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Trends in agile innovation management

Authors:
  • Visoka poslovna škola strukovnih studija "Prof. dr Radomir Bojković" Kruševac
  • Faculty of Business Economy and Entrepreneurship Belgrade

Abstract and Figures

The scope and type of applied innovations, as well as the speed of innovation by companies, today show a growing trend, which requires special efforts from the companies that claim to be leaders in the market. Therefore, these companies are forced to transform their innovative management into new forms. As an especially effective way to transform innovative management into the forefront, agile innovative management has emerged. Therefore, the theoretical desktop research of the state of development of agile innovative management from a number of perspectives has been carried out, as follows: agile innovation systems (AIS) as a phenomenon; the history of the creation of AIS; application of agile methods in companies; the basic function of agile innovation; places of agile innovation in the company; key elements of agile innovation; useful recommendations for companies that develop agile innovation; the process of agile innovation; agile behavioral approach; the uncertainty of agile innovation, and the measurement of agile innovation in companies. This paper summarizes the results of this research and gives guidelines to companies how to successfully implement agile innovation management.
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58 Faculty of Business Economics and Entrepreneurship International Review (2018 No.3-4)
SCIENTIFIC REVIEW
TRENDS IN AGILE INNOVATION MANAGEMENT
Milan Krstic
22
,Ana Skorup,
23
,Goran Lapcevic
24
ABSTRACT
The scope and type of applied innovations, as well as the speed of innovation by companies,
today show a growing trend, which requires special efforts from the companies that claim to be
leaders in the market. Therefore, these companies are forced to transform their innovative
management into new forms. As an especially effective way to transform innovative management
into the forefront, agile innovative management has emerged. Therefore, the theoretical desktop
research of the state of development of agile innovative management from a number of
perspectives has been carried out, as follows: agile innovation systems (AIS) as a phenomenon;
the history of the creation of AIS; application of agile methods in companies; the basic function
of agile innovation; places of agile innovation in the company; key elements of agile innovation;
useful recommendations for companies that develop agile innovation; the process of agile
innovation; agile behavioral approach; the uncertainty of agile innovation, and the measurement
of agile innovation in companies. This paper summarizes the results of this research and gives
guidelines to companies how to successfully implement agile innovation management.
KEY WORDS: research, innovation, innovation management, agility
JEL: O30, O32
UDC: 005:001.895
001.895
COBISS.SR-ID 272203020
22
Faculty of Business Economics and Entrepreneurship, Belgrade, Serbia,
mykrstic@gmail.com
23
Faculty of Business Economics and Entrepreneurship, Belgrade, Serbia
24
Higher business school of applied studies “Prof. Radomir Bojkovic, PhD“, Krusevac
Faculty of Business Economics and Entrepreneurship International Review (2018 No.3-4) 59
INTRODUCTION
The current economic paradigm - Knowledge driven economy, resulting from further
evolutionary development from the previous paradigm - Economics based on the intensive
application of knowledge, is basically the result of technological progress that manifests itself in
civilizational practices, embodied in useful objects (products) and services, processes,
organization, artifacts in all spheres of our lives (Krstić, Skorup, Lapčević, 2016). On the other
hand, economics based on intensive use of knowledge in which individual product customers are
in a specific way directly included in the production process with their knowledge,
information, suggestions and ideas, and thereby actively participate in its realization (Krstić,
Skorup, Minkov, 2016).
Knowledge-driven economy in front of businesses now sets new challenges that can be
summarized in the following: the markets have become global and with new competitors; life
cycles of products and services are rapidly shrinking; users are increasingly demanding; The
complexity of technology is increasing. (Krstić, 2013)
In such an economy, changes have become almost everyday, which makes the entire
business environment permanently changing, so the key question that is being posed today to all
companies, regardless of their size, is how to survive under such conditions. In order to give a
meaningful answer to that question, a theoretical desktop research was launched, which is briefly
presented in this paper.
RESEARCH METHODOLOGY
The aim of the research was to explore approaches that give companies a chance to survive
in a constantly changing environment.
The basic research hypothesis is that the response to the fast-changing environment of
business entities should be an agile innovation.
The research applied: historical, descriptive, comparative, deductive and analytical methods.
The research has confirmed that agile innovation can enable sustainability in the long run.
In this regard, the conclusions of the research presented the appropriate recommendations.
Innovative methodology is a set of methods that are applied in innovative management, that
is, in the initiation and management of innovations and innovation incentives. Which of the
innovative methodologies in the concrete case will be applied depends on the context (state of
the environment) in which the innovation is realized, as well as our perceptions of innovation.
Therefore, innovative methodologies are constantly changing and upgrading, new ones appear,
and their rank of significance changes (Zakić, Bugarčić, Milovanović, 2017), (Daragahi, 2017).
The latest ranking of significance, evaluation of the first 10 innovative methodologies,
(Kaminskaite J, 2016) resulted in their following order: Agile Innovative Systems, Co-Creating
Values, Deep Immersion, Design Thinking, Lean Thinking, Open Innovation, Planning scenario,
Six Sigma. Since Agile Innovation Systems have come to the forefront of innovative
methodologies, it will be discussed in more detail.
