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Managing Innovation and Entrepreneurship

  • by admin
  • Course level: Expert
  • Categories Business
  • Duration 12h
  • Total Enrolled 0
  • Last Update October 4, 2019

About Course

This course discusses the basics every manager needs to organize successful technology-driven innovation in both entrepreneurial and established firms.


Fiona Murray. 15.351 Managing Innovation and Entrepreneurship. Spring 2008. Massachusetts Institute of Technology: MIT OpenCourseWare, https://ocw.mit.edu. License: Creative Commons BY-NC-SA.


This course discusses the basics every manager needs to organize successful technology-driven innovation in both entrepreneurial and established firms. We start by examining innovation-based strategies as a source of competitive advantage and then examine how to build organizations that excel at identifying, building and commercializing technological innovations. Major topics include how the innovation process works; creating an organizational environment that rewards innovation and entrepreneurship; designing appropriate innovation processes (e.g. stage-gate, portfolio management); organizing to take advantage of internal and external sources of innovation; and structuring entrepreneurial and established organizations for effective innovation. The course examines how entrepreneurs can shape their firms so that they continuously build and commercialize valuable innovations. Many of the examples also focus on how established firms can become more entrepreneurial in their approach to innovation.

Technological innovation is increasingly the source of sustainable competitive advantage for firms around the world. However, building an organization to successfully and repeatedly bring technological innovations to market is a daunting managerial challenge. In this course we focus on the practices and processes that managers use to manage innovation effectively. Over the semester we will examine four aspects of technological innovation: exploring, executing, leveraging and renewing innovation. Our focus will be on entrepreneurial firms (new and established) and on firms that have been successful and unsuccessful in their innovation.

15.351 is designed to provide both a deep grounding in the field of technological innovation for managers and entrepreneurs whose goal is to play a leading role in innovation-driven firms. The course combines lectures, case analyses, visiting experts and student presentations. The readings are drawn from research in the management of technological innovation and technology-based entrepreneurship as well as from economics and organizational theory. The cases provide an extensive opportunity to integrate and apply these tools in a practical, business context, and draw from a wide variety of firms and industries: established and entrepreneurial, mainly from high technology and many originating at MIT.

The material moves deliberately between strategic issues (what should you do?) and organizational and managerial issues (how should you get it done?), though the focus of the course is more on examples of process and implementation. The course design is grounded in the belief is that it is particularly dangerous to separate strategy from implementation (the “why” from the “how”) when innovation is the issue because having a great idea is worth little or nothing if a firm cannot figure out how to commercialize or monetize that idea.

Innovation management can include a variety of topics; here are three clarifications about the approach we will take in this course: First, we will approach innovation issues from the entrepreneur and manager’s perspective. While most firms have specialized R&D, other functions must all interface with R&D. Indeed, building an organization that can continuously generate and commercialize innovations is one of the core concerns of top management. Thus any leader should be conversant with the leading thinking on innovation and should not leave this challenge to the R&D function alone. Second, this course will approach the management of innovation from a strategic perspective. As such, we will consider the relationship between processes and structures for innovation in firms, the strategies for exploitation and the environment in which these must be designed e.g., competition, rate of technological change, sources of innovation.

Readings, assignments, and cases will be used to highlight issues and problems that face leaders as they create and implement processes, structures and strategies to strategically manage their technological innovation. By completion of the course, you will have:

  1. A familiarity with current topics in strategic innovation management, such as innovation networks, idea brokering, open innovation;
  2. A familiarity with innovation processes and structures such as R&D team and incentive design, R&D portfolio management, idea generation processes, the pros and cons of various R&D organizational structures, and the challenges of innovation in large and small firms;
  3. An understanding of the strategies most effective for exploiting innovations;
  4. The ability to apply these concepts directly to real world situations;
  5. Skills to identify, evaluate, and resolve a variety of issues relating to poor innovative performance in large firms as well as entrepreneurial firms.

To achieve these goals the course is divided into four modules. The first three modules cover the following three areas: exploring, executing and exploiting innovations. The fourth module is renewing innovation and examines how established firms re-energize their exploration, execution and exploitation practices to renew the innovation base of their firm:

  1. Module 1 – Exploring innovations — the processes used to explore innovations along the technology, market and strategy dimensions as the innovation moves from idea to market.
  2. Module 2 – Executing innovations — the structures and incentives organizations must put into place to effectively allow talented individuals (from different functions) to execute innovation processes.
  3. Module 3 – Exploiting innovations — the strategies that a firm must consider to most effectively exploit the value of their innovation, including innovation platforms that incorporate multiple product options, portfolios and standards.
  4. Module 4 – Renewing innovations — the processes, structures and strategies for exploring, executing and exploiting innovations that established firms can use to renew their innovation foundations in the face of potentially disruptive innovations.

What Will I Learn?

