Innovators and Integrators - Essay Example

Innovators and Integrators While it is clear that Intel is a technology innovator in the semiconductor industry, many analysts consider Dell to be atechnology integrator rather than an innovator. This matter is much more complex than we might think. It is true that most of the role for Dell is to be a simple integrator of technological innovations, but it is also valid to consider Dell as an innovator in the instance of marketing innovation. There are different types of innovation: "Scholars who have studied innovation generally differentiate among four main types of innovation: product innovation, process innovation, organizational innovation, and marketing innovation" (Wikipedia. "Innovation". 29 Sept. 2005). Besides this division into types, there is also another kind of classification of innovation depending on its impact on existing markets or businesses. So we also have sustaining innovations, disruptive innovations, incremental innovations, and radical innovations (Wikipedia. "Innovation". 29 Sept. 2005). Regarding the focus that keeps driving innovation forward we have that innovation is "mainly supply-pushed (based on new technological possibilities) or demand-led (based on social needs and market requirements)" (Wikipedia. "Innovation". 29 Sept. 2005). From this point of view we can see that Dell is a marketing innovator. Dell engages also in sustaining and incremental innovations as it doesn't look for radical or disruptive changes in the market or the process. And it is quite clear that Dell is a demand-led innovator as it focuses its efforts in satisfying the needs of the consumers or customers. We can learn about Dell's position regarding innovation in its corporate website. "Dell Direct Model" and its "Open Innovation and Effective R&D" approach are two distinctive examples of its involvement in technological innovation as a way of being creative in its business activities in the computer industry. Dell states the following in relation to its Direct Model: "With its singular focus on the customer, the model takes five basic tenets and creates a unique way of buying and selling technology. That not only sets Dell apart, it means that the customer experience is revolutionary. The five tenets of the model are: Most Efficient Path to the Customer (), Single Point of Accountability (), Build-to-Order (), Low-Cost Leader (), and Standards-Based Technology." (Dell, Inc. "Dell Direct Model". 1999-2005). This is mostly a marketing innovation model in the field of technology. But this model also has in mind the technology aspect in its fifth tenet as it procures to produce "standards-based technology". That way Dell cares about the kind of technology being developed. Its compromise goes to favor open technological solutions. Regarding its approach to innovation and R&D its position is also expressed in simple terms that give us an idea of the relevance of innovation in Dell's schemes of doing business. Dell says the following in its corporate website about its "Open Innovation and Effective R&D" method: "Dell's approach to innovation allows Dell to influence industry technology and product directions. Dell-developed customer requirements are shared with the industry through technology and product direction discussions with strategic partners such as Intel, Microsoft, Oracle, and EMC. Often, the requirements are also driven through open industry standards. In this way, the entire industry benefits from Dell's insights." (Dell, Inc. "Open Innovation and Effective R&D". 1999-2005). Dell's approach to technology innovation helps in the development of new products indirectly as those products are made possible by Intel, Microsoft, Oracle, and EMC in a direct way. So Dell is a technological facilitator. In other words, Dell is a technology integrator who refuses to assume the role of technology innovator on a full time basis. All this looks fine and orderly, but many analysts disagree with Dell when it comes to giving their opinions about Dell's role at innovating in the computer industry. They want Dell to be a product innovator, so they don't value too much the function of Dell as a marketing innovator. One of those analysts is Fred Dunn. He shows himself to be very critical against Dell. Let's see: "Read Intel's product roadmap and you are reading Dell's roadmap. Dell used to provide quality, now they just provide commodity items. () For enterprise customers their only attraction is their system configuration stability (lifetime) but even that has changed. Dell has been relegated to selling other's innovation and even products." (Dunn, Fred. 24 Feb. 2005). That is a very bitter critique to Dell. But it is not the only one. Peter Burrows seems to be much more realistic when it comes to express his opinions about Dell. He is really worried about technology innovation. That's quite fine. All of us have to take into account the importance of technology innovation. Peter Burrows has a wider perspective on Dell's role in relation to innovation. He says: "Even Dell can't prosper for long without innovation. The company spends most of its R&D budget honing its superefficient manufacturing and distribution processes to make them better. But Dell also is working on computer designs that string together hordes of Intel chips to deliver supercomputer power. () As for talk about high tech being mature, TRIPS researcher Moore refuses to believe today's off-the-shelf servers are the final stop in the computer's evolution. "The economic reality of commoditization is undeniable, and if you don't recognize it, you get slaughtered," he says. But if there are no innovations, he points out, there will be nothing left to commoditize." (Burrows, Peter. 