THEORETHICAL OVERVIEW OF AGILE INNOVATION SYSTEMS
Agility as a term
The term "agile" means "fast and well-coordinated on the move; (DIC, 2017), and originates
from Latin agilis, which means "it has speed in motion, turning, clever, smart" (ETY, 2017).
If the term is applied to innovative systems, the Agile Innovation System is referred to.
60 Faculty of Business Economics and Entrepreneurship International Review (2018 No.3-4)
Brief history of the creation of agile principles
According to (Rigby, K. D, Sutherland, J., Takeuchi, H, 2016, a) key historical points that
ultimately resulted in the emergence of Agile Innovative Systems can be summarized as
following:
Francis Bacon defined the Scientific Method in 1620.
Walter Shewhart and Edwards Deming establish the PDSA (Plan-Do-Study-Act) cycle.
The Toyota company in the 80's introduces the Toyota Production System - the primary
source of today's "Lean" thinking.
In 1986, Hirotaka Takeuchi and Ikujiro Nonaka identified the Team-based approach,
which significantly changed the process of designing and developing complex products
(examples of Fuji-Xerox photocopiers, Honda Automobile Motors, Canon cameras).
Jeff Sutherland and Ken Schwaber, in 1995, instead of a conventional "Staple" product
development method, establish a new so-called "rugby" method, called "scrum" - a
crowd for the ball, which allows an seemingly impossible project to end in time budget,
and with fewer errors than any previous version.
17 programmers in 2001, who called themselves "organizational anarchists", in
Snowbird, Utah, established a new name for the software design project - Agile, on the
basis of which, in the meantime, was formed the Agile Alliance, a non-profit
organization (with more than 30,000 members) whose aim is to promote agility in
design.
Today, agility extends far beyond the information technology (IT) framework, and
moreover, it has a tendency to expand to improve innovative processes, in virtually every
function, of almost every industry.
Agile innovative systems are especially important for companies that have developed the
Product Management, and especially within the R & D function, and are characteristic for the
development of complex products, and in particular come to terms with IT products.
The place of agile innovation in innovation management
According to the observations (Prasadi Lokuge, 2015), agile innovation can be presented as
a core that links innovation, people, technology, project and outputs, Figure 1.
Figure 1. Agile innovation
Source: (Prasadi Lokuge, 2015)
Depending on the technology used, various types of innovations can be achieved, of which
the most common are radical, incremental and desruptive innovations. In a modern competitive
market, companies are usually unable to tolerate desruptive innovations, because they are very
Innovati
on
People
Outputs
Project
Technology
Agile
innovation
Faculty of Business Economics and Entrepreneurship International Review (2018 No.3-4) 61
expensive and very risky. This is why companies, using the available organizational technologies,
mainly implement incremental or radical innovations. Key differences between incremental and
radical innovations are presented in Table 1.
Table 1: Characteristics of radical and incremental innovation, Source (Prasadi Lokuge, 2015)
Incremental innovation
Radical innovation
continuous (linear improvement of value
acquired by the customer)
discontinuous (with or without predecessor;
essential, nonlinear improvement obtained
by the customer)
based on old technology
based on new technologies
dominant design unchanged
leads to a new dominant design
does not lead to a paradigm shift
can lead to a paradigm shift
implies a low level of uncertainty
implies a high level of uncertainty
improvement of existing characteristics
introduces a whole new set of performance
features
existing organization and qualifications are
sufficient
requires education, new organization and
skills
the result of a rational response or necessity
result of chance or R & D policy, not
necessity
driven by market pull (important in the
advanced stage of technology)
driven by technology (important in the early
stage of technology)
in order to achieve short-term economic
goals
in order to achieve long-term economic
goals
The place and role of agile innovation in relation to incremental and radical innovation are
presented in Table 2.
Table 2: Comparison of innovation types
Incremental innovation
Radical innovation
Agile innovation
Continuous (linear
improvement of value
acquired by the customer)
discontinuous (with or
without predecessor;
essential, non-linear
improvement)
ad-hoc
based on old technology
based on new technology
based on old and on new
technology
dominant design unchanged
leads to a new dominant
design
dominant design expanded
does not lead to a paradigm
shift
can lead to a paradigm shift
can lead to moderate
changes in the paradigm
implies a low level of
uncertainty
implies a high level of
uncertainty
implies a moderate level of
uncertainty
improvement of existing
characteristics
introduces a new set of
features
leads to the expansion of
existing characteristics
existing organization and
qualification are sufficient
there is a need for additional
education, new organization
and new skills
there is a need for smaller or
specialized skills
62 Faculty of Business Economics and Entrepreneurship International Review (2018 No.3-4)
The result is a rational
response to needs
The result is the coincidence
or the impact of R&D
policy rather than need
attributed to the agility
driven by market dragging
(important in the advanced
stage of technology)
driven by pushing
technology (important in the
early stage of technology)
driven by competition on
the market and by
technological advancement
in order to achieve short-
term economic goals
in order to achieve long-
term economic goals
in order to achieve a quick
return
Source: (Prasadi Lokuge, 2015)
Possibilities for using agile methods
Agile methods are being successfully applied, and only some typical examples of application
in different areas will be listed here (Rigby, Sutherland, Takeuchi, 2016, b):
National Public Radio uses agile methods for creating new programs,
John Deere uses agile methods to develop new machines, i
Saab uses agile methods to produce new combat aircraft,
Intronis, a leader in cloud backup services, uses agile marketing methods,
C.H. Robinson, a global leader in logistic services, uses agile methods in human
resource management,
Bell Winery uses agile methods from wine production to warehouse,
GE uses agile methods to accelerate public transition from the 20th century
conglomerate to the "digital and industrial company" of the 21st century.
