GLOBAL INNOVATION MANAGEMENT AND VIRTUAL R&D TEAMS

GLOBAL INNOVATION MANAGEMENT AND VIRTUAL R&D TEAMS

GLOBALIZATION OF INNOVATION

Innovatıons have acquired a key-ole in the growth and competition strategies of firms today.


At the same time, innovations in today’s “GLOBALIZED” world are hardly feasible in isolation.


All these developments are leading to do “globalization” of innovation. Based on recent emprical studies cunducted by the authors in Germany.



GLOBALIZATION OF INNOVATION ERNST and KIM (2001) identified three forces that

drive global production Networks(GPN) a)Instutional changes in the form of economic

liberalization and free trade agreements b)The impact of information and

communication Technologies (ICT) c) Competition and the changing industrial

organization (Networks)

GLOBALIZATION OF INNOVATION In summary, GLOBAL INNOVATION

activities are thought to provide firms the following advanteges:

1-ACCESS TO GLOBAL EXPERTISE AND

KNOW-HOW :

GLOBALIZATION OF INNOVATION 1-ACCESS TO GLOBAL EXPERTISE AND KNOW-

HOW 2- REDUCE BOTTLENECKS IN THE R&D

PIPELINE AND SHORTEN TIME TO MARKET 3-MEET DEMAND FOR LOCALİZED PRODUCTS

IN EXTERNAL (FAST – GRAWING ) MARKETS4- RELIEVING COST PRESSURE 5- PROXIMITY TO PRODUCTION CENTERS6- LEARNING FROM “LEAD MARKETS”

GLOBALIZATION OF INNOVATION 4- RELIEVING COST PRESSURE 5- PROXIMITY TO PRODUCTION

CENTERS6- LEARNING FROM “LEAD MARKETS”

GLOBALIZATION OF INNOVATIONThe above mentioned advantages

may be translated in a BCF strategy, which enables a “better,cheaper and faster” development of products, process and services. The BCF factors may be regarded as characterizing the “goal model” of moderni international firm.

GLOBALIZATION OF INOVATION

CHALLENGES OF GLOBAL INNOVATIONThe desire to engage in international

innovation activites however either did not materialize or did not run satisfactorialy for many. (((The primary reasons cited, and evaluated on a scale of 1 (=very important to 6=not importatnt at all)

CHALLENGES OF GLOBAL INNOVATION

HOW DO WE MANAGE THE GLOBAL INNOVATION?

GLOBAL INNOVATION MANAGEMENT

10 RULES FOR MANAGING GLOBAL INNOVATION

GLOBAL INNOVATION MANAGEMENTCompanies are well aware that

hidden in their dispersed, global operations is a treasure trove of ideas and capabilities for innovation.

But it’s proving harder than expected to unearth those ideas or exploit those capabilities in global innovation projects.

GLOBAL INNOVATION MANAGEMENT What works for an innovation project

conducted in a single location doesn’t necessarily work for one dispersed across many sites around the world. When a project spans multiple locations, many of the natural benefits of co-location are lost. Part of the challenge of dispersed innovation thus becomes how to replicate the positive aspects of co-location while harnessing the unique benefits of a global initiative.


To explore this challenge, we spent more than a decade doing field research at 47 companies around the world, including Citibank, Intel, Novartis, Samsung and Xerox. In 2004 we teamed up with Booz & Company to conduct a global survey that was completed by 186 companies from 19 countries and 17 sectors. We draw on that work to present a set of guidelines for successfully managing global innovation projects.


1. Start Small No matter how strong technical capabilities or

customer knowledge may be at a particular site, employees will struggle to make a contribution to a global project commensurate with their skills if they have had experience only in co-located development. That’s because on single-location projects, team members benefit from collective tacit knowledge and a shared context, both of which support rich communication and help build trust and confidence among coworkers.

GLOBAL INNOVATION MANAGEMENT Projects that span multiple sites and time

zones are often hobbled by differences in workplace practices, communication patterns and cultural norms. In the absence of everyday interactions and encounters, people struggle to signal trustworthiness and demonstrate competencies. Many teams are used to competing for resources with teams at other sites, and this creates yet another barrier to trust and collaboration between sites.

