Chapter
3
Sources of Social innovation
Prepared by: Minale D.
McGraw-Hill/Irwin Copyright © 2008, The McGraw-Hill Companies, Inc. All rights reserved.
LEARNING OBJECTIVES
At the end of this chapter; you will develop an
understanding of:
• Where innovations come from – the wide range of different sources
which offer opportunities to entrepreneurs
• The idea of ‘push’ and ‘pull’ forces and their interaction.
• Innovation as a pattern of occasional breakthrough and long periods
of incremental improvement.
• The importance of different sources over time.
• Where and when you could search for opportunities to innovate.
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Introduction
An entrepreneur is someone who sees an opportunity –
and does something about it.
Whether it’s an individual looking to find a new product
or service to make his or her fortune, a social
entrepreneur trying to change the world or a large
established organization looking for new market space,
the challenge is one of finding opportunities for
innovation.
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• Sources of innovation can be resolved into two broad classes –
knowledge push and need pull – although they almost always act
in tandem. Innovation arises from their interplay.
• For example ‘need pull’ can include social needs, market needs,
latent needs, ‘squeaking wheels’, crisis needs, etc.
• While the basic forces pushing and pulling have been a feature of
the innovation landscape for a long time, it involves a moving
frontier in which new sources of push and pull come into play.
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• Knowledge push
– Innovation that came out from scientific research
– R & D processes
• Eg: Intel chips
• Antibiotics
• CDs
• Need Pull
– “Necessity is the mother of invention”
– Particularly important at mature stages in
industry/product life cycles
– Eg: Energy saving cars
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Where do social innovations come from?
Advertising
Shocks the system
Inspiration
Accident
Knowledge
push
Watching others
Where do
Design driven
innovations comes
Recombinants innovation
from?
innovations
Need -pull
Regulation
Users as
innovators
Exploring
alternatives
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Knowledge Push
All activities in laboratories and science facilities in the
public and private sector is not for the sheer fun of
discovery. It’s driven by a clear understanding of the
importance of R&D as a source of innovation.
A systematic activity of involving a wide network of
people sharing their ideas
The rise of the large corporate research laboratory was a
key instrument of progress for knowledge push innovation.
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Shocks to the system
• Whose needs? Working at the Edge
– Existing customers
– New & potential customers eg: small entrepreneurs who want to
save costs
• Emerging New Markets at ‘the Base of the Pyramid’
– “Bottom of the pyramid”-80% under the poverty line
– Eg: Poverty in Africa-created demand for cheap food in low
prices.
– Powerful source of ideas at the edge comes from what are often
termed ‘emerging markets’ – countries like India, China and
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Extreme Users
• “Tough customers mean good designs”
• The users in the toughest environments may have needs which by
definition are at edge
• Eg: Military needs inspire more innovations within the security
industry.
Watching Others
• Concept of benchmarking:- is to identify internal
opportunities for improvement.
• Eg: Korea manufacturing field that came from the
concept of “copy and develop”.
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Advertising and mass customization
• Challenge in markets-buyers want variety and
customization at the same time
• Eg: Rising individuality has opened up new market for
customized products
Users as innovators
• Create innovative solutions on a continuing basis
• Eg: Tech-hobbyists keep on providing ideas on
technological innovations-new models for pc, phones
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Combination & recombination
• ‘Crossover’
• Combination of industries
• Eg: Nike fashionable shock-absorbing shoes-
combination of arts, health and fitness industry
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Regulation
• Restrict certain things and opens up new ones.
• Important element in shaping and directing innovative activity.
• By restricting what can and can’t be done for legal reasons, new
trajectories for change are established which entrepreneurs can take
advantage
• Eg: New tax rules on cigarettes- restricts sales of cigarettes, opens
up new market of ‘fake cigarettes’ and aids to quit smoking
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Futures and forecasting
• Exploring alternatives
• Eg; Shell exploring possibilities for alternatives for
oil and gas
• Design-driven approaches and the related toolkit
around prototyping are of growing importance
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Accidents
Mistakes that turned out to be important inventions
Have always been a potential source of innovation – but
converting them to opportunities requires an open mind.
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THE PROCESS OF SOCIAL INNOVATION
Social innovation includes six stages that move from idea
generation to the creation of impact.
Social innovations are not always sequential because 'some
innovations jump straight into ‘practice’ or even ‘scaling’.‘
Social innovations 'can also be thought of as overlapping spaces,
with distinct cultures and skills.
They provide a useful framework for thinking about the different
kinds of support that innovators and innovations need in order to
grow.
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• The 6 basic steps includes the following
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STAGE ONE: PROMPTS, INSPIRATIONS AND DIAGNOSES
• In this stage we include all the factors which highlight the need for
innovation – such as crisis, public spending cuts, poor performance,
strategy – as well as the inspirations which spark it, from creative
imagination to new evidence.
• It involves diagnosing the problem and framing the question in such
a way that the root causes of the problem, not just its symptoms, will
be tackled.
• Framing the right question is halfway to finding the right solution.
This means going beyond symptoms to identifying the causes of a
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STAGE TWO: PROPOSALS AND IDEAS
• This is the stage of idea generation. This can involve
formal methods – such as design or creativity
methods to widen the menu of options available.
• Many of the methods help to draw in insights and
experiences from a wide range of sources.
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STAGE THREE: PROTOTYPING AND PILOTS
• 'This is where ideas get tested in practice and done through simply
trying things out, or through more formal pilots, prototypes and
randomised controlled trials.
• The process of refining and testing ideas is particularly important
in the social economy because it’s through iteration, and trial and
error, that coalitions gather strength (for example, linking users to
professionals) and conflicts are resolved (including battles with
entrenched interests).
• It’s also through these processes that measures of success come to
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STAGE FOUR: SUSTAINING
• This is when the idea becomes everyday practice.
• It involves sharpening ideas (and often streamlining
them), and identifying income streams to ensure the
long term financial sustainability of the firm, social
enterprise or charity, that will carry the innovation
forward.
• In the public sector this means identifying budgets,
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STAGE FIVE: SCALING AND DIFFUSION
• There are a range of strategies for growing and spreading an
innovation – from organisational growth, through licensing and
franchising to federations and looser diffusion.
• Emulation and inspiration also play a critical role in spreading an
idea or practice.
• This process is often referred to as ‘scaling’, and in some cases
the word is appropriate, as the innovation is generalised within an
organisation or the organisation itself expands
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STAGE SIX: SYSTEMIC CHANGE
• Change is the ultimate goal of social innovation.
• Systemic change usually involves the interaction of many elements:
social movements, business models, laws and regulations, data and
infrastructures, and entirely new ways of thinking and doing.
• Systemic change generally involves new frameworks made up of
many smaller innovations.
• Systemic change conditions include new technologies, supply
chains, institutional forms, skills, and regulatory and fiscal
frameworks.'
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