  • Familiarity with strategic innovation management Innovation networks, idea brokering, open innovation;
  • Familiarity with innovation processes and structures
  • R&D team and incentive design
  • R&D portfolio management
  • Idea generation processes
  • The pros and cons of R&D organizational structures
  • Learn strategies most effective for exploiting innovations;
  • Ability to apply concepts directly to real world situations;
  • Skills to identify, evaluate, and resolve a issues

Topics for this course

14 Lessons12h

Dynamics of technological innovation?

1. Make a list of those factors which you believe are most important in determining the rate at which technology improves. 2. In what ways are radical and incremental technological change really different? 3. What are the managerial implications of the technology dynamic described by Foster as the S curve? 4. How did diaper technology evolve? Does it fit the models outlined by Foster?
Technology Dynamics

Industrial implications of technological innovation?

Dynamics of markets for technological innovation 1. How do markets evolve? 2. How does technological change shape and connect to market evolution?

Competitive implications of market and technology dynamics?

1. How do market and technology evolution provide opportunities for entrepreneurs? 2. What types of changes in competition are driven by technological and market dynamics? 3. Is disruption a useful way to think about these dynamics? What does it really mean – what is the definition that Christensen uses? How is it different from the idea of radical innovation? 4. Why do some of these opportunities lead to a wave of successful start-ups, for example the hard disk drive industry analyzed by Christensen, while others, such as the TV opportunity that Gladwell describes (The Televisionary) lead to failed entrepreneurship?

Systematizing innovation; “What’s the Big Idea;” IDEO?

1. Is innovation about individuals or groups? 2. Do you think it is possible to build an organization to systematically come up with new innovations? What processes would it need to have? 3. Referring to the case, why does BIG seem better able to identify and bring to market innovative toy concepts, whereas the major toy companies feel they are in a period of a "lack of innovation" (p. 3)? 4. How proprietary or defensible is BIG's system? Could one of the major toy companies replicate it? Why or why not? 5. Can BIG replicate its system in other industries such as your own?

Scoping technology: Advanced Inhalation Research?

1. When a new idea is generated what are the actions required to turn it into an innovation? 2. How can experiments help with this refinement of an idea into an innovation? 3. What does it mean to have an experimentation strategy? What did this mean for Advanced Inhalation Research and for Bank of America? 4. What experiments did they undertake at AIR and what was the purpose of each one? As an investor in AIR, are these the experiments you would have wanted the firm to do with your money? If not why not?


No lesson today. Teams work on assignment #1

Iterating design: team New Zealand?

1. How would you evaluate Team New Zealand's use of simulation technology in its development process? What are its advantages and disadvantages? How did Team New Zealand's approach differ from that used by other syndicates? 2. Decision point: Which of the three yacht construction strategies should Team New Zealand follow? (a) One boat now, one boat later? (b) Two identical boats now? (c) Or two different boats now? Why? How much improvement would you expect from each strategy? 3. When you cannot build prototypes can you still experiment and iterate with design? If so how?

Experimenting with markets: innovation at 3M?

innovation at 3M 1. How does the Lead User research process differ from and complement other traditional market research methods? What about prediction markets? 2. How has 3M's innovation process evolved since the company was founded? Why, if at all, does 3M, known as a "hothouse" of innovation, need to regain its historic closeness to the customer? 3. Has the Medical-Surgical team applied the Lead User research process successfully? Why or why not? 4. Decision Point: What should the Medical-Surgical Lead User team recommend to Dunlop: the three new product concepts or a new business strategy? What are the risks to the new Lead User process at 3M? What are the risks to the Medical-Surgical business unit?

Capstone: Iridium?

1. Who was to blame for Iridium's failure? At what point could you have known Iridium would fail? 2. What is your evaluation of Iridium's system design? What impact did the choices that were made have on the subsequent evolution of the venture? 3. What is your evaluation of Iridium's organizational design? What changes would you have made to increase the probability of a successful outcome? 4. What general lessons does Iridium provide for ventures seeking to develop technology intensive products or services?

Organizing innovation teams: ‘The Bakeoff’?

1. How does team organization impact the innovation process? 2. How did the groups in the Bakeoff differ their approach to innovation and development? 3. Under what circumstances would you prefer each type of team? 4. How do the different modes of organizing innovation map to Wheelwright and Clark's typology for project teams? When are their teams more likely to be effective?

Organizing flexible processes; ‘Internet Time’ exercise?

1. What are the similarities and differences in the four approaches to organizing innovation described in "Living on Internet Time?" What drives these differences? 2. Which process is superior? Which company would you prefer to work for? Which processes have you experienced? What are their pros and cons? 3. What lessons from the Internet environment can be applied to other industries (e.g. cars, fashion, consumer goods)?

Incentivizing and organizing innovators: GSK?

1. What are the challenges that pharmaceutical drug developers face providing incentives for their employees (especially scientists)? 2. How does Yamada's proposed Center of Excellence for Drug Discovery (CEDD) structure different from the traditional organizational arrangements found in the pharmaceutical industry? 3. Does this structure provide greater incentives for innovation? Are the incentives similar or different from those found in a biotech firm? If you were a talented scientist where would you prefer to work?