Characteristics of agile innovation
Agile innovation is a specific "guide in the field for designing and implementing effective
innovation strategies by strengthening the classical methodology of innovation with the Agile
process. In order to facilitate Agile collaborative processes, self-organized and self-optimizing
teams can be formed in the organization to better solve complex problems and create desruptive
innovations" (Langdon, Moses, Po Chi, 2014). In this sense, three key functions of Agile
innovation are:
(1) Achieve maximum speed in innovative efforts. Agile innovations support the effective
development of created ideas and their productive implementation, through a common
innovation, from leadership to operation.
(2) Risk reduction. Agile innovation encourages the creation of a culture of innovation, and
through increased collaboration between all actors in innovation, risk can be reduced (see section
1.9).
(3) Engaging the entire organization in creating and developing the best ideas, since agile
innovation promotes the principles of integration. Effective innovation, as a rule, does not happen
by chance, but it is the result of the deliberate design and improvement of the organization's
innovation.
Elements of Agile Innovation
The practice of innovative management shows a rule that innovation is accompanied by
organizational changes. However, according to (IVP, 2015), thanks to the Agile Innovative
System - AIS, companies can improve their innovative activities even without the need for major
organizational changes. The condition for this is the creation of a flexible team and assignment
of authorization to the team, for the implementation of an innovative task. In this way, AIS can
Faculty of Business Economics and Entrepreneurship International Review (2018 No.3-4) 63
be thought of as an execution plan that will be implemented through Open Innovations. Within
the AIS, three subsystems can be identified (Figure 2): Growth, Accel and Scouting.
The subsystem Growth focuses on development opportunities, as a company that needs to
build growth on the basis of new innovative activities, as well as companies that already realize
innovative activities through acceleration of team effort.
The Accel subsystem serves to build new platforms based on the iterative "market-testing"
approach, which quantifies the risk and reduces the uncertainty of organized investment.
The Scouting subsystem enables teams of internal technology experts to proactively identify
destructive technologies, which help predict new growth platforms.
Figure 2. Agile innovation systems
Source: (IVP, 2015)
Agile Innovation Process
Each innovation is realized through a specific innovative process, and in this sense Agile
Innovation is realized through the Process of Agile Innovation, Figure 3.
Figure 3. The process of agile innovation
Source: (Prasadi Lokuge, 2015)
Hereinafter, the process of agile innovation will be elaborated in detail.
Figure 3, Block 1 shows the important structural elements of the agile process, as follows:
ES,
Digital
Technologies,
Customers,
Suppliers,
Employee,
Flexible control
structures
sensibilit
y
inspiratio
n ideas
Engageme
nt,
Integration
,
Orchestrati
on
Trial
application
s
Agile innovation
With a short lead
time,
Opportunist,
Functional Focus,
The direct value of
the proposal
64 Faculty of Business Economics and Entrepreneurship International Review (2018 No.3-4)
Innovative platform. The requirement for the realization of innovation is the existence of an
innovative platform. Innovative platform is a business system, which in Figure 3 is represented
as a stable and open Enterprise System (ES), which enables innovation.
Digital technologies. Digital technologies today are helping and inspiring creative thinking
and innovative challenges. Companies are able to assess their capacities and capabilities and on
the basis of that they choose the most appropriate technologies for improving a particular business
function or business process.
Eco-system. By analogy with the bio-ecological system, the eco-system of the business
system consists of the following stakeholders, that is, the stakeholders of the ES, namely:
customers, suppliers and employees. They all have a share in the realization of agile innovation.
Flexible control structures. Experience, especially with the IT governance structures,
highlighted the importance of organizational design, where the need for more flexible
management structures favoring innovation is especially emphasized.
The direction of Block 1 is towards sensibility (feeling) for the needs of the market, towards
inspiration and ideas, or creation of ideas.
Block 2 includes the following structural elements of the agile process, as follows:
Engagement. Engagement refers to the engagement of all actors involved in the innovation process.
Integration. In order to enable the engagement of all stakeholders, it is necessary to integrate
their efforts.
Orchestration. In order for the integrated efforts to provide a synergistic effect, it is
necessary to ensure their orchestration, or successful conduct.
The direction of Block 2 is towards the trial of application, since in the case of agile
innovation, the trial takes place synchronously with its formation.
Block 3 includes structural elements of an agile process that relate to the key characteristics
of agile innovation, such as: short implementation time, opportunistic innovation, functional
focus, and direct value of the innovation proposal.
Agile approaches
Agile access can be best viewed on an IT iterative approach, or an access to software
delivery, that is used by companies that develop software. (Rasmusson J, 2017)
In the traditional software development, Figure 4, there is a continuous one-by-one activity
- analysis, design, coding and, finally, testing. In this case, software testing is realized after all
the activities that precede it have been realized.
