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DIGITAL INNOVATION MANAGEMENT: FRAMEWORKS, STRATEGIES, AND FUTURE PERSPECTIVES

Year 2023, Volume: 3 Issue: 2, 1 - 19, 03.01.2024

Cenk Aksoy

Abstract

Digital innovation management has become crucial in today's rapidly evolving business landscape, marked by technological convergence, accelerated development cycles, and emerging market opportunities. This paper, employing a systematic literature review methodology to critically analyze and synthesize existing literature, offers an in-depth analysis of digital innovation management, examining its unique attributes, frameworks, and best practices. The Digital Innovation Process Model (DIPM) is highlighted, emphasizing the importance of incorporating digital technologies throughout the ideation, development, and commercialization phases to create value and achieve competitive advantage. The challenges and strategies associated with managing digital innovation are explored, such as striking a balance between agility and stability, nurturing collaborative innovation ecosystems, and fostering organizational cultures that promote digital innovation. Additionally, emerging theoretical perspectives like digital innovation logic and platform logic are discussed, shedding light on the converging nature of digital innovation and the role platforms play in value co-creation. In formulating a digital innovation management strategy, the focus is on aligning innovation efforts with business objectives, fostering a supportive organizational culture, and harnessing the power of digital platforms for collaboration. Lastly, potential avenues for future research are outlined, including assessing the impact of digital innovation on performance, investigating the interplay between digital innovation and emerging technologies, and examining the influence of public policy and regulation on the digital innovation landscape. This paper strives to provide a comprehensive understanding of digital innovation management and its implications for organizations, strategists, and researchers.

