Abstract
Innovation has been and continues to be an important theme in management literature, and almost any improvement upon the status quo could be regarded as some sort of innovation. Such an improvement could be made in terms of an increase of efficiency for an existing process or the creation of something new, such as a new process, product, position (perception), or even a paradigm (mental model) (Tidd, Bessant et al., 2005). Not all innovations are therefore the same. Some are more disruptive, while others are incremental, reinforcing the existing order of things. This paper discusses the evolution of innovation as a management concept in the context of a physical product or technology and studies innovation from a longitudinal perspective, i.e., from a single physical product to a product family to smart services associated with the physical products and to the fourth industrial revolution (Industry 4.0) in which physical products are now part of an extensive industrial network, namely the internet of things. How does the theme of innovation (management) change and evolve during this industry transition? More importantly, what are the managerial implications for innovating in the era of Industry 4.0?
Highlights
Nowadays, products are no longer a standalone autonomous assembly of electrical or mechanical components
This paper could be summarized in terms of a simplified chronology of innovation issues associated with a manufactured physical product (Figure 7) for a product-centric firm making the transition to the industry 4.0 era
This paper could be summarized in terms of a simplified chronology of innovation issues associated with a manufactured physical product (Figure 7) for a productJ
Summary
Products are no longer a standalone autonomous assembly of electrical or mechanical components. From the product manufacturer’s point of view, new functionalities are continually being added or augmented upon the basic physical principle of bimetallic strip (for the case of a thermostat) such that the temperature signal could be sensed and communicated. In this simple setup, innovation could be made in terms of improving the accuracy of temperature measurement, adding communications & connectivity functionalities, partnering with different makers of devices or systems which the thermostat could “talk to” so that the real-time temperature information could be used in different or as many contexts as possible, re-positioning the thermostat as a control device rather than for mere measurement etc.
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