Figure 4: Traditional and agile software development
Source: (Rasmusson J, 2017)
Faculty of Business Economics and Entrepreneurship International Review (2018 No.3-4) 65
Unlike the traditional approach, Figure 4, in the agile approach, all the above activities -
analysis, design, coding and testing - are carried out continuously and simultaneously throughout
the development project. In this way, the following benefits are achieved:
The quality of the project is improving, as its testing starts from the first day of software
development;
The visibility of the project is improving, because the project immediately becomes
visible to the extent that a part of its functions has been built;
the risk is reduced because user feedback is relatively early; and
End-users are satisfied because they can introduce changes in the project without the
obligation to pay the additional costs.
Uncertainty with agile innovation
Risk and uncertainty are regular followers of every innovative project, and in that sense agile
innovation. This especially due to the fact that the environment conditions of the business entity
that innovates and the innovations change rapidly, which puts additional problems ahead of the
designers. In order to assess the risk of agile innovation, an Uncertainty cone can be used as an
analogue, which is present in IT innovation or software design.
According to (CON, 2017), at the earliest stage of the software designing project, specific
details regarding the nature of the software, details of specific requirements, details of the final
solution, project plan, details of work engagement and other variables of the project, as a rule, are
unclear. The variability in the above details contributes to the variability in the assessment of the
project as a whole. As the sources of variabillity that concern the details are investigated and
fixed, so the variability within the project decreases, which also leads to a decrease in uncertainty.
This phenomenon is known as the "Cone of Uncertainty", which is shown by the diagram of the
cone of uncertainty, Figure 5.
Figure 5: Cone of Uncertainty
Source: (CON, 2017)
The horizontal axis of the diagram is the time axis of the duration of the project. It features
characteristic project points (milestones), such as: the end time of the initial concept, the time
66 Faculty of Business Economics and Entrepreneurship International Review (2018 No.3-4)
when product definition was adopted, the time when the project requirements were completed,
the time when the user interface was completed, and so on.
The vertical axis of the diagram is the estimation of variability and is expressed by the degree
of error that can be found in the assessments made by qualified assessors within the milestones
in the project. Estimates can refer to the costs of a particular set of functions, the effort to invest
in the realization of the set of functions, and the like. As is evident from Figure 5, the estimates
made earlier in the project are those that are susceptible to a greater degree of error. Thus,
estimates of the completion time of the initial concept may be incorrect with a factor of 4x, an
estimate of the time when the product definition may be incorrect with a factor 2x, an estimate of
the time when the user interface is completed with the factor of 1.25x, and so on, with estimation
in later phase of the project, the error is less.
In this regard, the presented uncertainty model present in software design can be generalized
and applied to Agile systems, since they represent uncertainty especially in terms of changing
initial conditions.
Measurement of agile innovation parameters
Management process assumes that four key functions are implemented, namely: planning,
organizing, leading, and controlling. The last - control is missing, unless an adequate performance
measurement is established. This also applies to innovation management. Hence, the issue of
innovative metrics, which deals with benchmarking at the national or company level, is gaining
in importance, and it is no wonder that it has a longer pre-history. So far, four generations of
innovative metrics have been developed, Table 3, from which it is evident that new indicators
have been introduced, which measure innovation. Thus, the first generation of the indicators is
characterized by inputs for innovation, the second generation by outputs, the third generation by
innovation parameters, and the fourth generation by process indicators.
Table 3. The four generations of innovative metrics
First generation
(1950s-1960s)
Second generation
(1970s-1980s)
Third generation
(1990s)
Fourth generation
(2000s)
Input indicators
Output indicators
Innovation indicators
Process indicators
R&D expenditure
S&T personnel
Capital
Technology
intensity
Patents
Bibliometrics
Products
Quality change
Innovation surveys
Indexing
Benchmarking
Human resources
ICT indicators
Knowledge
Intangibles
Networks
Demand
Clusters
Management
techniques
Risk/return
System dynamics
Source: (Arasimhalu, 2011)
The emergence of agile innovative systems has led to the development of a new
methodology for measuring the agility of innovative management in companies, which differs
from the previous four generations of indicators (Arasimhalu, 2011). Key measurement targets
and indicators for measuring agility in innovative management in the company are shown in
Table 4.
Faculty of Business Economics and Entrepreneurship International Review (2018 No.3-4) 67
Table 4. Objectives and indicators for measuring agility in innovative management in the
company
Goals
Indicators
Comment
Maximizing the efficiency
of innovative management
Agile Innovation
Management Index (AIMI)
Synthesized indicator of the
agility of innovative
management
The time needed to form an
innovative team
Innovation Response Index
(IRI)
A measure of how quickly a
team for design and delivery
of innovation can be formed
Minimizing the cycle time
from idea to market (I2M)
Agile Innovation
Development Index (AIDI)
The amount of time it takes
for an innovative team to
develop and deliver
innovation
Source: Authors, based on (Arasimhalu, 2011)
The structure of Agile Innovation Management Index is presented in Figure 6, from which
it is evident that the Agile Innovation Management Index (AIMI) is built from two indexes - the
Innovation Response Index (IRI) and the Agile Innovation Development Index (AIDI). It is
evident from Figure 6 that two indexes - the Innovative Culture Index (ICI) and the Innovation
Depth Index (IDI) are included in the formation of the Innovation Response Index (IRI). In
addition, the Innovation Culture Index (ICI) is built from three indexes - Innovation Training
effectiveness (ITE), Innovation Quality and Capacity (IQC) and Management Commitment
to Innovation (MCI). A questionnaire with a total of 18 questions (variables) is involved in the
formation of these indexes.
