How the Aspects of the Innovation System Affect Innovation and Commercialization - Essay Example

?BUSINESS AND GOVERNMENT Using the article (analyzing functional dynamics of technological innovation systems) plus any other sources choose a location (city, county, region, or country), describe this location’s innovation system, and discuss how the aspects of the innovation system affect innovation and commercialization. The country of study is the United States of America. The innovation System approach to innovation is a more appropriate basis for policy action. National and regional institutions as well as international bodies have adopted the system method as an approach for economic growth. In order to understand the effectiveness of the system approach to innovation, it is significant to review how this system has led to strengthening of innovation in the United States of America. Innovation in the Unites States of America can be viewed as a role of free access to markets, capital, human resources, macroeconomic environment, and industrial structure (Bergek et al 2008, p 408). The Function approach has been used by policy makers in the United States, which in turn has strengthened the tendency of innovation system perspective to open up richer and more difficult innovation policies. In addition, policymakers also use the innovation system approach to define process goals of their interventions in terms of a changed functional pattern in industrial operation. They have done this by explaining the nature of these processes in terms of the outcome of a balance between various inducements and blocking mechanisms. The approach is applied to identify the key policy challenges that exist. The components of the innovation system are networks, institutions, and actors who contribute to the function of diffusing, developing, and utilizing new products and processes. Although the system calls for collective actions and coordinated action, an innovation system approach is analytical in nature in the sense that it does not focus on how to exist as fully-fledged system. For instance, access to capital is very essential to commercializing output. Some areas in the US have taken longer periods to bring new items to market. Due to this, the availability of funds to fund the commercialization of new technologies is very essential in determining the performance of the business. In addition, the industrial structure in the United States has provided competitive environment where technological innovations can operate. Further, development is often linked with availability of technology developers whose role is to drive development by providing required technologies, resources, markets, and applications. Most industries innovate and improve on new products in order to be competitive. The level of resource mobilization in the United States is strong since it has managed to mobilize human capital through education and training in specific scientific and technological disciplines as well as entrepreneurial, finance and management. There is an association between industries and educational institutions whereby educational institutions offer educational programs that prepare students to venture into business by developing stronger association to the industrial sector via internships, cooperation, and research projects (Bergek et al 2008, p 410). The importance of innovation and diffusion process recommends the generation of positive external economies, which is a key process in the formation, and growth of business. The feature of United States markets and marketing potential has influenced the innovation and diffusion of its business. For instance, it has access to regional, local, and international markets in which it can sell its products. The nature of technological innovation changes with time so as the nature of industrial products and services in that industries and factories manufacture new products based on new and enhanced technology. Therefore, in order for commercialization to be successful like it is in the United States, it is vital to create a conducive surrounding to innovation and require industrial infrastructure. 2. Using the two articles above plus any other sources, choose an industry and discuss how technological innovation and industry dynamics have influenced its emergence (innovation and the dynamics and evolution of industries: a discovery driven approach, Toyota company). Industrial dynamics has expanded to include the market structure and evolution. Innovation is the key aspect affecting the dynamics and evolution of industries, which is the result of the interaction of different actors that have a collaborative relationship (Melarba 200, p 669). For instance, Toyota company has a positive corporate image in that it work with universities, schools and colleges to support programs that help people, and the company at large. It has employed workers all over the world with diverse cultures and knowledge that help run the company. The idea of business model is significant because it suggests a transformation in the manner that strategies are created, conceived, and executed. The long-term dynamics of Toyota Company is an example of an industry that has favored innovation and radical change. For instance, it embarked on manufacturing environmental friendly vehicles to avoid producing cars that polluted the environment. The dynamic of the market structure provides new ideas and knowledge for Toyota Company. The evolution and growth of Toyota company can be attributed to the fact that it followed a life cycle in which a radical innovation and the related entry of new car manufacturers that introduced new car models due to growth in demand, therefore, Toyota concentrated on greater emphasis of process of innovation and selection to avoid the crowded market. Contemporary market is uncertain, complex, and fast moving, firm’s strategies are as much as insight, experimentation, and execution. For instance, Toyota company has been innovative in order to reduce costs, guard, and sustain competitive advantage. Further, the Company has implemented lean manufacturing, internet marketing, and production technology and customer relationship as a strategy to cope with the changing environment. As part of its innovation strategy, the Company spent millions of dollars on research and development in order to come up with new technologies that its competitors lack. This has made them come up with good cars that are economical and environment friendly. Since the company wants to be in the market for the next 100 years, it started working on new car models such as Prius in 1991 as part of their plan to manufacture hybrid cars. They knew that at one time, the world will run out of oil and therefore, they emphasized on manufacturing long lasting cars rather than quick returns from investment. From business model analysis, it is sensible to realize what managers at Toyota Company did in order to increase their competitive advantage over their competitors. Firms like Toyota need to find a differentiated and defensible position within an industry and execute relentlessly against that position (McGrath 2010, p 248). This argument is evident in the operation of Toyota Company whereby they focus on continuous improvement in their product manufacture by producing high quality products that are liked by people from all corners of the world. These products are available for less money as compared to their competitors who manufacture expensive cars. For Toyota, building cars that are more effective did not necessarily mean harnessing more profits but to them it was better to make savings in the assembly lines by making customers pay less. The company’s innovative ability is credible since it is focused on producing quality cars that are economical and friendly to the environment. References Bergek, A, Jacobson, S & Carlsson, B 2008, Analyzing the functional dynamics of technological Innovation systems: A system of analysis, Research policy, 37, 407-429. Malerba, F 2007, Innovation and the dynamics and evolution of industries: Progress and challenges, International Journal of industrial organization 25, 675-699. McGrath, R.G 2010, Business Models: A discovery driven approach, Long range planning 43, 247-261 Read More