Keywords

Digitalization Innovation Strategy

References

  • Acquisti, A., Taylor, C., & Wagman, L. (2016). The economics of privacy. Journal of Economic Literature, 54(2), 442-492.
  • Adner, R. (2017). Ecosystem as structure: An actionable construct for strategy. Journal of Management, 43(1), 39-58.
  • Berghaus, S., & Back, A. (2016). Stages in digital business transformation: Results of an empirical maturity study. MCIS 2016 Proceedings, 1-13.
  • Bharadwaj, A., El Sawy, O. A., Pavlou, P. A., & Venkatraman, N. (2013). Digital business strategy: Toward a next generation of insights. MIS Quarterly, 37(2), 471-482.
  • Boudreau, K. J., & Lakhani, K. R. (2009). How to manage outside innovation. MIT Sloan Management Review, 50(4), 68-76.
  • Bower, J. L., & Christensen, C. M. (1995). Disruptive technologies: catching the wave. Harvard Business Review, 73(1), 43-53.
  • Brynjolfsson, E., & Kahin, B. (2002). Understanding the digital economy: Data, tools, and research. MIT press.
  • Bughin, J., & van Zeebroeck, N. (2017). The best response to digital disruption. Business Horizons, 60(3), 395-402.
  • Bughin, J., Catlin, T., & Hirt, M. (2018). Why digital strategies fail. McKinsey Quarterly, 1, 24-35.
  • Chesbrough, H. (2003). Open innovation: The new imperative for creating and profiting from technology. Boston: Harvard Business School Press.
  • Chesbrough, H. (2006). Open innovation: A new paradigm for understanding industrial innovation. In Open innovation: Researching a new paradigm (pp. 1-12). Oxford University Press.
  • Chesbrough, H. (2007). Business model innovation: it's not just about technology anymore. Strategy & Leadership, 35(6), 12-17.
  • CIO Insight. (2018). Bimodal IT Approach: What Are Pros & Cons?. Retrieved from https://www.cioinsight.com
  • Cohen, J., & Sundararajan, A. (2019). Self-regulation and innovation in the peer-to-peer sharing economy. University of Chicago Law Review, 82, 293.
  • Davenport, T. H. (2013). Analytics 3.0. Harvard Business Review, 91(12), 64-72.
  • De Reuver, M., Sørensen, C., & Basole, R. C. (2018). The digital platform: a research agenda. Journal of Information Technology, 33(2), 124-135.
  • Digiquation. (2023). The Convergence of AI and Quantum Computing: A Glimpse into the Future. Retrieved from https://digiquation.io
  • Dyer, J., & Gregersen, H. B. (2015). The innovator's DNA: Mastering the five skills of disruptive innovators. Harvard Business Press.
  • Eisenmann, T. R. (2006). Internet companies' growth strategies: determinants of investment intensity and long-term performance. Strategic Management Journal, 27(12), 1183-1204.
  • Fast, E., & Horvitz, E. (2017). Long-term trends in the public perception of artificial intelligence. Proceedings of the AAAI Conference on Artificial Intelligence, 31(1).
  • Fichman, R. G., Dos Santos, B. L., & Zheng, Z. E. (2014). Digital innovation as a fundamental and powerful concept in the information systems curriculum. MIS Quarterly, 38(2), 329-353.
  • Gartner. (2017). Bimodal IT. Retrieved from https://www.gartner.com
  • Hanelt, A., Kolbe, L. M., & Bretschneider, U. (2016). Beyond the shadows: the role of the formal and informal in digital transformation. Business & Information Systems Engineering, 58(6), 433-442.
  • Hess, E. D., & Saxberg, B. (2019). Building an innovative learning organization: A framework to build a smarter workforce, adapt to change, and drive growth. Springer.
  • Hess, T., Matt, C., Benlian, A., & Wiesböck, F. (2016). Options for formulating a digital transformation strategy. MIS Quarterly Executive, 15(2).
  • Iansiti, M., & Levien, R. (2004). The keystone advantage: what the new dynamics of business ecosystems mean for strategy, innovation, and sustainability. Harvard Business Press.
  • Kagermann, H., Wahlster, W., & Helbig, J. (2013). Recommendations for implementing the strategic initiative Industrie 4.0: Securing the future of German manufacturing industry; final report of the Industrie 4.0 Working Group. Forschungsunion.
  • Kane, G. C. (2017). The evolutionary implications of digital innovation. Information Systems Research, 28(2), 216-229.
  • Kane, G. C., et al. (2015). Strategy, not technology, drives digital transformation. MIT Sloan Management Review, 56(4), 1-25.
  • Kanter, R. M. (1983). The change masters: Innovation for productivity in the American corporation. Simon and Schuster.
  • Kaplan, A. M., & Haenlein, M. (2019). Siri, Siri, in my hand: Who's the fairest in the land? On the interpretations, illustrations, and implications of artificial intelligence. Business Horizons, 62(1), 15-25.
  • Kapoor, R., & Hirschheim, R. (2017). Moving ahead, but in what direction? An analysis of electronic medical record research. Journal of the Association for Information Systems, 18(2), 138.
  • Lu, Y., Morris, J. C., & Frechette, S. (2017). Current standards landscape for smart manufacturing systems. National Institute of Standards and Technology, US Department of Commerce.
  • Lyytinen, K., Yoo, Y., & Boland Jr, R. J. (2016). Digital product innovation within four classes of innovation networks. Information Systems Journal, 26(1), 47-75.
  • Manifold Group. (2021). How to implement a Bimodal IT strategy. Retrieved from https://www.manifold.group McKinsey & Company. (2018). The drawbacks of agility. Retrieved from https://www.mckinsey.com
  • Nambisan, S., Lyytinen, K., Majchrzak, A., & Song, M. (2017). Digital innovation management: Reinventing innovation management research in a digital world. MIS Quarterly, 41(1), 223-238.
  • O'Reilly, C. A., & Tushman, M. L. (2013). Organizational ambidexterity: Past, present, and future. Academy of Management Perspectives, 27(4), 324-338.
  • Parker, G. G., Van Alstyne, M. W., & Choudary, S. P. (2016). Platform revolution: How networked markets are transforming the economy and how to make them work for you. WW Norton & Company.
  • Porter, M. E., & Heppelmann, J. E. (2014). How smart, connected products are transforming competition. Harvard Business Review, 92(11), 64-88.
  • Rangaswamy, E., Nawaz, N. & Changzhuang, Z. (2022). The impact of digital technology on changing consumer behaviours with special reference to the home furnishing sector in Singapore. Humanit Soc Sci Commun 9, 83. https://doi.org/10.1057/s41599-022-01102-x
  • Rochet, J. C., & Tirole, J. (2003). Platform competition in two-sided markets. Journal of the European Economic Association, 1(4), 990-1029.
  • Rogers, E. M. (2010). Diffusion of innovations. Simon and Schuster.
  • Romanosky, S. (2016). Examining the costs and causes of cyber incidents. Journal of Cybersecurity, 2(2), 121-135.
  • Teece, D. J. (2018). Business models and dynamic capabilities. Long Range Planning, 51(1), 40-49.
  • Tidd, J., & Bessant, J. (2009). Managing innovation: integrating technological, market and organizational change. John Wiley & Sons.
  • Tiwana, A. (2014). Platform Ecosystems: Aligning Architecture, Governance, and Strategy. Academic Press.
  • Tiwana, A., Konsynski, B., & Bush, A. A. (2010). Platform evolution: Coevolution of platform architecture, governance, and environmental dynamics. Information Systems Research, 21(4), 675-687.
  • Tripsas, M. (2009). Technology, identity, and inertia through the lens of “The Digital Photography Company”. Organization Science, 20(2), 441-460.
  • Von Hippel, E. (2005). Democratizing innovation. MIT Press.
  • Werbach, K. (2018). The blockchain and the new architecture of trust. MIT Press.
  • Westerman, G., Calméjane, C., Bonnet, D., Ferraris, P., & McAfee, A. (2011). Digital transformation: A roadmap for billion-dollar organizations. MIT Center for Digital Business and Capgemini Consulting, 1-68.
  • Yoo, Y., Henfridsson, O., & Lyytinen, K. (2010). Research commentary—The new organizing logic of digital innovation: An agenda for information systems research. Information Systems Research, 21(4), 724-735.