Companies should periodically calculate their indexes of innovative management - Agile
Innovation Management Index (AIMI), Innovation Response Index (IRI), and Agile Innovation
Development Index (AIDI), and compare them:
- with indexes for the previous period (it is recommended to be done every year),
- with indexes for comparable companies in the same industry.
Figure 6: Excel tool for determining the company's agility in innovation management,
Source: Authors, based on (Arasimhalu, 2011)
68 Faculty of Business Economics and Entrepreneurship International Review (2018 No.3-4)
DISCUSSION
On the basis of the conducted desktop research, it can be concluded that agile innovation has
largely developed into innovative management and confirmed its introduction. On the basis of the
previous review, certain recommendations can be made for companies that intend to develop agile
innovations. In that sense, leaders in companies, if they want to use agile potential, should adopt the
following key practical recommendations (Rigby, Sutherland , Takeuchi , 2016, b), as follows:
1. Find out how agility really works
Leaders of agile behavior must find out how agility really works. For this knowledge of
importance is the realization that the values and principles of Agile innovation include:
scrum, which emphasizes creative and adaptable team work in solving complex
problems;
lean development, which focuses on the continuous elimination of all losses; and
kanban, which concentrates on reducing lap times and the amount of work in the
process.
2. Understand where agility works`
Leaders of agile behavior should understand where agility has an effect. For assessing the
condition where agility works or where it does not work, Table 5 which presents key states for
agility can be very useful.
Table 5: Favorable and unfavorable conditions for agility
STATE
FAVORABLE CONDITIONS
FOR AGILITY
UNFAVORABLE CONDITIONS
FOR AGILITY
Market
environment
User Preferences and elective options
change frequently
User preferences are stable
User involvement
Close cooperation and quick feedback are
possible.
Users know best what they want because
the process is progressing.
The requirements are clear at the very
beginning and will remain stable.
Customers are unavailable for permanent
cooperation.
The type of
innovation
The problems are complex, the choices
are unknown, and the scope is not clearly
defined. Product specifications can be
changed. Creative breakthroughs and time
to market are important. Cross-functional
cooperation is vital.
Similar work has not been done before,
and innovators believe that solutions are
clear. Detailed specifications and work
plans can be foreseen with certainty and
should be followed. Problems can be
solved sequentially in functional
organizational units.
Modularization of
work
Incremental events have value, and users
can use them.
Work can be divided into parts and
implemented in fast, iterative cycles.
Later changes can be solved.
Users can not start testing parts of the
product until everything is finished.
Late changes are expensive or impossible.
The impact of the
temporary error
Provide precious learning.
It can be catastrophic.
Source: (Rigby, Sutherland, Takeuchi, 2016, b)
Routine and predictable tasks, in which impact assessments, press interviews, factory visits,
customers and suppliers, etc. can be classified, do not fall under the category of agility tasks.
Faculty of Business Economics and Entrepreneurship International Review (2018 No.3-4) 69
Non-routine and hard-to-predict tasks, which can include development strategies, resource
allocation, pervasive innovation, and improved organizational cooperation, etc., fall into the
category of agility tasks.
3. Agility start with small increments
Leaders of agility, that is, the leaders who are most successful in agility management, usually
introduce agility with small increments, usually at the IT sector, since programmers are the largest
acceptors of agility, and they extend agility to other functions in the organization.
4. Agility requires stable teams
The experience of introducing agile innovations indicates that it is desirable that the deployment
teams are relatively stable. If the teams are stable, or if there is no change in team members, the teams
are more productive even by 60%, compared to teams that change team members.
5. Agility should be practiced from top management
Experience has shown that agility should not be practiced only with innovative teams that carry out
innovative activities. It is very important that top management also learns the principles of agility, and
applies them as an agile team, as this can achieve the far-reaching benefits of their company.
6. Agliness should destroy organizational barriers
In overcoming the barriers of agile behavior, very benefitial can be a management style that helps
functional managers turn into general managers, and the strategies of companies and their
organizations to evolve, from managers sealed into organizational units, into managers who become
fighters for power and resources in common cross- functional teams of the company.
Leaders who pretend to be leaders in agile behavior should learn to, instead of ordering,
build leadership on issues addressed to agile teams, such as "What do you recommend?" and
"How can this be tested?" and similar.
CONCLUSION
In this paper, the results of desktop theoretical research are presented in the shortened scope in order
to explore approaches that give companies a chance to survive in a constantly changing environment.
The basic assumption of research has been confirmed that agile innovation is the right
response to the fast-changing environment of business entities.
In the present research focus was on companies - large corporations, which have developed
R&D function.
The possibilities for the rational application of the principles of agility when it comes to
companies in the category of micro, small and medium-sized companies remain yet to be explored.
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preduzetništvo, Beograd : ISBN 978-86-6069-84-7, COBISS.SR-ID 196935180, strana 169.
