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In Search of Innovation: Exploring the Dynamics of Innovation
Halmstad University, School of Business, Engineering and Science, Centre for Innovation, Entrepreneurship and Learning Research (CIEL), Business Model Innovation (BMI). HMS Industrial Networks AB, Halmstad, Sweden.ORCID iD: 0000-0002-5892-7955
Halmstad University, School of Business, Engineering and Science, Centre for Innovation, Entrepreneurship and Learning Research (CIEL), Business Model Innovation (BMI).ORCID iD: 0000-0003-2111-5977
Halmstad University, School of Business, Engineering and Science, Centre for Innovation, Entrepreneurship and Learning Research (CIEL), Business Model Innovation (BMI).
2016 (English)In: International Journal of Social, Behavioral, Educational, Economic, Business and Industrial Engineering, ISSN 1307-6892, Vol. 10, no 1, p. 215-229, article id 280Article in journal (Refereed) Published
Abstract [en]

HMS Industrial Networks AB has been recognized as one of the most innovative companies in the industrial communication industry worldwide. The creation of their Anybus innovation during the 1990s contributed considerably to the company’s success. From inception, HMS’ employees were innovating for the purpose of creating new business (the creation phase). After the Anybus innovation, they began the process of internationalization (the commercialization phase), which in turn led them to concentrate on cost reduction, product quality, delivery precision, operational efficiency, and increasing growth (the growth phase). As a result of this transformation, performing new radical innovations have become more complicated.

The purpose of our research was to explore the dynamics of innovation at HMS from the aspect of key actors, activities, and events, over the three phases, in order to understand what led to the creation of their Anybus innovation, and why it has become increasingly challenging for HMS to create new radical innovations for the future.

Our research methodology was based on a longitudinal, retrospective study from the inception of HMS in 1988 to 2014, a single case study inspired by the grounded theory approach. We conducted 47 interviews and collected 1 024 historical documents for our research.

Our analysis has revealed that HMS’ success in creating the Anybus, and developing a successful business around the innovation, was based on three main capabilities – cultivating customer relations on different managerial and organizational levels, inspiring business relations, and balancing complementary human assets for the purpose of business creation.

The success of HMS has turned the management’s attention away from past activities of key actors, of their behavior, and how they influenced and stimulated the creation of radical innovations. Nowadays, they are rhetorically focusing on creativity and innovation. All the while, their real actions put emphasis on growth, cost reduction, product quality, delivery precision, operational efficiency, and moneymaking. In the process of becoming an international company, HMS gradually refocused. In so doing they became profitable and successful, but they also forgot what made them innovative in the first place. Fortunately, HMS’ management has come to realize that this is the case and they are now in search of recapturing innovation once again.

Our analysis indicates that HMS’ management is facing several barriers to innovation related path dependency and other lock-in phenomena. HMS’ management has been captured, trapped in their mindset and actions, by the success of the past. But now their future has to be secured, and they have come to realize that moneymaking is not everything. In recent years, HMS’ management have begun to search for innovation once more, in order to recapture their past capabilities for creating radical innovations. In order to unlock their managerial perceptions of customer needs and their counterinnovation driven activities and events, to utilize the full potential of their employees and capture the innovation opportunity for the future.

Place, publisher, year, edition, pages
2016. Vol. 10, no 1, p. 215-229, article id 280
Keywords [en]
Barriers to innovation, dynamics of innovation, in search of excellence and innovation, radical innovation
National Category
Business Administration
Identifiers
URN: urn:nbn:se:hh:diva-32668OAI: oai:DiVA.org:hh-32668DiVA, id: diva2:1055655
Conference
ICEID 2016: 18th International Conference on Entrepreneurship, Innovation and Development, London, United Kingdom, January 18-19, 2016
Available from: 2016-12-13 Created: 2016-12-13 Last updated: 2019-08-12Bibliographically approved
In thesis
1. Embedded Innovation: Exploring the Dynamics of Innovation
Open this publication in new window or tab >>Embedded Innovation: Exploring the Dynamics of Innovation
2019 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

For this dissertation I aimed to explore HMS Networks AB and how HMS managed to transform their potential ideas into innovations. My purpose was also to develop knowledge and understanding of the dynamics between exploration of new ideas and exploitation of old solutions, which can support HMS in developing future innovations. My research orientation thus led me to perform a longitudinal study to learn about HMS' past, present, and future, from the perspective of key actors, their performed activities, and how they were affected by different events in their process of creating innovation. My approach enabled me to learn how HMS managed to create their two Anybus® innovations in the past and what they did to become a market leader in the industrial communication industry. I also used a metaphorical perspective to understand how HMS created their two innovations in the past and what HMS could do to create more innovations in the future. I used an inductive and qualitative research approach substantially influenced by grounded theory to collect empirical data that were periodically and chronologically sorted and categorized for the study of key actors and how their activities and different events changed over time. I conceptualized the collected empirical data to discover latent social and psychological processes and behavioral aspects of people in their process of creating innovation. And through my analysis I constructed two main concepts - "embedded innovation" and the "dynamics of innovation" - to capture how companies co-exist in symbiosis and create a higher value together compared to what they can do on their own, to how companies survive long-term.

Embedded innovation mainly captures how companies, as organisms, struggle for survival within their (often turbulent) environment, and how they embed themselves with other organisms within their environment. Embedded innovation also focuses on capturing the needs of the different organisms within the environment, such as customer needs, employee needs, supplier and partner needs, as well as the need of the focal organization itself. Embedded innovation therefore considers the process of creating "innovation ecosystems" and performing "business model innovation" as instrumental techniques for embedding the different organisms in the environment with each other, which also makes the concept of "embeddedness" a central aspect for embedded innovation. The dynamics of innovation captures the difficulty of innovation over time and that the ever-changing environment expects its organisms (its companies and their employees) to balance the different dualities of organizational life, especially the two phases of diversification (the process of exploration) and focus (the process of exploitation). Consequently, learning how to balance between these two processes is of key importance for the organism's survival and for innovation.

The study of HMS was also complemented with a study of two other companies, namely Axis Communication AB and Sectra AB, in order to gain more knowledge on the dynamics of innovation from their perspective. A strategy for diversifying close to the knitting was also proposed, since the dynamics of innovation relies on this strategy, which offers a new perspective for managers on how to balance between exploration and exploitation. This dissertation therefore intertwines embedded innovation with the dynamics of innovation, by focusing on balancing between exploring new possibilities and exploiting old certainties for the creation of innovation.

Place, publisher, year, edition, pages
Halmstad: Halmstad University Press, 2019. p. 342
Series
Halmstad University Dissertations ; 59
Keywords
Embedded innovation, dynamics of innovation, diversification, exploration and exploitation
National Category
Business Administration
Identifiers
urn:nbn:se:hh:diva-40386 (URN)978-91-88749-26-0 (ISBN)978-91-88749-27-7 (ISBN)
Public defence
2019-09-06, O104, Linjegatan 12, 10:00 (English)
Opponent
Supervisors
Available from: 2019-08-12 Created: 2019-08-12 Last updated: 2019-09-11Bibliographically approved

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Lysek, MichalDanilovic, MikeLiu, Jasmine Lihua

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