. &
stakeholders
8
Style
Corporate
Process
Corporate
Operations
1
Resource
s
9) Building an
organizational ethos
of innovation
2
Production
6
Mission/
Vision
6) Future-oriented
guidance of risks/
returns across
portfolio
Corporate
Administration
4
Controlling
5
Policy Making
1) Improving quality
2) Continually im- 4) Tracking and
standards for all inputs proving productivity controlling decisions
5) Building credible
leadership
33
Author - Dr. Clarence J. Mann, UMUC – Oct. 12, 2008
Part I
Organizational Constraints
• Limited Vision
• Reluctant Leadership
• Short Term Thinking
• Investment Costs
• Organizational Rigidities
34
Strategic Innovation Dimensions
1. Internal Focus – strengthen innovative
capacity of the firm
2. Location Focus – leverage the firm’s
environment - multiple locations?
3. Alliance Focus – build the firm’s
international value network
35
Consider Now
the Nine Corporate Dynamics
for Building Innovation
Capacity
36
Org’l Innovation Dynamics
Corporate Operations
• Resources Dynamic – quality standards
• Production Dynamic – kaizen, Six Sigma
• Marketing Dynamic – customer value
37
Org’l Innovation Dynamics
Corporate Administration
• Controlling Dynamic – measuring
appropriate results
• Policy-Making Dynamic – credible
leadership
• Mission/Vision Dynamic – balanced values
38
Org’l Innovation Dynamics
Corporate Culture
• Learning Dynamic – enhancing
skills and creative thinking
• Style Dynamic – promoting synergy
• Identity Dynamic – building
innovation ethos
39
Significating
Dynamic
Symbol
Culture
Cultural
Commonality
Wisdom
Corporate
Process
Style
Operations
Country
Administration
Environment
Distribution
Economic
Commonality
Resources
Foundational
Dynamic
Production
Welfare
Political
Commonality
Order
Justice
Organizational
Dynamic
Envisioned Corporate Profile
Gaps
Culture
Triangulating the
Corporate Future
for Innovation
Corporate
Process
Operations
Administration
Present Corporate Profile
40
Questions & Comments
41
Country Environment
for
Innovation
Clarence J Mann, JD, Dr. jur.
University of Maryland
University College
Exchange Faculty Program
Universitas Terbuka – University of Maryland University College
UPBJJ JAKARTA 4 October 2009
Enhancing
Country Environment
for
Innovation
Clarence J. Mann, JD, Dr. jur.
University of Maryland University College
Graduate School of Management & Technology
Innovation Imperatives
• For the Country –
Increasing Productivity and Standards
of Living for All
•For the Enterprise –
Increasing Productivity and Competitive
Advantage
in an
Intensely Competitive Global
Environment
National Comparative Advantage
“Innovation and Imagination give
an economy or a company that
extra edge. Today, wealth is
generated by new Ideas”
Goh Chok Tong, former Prime Minister,
Singapore
Difficult to Measure Innovation?
Countries Vary Significantly
• Quantitatively – e.g., patents, proportion of
scientists and engineers; different types (e.g.,
soft and hard)
• Qualitatively – e.g., innovation intensity
– Complex Process – i.e., ability to create and
then commercialize new products, processes
– shifting the innovation frontier (Porter)
– “Healthy rate of innovation” – Porter
– Effects – depend on users perspective
What is Innovation?
• New combinations applied in the
market place
• Ability of Individuals, Companies and
Entire Nations to Continuously Create
Their Desired Future
• Process of –
– Harvesting Knowledge
– Generating New Products, Services,
Processes & Business Models
– Applying to Change Existing “Ways”
Innovation Occurs
at
All Aspects & Levels of Society
•
•
•
•
•
•
R&D Centers
Enterprises
Government Agencies
Educational Institutions
Provincial & City Government
Rural Areas & Villages
Types of Innovation
• Products/Services & Processes
• Operations & Management
• Public & Private Sectors
• Sustainable & Disruptive Effects
8
Global Drivers of Innovation
Nations & Enterprises Alike
1. Intensifying Competition @ business
models, technology, value propositions
2. Diversity of Geography @ scattered
centers of excellence - transparency
3. Multiplicity of Value Networks @ chess
game, locking in advantages
9
Question to Consider
What Should Guide
Nations & Enterprises
in
Building Innovative Capacity?
• Holistic Systems Thinking
• National Priorities
Three Part Analysis
I.
Systems Models - addressing
issues holistically
II. Building Country Climate for
Innovation
III. Strengthening Enterprise
Innovative Capacity
11
Part I.