[10] Krstić, M., Skorup, A., Lapčević, G. (2016). Trendovi u razvoju inovativnih poslovnih
modela,. Trendovi u poslovanju, Godina IV, Sveska 2., Br.8 (2016), str. 43-54, ISSN 2334-
816X, ISSN (Online) 2334-8356, http://trendovi.indmanager.org.
[11] Langdon M., Moses M., Po Chi W. (2014). AGILE INNOVATION, The Revolutionary
Approach To Acclerate Success, Inspire Engagament & Ignite Creativity . Wiley.
[12] Prasadi Lokuge, S.K. (2015). Agile Innovation: Innovating With Enterprise Systems. Doctor
Thesis: Information Systems School Science and Engineering Faculty Queensland
University of Technology.
[13] Rasmusson J. (2017). What is Agile? Retrieved from Agile In a Nutshell:
http://www.agilenutshell.com/, 29.5.2017
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from https://hbr.org/2016/05/embracing-agile
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innovation, 31.5.2017
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Article history:
Received 5 March 2018
Accepted 25 November 2018
... This approach to business has also situated organisations in a state of high technological competitiveness and readiness that have kindled the start of an entirely new digital transformation and new innovative business models (Kohnová, Papula & Salajová 2019). The pressure to come up with innovative ways to compete in this new era has fostered the need for effective organisational innovation management strategies, which empower organisations to adopt systematic promotion of innovations (Krstić, Skorup & Lapčević 2018). The objective of organisations has transitioned from being only about meeting the organisational strategic goals to investing in processes that facilitate the continuous establishment of innovative ways to meet those goals (Agostini & Filippini 2019). ...
... The continuous technological transformation has forced organisations to develop new business models that respond to this transformation effectively. Krstić et al. (2018) suggested that organisations' response to this transformation should be the adoption of Agile and its principles. They stated that Agile facilitates innovation efforts that enable organisations to be flexible and adaptive during the initial introduction stage of projects, as well as in integrating design with development, therefore making innovation processes noticeably faster. ...
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Background: Organisations must respond quickly and consistently to ongoing global shifts. This streak separates remaining competitive from losing market share. Globalisation has accounted for the majority of this transformation, which has been reinforced by rapid digital transformation. Industry experts and researchers are continually studying effective remedies to this worldwide transition as part of their response to this drive. This is required because the world is changing unavoidably, and effective responses to the change should be investigated. Objectives: To study the relationship between Agile and innovation, and how this relationship might facilitate organisations’ reaction to global changes, in response to the battle of how to adapt to global transformations successfully. Method: A systematic literature review analysing 1645 peer-reviewed journals through the use of social network analysis. Results: The terms ‘Agile,’ ‘digital transformation’, ‘design thinking’, ‘agility’, ‘innovation management’, ‘lean’, ‘Industry 4.0’, ‘Agile development’ and ‘digital innovation’ have the strongest links to ‘innovation’. This demonstrates how innovation is reliant on Agile and its characteristics. Furthermore, the computed data clusters from the analysed dataset led to five propositions: (1) Agility sustains innovation strategies (P1). (2) Collaborating Agile methodology with digital innovation leads to competitive advantage (P2). (3) Agile development accelerates or facilitates new business models, such as Industry 4.0 (P3). (4) Design thinking creates value in innovation management or development of new product (P4). Lastly, (5) the concept or theory of lean Agile management (P5). Conclusion: The correlation between Agile and innovation is critical for effective responses to global digital transformations that are ongoing.
... Disruptive innovation through environmental turbulence is a major creative driver for reengineering businesses. It is not just innovation but agile innovation that can take advantage of economic downturns by developing new creative business models by making new paradigm shifts [15,16]. As globalization and digitization evolve, organizations must respond quickly to changing market demands. ...
... As globalization and digitization evolve, organizations must respond quickly to changing market demands. According to Milan Krstic, 2018 agile innovation is a collaborative process that connects innovation, people, technology, projects, and outputs that impact paradigm shifts driven by competition in the market and rapid technological advances [16]. Agile innovation emphasizes creative and adaptable teamwork in solving complex problems; Lean development focuses on eliminating all losses continuously so that the innovation process is significantly faster [15]. ...
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Society 5.0 focuses on people and changes from innovation to technological transformation through industrial automation 4.0. In this study, environmental turbulence refers to exogenous factors that give rise to an uncertain and volatile situation that impacts performance. This study was measured by asking respondents’ perceptions through explanatory studies and preliminary surveys about market predictability, innovation, and customer preference. Disruptive innovation and environmental turbulence are key creative drivers for reengineering businesses; however, only agile innovation can take advantage of the economic downturn. Exploratory case studies and literature reviews are using to test the antecedent of environmental turbulence, Distinctive Innovation Capabilities, through an innovative business model to firm performance. From a managerial perspective, this study provides a comprehensive view of environmental turbulence’s impact, how to develop a DIC strategy for developing an organization’s business model, how to achieve it, what variables contribute, and how to relate it to performance. This research’s authenticity lies in how management comes up with a practically oriented framework of how organizations shape to be innovative and competitive by constructing common business models. However, this study has limitations due to its qualitative nature and conceptual framework, which needs to be investigated further through large-scale surveys by quantitative research.