DIGITAL INNOVATION MANAGEMENT: FRAMEWORKS, STRATEGIES, AND FUTURE PERSPECTIVES

Year 2023, Volume: 3 Issue: 2, 1 - 19, 03.01.2024

Cenk Aksoy

Abstract

Digital innovation management has become crucial in today's rapidly evolving business landscape, marked by technological convergence, accelerated development cycles, and emerging market opportunities. This paper, employing a systematic literature review methodology to critically analyze and synthesize existing literature, offers an in-depth analysis of digital innovation management, examining its unique attributes, frameworks, and best practices. The Digital Innovation Process Model (DIPM) is highlighted, emphasizing the importance of incorporating digital technologies throughout the ideation, development, and commercialization phases to create value and achieve competitive advantage. The challenges and strategies associated with managing digital innovation are explored, such as striking a balance between agility and stability, nurturing collaborative innovation ecosystems, and fostering organizational cultures that promote digital innovation. Additionally, emerging theoretical perspectives like digital innovation logic and platform logic are discussed, shedding light on the converging nature of digital innovation and the role platforms play in value co-creation. In formulating a digital innovation management strategy, the focus is on aligning innovation efforts with business objectives, fostering a supportive organizational culture, and harnessing the power of digital platforms for collaboration. Lastly, potential avenues for future research are outlined, including assessing the impact of digital innovation on performance, investigating the interplay between digital innovation and emerging technologies, and examining the influence of public policy and regulation on the digital innovation landscape. This paper strives to provide a comprehensive understanding of digital innovation management and its implications for organizations, strategists, and researchers.

