Even the strongest and technologically most capable organizations have to face the situation where they must create, adapt and design new products and services to maintain their competitiveness. This is even more challenging, since the nature of innovation has become more open, collaborative, multi-disciplinary and global (see e.g. IBM, 2006, Hamel 2006, and Huston et al 2006).

Despite of the emerging new approaches to innovation, we still lack knowledge on the efficient forms of organizing and managing innovations in firms (see Raminez 2005, and BCG 2005. Strategic management literature has recognized that in turbulent markets firms cannot succeed by long-term planning but rather need to create adaptive routines to succeed (Eisenhardt & Martin, 2000). Therefore, the understanding of the renewal of the firm and managing the innovative activities by redirecting has become the interesting issue in strategic management literature.

Although the importance of different forms of innovation management is increasingly recognized, managing innovation activities and corporate ventures as well as measuring innovation and innovativeness is not well understood either in theory or in practice. In this project we focus on the renewal of the firm and managing the innovative activities by redirecting and adapting to the changing environment.

We address the following two broad sets of research questions:

1. Making sense of emerging trends of managing the innovative activities and ventures:
   • How and when do firms succeed in managing their innovation activities? More concretely, what are the possible outcomes of the investment?
   • How do the alternative outcomes affect the firm? Which factors influence which outcome will emerge?
   • How and when do innovative activities create value? Do innovative activities create value, even when outcomes are not what was intended when the projects were initiated? How this mechanism is working?
   • How do firms adapt their innovative activities to the changing and turbulent environment? More concretely, how do firms manage, direct and redirect their innovative activities? How this process works?
   • How and when can companies renew their operations? More concretely, what factors affect to renewal?
2. Measuring the innovativeness and innovation activities:
   • How can companies measure their innovativeness?
   • What are the measures for the success in enhancing innovativeness?
   • How do you measure the innovation from process, customer, financial and employee perspectives?
   • How can companies proactively define conditions for innovativeness in the firms, complemented by accountability for innovations?

We intend to leverage our understanding by selecting the research method for qualitative longitudinal case studies through global ICT-industry players. The cases will be done and data collected in both

1. big global ICT- industry players like Nokia, IBM, Kone, and
2. small and medium size corporations like HTV, Saunalahti, Suunto, and Planmeca.

First, the project develops best practices for large and small/medium size corporations for managing their innovations. Second, the project will develop policy recommendations on how innovations should be managed and measured.

These results will be disseminated through several tangible outcomes. Our dissemination focuses on four areas: dissemination to practitioners, and dissemination to policy makers and dissemination in academia, through teaching and researcher training.

Value to Finnish ICT industry renewal

1. Leading global research calibrated with Finnish ICT-industry data both in large and SME categories
2. Innovation and internal renewal management framework for identification agile management, value capture and realization
3. Knowledge transfer and innovation management process assessments and planning workshops for participating firms as well as for larger audience
4. Policymaking of ICT industry renewal in Finland and Helsinki area
5. Research publications and academic thesis from doctoral to masters to bachelors

Our project has prospects for significant contributions to theory and management practice. Finnish competitiveness and local competitiveness of Helsinki area derives at least partly from the ability to create advanced technology and productive resources (Science and Technology Policy Council of Finland, 2003). ICT industries have been a driver of the Finnish economy over the last decade and to maintain its strong competitiveness, efficient innovation management processes would seem to be utmost important.

Our research will contribute directly to give Finnish firms especially in ICT-industry, the necessary tools to compete. In our research we focus on both global big players as well as small/medium size firms. The development of the small/medium size firms and their strategic management tools is essential for the future success.

The implications for practicing managers are novel insight into how companies are better able to manage, direct and redirect the innovative activities. Our research will make significant contributions to theory by contributing to theories of entrepreneurship, innovation management, venturing, dynamic capabilities, adaptation and change. We will publish several articles aimed at top journals.

Through publishing in academic and practitioner journals, seminars, researcher training, and policy oriented reports, our research will contribute directly to give Finnish firms the necessary tools to compete in these environments but will also provide important insights for policy makers aiming at supporting these industries.

The research project will be carried out 2006-2008 in cooperation between Helsinki Polytechnic, Helsinki University of Technology, New Jersey Institute of Technology and Columbia University, Nokia and IBM. In addition this project is networked with professional associations like EFQM (European Foundation of Quality Management). All participating institutions will contribute researcher time and data access.

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