... We base our discussion and conclusions on a meta-analysis of the Web of Science's Collection in the period 1997-2021 to develop research propositions and outline some organizational changes and analytical tools to pilot transitions to agile. The focus, first, on HR flexibility is because employee matters are one of the main pillars of agile innovation and a driver of organizational changes (Krsti c et al., 2018;Walter, 2021;Meli an-Alzola et al., 2020). The way to manage HR flexibility is a key element of innovation processes as the tacit knowledge that resides in multi-skilled employees and external research and development (R&D) experts is required to accelerate sprints (iterations in agile innovation). ...
Article
Purpose The purpose of this paper is to study the implications of managing human resource (HR) flexibility and absorptive capacity (AC) of knowledge for the implementation of agile innovation methods in the new product development (NPD) process of manufacturing firms. Design/methodology/approach To achieve this, the authors have carried out a meta-analysis by defining first a research question that determines the design of bibliometric data and compilation. The study question is: How firms can support agile initiatives in innovation considering their HR flexibility and AC? The Web of Science Collection has been consulted in three steps with several search strings. The analysis of 161 references without duplicities in the period 1997–2021 provides the foundations for exploring the research question. Findings The authors propose research hypotheses to analyze the interrelationship between HR flexibility, AC and agile innovation according to the literature-based discussion. The authors have identified and develop metrics to pilot the transition to agile that have been also adapted to specific innovation departures points before the transition. The authors also propose and discuss some organizational changes and practical guidelines to pilot transitions to agile that should be useful to the firm’s strategic decision of implementing the most adequate type of agile innovation. Originality/value Even though flexibility and innovation are very important needs for many firms, agile schemes are still under-studied topics in the NPD of manufacturing firms. There are no specific studies in the literature that analyze the interrelationship between HR flexibility, AC and agile innovation, identifying common aspects and different approaches. Thus, this study is of original nature and the developed managerial tools, composed of metrics and organizational changes, will be useful to managers and permitted the authors to achieve the proposed goal.
... In the search carried out for this study, between April and June 2020, from a total of 51 articles, 46 agility definitions were found, 32 definitions from areas such as agile manufacturing (e.g., Mihardjo et al., 2019;Liu & Yang, 2020), and project management (e.g., Gonzalez, 2014). Another 14 definitions were freely proposed by the authors, without sources or structured scientific basis (e.g., Krstic et al., 2018;Vanharanta et al., 2018). ...
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Organizational agility is the ability of organizations to adapt and respond to changes, it has been cited to explain theinternal dynamics and competition in innovation ecosystems. Would it be possible to identify differences in agility as ameasure in such environments? The present article investigates the subject, beginning with a systematic literature reviewthat identified critical factors for agility in innovation ecosystems. Next, an exploratory field study was carried out toidentify whether such factors could be observed empirically. An innovation ecosystem in the agriculture sector was chosen- the Brazilian Agricultural Research Corporation - Embrapa. The study allowed identifying agility factors in three sub-levels of analysis, the last two being observed at Embrapa: Programs and Portfolios, Organizations and Ecosystems.Finally, future research that focuses on better understanding the phenomenon in innovation ecosystems is recommended.
... Organizations that can adopt a data-driven strategy will create more value [5,8]. Moreover, digital technologies enable rapid innovation in the processes and products, which help firms be leaders in the market [5,9]. In addition, digitalization changes customer experiences through customer engagement [5,10] and creates success for organizations in a competitive environment by focusing on platform business models and competitive advantages [5,11]. ...
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Sustainability is a must for all businesses in all industries. It can boost company image and productivity while being aligned with customer needs. On the other hand, digital transformation (DT) is vital for business environments, and organizations need to be resilient in the face of crises such as COVID-19. The main objective of our study is to figure out how DT and organizational resilience might help businesses become more sustainable. This study presents a model that explains social, environmental, and economic sustainability considering the domains of DT and organizational resilience. Our model is evaluated on the data gathered by 208 c-suite leaders from various Iranian companies. The model was empirically validated through a quantitative method of Partial Least Squares/Structural Equation Modeling (PLS/SEM) technique. The findings reveal that the five studied factors have substantial impact on the sustainability of Iranian organizations including data-driven, business process innovation, customer engagement, organizational resilience, and competitive advantages.
... Uticaj nacionalne kulture na radne performanse kod zaposlenih na daljinu je potrebno dodatno istražiti kao jedan od važnih faktora modernog doba i savremenog poslovanja, jer je veoma važno umanjiti faktore rizika koje inovacije mogu stvoriti prilikom implementacije, kao što je metod rada na daljinu. Kreiranjem kulture inovacija i pružanjem slobode zaposlenima da učestvuju u generisanju poslovnih procesa i metoda rada omogućava kompaniji da razvije veću posvećenost svojih zaposlenih i bolje poslovne rezultate [45]. ...
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With globalization and the emergence of a growing number of international companies, the influence of national culture on various aspects of human life in management has become particularly important in recent decades in modern business. Due to the encounter of different cultures from all over the world, it is impossible to avoid the influence of these cultural differences and the possibility of conflicts is great, so modern leaders and managers try to find good techniques of proper management of different people using knowledge of national culture. Any form of conflict, even constructive conflicts, can have a negative impact on the work performance of employees, and in international companies, a large number of conflicts is a direct consequence of a lack of understanding of national culture. Teleworking and flexible forms of work are the results of the technological revolution and globalization. Although it is an insufficiently researched form of work, is gaining more and more attention from the authors. Managers face new challenges in managing employees working remotely, especially in multinational and multiethnic environments of international companies, so it is important to explore aspects that affect their work performance.
