Organizational innovation is important for national
development. Research by Arundel, et. al. (2007) analyzed how European
countries learn and develop. They studied large surveys to come to conclusions
about how companies foster inner innovation and how this leads to a unique path
of national development. They create links between employee-centered skill
development, organizational innovation, and national development.
The ways in which businesses and people interact,
openly innovate and provide feedback create the national innovation approach
(Lundvall, 1998). It is the national innovation approach that helps to
determine the competitive structure of the country and its ability to succeed
in the global market place. Each country and culture comes with their own way
of viewing the world and interacting.
When organizations use science-based learning and experience-based
learning they are able to provide higher levels of innovation and production
(Jensen, et. al, 2007). It is the theory and its application that moves to
higher levels of innovation that creates tangible value on the market. Employees
who engage in the innovation process are part of the “learning economy”.
Organizational and national innovations are
interlinked. This innovation results from feedback loops and how agents within
the same organization interact at different times to create a chain-link model
of development (Kline and Rosenberg, 1986). All innovation is based in
interactions that lead to knowledge diffusion whether that is through
employees, suppliers, competitors, or regions.
Each organization has their own unique make-up of
employees that determine how they interact. When employees are encouraged to
solve-problems, work together, take ownership over issues, share their
knowledge, and contribute to development the organization becomes more
innovative. This innovation is incremental whereby individual knowledge is turned
into collective knowledge and then applied for practical use.
The authors found that the way innovation develops
is nation specific and co-evolves to create different modes of innovation. Those nations
likely to be more successful focus on encouraging complex problem-solving and
also place greater emphasis on inner firm development than only on external
sources of innovation. Learning and interaction between internal agents
is as important as learning through outside agents. Organizations should
balance the soft focuses of R&D and human skill input with hard focuses
such as materials input analysis. Each country develops their own unique mix in
development.
Arundel,
et. al. (2007). How Europe's Economies Learn: A Comparison of Work Organization
and Innovation Mode for the EU-15. Industrial
and Corporate Change, 16 (6).
Jensen, et. al. (2007), Forms of knowledge, modes of
innovation and innovation systems. Research
Policy, 36, 680–693.
Kline, S. and Rosenberg, N.
(1986). An overview of innovation,’ in R.
Landau and N. Rosenberg (eds), The Positive Sum Game. National Academy
Press: Washington D.C.
Lundvall, B. (1988), Innovation as an interactive process: from user-producer interaction to
the National Innovation Systems, in G. Dosi, C. Freeman, R. R. Nelson, G.
Silverberg and L. Soete (eds), Technology and Economic Theory. Pinter
Publishers: London.
