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190 MANAGING KNOWLEDGE WORK AND INNOVATION

high
Invention Implementation
(creating) (sharing and
integrating)

innovation
Exploration

Diffusion
Status quo (codifying and
connecting)
low
low high
Exploitation
Figure 9.1 The purpose of innovation

services. For example, Grindley et al. (1989) described how the Richardson
organization managed to buck the trend of the declining Sheffield cutlery
industry in the 1970s by applying specialist knowledge of metallurgy to the
development of a new type of knife blade – the ‘Laser’ range. This new blade,
with its lifetime sharpness guarantee, was a result of continued commitment to
product innovation that was said to have helped turn sales from £1 million in
1974 to £23 million in 1989.
Process innovation, in contrast, involves the development of new manage-
ment, work or organizational practices. Innovations in service delivery, such as
the one described in Medico, essentially entail process innovation. Medico’s suc-
cess resulted not only from the development of a new product but also from the
development of core competencies in manufacturing, sales and marketing. Whilst
much work in innovation has focused on the design and development of prod-
ucts, the growing importance of services has made process innovation as, if not
more, important. Innovations in services seem to have distinctive characteristics
that pose particular challenges for managing knowledge work – challenges that
are summarized in the Table 9.1 (see also Miles, 2003; Vermeulen, 2003).
As seen in Medico, product and process innovations also often go hand in
hand. For example, the major success of Apple’s products such as the iPod is
closely linked to online modes of product and service delivery in iTunes. That
said, it is worth remembering that product and process innovations do pose
potentially different problems for managing knowledge. Knowledge creation in
product innovation, for example, tends to converge around the product itself.
This means that the product – and associated physical artefacts such as blueprints
and prototypes – can serve as a tangible ‘boundary object’ in bringing together
relevant knowledge (Whyte et al., 2008).

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