Organizing innovation between firms and communities; One Laptop Per Child, innovation communities (Visitor: Mako Hill)?

1. Innovation seems to be moving into the hands of communities. Please find and come prepared to describe one such community. Who are they? How do they coordinate their innovation activities? Who can make money in the community (if anyone)? Why do people participate? 2. What are the challenges for One Laptop Per Child in getting the open source community to collaborate? 3. Can they learn anything from IBM's experience with the open source community developing Linux?

Incentivizing and organizing external innovators: D-Wave?

1. What is D-Wave/P&G trying to achieve through the use of its 'distributed' innovation network? Under what conditions would you use each of the models proposed by P&G, D-Wave etc.? 2. Are incentives important for innovators and innovation? What types of people are driven by what types of incentives? Why do public scientists choose to work with D-Wave, handing over their IP rights? Should D-Wave offer equity to the scientists? 3. Under what circumstances should D-Wave consider bringing at least some of the scientific talent in house?

Negotiation innovation work between firms and academia (SpudSpy & negotiation exercise)?

1. What went wrong at SpudSpy? Why are Anderson and Huang so upset? Should they be? Can this project be salvaged? 2. Does it make sense to you that there is "Gold in the Ivory Tower?" Should this be encouraged?

Assignment #2?

No class; time for project work

Dynamics of the market for ideas; designing the value chain?

1. Effective commercialization strategy must be based on a clear understanding of the drivers of commercialization. What are these drivers? 2. How do different industries and sectors differ in terms of commercialization environment and strategy?

Leveraging portfolio development: A123 (Visitor: Ric Fulop, Founder A123 Systems)?

1. The technology developed by Professor Chiang allows A123 to develop a wide portfolio of products. Which products should they develop? 2. What is the right business model for A123; which markets and customers will be the initial focus; which portfolio of projects will be provide early success and a platform for the future? 3. Should they develop a new technology platform or build a portfolio on the basis of their core portfolio?

Capstone: leveraging platforms in online video gaming (Visitor: Cyrus Beagly, Sloan ’02)?

1. What is a technology platform? How can it form the basis of a successful innovation strategy? 2. What is the role of platforms in on-line gaming? What are the different choices that firms face when using their platform as the basis for their commercialization strategy? 3. Can you sustain a platform approach when you use external innovators, particularly on-line game developers? 4. Find one example of an on-line gaming company – what is their commercialization approach and how do they use external developers?

Portfolio management processes: le Petit Chef?

1. What are the particular challenges of managing platforms and portfolios? What in your experience are the organizational issues? 2. Does the Aggregate Project Plan presented by Wheelwright and Clark address your concerns? 3. What is wrong with the current portfolio at le Petit Chef? What should Gagne do? Specifically, which projects should she fund and why? How should she handle the executive meeting? Please be sure to do your own calculations for this analysis. 4. What factors explain le Petit Chef's poor performance? What actions would you recommend to remedy the situation?

Internal vs. external sources of renewal: Intel?

1. Should firms try and renew their foundational innovations? Should they try and develop radical and incremental innovations? 2. Does Tennenhouse's approach to designing an exploratory research organization solve the problem of disruption? How is it better than the traditional R&D laboratory approach pioneered by Xerox, IBM and AT&T? 3. What are its main elements of the Intel Lablet program? How do these elements work together? How could its design be improved? 4. Should Intel fund projects like PlanetLab and Sensor Networks? How do they generate value?

Renewing innovation; corporate venturing; IBM Alphaworks?

1. What are the different models of corporate entrepreneurship that have been used? What are they elements and under what conditions would each be most effective? 2. Does the Xerox model of Inxight seem appropriate?

Renewing innovation; internal venturing; GE imagination breakthroughs?

1. One alternative to corporate venturing is to attempt to reinvent the corporate from within, as Immelt has attempted in the GE Imagination initiative. Is this likely to succeed? Under what conditions would you use this model rather than a venturing/entrepreneurship model? 2. Decision point: Should the leadership of the Transportation division support the hybrid Locomotive initiative?



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The course is extraordinary!!

It explains everything from A to Z regarding Nutrition and also there are some very valuable workout tips.

Great job!

Absolutely fantastic!! Thanks so, so much Felix for your concise, practically useful and well informed course.


Material Includes

  • Selected Lecture Notes


  • This is a case-based course. The primary reading material for most sessions is a case study. Often there will be additional readings associated with a session. These readings provide some conceptual frameworks that may help you in your case analysis. These readings come from a number of different sources (including academic research articles, short articles from both popular and business presses, and case studies) and have been carefully chosen to reflect a variety of perspectives and stimulate your thinking. Not all class materials will be discussed to the same extent.

Target Audience

  • Anyone wanting to learn the truth about entrepreneurship & innovation
  • Anyone with an open mind towards innovation