Managing Innovation Technology - Term Paper Example

     There are generally two types of innovation. The first and most common is market-led or market-push innovation, where market research or other processes identify a need and the innovation process is directed towards meeting it. This could range from solving a major technological problem through a significant research programme, to simply making some minor improvements to an existing product (IPENZ 2).  One example of this type of innovation is a portable MP3 player.

  This is basically an improvement on the compact disc player.  This was market-led as there was an increasing need by the market to have this device, due to the increasing availability of downloadable files, coupled with the relatively low cost.  The second is technology-led innovation. This is where a technological breakthrough, often arising from market-led innovation in another sector, creates an opportunity for a new product or service, but one that the market itself has not yet recognized.

A market then needs to be developed for this innovation (IPENZ 2).  An example of this type of innovation would include the in-house stereo system that is being introduced on the new housing estates in the UK.  This involves speakers built into ceilings in all rooms of the house, with the main radio control center in a central location.  This means the occupants of the household, can listen to their favorite radio station, music or television programme without having to take the radio or television with them.

  In terms of the service sector, innovation would include applications such as the Pay Pal payment system, which is an online payment system or even online banking.   For innovation to be successful it has to fulfill a number of factors.  It has to have market value and to achieve this there needs to be a close link with the marketing process.   There is no point in producing products if the market does not value the innovation.  The innovation must be unique and protected in order to prevent competitors from making any gains on it.