... (3) Corporate managers should also keep good connections with their suppliers and customers to build good image and gain customers' loyalty. Meanwhile, they should construct technological innovation networks through their social networks (4) Chinese manufacturing companies should make more investment in innovation activities and implement agile innovation management [112] in order to maintain high levels of innovative capability and improve their competitive advantage in the fierce market. Corporate R&D division should transform the input management into the out management by utilizing IC resources in a more positive way [113]. ...
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Intellectual capital (IC) is considered to be a main driver of organizational success in the knowledge economy. This study examines the impacts of three IC components, including human capital (HC), structural capital (SC), and relational capital (RC), on technological innovation and firm performance. Data are collected from 1112 manufacturing listed companies in China during 2013–17. Using partial least squares structural equation modeling (PLS-SEM), the results show that HC and SC exert a positive impact on firm performance while RC has a negative impact; SC has a positive influence on technological innovation while HC has a negative influence; technological innovation can enhance the firm’s performance. In addition, technological innovation partially mediates the relationship between SC and firm performance. This study will bridge the gap in research by investigating the impacts of IC components on technological innovation and firm performance in developing countries.
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Nowadays customer satisfaction is one of the basic requirements of manufacturing companies in developing countries. This study was conducted to investigate the effect of innovation in product presentation on customer satisfaction. The statistical population includes the customers of cosmetics produced by ten companies in Iran. The simple random sampling method was used to select 387 individuals. The results indicated that innovation in product presentation had a positive effect on the satisfaction of customers consuming cosmetics. In this study, open innovation and closed innovation paradigms were employed to deal with the main research problem.
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The theory of evolution has found numerous analogies and applications in other scientific disciplines apart from biology. In that sense, today the so-called 'memetic-evolution' has been widely accepted. Memes represent a complex adaptable system, where one 'meme' represents an evolutional cultural element, i.e. the smallest unit of information which can be identified and used in order to explain the evolution process. Among others, the field of innovations has proved itself to be a suitable area where the theory of evolution can also be successfully applied. In this work the authors have started from the assumption that it is also possible to apply the theory of evolution in the modelling of the process of innovation diffusion. Based on the conducted theoretical research, the authors conclude that the process of innovation diffusion in the interpretation of a 'meme' is actually the process of imitation of the 'meme' of innovation. Since during the process of their replication certain 'memes' show a bigger success compared to others, that eventually leads to their natural selection. For the survival of innovation 'memes', their manifestations are of key importance in the sense of their longevity, fruitfulness and faithful replicating. The results of the conducted research have categorically confirmed the assumption of the possibility of application of the evolution theory with the innovation diffusion with the help of innovation 'memes', which opens up the perspectives for some new researches on the subject.
Agile Innovation: Innovating With Enterprise Systems
  • S K Prasadi Lokuge
Prasadi Lokuge, S.K. (2015). Agile Innovation: Innovating With Enterprise Systems. Doctor Thesis: Information Systems School Science and Engineering Faculty Queensland University of Technology.
Upravljanje inovacijama . Visoka škola za poslovnu ekonomiju i preduzetništvo
  • M Krstić
Krstić M. (2013). Upravljanje inovacijama. Visoka škola za poslovnu ekonomiju i preduzetništvo, Beograd : ISBN 978-86-6069-84-7, COBISS.SR-ID 196935180, strana 169.
AGILE INNOVATION, The Revolutionary Approach To Acclerate Success, Inspire Engagament & Ignite Creativity
  • M Langdon
  • M Moses
  • Chi W Po
Langdon M., Moses M., Po Chi W. (2014). AGILE INNOVATION, The Revolutionary Approach To Acclerate Success, Inspire Engagament & Ignite Creativity. Wiley.
What is Agile? Retrieved from Agile
  • J Rasmusson
Rasmusson J. (2017). What is Agile? Retrieved from Agile In a Nutshell: http://www.agilenutshell.com/, 29.5.2017
Embracing Agile, 15.6
  • K D Rigby
  • J Sutherland
  • H Takeuchi
Rigby K. D, Sutherland J, Takeuchi H. (2016, b). Embracing Agile, 15.6.2017. Retrieved from https://hbr.org/2016/05/embracing-agile
The Secret History of Agile
  • K D Rigby
  • J Sutherland
  • H Takeuchi
Rigby, K. D, Sutherland, J., Takeuchi, H. (2016,a). The Secret History of Agile. Retrieved from Harvard Business Review: https://hbr.org/2016/04/the-secret-history-of-agileinnovation, 31.5.2017
Trendovi u razvoju inovativnih poslovnih modela
  • M Krstić
  • A Skorup
  • G Lapčević
Krstić, M., Skorup, A., Lapčević, G. (2016). Trendovi u razvoju inovativnih poslovnih modela,. Trendovi u poslovanju, Godina IV, Sveska 2., Br.8 (2016), str. 43-54, ISSN 2334-816X, ISSN (Online) 2334-8356, http://trendovi.indmanager.org.