Running an innovation engine in high-tech product business

Abstract

Vaisala is a Finnish stock-listed technology company founded in the 1930s. The company has a successful innovation track record, and its Industrial Measurements business unit has performed financially successfully over the past years. However, its innovation practices are conservative with respect to the literature and practices in more dynamic business environments. Because financial impact of innovation show with a delay and the innovation practices in Industrial Measurements have not been thoroughly benchmarked earlier, this thesis examined the key enablers for an Innovation Engine in such a high-technology hardware product business context. This qualitative research was based primarily on five internal and twelve benchmark interviews, and as a result, I propose managerial implications for five identified development areas for the case company. According to my analysis, the business unit needs to adopt a wider exposure to external knowledge, and it needs to create an innovation strategy that defines how and where innovation is sought. Moreover, a systematic process for validated learning that is shared for all initiatives needs to be adopted in the business unit. Then, through the implemented strategic guidance, systematic validation process and leadership, a more focused portfolio and shorter projects with a rapid cadence need to be achieved in initiatives. Finally, for an optimized performance in each innovation initiative, Industrial Measurements need to adopt diverse cross-functional teams with integrated market and customer need understanding and strive for a more holistic approach for business cases.