Keywords

Digitalization Innovation Strategy

References

  • Acquisti, A., Taylor, C., & Wagman, L. (2016). The economics of privacy. Journal of Economic Literature, 54(2), 442-492.
  • Adner, R. (2017). Ecosystem as structure: An actionable construct for strategy. Journal of Management, 43(1), 39-58.
  • Berghaus, S., & Back, A. (2016). Stages in digital business transformation: Results of an empirical maturity study. MCIS 2016 Proceedings, 1-13.
  • Bharadwaj, A., El Sawy, O. A., Pavlou, P. A., & Venkatraman, N. (2013). Digital business strategy: Toward a next generation of insights. MIS Quarterly, 37(2), 471-482.
  • Boudreau, K. J., & Lakhani, K. R. (2009). How to manage outside innovation. MIT Sloan Management Review, 50(4), 68-76.
  • Bower, J. L., & Christensen, C. M. (1995). Disruptive technologies: catching the wave. Harvard Business Review, 73(1), 43-53.
  • Brynjolfsson, E., & Kahin, B. (2002). Understanding the digital economy: Data, tools, and research. MIT press.
  • Bughin, J., & van Zeebroeck, N. (2017). The best response to digital disruption. Business Horizons, 60(3), 395-402.
  • Bughin, J., Catlin, T., & Hirt, M. (2018). Why digital strategies fail. McKinsey Quarterly, 1, 24-35.
  • Chesbrough, H. (2003). Open innovation: The new imperative for creating and profiting from technology. Boston: Harvard Business School Press.
  • Chesbrough, H. (2006). Open innovation: A new paradigm for understanding industrial innovation. In Open innovation: Researching a new paradigm (pp. 1-12). Oxford University Press.
  • Chesbrough, H. (2007). Business model innovation: it's not just about technology anymore. Strategy & Leadership, 35(6), 12-17.
  • CIO Insight. (2018). Bimodal IT Approach: What Are Pros & Cons?. Retrieved from https://www.cioinsight.com
  • Cohen, J., & Sundararajan, A. (2019). Self-regulation and innovation in the peer-to-peer sharing economy. University of Chicago Law Review, 82, 293.
  • Davenport, T. H. (2013). Analytics 3.0. Harvard Business Review, 91(12), 64-72.
  • De Reuver, M., Sørensen, C., & Basole, R. C. (2018). The digital platform: a research agenda. Journal of Information Technology, 33(2), 124-135.
  • Digiquation. (2023). The Convergence of AI and Quantum Computing: A Glimpse into the Future. Retrieved from https://digiquation.io
  • Dyer, J., & Gregersen, H. B. (2015). The innovator's DNA: Mastering the five skills of disruptive innovators. Harvard Business Press.
  • Eisenmann, T. R. (2006). Internet companies' growth strategies: determinants of investment intensity and long-term performance. Strategic Management Journal, 27(12), 1183-1204.
  • Fast, E., & Horvitz, E. (2017). Long-term trends in the public perception of artificial intelligence. Proceedings of the AAAI Conference on Artificial Intelligence, 31(1).
  • Fichman, R. G., Dos Santos, B. L., & Zheng, Z. E. (2014). Digital innovation as a fundamental and powerful concept in the information systems curriculum. MIS Quarterly, 38(2), 329-353.
  • Gartner. (2017). Bimodal IT. Retrieved from https://www.gartner.com
  • Hanelt, A., Kolbe, L. M., & Bretschneider, U. (2016). Beyond the shadows: the role of the formal and informal in digital transformation. Business & Information Systems Engineering, 58(6), 433-442.
  • Hess, E. D., & Saxberg, B. (2019). Building an innovative learning organization: A framework to build a smarter workforce, adapt to change, and drive growth. Springer.
  • Hess, T., Matt, C., Benlian, A., & Wiesböck, F. (2016). Options for formulating a digital transformation strategy. MIS Quarterly Executive, 15(2).
  • Iansiti, M., & Levien, R. (2004). The keystone advantage: what the new dynamics of business ecosystems mean for strategy, innovation, and sustainability. Harvard Business Press.
  • Kagermann, H., Wahlster, W., & Helbig, J. (2013). Recommendations for implementing the strategic initiative Industrie 4.0: Securing the future of German manufacturing industry; final report of the Industrie 4.0 Working Group. Forschungsunion.
  • Kane, G. C. (2017). The evolutionary implications of digital innovation. Information Systems Research, 28(2), 216-229.
  • Kane, G. C., et al. (2015). Strategy, not technology, drives digital transformation. MIT Sloan Management Review, 56(4), 1-25.
