A firm’s ability to be innovative is arguably
becoming a defining challenge for global competitiveness. Technology,
information, and production standards are all increasingly accessible to
companies operating in developed economies. Arguably, these factors
do not help a company sustain competitive advantage. Rather, they
do contribute to rapid changes in the global environment. More important,
companies must be able to utilize these factors to become innovative.
The point is that companies must be able to innovate and do so at a faster
pace than their competitors.
Recently, corporate interest lay in reducing
costs and increasing quality to reach customers. Now, the focus is
shifting to understanding how to manage learning and knowledge in order
to create an innovative structure that can adapt effectively to environmental
change. Furthermore, companies are increasingly creating alliances
and partnerships as a means to leverage assets and resources. This
complicates issues tremendously.
The idea of leveraging interorganizational
assets calls attention to relationship management. Research has examined
information sharing and collaborative tools as means to create capabilities,
but this research also motivates the question: how do companies develop
innovative partnerships and how do they manage the process between organizations?
Is it merely a function of transferring internal mechanisms to partners?
Differences in corporate culture, foreign environments, and network linkages
are some of the influences that impact a firm’s ability to create and manage
an innovative culture. One approach that addresses this may be through
the concept of knowledge management.
Today, technology drives the rate of change,
which is in turn, drives the need for companies to be right the first time.
At the very least, the company cannot be wrong. Indeed, the rapid
pace of the global economy is placing a premium on being able to keep up.
Those who are able to innovate and innovate faster than their competitors
will most likely be the future survivors. Moreover, the rapid pace
of change has also motivated companies to seek alliances and partnerships
precisely because one company cannot distribute all its assets and resources
over the necessary attributes to remain competitive. Subsequently,
innovation needs to be an attribute that is both internal (to the company)
as well as external (incorporating the partnership). Understanding
how to develop and manage the knowledge management process is the power
that will drive companies’ ability to adapt to change. Can the knowledge
management process be a governance mechanism that ultimately drives innovation? |
