UNSW Business School
Week 1: Introduction to MARK5813
Agenda:
• Course overview (structure, weekly schedule, engagement opportunities, assessments)
• Readings and case studies
• New product development, innovation, and marketing/management strategy
Course Overview:
Teaching team:
Lecturer in Charge: Professor Tania Bucic
Tutor: Mr Balu Varghese (weeks 2-5, 7-9; personal consultation available in Week 6)
Tutor: Mr Stephen Enemark (weeks 2-5, 7-9; personal consultation available in Week 6)
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Course Overview:
Teaching team:
Lecturer in Charge: Professor Tania Bucic
Tutor: Mr Balu Varghese (weeks 2-5, 7-9; personal consultation available in Week 6)
Tutor: Mr Stephen Enemark (weeks 2-5, 7-9; personal consultation available in Week 6)
Structure:
Lecture – 2 hours per week. This will comprise and live (synchronous) discussion with Lecturer on
set readings as well as at times, recorded material (asynchronous). Lectures will be offered in
Weeks 1-5, 7-10 (9 in total)
Tutorial – Focus on critical discussion of set case study material. Weeks 2-5, 7-9 (7 in total)
Weekly schedule: See course outline and Moodle
Engagement and learning opportunities:
Synchronous (lecture discussion and review + tutorials) and asynchronous (recorded lecture
material + set readings + set case studies).
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Assessment: MARK5813 in T1 2023
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Readings and Case Studies
• No textbook
• Linked pivotal readings in innovation research
• Linked pivotal case studies for critical discussion in tutorials
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Moodle – where to find useful things
(tour)
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What is Innovation?
Innovation:
• For 2,500 years it was not concerned with economics in a positive sense
• Has been contested over many centuries in politics, social affairs, religion and philosophy
• Is now largely decontested and ubiquitous because of its contribution to economic progress but this
quite new (100 years)
• Seismic shift from being a vice to a virtue; an instrument for driving positive change and achieving
social and political goals
(Benoit Godin, 2015)
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Domain of innovation?
Is there a “theory of innovation”?
• To which domain does innovation belong?
Is there a process of innovation?
• No accepted standard process.
Are most innovations successful?
• What is the success rate of innovations?
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Domain of innovation?
Is there a “theory of innovation”?
• To which domain does innovation belong?
– “Innovation is far to important to be let to scientists and technologists, It is also far too important to be left to
economics and social scientists” (Freeman, The Economics of Industrial Innovation, 1974: 309)
Is there a process of innovation?
• No accepted standard process.
– But many frameworks, models and ideas across disciplines.
Are most innovations successful?
• What is the success rate of innovations?
– About >3% for radical innovations
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The path toward defining innovation
• “anything that the nation has not been used to” (Clarendon 1702: 71)
• Change, reformation, innovation, revolution (in order of semantic hierarchy/ ordering of
significance of words) (Freeden, 2011)
– Change: prior to the 19th century, definitions focused on the innovator (individual
change agent; ie the “introducer” of the change. That is it was focused on the “act of
innovating”). From 19th century, innovation was also presented in concrete
disposition (ie substantive: novelty – the effect/outcome/result of an action)
• Current innovation is a departure from past practice and thought
• It is simply different to the traditional way of doing things
• Innovators are creative and different from the masses. They are entrepreneurs,
leaders; they experiment and they are agents of change.
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Innovation from a marketing perspective
• Achieving change, reformation, innovation, revolution by motivating, inspiring and
managing innovators to create new and superior solutions that benefit the market. The
individual innovator, the innovation support system (initial group), organisational support
(top management; SBU for process management), and the innovation outcomes are
matters for the discipline of marketing.
• Marketers are concerned with:
– Innovators (sole innovator/innovation group)
– Innovation processes (investment balance, management support, NPD process)
– Product success in a product category as part of a portfolio or as a new category and
new business (test marketing and scaling the new business using integrated
business processes)
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Key issues for marketing management
1. NPD from a strategic perspective;
2. Relationship between creativity and innovation;
3. Market structure and effects on competition and market potential;
4. Sources and types of innovation;
5. The role of users vs lead users in NPD;
6. Product adoption and resistance;
7. Marketing research techniques for NPD;
8. Market transformation and disruptive innovation;
9. Market entry timing (strategies for launch).
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NPD - New product (and service) development from a strategic
marketing and management perspective
Strategic innovation vs innovation strategy
• strategy decision = planning decisions about how to use company resources/capabilities to secure a
distinctive position and appeal to target markets;
• strategic decision = operating decisions pertaining to combinations of resources, capabilities,
processes, often made in complex and uncertain situations where there is no obvious, optimal or
dominant decision (Davis and Devinney 1997). The objective is to generate a return and a
competitive advantage.
Strategically valuable resources
Resources that yield a competitive advantage through Valuable Rare Inimitable Non-substitutable
properties
NPD/Innovation relies on understanding when to spend time on strategy and when to
implement strategic decisions to maximise market opportunity.
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Variable success rates (interpreting academic articles)
Henard and Szymanski (2001)
Finding: Top predictors of new product performance (topmost of the key predictor shortlist) are:
– Product advantage
– Market potential
– Meeting customer needs
– Pre-development task proficiencies
– Dedicated resources
Finding: HOWEVER, the reported performance relationships are impacted by the nature of measurement of
performance, and context. That is, measurement is affected by subjective vs objective, multi-item scales,
level of reporting (senior vs project level), time passed since product introduction); while context is affected
by services vs goods, Asian vs North American markets, competition (high-tech vs low-tech markets).
TAKEAWAY SUMMARY: Classic variables are always important but their effects change depending on
measurement and context. The issue of functional diversity/cross-functional coordination is raised, as are
principles of strategic alignment across the organisation, and managerial perceptions of business
performance.
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Success factors of product innovation (interpreting academic articles)
Evanschitzky, Eisend, Calantone and Jiang (2012)
Finding: Common success factors diminish over time. Examples include: product characteristics (product
advantage, technical sophistication), strategy characteristics (marketing & technological synergy, order of
entry, HR, R&D resources), process characteristics (structured approach, proficiency (predevelopment,
marketing, technological, launch), market orientation/customer focus, management support), marketplace
characteristics (market potential, competitive response).
Finding: Culture moderates success factors. There are different effects in individualistic countries vs risk averse
ones. Thus, some countries will respond to innovation conditions better than others. Depending on the
nature of the innovation (type), different management approaches are needed (ie more or less strict
processes, more or less strategy emphasis)
Finding: Marketing and technological assets are distinct and cannot be substituted. Cross function
transformation is not possible. Thus, they can work in partnership (be integrated), but not in competition
with each other (non substitutable). Conclusion: scale and scope efficiencies are uneven across an
enterprise and are segmented by the source (technology or marketing)
TAKEAWAY SUMMARY: Success factors are time dependent and dynamic. The marketing environment is
dynamic because the market (customers, trends, market forces) is dynamic. Ongoing research is needed
to identify current and future success factors to be competitive.
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What to do next:
Review Week 1:
• Review readings/materials set for Week 1 and take personal notes
Outcome: An understanding of new product development/innovation and the key variables (from a
marketing perspective for managerial purposes).
Prepare for Week 2:
• Engage with the material set for Week 2
• Read the case study set for Week 2 and come to the tutorial prepared to participate in the discussion.