Hans Georg Gemuenden

Exploring How Lead Users Develop Radical Innovation: Opportunity Recognition and Exploitation in the Field of Medical Equipment Technology

In this paper, we explore how lead users develop radical innovations outside of manufacturing firms. We analyze the transition from a very early stage of activities to the ultimate commercialization of these innovations. The focus in this context is on the initiatives undertaken by lead users in order to transform their radically new solutions into functional prototypes, and then, to convince established manufacturers of the technological and market potential of their innovations. Using a comparative case study design in the high-tech field of medical equipment technology, we find that individual lead users as surgeons launch entrepreneurial activities and bridge periods in which established medical equipment manufacturers would not risk investing in radical innovations. By doing so, lead users create the conditions usually provided in manufacturer-initiated lead user projects, including the supply of diversified knowledge, the development and coordination of a network for further development of the innovation, and initial tests of technical or market feasibility. Our findings have implications for manufacturing firms that wish to design radical innovation projects with (individual) lead users and for research on new forms of lead user cooperation and integration.

Learning from users for radical innovation

In todays environment of rapid technological change companies can not rely on incremental innovations alone. To sustain long-term competitiveness companies need to develop radical innovations as well. Such innovations typically incorporate new and highly complex technologies, create new markets or shift existing market structures, and require user learning as they often induce significant behaviour changes on side of the users. To systematically develop radical innovations firms need to involve the proper actors. One such important external actor in the development process of new products is the user. Our study focuses on the question what kind of users are able to actively contribute to the development of radical innovations and what firms can learn from them to improve their innovative capability. A multiple case study analysis was conducted in the field of medical technology. Five radical innovation projects were selected including medical robots and computer-assisted navigation systems. The case study analysis reveals that users with a unique set of characteristics can contribute substantially to the development of radical innovations. These users have a high motivation toward new solutions, are open to new technologies, possess diverse competencies, and are embedded into a very supportive context. Manufacturers that took over the ideas and prototypes of the inventive users benefited significantly. By learning from these users, firms were able to significantly improve their radical innovative capability. The paper contributes to technology and innovation management research in two ways. First, by exploring critical user characteristics for distinct phases of the radical innovation process, we provide first insights how manufacturing firms can more effectively identify and leverage valuable users for their radical innovation work. Thereby, we highlight the involvement of capable users as an effective learning mechanism to improve the radical innovation capability of a firm. Second, new perspectives on lead user research are provided by enriching the lead user concept with other crucial characteristics of innovative users.

Financial Management Competence of Founding Teams and Growth of New Technology-Based Firms

This article draws on the resource–based view to analyze the role founding teams’ financial management competencies play for firm growth. Prior research stressed the importance of acquiring external financial resources. In this study, we broaden the understanding of financial management in new firms. We explore the relevance of strategic financial planning competence, external financing competence, competence in financing from cash flow, and controlling competence of entrepreneurial teams for the growth of new technology–based firms. A total of 212 founding teams provided self–assessments of their financial management competencies at start–up. We apply the partial least squares approach to determine the effects of the different financial management competencies on firm growth.

ORGANIZATIONAL BENEFITS OF COMMUNITIES OF PRACTICE: A TWO-STAGE INFORMATION PROCESSING MODEL

The concept of Communities of Practice (CoPs) has been recognized as a means to foster knowledge sharing and learning in organizations. In this article, we first address the challenge of measuring the value of CoPs. Second, we develop and test a two-stage information processing model including information generation through CoP participation and information processing into the organization. An enhanced network position of CoP-members in relation to the primary organization is identified as a critical means to facilitate information processing. We analyze data from 222 community members from different communities of a multinational company, using partial least square structural equations modeling.