Systems Models
for Assessing the Climate
of
Innovation
1. Social Process Model @
Country Environments
2. Corporate Process Model @
Organizational Environments
Three Complementary
Societal Realms
Goods &
Services
Protect &
Structure
Cultural
Commonality
Market
Preferences
Economic
Commonality
Foundational
Pole
Significating
Pole
Social
Process
Model
Rules of
Conduct
Policy
Direction
Political
Commonality
Public
Infrastructure
Organizational
Pole
13
Social Process Model
Rationale
Comprehensive – all societal aspects
Universal – every society
Analytical – critical components
Relational – 3 functional perspectives
Interactive – 3 inter-dependent realms
Transparent – underlying dynamics,
not institutions
14
Component Subsets
Fractals of Parent Dynamic
Contain All Three Poles
Reveal Depth and Nuance
Enable Multi-Level
Analysis
Nine Dynamics
within Three Societal 9.
Symbol
Realms
Significating
Pole
Cultural
Commonality
7.
Wisdom
8.
Style
3.
Distribution
Societal
Dynamics
6.
Welfare
Economic
Commonality
3 Realms
Political
Commonality
1.
Resources
Foundational
Pole
2.
Production
4.
Order
5.
Justice
Organizational
16
Pole
Multi
Multi--level View of
Social Process
Dynamics
Symbol
Communication
Modes
Final
Meanings
Significating
Pole
Religious
Beliefs
Aesthetic
Expression
Cultural
Societal
Commonality Recognition
Style
Wisdom
Useful skills
Consumption
Preferences
Distribution
Property
Claims
Exchange
Mechanisms
Economic
Technological
Commonality
Resources
Resources
Natural
Resources
Foundational
Pole
Accumulated
Knowledge
Social
Process
Management
Systems
3 Realms
Production
Assets
Production
Processes
Significant
Engagement
Welfare
Secure
Existence
Legal Base
Production
Human
Resources
Decisional
Patterns
Basic Roles
Political
Freedoms
Political
Commonality
Executive
Authority
Order
Common
Defense
Justice
Domestic
Tranquility
Constructed using Fractals of each higher level
Legislative
Consensus
Judicial
Procedures
Organizational
17Pole
Significating
Dynamic
Symbol
Cultural
Commonality
Wisdom
Distribution
Social
Process
Economic
Commonality
Resources
Foundational
Dynamic
Style
Production
Corporations as
Mirror Images of
Society – with
Parallel Dynamics
Welfare
Political
Commonality
Order
Culture
Justice
Organizational
Dynamic
Corporate
Process
Operations
Administration
18
Part II
Country
Environment
Analysis
Country Innovation Indicators
9.
9.
Symbol
Societal Goals:
Improving Quality
of Life for All
[‘Progress’ Mindset]
Cultural
Commonality
7. Scientific literacy,,
R&D/Discovery- oriented
[Experimental Mindset]
7.
Wisdom
3. Market Size,
[Sophisticated,
3.
Demanding
Distribution
Buyers]
8.
Style
COUNTRY
ENVIRONMENT
ANALYSIS
Economic
Commonality
1.
Resources
1.
6.
6.
Welfare
National Commitment:
Favorable Regulatory
Regime, Incentives,
[National Strategy]
Political
Commonality
2.
Production
Skilled Labor, Technological Readiness,
Supporting Networks of
Industries [Reliable
Infrastructure]
8. Societal Recognition,
Achievement & Risk-Oriented;
income inequality acceptable;
[Collaborative Linkages]
2. Risk Capital, unfettered competition;
results-oriented mngt.,
e.g., kaizen, Six Sigma
[Management Systems]
4.
Order
5.
Justice
4. Transparent markets; 5. Rationale, transparent decision-making;
consistent, predictable
Stable, predictable
system of anti-trust law
system of governance;
& property rights
[Stable Governance] 20
[Effective Institutions]
Author – Dr. Clarence J. Mann, UMUC – Oct. 12, 2008
Three Rules
Significating
Dynamic
for Assessing
Country
Environments
Cultural
Commonality
Rule of Effectiveness
Collaborative Trust
Social
Process
Economic
Commonality
Political
Commonality
Rule of Market
Rule of Law
Competitiveness
Stability/Predictability
Foundational
Pole
Organizational
21
Pole
Three Complementary Realms
in Tension
Complementary
Dynamics
Goods &
Services
Protect &
Structure
Cultural
Commonality
Market
Preferences
Policy
Direction
Social
Process
Economic
Commonality
Rules of
Conduct
Dynamics
in Tension
Cultural
Commonality
Political
Commonality
Public
Infrastructure
Significating
Dynamic
Social
Process
Economic
Commonality
Foundati onal
Dynamic
Political
Commonality
Organizational
Dynamic
22
Ideological Tension
Among the Three Realms
• Economic Realm – functional rationality:
Efficiency vs. fairness
• Political Realm – legitimacy: informed
Consensus vs. coerced acceptance
• Cultural Realm – harmony, identity
High vs. low trust
23
Innovating
Society In Transition
Significating
Pole
Cultural
Traditional Values
Societal
Tensions
Economic
Creative Destruction
Foundational
Pole
Political
Shifting Alliances
Organizational
Pole
24
Harmonizing 3 Realms
• Supportive Industry Clusters
• Promote Centers of Excellence
• Encourage FDI Inflows
• Align Institutions
• Societal Commitment –
“Running in a New Direction”
Part III
Enterprise
Analysis
Significating
Dynamic
Symbol
Cultural
Commonality
Wisdom
Distribution
Social
Process
Economic
Commonality
Resources
Foundational
Dynamic
Style
Production
Corporations as
Mirror Images of
Society – with
Parallel Dynamics
Welfare
Political
Commonality
Order
Culture
Justice
Organizational
Dynamic
Corporate
Process
Operations
Administration
27
Organizational Profile Indicators
What symbolizes
organizational
Identity
identity?
