Chapter 34. The Front End of Innovation in Large Established Firms

Peter A. Koen and Heidi M. J. Bertels

Stevens Institute of Technology

Introduction

Innovation in large established firms may be broadly divided into three areas: the front end of innovation (a.k.a. fuzzy front end or predevelopment), the new-product development process, and commercialization. The majority of scholarly research has been focused on the development process (see Brown and Eisenhardt, 1995; Montoya-Weiss and Calantone, 1994 for reviews), which requires a well-practiced routine and has become regimented through the widespread adoption of total quality management practices and six-sigma programs. Managing the front end is crucial since choices made during this part determine the company's options of which products will be ultimately developed and commercialized.

Research streams in the front end may be divided into two broad categories depending on whether the learning behavior that is required is exploitative or explorative (March, 1991). Exploitative behavior focuses on incremental and competency-enhancing product development efforts. Exploration refers to more radical (or breakthrough) and competency-destroying product development efforts.

In contrast to a relative consensus on how to manage exploitation processes and practices, our understanding of similar exploration processes and practices is just emerging with a lack of consensus as to the definitions, the required organizational structure, or even the ...

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