technological innovation 4961

from market driven competition, critical inno
vations such as supercomputers, integrated cir
cuits, and the digital control of manufacturing
were directly linked to government funded
research. A reflection of this new way of look
ing at why and how innovation happens is the
continuous search for design forms which are
to respond to the need for coordination and
information exchange between the multiple
organizational divisions that take part in the
innovation process.
The literature discusses four types of techno
logical innovation. When the classification cri
terion is the locus of technological change, the
differentiation is between product and process
innovations. The former concerns any change
to a firms existing product or service portfolio;
the latter refers to a change that the company
introduces in the way a product is made or
service is provided. More recent research has
suggested that it is somewhat misleading to
regard the two as completely independent from
each other. Rather, as Utterback demonstrates
in Mastering the Dynamics of Innovation (1994),
they ought to be seen in an interrelated relation
ship in which their relative importance for the
firm changes over time. Depending on the
degree of technical change that is introduced
to a final product or process when compared
to the existing state of technology and the
knowledge base, a distinction is made between
incremental and radical technological innova
tions. Incremental innovation corresponds to a
little departure from the currently existing and
relied upon technical and scientific knowledge
and practices; it only adds new features to an
already existing product or process. In contrast,
radical technological innovation involves a dras
tic departure from the existing technology,
knowledge base, and practices; it is normally
linked to a breakthrough in knowledge (e.g.,
the introduction of the airplane) (Damanpour
An important reason for distinguishing
between radical and incremental innovation lies
in the complexity of scientific knowledge that
they draw upon and the degree of the predict
ability of the tasks associated with carrying out
research and development. As a result, each
imposes different requirements on staffing and
organizing. For example, testing the con
ventional mechanical properties of batches of
commercial plastics is a highly predictable task.
The complexity of a task refers to the require
ment that knowledge must be drawn from mul
tiple knowledge domains that are at most only
loosely connected to one another. Complex tasks
deal with ill structured, ambiguous technical
circumstances that require assessment of the
implications of multiple, and perhaps conflict
ing, knowledge domains to characterize them in
terms of the actions needed. Simple tasks, on the
other hand, deal with circumstances that are
perceived to fall into the range of ordered
experience, to conform to a well established
paradigm. Integrating knowledge from medical
practice, electronics, chemistry, and mechanical
engineering to produce a concept for a medical
magnetic resonance imaging device is a highly
complex task. So too may be that of deciding
which are the important characteristics of a
plastic to test, while the selection of procedures
to carry out routine tests is generally a simple
Technological innovation has been studied
qualitatively and quantitatively at the level of
the individual, the project, and the organiza
tion, as well as at the intra and interindustry
levels. A wide array of topics has received cov
erage ranging from paradigm shifts, organiza
tional learning, entrepreneurship, knowledge
organizations, individual and organizational
creativity, and, of course, how to organize for
and succeed at innovation.
Much of the empirical research has been
focused on structure and the investigation of
the effect of the formal organization on the
individual and firm behavior and outcomes.
After decades of preoccupation with discovering
the one best way to organize, the contingency
tradition, which developed in the 1960s, broke
the old model. In this tradition, organizational
structure is shaped by the nature of the techno
logy and then in turn shapes the relationships
between people in the work processes. In The
Management of Innovation (1961), Burns and
Stalker studied the relationship between a firms
innovativeness and organization design in 20
British electronics and rayon firms. They
argued that organic (decentralized and less for
malized) structures are conducive to technolo
gical innovation, particularly a radical one, as
they are better able to respond rapidly to the
ever changing environment, whereas mechanistic