23 June 2003). Innovation is a must. It's necessary to move forward, so Burrows is right on his assertions. Without innovation, there is no advance in technology and science. The importance of creativity is immense when it comes to deal with innovation. But it is important to notice that Dell is also a process innovator according to Burrows' assertions. So Dell is playing a relevant role in process and marketing innovations. In an interview to Dell's Chief Technology Officer in Computer World's Q&A section by Robert L. Mitchell the CTO's statements prove once again the reality that Dell has played its role of technology innovation in a very discreet manner. Robert L. Mitchell says the following, recognizing that Dell has been a marketing innovator: "Dell Inc.'s success is usually chalked up to its marketing savvy rather than innovative technology. Chief Technology Officer Kevin Kettler says, however, that the company has played a pivotal role behind the scenes, helping to shape emerging technologies to meet customer needs." (Mitchell, Robert L. 9 May 2005). In other words, Dell has been a facilitator rather than a technology innovator. Or we can say that it has been an integrator. But this is related to its role as a product innovator, because it is clear that Dell has been a marketing innovator. We have to keep in mind that for a technology to be successful it needs to be marketed successfully. That's what Dell does best. So there is a real contribution to technology innovation through marketing innovation. Also the process innovation is very important and necessary as well as organizational innovation. We need innovation in all the areas where creativity can be implemented. The United Kingdom Department of Trade and Industry's "Innovation Report" states the following about innovation: "We define innovation as "the successful exploitation of new ideas. Often it involves new technologies or technological applications. Innovation matters because it can deliver better products and services, new, cleaner and more efficient production processes and improved business models." (Department of Trade and Industry (DTI), "Innovation Report" 17 Dec. 2003). This definition of innovation is very helpful to guide us in the understanding of the importance of innovation in all areas of technology and science. This "Innovation Report" is very informative and gives us some relevant ideas about the importance of innovation in the present time. There are three main reasons for the necessity of innovation now, and the "Innovation Report" is very clear about those points. Let's see: "Today, there are three reasons why innovation is even more urgent for companies and countries: trade liberalization and a rapid fall in communication and transport costs() technology and scientific understanding are changing our world faster than ever before. Developments in Information and Communications Technologies (ICT), new materials, biotechnology, new fuels and nanotechnology are unleashing new waves of innovation, and creating many opportunities for entrepreneurial businesses to gain competitive advantage; and global communications, the 24 hours, 7 days of the week media phenomenon of the 21st century, mean that consumer tastes are also changing faster, as new fashions, ideas and products spread across the world almost instantaneously." (Department of Trade and Industry (DTI), "Innovation Report" 17 Dec. 2003). As we can see, innovation is a matter that must interest everybody in our present society, not only locally, but globally. We have to consider all these aspects of innovation when dealing with Dell's role as an innovator or as an integrator of technology. Without marketing and process innovations, there cannot be a widespread use of the new technologies. So Dell is playing its function, and Dell is aware of it. Dell knows that its role is to be a marketing innovator, or even a process innovator, or an organizational innovator. Dell is quite clear that they are not product innovators even though they are facilitators or integrators when it comes to technology innovation. This idea is stated in Frank Boosman's article about Dell position on innovation. Boosman gives us some insider's story as follows: "A former colleague of mine once visited Dell to discuss potential non-PC products. Dell had devoted a great deal of thought to the matter, and held many meetings on the topic, but in the end, their response -- as quoted by my colleague -- was, "We take the best technology from Intel and Microsoft, then package and ship it to our customers." That's the Dell model, and given that it has made them the most successful PC maker in the world, the idea that they would change at this point is almost laughable." (Boosman, Frank. 17 Aug. 2002). So we ask ourselves, why innovation Why does Dell need to be innovative regarding technological products when they are doing very well as marketing and process innovators And it is clear that Dell is not going after disruptive and radical innovations. Dell goes forward after sustaining and incremental innovations which are more conservative models of innovation. Dell is not Xerox, which is a company with a solid background on innovation. At Xerox, innovation is part of its tradition. It is a way of living. It is a way of breathing. Just by reading one of the brochures by the Xerox Innovation Group, we get the idea of the importance of innovation for Xerox. Let's see: "The Xerox Innovation Group explores the unknown, invents next-generation technology, architects product platforms, manages intellectual property, and creates new business opportunities through its research centers and associated operations. It includes 1,100 researchers, scientists, engineers, patent and IP experts, and business development managers. Xerox concentrates on R&D in key areas: marking systems, materials, digital imaging and solutions and services" (Xerox. "About Xerox Innovation". 29 Sept. 2005). Dell is not Xerox. Dell is a process and marketing innovator, not a product or technology innovator. We have to keep this clearly fixed in our minds when dealing with this matter. Dell is not going to change as it is successful applying its marketing machinery as a top-of-the-line PC-maker. Dell's contributions are going to come from the marketing field, not really from the technological area. Dell is not Xerox, and we have to accept it that way. Dell is an integrator and facilitator of technology in the same manner that Intel is a technology innovator in need of Dell for the marketing of its technological innovations. They need each other, and there is nothing wrong about it. Works Cited Boosman, Frank. "Innovation at Dell". (17 Aug. 2002). Pseudorandom. 29 Sept. 2005. . Burrows, Peter. "Innovation, Lego-Style". Business Week. 23 June 2003. (29 Sept. 2005). . Dell, Inc. Dell Direct Model. (1999-2005). 29 Sept. 2005. . Dell, Inc. "Open Innovation and Effective R&D". (1999-2005). 29 Sept. 2005. . Department of Trade and Industry (DTI), (United Kingdom). "Innovation Report - Competing in the Global Economy: the Innovation Challenge." (17 Dec. 2003). 29 Sept. 2005. . Dunn, Fred. "Dell is an Intel Drone, No Innovation at all." (24 Feb. 2005). News.Com. C/NET. 29 Sept. 2005. . Mitchell, Robert L. Q&A: Dell's CTO on Unconventional Innovation. (9 May 2005). ComputerWorld. 29 Sept. 2005. . Wikipedia. "Innovation". (29 Sept. 2005). 29 Sept. 2005. . Xerox. "About Xerox Innovation". 29 Sept. 2005. . Read More