Two potential means for SKF Nova to add value to the SKF group
The two scenarios presented above represent two different means for SKF Nova to add value to the SKF group. The scenarios have been developed to support the needs related to
innovation of the SKF group, perceived by the respondents.
The scenarios out of a long-term and a short-term perspective
The present market situation implies restricted budgets and restricted motivation of the divisions to perform radical innovation. This makes Brain shopping the presently most relevant scenario for SKF Nova. The Brain shopping scenario is an answer to the immediate development needs of the potential customers within the SKF group. It is further an answer to the need of getting closer to the divisions and adjusting to their demands.
The research presented by this study reveals that the long-term survival of firms to a great extent depends on the ability to successfully perform and implement radical innovation. The research further reveals that the exploration of inventive technologies and knowledge appear to require small and organic organisational structures, whereas rapid innovation through effective exploration of that knowledge, in contrast, calls for large and rigid organisations.274 Through successful management of the knowledge transfer process, effective screening of ideas and the ability to closely co-operate with the recipients of the SKF group, SKF Nova can compose a complementary resource for the group. Out of a long-term perspective, the SKF group may benefit from the use of also the In-house innovation business scenario. The process to support in-house innovation includes the flexibility needed to tailor make the process of knowledge transfer. The business scenario called In-house innovation provides SKF Nova with the pre-requisites necessary to perform both incremental and radical innovation.
I claim that a long-term competitive advantage of SKF Nova must be based on skills that make SKF Nova unique within the SKF group. The empirical findings of the study indicate that the large and rigid structure of the SKF group is well suited to perform both maintenance of the mainstream business and incremental innovation. The NMO process of the Industrial Division is an example of a highly structured process to support the creation of new market offers. Out of a long-term perspective I find the survival of SKF Nova most unrealistic if only using the business model implied by Brain-shopping. The services offered would to a high extent consider incremental innovation, which does not consider a unique capability within the SKF group.
SWOT-analysis considering both scenarios
The table below presents a SWOT analysis that considers SKF Nova using both Brain- shopping and In-house innovation.
SWOT-analysis
Strengths An entrepreneurial culture in the sense that the climate is characterised by openness to
273 Tatikonda, M. & Stock, G. (2000). p. 720. 274 Harryson, S. (2000).p.5.
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A small and organic organisational structure with the speed and flexibility needed for the exploration of inventive technologies and knowledge.
Previous experience from working with innovation projects. A well-established external network.
Existing experience and leading edge competencies in the areas of idea management and business analysis and planning.
The mix of business, technology and economy composes a stimulating work environment, which can increase the motivation of the employees and attract new competence.
Weaknesses No previous experience of working as a consultancy firm.
Opportunities To eventually become an important resource of the SKF group with:
A base of knowledge and experience considering the different innovation projects of different parts of the SKF group.
An extensive external and internal network Threats Internal competition
Taking on external orders could seriously damage the internal credibility of SKF Nova. Risk of loosing internal trustworthiness if SKF Nova does not observe the difference between a consultancy firm and a recruitment firm.
Some potential benefits of the two business scenarios
· An increasing tie to the divisions over time thanks to the close corporation within cross- functional teams.
· Increasing “internal market share” (within the SKF group) due to improved communication and corporation.
· An increasing ability to understand the technology trends in the market place and the need of the customers within the SKF group.
Both of the scenarios imply transfer of knowledge
Both the scenarios imply knowledge creation. In the Brain-shopping scenario, the employees of SKF Nova participate in the innovation projects of the divisions by contributing with unique knowledge. In the In-house innovation scenario the level of cross-functional co- operation is determined by the technological uncertainty. Both scenarios include knowledge transfers in both directions between the divisions and SKF Nova.
The knowledge transfer implied by Brain-shopping
In the Brain-shopping scenario it is critical to anticipate the needs of the divisions. This requires close communication and co-operation between the parties involved. The Brain- shopping scenario further requires transfer of knowledge from external sources to SKF Nova. This knowledge is eventually to be transferred to the divisions.
The knowledge transfer implied by In-house-innovation
The business scenario called In-house innovation implies that SKF Nova sets up an appropriate process to successfully transfer knowledge to the SKF group. The process to support this scenario is dynamic in the sense that it provides the possibility to take the unique features of each innovation into consideration. The use of a cross-functional team during the knowledge transfer provides one means to improve the transfer. A new activity of the innovation process called “Design of new business” has been suggested. The ITT-typology represents another option for SKF Nova to improve the effectiveness of the transfer process, i.e. exit when using the innovation process that was suggested to support the business scenario that is called In-house innovation. The next part of this chapter considers the knowledge that must be included in an exit to make the knowledge transfer successful.
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