GLOBAL INNOVATION MANAGEMENTTo be effective, dispersed teams

have to develop a new set of collaboration competencies and establish a collaborative mindset. This can be done by running small, dispersed projects involving just two or three sites before a project launch

GLOBAL INNOVATION MANAGEMENT2. Provide a stable organisational context During periods of major organisational change, the

complexity of dispersed innovation escalates. Top managers are likely to be focused elsewhere within the organisation, leaving their global projects orphaned. In a climate of organisational uncertainty, turf battles can flare up, and team members may become concerned about job security and lose focus.

Managers need to anticipate the possible toxic side effects of reorganisation on global innovation and shelter teams as much as possible from disruptions. They should focus on creating an atmosphere of stability and bolster employees’ sense of self-worth and loyalty to the firm.

GLOBAL INNOVATION MANAGEMENT3. Assign oversight and support responsibility

to a senior manager When a project is fragmented and scattered over

multiple locations, miscommunication, conflict and stalemates over crucial decision-making are much more likely. Teams often struggle to handle these problems constructively over a distance, so senior managers have to take on a formal role as arbiter, risk-manager, support-provider and ultimate decision-maker. Companies that are smart about global innovation create an explicit role for senior executives in their projects.

GLOBAL INNOVATION MANAGEMENT4. Use rigorous project management and

seasoned project leaders A global innovation project also requires a

strong management team to drive the project on a day-to-day basis and strong team leaders supported by robust tools and processes. These are necessary to impose discipline, structure and a shared sense of purpose across the locations.

GLOBAL INNOVATION MANAGEMENTFirms can adopt rigorous quality

programs to provide formal management for global projects, or they can build a corporate project-management capability. However, it’s important to note that global innovation projects are so complex that standard tools and processes don’t always work well.


5. Appoint a lead site Each site involved in global innovation will

see the project through the prism of its own contribution and context. That’s why all sites can’t carry equal weight, even if their experience and expertise are equivalent; one has to be designated the lead. That site takes responsibility for delivering the project on time and on budget.

GLOBAL INNOVATION MANAGEMENT6. Invest time defining the innovation One of the great benefits of co-location innovation is that

the product or service isn’t always what was anticipated at the outset. Because everyone involved is in frequent communication, continuous learning and adaptation can take place, allowing the design of the product or service to improve over the course of the project.

When a project is split, there is very little latitude for iterative learning. Instead, everything must be defined upfront. In addition, process flows, timelines and knowledge requirements need to be thoroughly understood so that everyone working on the project has the same understanding of the goals and their individual contributions to them.

GLOBAL INNOVATION MANAGEMENT Although there is a natural temptation to

dive into development as soon as possible, studies show a positive correlation between investment in defining goals and technical specifications and the successful outcome of projects. We believe that a global project can’t be effectively defined without some degree of co-location between the different functions and sites involved. Co-location builds relationships and trust upfront and supports the sharing of complex ideas and concepts.


7. Allocate resources on the basis of capability, not availability

The question of how best to staff a project rarely arises when only one location is involved. The effective staffing of a global project, however, requires a great deal of attention to select and integrate the best possible knowledge and capabilities.

GLOBAL INNOVATION MANAGEMENT8. Build enough knowledge overlap for

collaboration Although sites should be selected on the basis of the

unique capabilities and knowledge they can bring, there also has to be a small degree of knowledge overlap between sites. Without this, critical interdependencies between modules may not be apparent until the integration phase, when problems are costly to rectify. This doesn’t mean replicating the other sites’ knowledge, but understanding enough of what they do to anticipate potential interdependencies and interfaces in the development process.


9. Limit the number of subcontractors and partners

In most innovation projects today, part of the work is outsourced or undertaken by development partners to access specific competencies, reduce development time or cut costs. Managing relationships with external parties takes time and energy, so global projects must limit the additional complexity and management burden by keeping the number of subcontractors or partners to a minimum.