  • Kanter, R. M. (1983). The change masters: Innovation for productivity in the American corporation. Simon and Schuster.
  • Kaplan, A. M., & Haenlein, M. (2019). Siri, Siri, in my hand: Who's the fairest in the land? On the interpretations, illustrations, and implications of artificial intelligence. Business Horizons, 62(1), 15-25.
  • Kapoor, R., & Hirschheim, R. (2017). Moving ahead, but in what direction? An analysis of electronic medical record research. Journal of the Association for Information Systems, 18(2), 138.
  • Lu, Y., Morris, J. C., & Frechette, S. (2017). Current standards landscape for smart manufacturing systems. National Institute of Standards and Technology, US Department of Commerce.
  • Lyytinen, K., Yoo, Y., & Boland Jr, R. J. (2016). Digital product innovation within four classes of innovation networks. Information Systems Journal, 26(1), 47-75.
  • Manifold Group. (2021). How to implement a Bimodal IT strategy. Retrieved from https://www.manifold.group McKinsey & Company. (2018). The drawbacks of agility. Retrieved from https://www.mckinsey.com
  • Nambisan, S., Lyytinen, K., Majchrzak, A., & Song, M. (2017). Digital innovation management: Reinventing innovation management research in a digital world. MIS Quarterly, 41(1), 223-238.
  • O'Reilly, C. A., & Tushman, M. L. (2013). Organizational ambidexterity: Past, present, and future. Academy of Management Perspectives, 27(4), 324-338.
  • Parker, G. G., Van Alstyne, M. W., & Choudary, S. P. (2016). Platform revolution: How networked markets are transforming the economy and how to make them work for you. WW Norton & Company.
  • Porter, M. E., & Heppelmann, J. E. (2014). How smart, connected products are transforming competition. Harvard Business Review, 92(11), 64-88.
  • Rangaswamy, E., Nawaz, N. & Changzhuang, Z. (2022). The impact of digital technology on changing consumer behaviours with special reference to the home furnishing sector in Singapore. Humanit Soc Sci Commun 9, 83. https://doi.org/10.1057/s41599-022-01102-x
  • Rochet, J. C., & Tirole, J. (2003). Platform competition in two-sided markets. Journal of the European Economic Association, 1(4), 990-1029.
  • Rogers, E. M. (2010). Diffusion of innovations. Simon and Schuster.
  • Romanosky, S. (2016). Examining the costs and causes of cyber incidents. Journal of Cybersecurity, 2(2), 121-135.
  • Teece, D. J. (2018). Business models and dynamic capabilities. Long Range Planning, 51(1), 40-49.
  • Tidd, J., & Bessant, J. (2009). Managing innovation: integrating technological, market and organizational change. John Wiley & Sons.
  • Tiwana, A. (2014). Platform Ecosystems: Aligning Architecture, Governance, and Strategy. Academic Press.
  • Tiwana, A., Konsynski, B., & Bush, A. A. (2010). Platform evolution: Coevolution of platform architecture, governance, and environmental dynamics. Information Systems Research, 21(4), 675-687.
  • Tripsas, M. (2009). Technology, identity, and inertia through the lens of “The Digital Photography Company”. Organization Science, 20(2), 441-460.
  • Von Hippel, E. (2005). Democratizing innovation. MIT Press.
  • Werbach, K. (2018). The blockchain and the new architecture of trust. MIT Press.
  • Westerman, G., Calméjane, C., Bonnet, D., Ferraris, P., & McAfee, A. (2011). Digital transformation: A roadmap for billion-dollar organizations. MIT Center for Digital Business and Capgemini Consulting, 1-68.
  • Yoo, Y., Henfridsson, O., & Lyytinen, K. (2010). Research commentary—The new organizing logic of digital innovation: An agenda for information systems research. Information Systems Research, 21(4), 724-735.
There are 52 citations in total.

Details

Primary Language English
Subjects Innovation Management
Journal Section Reviews
Authors

Cenk Aksoy 0000-0003-0763-2847

Early Pub Date January 3, 2024
Publication Date January 3, 2024
Published in Issue Year 2023 Volume: 3 Issue: 2

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APA Aksoy, C. (2024). DIGITAL INNOVATION MANAGEMENT: FRAMEWORKS, STRATEGIES, AND FUTURE PERSPECTIVES. Uluslararası İşletme Bilimi Ve Uygulamaları Dergisi, 3(2), 1-19.
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