Corporate
Culture
How are skills and
innovation enhanced?
How is customer
value delivered?
Learning
Marketing
What standards must
resources meet?
Style
Corporate
Process
Corporate
Operations
Resources
How do employees
& stakeholders
interrelate?
Production
Mission
What values guide
the decisional
process?
Corporate
Administration
Controlling
Policy-Making
How are critical
How to ensure improving
How are decisions
productivity?
monitored & controlled? decisions made?
28
Performing a Corporate
Innovation Audit
Aligning Nine Dimensions
of
Organizational Dynamics
with
Corporate Vision
Innovation Organizational Audit
Four Steps
1. Practical Vision – Images of Success
2. Assess Future-Critical Gaps/Needs
Especially Core Competencies
3. Assess Country-Specific
Environmental Constraints
4. Build Strategic Pathway
Significating
Dynamic
Symbol
Culture
Cultural
Commonality
Wisdom
Corporate
Process
Style
Operations
Country
Administration
Environment
Distribution
Economic
Commonality
Resources
Foundational
Dynamic
Production
Welfare
Political
Commonality
Order
Justice
Organizational
Dynamic
Envisioned Corporate Profile
Gaps
Culture
Triangulating the
Corporate Future
for Innovation
Corporate
Process
Operations
Administration
Present Corporate Profile
31
Triangulating
Future Organizational Requirements
Two Assessments
1. Present Capacity of Firm
vs. Future-Critical Needs
2. Future Organizational Needs
vs. Country Environment
32
Organizational Innovation
Indicators
9
Identity
Corporate
Culture
7) Continually
enhancing skills and
innovative thinking
3) Improving
customer
value?
7
Learning
3
Marketing
8) Promoting synergy
among employees. &
stakeholders
8
Style
Corporate
Process
Corporate
Operations
1
Resource
s
9) Building an
organizational ethos
of innovation
2
Production
6
Mission/
Vision
6) Future-oriented
guidance of risks/
returns across
portfolio
Corporate
Administration
4
Controlling
5
Policy Making
1) Improving quality
2) Continually im- 4) Tracking and
standards for all inputs proving productivity controlling decisions
5) Building credible
leadership
33
Author - Dr. Clarence J. Mann, UMUC – Oct. 12, 2008
Part I
Organizational Constraints
• Limited Vision
• Reluctant Leadership
• Short Term Thinking
• Investment Costs
• Organizational Rigidities
34
Strategic Innovation Dimensions
1. Internal Focus – strengthen innovative
capacity of the firm
2. Location Focus – leverage the firm’s
environment - multiple locations?
3. Alliance Focus – build the firm’s
international value network
35
Consider Now
the Nine Corporate Dynamics
for Building Innovation
Capacity
36
Org’l Innovation Dynamics
Corporate Operations
• Resources Dynamic – quality standards
• Production Dynamic – kaizen, Six Sigma
• Marketing Dynamic – customer value
37
Org’l Innovation Dynamics
Corporate Administration
• Controlling Dynamic – measuring
appropriate results
• Policy-Making Dynamic – credible
leadership
• Mission/Vision Dynamic – balanced values
38
Org’l Innovation Dynamics
Corporate Culture
• Learning Dynamic – enhancing
skills and creative thinking
• Style Dynamic – promoting synergy
• Identity Dynamic – building
innovation ethos
39
Significating
Dynamic
Symbol
Culture
Cultural
Commonality
Wisdom
Corporate
Process
Style
Operations
Country
Administration
Environment
Distribution
Economic
Commonality
Resources
Foundational
Dynamic
Production
Welfare
Political
Commonality
Order
Justice
Organizational
Dynamic
Envisioned Corporate Profile
Gaps
Culture
Triangulating the
Corporate Future
for Innovation
Corporate
Process
Operations
Administration
Present Corporate Profile
40
Questions & Comments
41