Page 28 - Grow from Within Mastering Corporate Entrepreneurship and Innovation

Entrepreneurship, Innovation, and Organic Growth 15

tive” or “radical” innovation (terms popularized by Clayton
Christensen in The Innovator’s Dilemma, Richard Leifer et al. in
Radical Innovation, and Constantinos Markides and Paul
Geroski in Fast Second). Early in the twentieth century, Joseph
Schumpeter, arguably the intellectual father of the economics
of innovation and entrepreneurship, in The Theory of Economic
Development, defined innovation as “new combinations,” or,
more specifically, new combinations of capabilities and market
needs. While new technologies or concepts might be exciting,
they will have limited impact unless they address market
needs of value; however, doing so doesn’t necessarily require
radically new technologies or groundbreaking business model
concepts. Firms such as Wal-Mart and FedEx have been inno-
vative without actually inventing products, and even Apple’s
recent successes have been attributable as much to business
system design as to product design.
Even in the traditional domain of technology-based prod-
uct innovation, Andrew Hargadon of the University of Cali-
fornia Davis Graduate School of Management instructed in his
2003 Ivey Business Journal article, “Retooling R&D,” that the
essence is “bridging the many different industries and mar-
kets that exist, and building the necessary combinations of
technologies and people to make potential breakthroughs pos-
sible.” Ron Adner of INSEAD and David Levinthal of Whar-
ton pointed out in a 2002 California Management Review article
that “emerging technologies” are often existing technologies
that migrate to new application areas, where they evolve in
new directions that create value more rapidly than in their
original application. Satellite navigation systems, for instance,
moved from relatively small markets in military systems to
surveying to fleet management to hiking and maritime navi-
gation before creating billions of dollars of revenue in the pri-
vate automobile market.