GLOBAL INNOVATION MANAGEMENTChoosing partners or subcontractors

located close to one of the internal project sites will reduce the potential for cross-cultural misunderstandings and support face-to-face communication.

GLOBAL INNOVATION MANAGEMENT10. Don’t rely solely on technology for

communication The successful execution of a global project remains

dependent upon communication channels that go as far as possible to replicate the richness of co-located communication. Information and communications technologies certainly have a role to play, but those tools shouldn’t be over-relied on, because they tend to mask differences between locations, leading to misunderstandings and tension. Successful globally integrated firms understand the importance of an extensive communications approach.

GLOBAL INNOVATION MANAGEMENT Information and communications

technologies certainly have a role to play, but those tools shouldn’t be over-relied on, because they tend to mask differences between locations, leading to misunderstandings and tension. Successful globally integrated firms understand the importance of an extensive communications approach.

GLOBAL INNOVATION MANAGEMENT TOGETHER , 10 STEPS we have outlined

represent the foundation for successful global innovation projects.Adopting only one or two may result in fleeting success in some projects but will not produce a stream of positive outcomes.These best practices all need to be put in place and honed over time.It’s not easy to build a global innovation capability , but for companies that don’t have the skills and processes in place to manage global innovation projects,the future offers a stark choice :

GLOBAL INNOVATION MANAGEMENT Continue with only colocated projects , in

the hope that they will fill the innovation pipeline for a few more years until global competition intensifies and makes local innovation a niche activity.Or begin building capability in global innovation now to take advantage of lower development costs , faster time to market , and , most important , the ability to leverage dispersed knowledge to gain competitive advantage.

VIRTUAL R&D TEAMS

VIRTUAL R&D TEAMS Innovation is becoming the most important key

issue for company’s success in the 21 st century. In the competitive environment is necessary for the enterprises to put together different capabilities and services with the goal. It’s a widely accepted that innovation is better achieved by working in team.

VIRTUAL R&D TEAMS Virtual teams base on information technology are

formed to facilitate transnational innovation processes and it should be noted that innovation has a positive impact on corporate performance. Information and communication technology has brought about significant changes in organizations and produced important benefits, including in the areas of innovation which is recognized as a prime source of national competitive advantage. This contribution proposes a conceptual model for understanding and analyzing the process of virtual R&D team as an innovation and technology assimilation facilitator.

VIRTUAL R&D TEAMS Research and development and as a result,

technology have tremendously improved the quality of human life over the last five decades. Timely information can be crucial to the success of businesses.

In adequate knowledge about or access to new technologies and know-how is a central concern for many enterprises. One of the best ways of promoting innovation is to ensure that individuals and firms benefit from the results of their research efforts.

VIRTUAL R&D TEAMS The use of teams has increased significantly as

organizations (both public and private) have turned more and more jobs over to team-based structures. Teams are now being used in innovative ways in strategic planning , flexible-jobbing initiatives , global networks , the horizontal organization, and the virtual organization.

VIRTUAL R&D TEAMS

Now,due to communication technology improvements and continued globalization, virtual teams have increased rapidly worldwide. With rare exceptions all organizational teams are virtual to some extent. Virtual teams are assumed to be part of normal business life. It is commonly agreed that virtual teams produce a greater quantity of ideas and information than individuals acting alone. So delaying with virtual team can bring new opportunity to facilitate technology creation and innovation in enterprises.

VIRTUAL R&D TEAMS

DEFINITION OF VIRTUAL TEAM : A summary of the definition of virtual team may be taken as : “small temporary groups of geographically, organizationally and/or time dispersed knowledge workers who coordinate their work predominantly with electronic information and communication technologies in order to accomplish one or more organization tasks”.

VIRTUAL R&D TEAMS Common Criteria Of Virtual Team

Characteristics of virtual team : • Geographically dispersed (over different time zones)• Driven by common purpose • Enabled by communication technologies• Involved in cross-boundary collaboration • It is not a permanent team• Small team size• Team member are knowledge workers• Team members may belong to different companies

VIRTUAL R&D TEAMSSome Of The Main Advantages Associated With Virtual Teaming

Reducing relocation time and costs, reduced travel costs Reducing time-to-market More effective R&D continuation decisions Able to tap selectively into center of excellence, using the best

talent regardless of location Greater productivity, shorter development times Greater degree of freedom to individuals involved with thedevelopment project Higher degree of cohesion Producing better outcomes and attract better employees Provide organizations with unprecedented level offlexibility and responsiveness Can manage the development and commercialization tasksquite well Organizations seeking to leverage scarce resources acrossgeographic and other boundaries…

VIRTUAL R&D TEAMS Respond quickly to changing business environments Sharing knowledge, experiences Enable organizations to respond faster to increased

competition Better team outcomes (quality, productivity, and

satisfaction) Most effective in making decisions Higher team effectiveness and efficiency Self-assessed performance and high performance Cultivating and managing creativity Improve the detail and precision of design activities Provide a vehicle for global collaboration and

coordination of R&D-related activities

VIRTUAL R&D TEAMS

This virtual team strategy has many advantages, but it presents its own set of managerial challenges; working online is less formalized, and companies frequently lack clear policies on how to manage virtually .

http://en.wikipedia.org/wiki/Virtual_team

VIRTUAL R&D TEAMS Here are 10 tips for managers to get the most out of

their virtual teams:

1- Be available

2-Organize regular meetings with both individuals and the whole team

3-Encourage informal conversations

4-Rotate

5-Be creative with team bonding

VIRTUAL R&D TEAMS

6-Treat time zones fairly

7- Prioritize cultural sensitivity

8-Invest in socializing pre-existing teams

9-Look for shared understanding when recruiting

10-Manage expectations

VIRTUAL R&D TEAMSSome Of The Main Disadvantages Associated With Virtual

Teaming Lack of physical interaction Challenges of project management are more related to the

distance between team members than to their cultural or language differences

Challenges of determining the appropriate task technology fit

Cultural and functional diversity in virtual teams lead to differences in the members’ thought processes. Develop trust among the members are challenging

Will create challenges and obstacles like technophobia (employees who are uncomfortable with computer and other telecommunications technologies)

Variety of practices (cultural and work process diversity) and employee mobility negatively impacted performance in virtual teams.

VIRTUAL R&D TEAMS

RESEARCH AND DEVELOPMENTNowadays, unpredictable economic

and business environment suggests that many firms seek new ways of conducting their business through some innovation to make a profit and stay ahead of the competition

R&D is a strategy for developing technologies that can be commercialized under independent intellectual property rights.

VIRTUAL R&D TEAMS

R&D enable firms to create new technologies and/or to build on existing technologies gained through technology transfer.

R&D efforts are necessary to realize various goals.

R&D is an endless process for any forward thinking technology based companies.

VIRTUAL R&D TEAMS Virtual R&D team is a form of a virtual team,

which includes the features of virtual teams and concentrates on R&D activities.

The members of a virtual R&D team utilize different degrees of communication technology to complete the research without space, time and organizational boundaries.

There is a general movement towards virtual R&D teams, as virtual R&D teams facilitate the spreading of risks and sharing or costs among a network of companies.

VIRTUAL R&D TEAMS

For most R&D teams, being virtual is a matter of degree in their case study of virtual team working in the European automotive industry have shown that enhanced communication and collaboration between geographically distributed engineers at automotive manufacturers and suppliers sites make them acquiring benefits in terms of quality, reduced costs and a reduction in the time-to market for a new product.

VIRTUAL R&D TEAMS

Five Trends in Organizing Virtual R&D Teams

1. Continued internationalization of R&D will further increase the importance of and reliance on virtual R&D teams.

2. Virtual R&D teams will better integrate talent in newly industrialized countries.

3. Advances in information and communication technologies will further enhance the functionality of virtual teams.

4. Relative costs of running virtual R&D projects will decrease due to learning curve effects.

5. Highly decentralized virtual R&D teams will gain importance in open system architectures such as internet-based applications

GLOBAL INNOVATION MANAGEMENT AND VIRTUAL R&D TEAMS

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