R & D Venture Organizations
There are a number of quite compelling reasons for exploiting an innovation by establishing a separate venture operation. We have already cited most of these reasons already, but others follow.
1. The needs to exploit applications engineering opportunities and changes in societal attitudes towards R & D. These are discussed immediately below and are reflected in the venture operations of British Oxygen.
2. The need to exploit a radical/revolutionary innovation of a central R & D facility, that is, one that does not fit into the technology-matrices of existing product market lines, so that the company lacks an established manufacturing expertise to do so.
3. The fecundity of R & D invention that may overload the capacities of the operations divisions to exploit innovations.
4. The enhancement of a project team into a venture team which may bypass the technical and bureaucratic barriers to technology transfer and provide a satisfying outlet for the autonomy needs and entrepreneurial drives of staff. It thus provides a useful mode for stimulating organizational entrepreneurship and compensates for the bureaucratic arteriosclerosis which often develops as the organization matures.
6. The attempt to prevent key members of the project team from resigning from the company to establish an independent venture to exploit the innovation.
7. Attitudinal factors in operations management that are partially reflected in the above and were discussed earlier. That is, qualities that make individuals successful operations managers--the administrative and personal abilities to coordinate workers, material, and money into a continually profitable manufacturing operation--are contrary to those required by the successful entrepreneur. Therefore, operations management may take a jaundiced view of a radical innovative project which promises to dislocate current manufacturing operations, consume scarce resources, and erode perhaps the next several years profit-and-loss records, all with (to them, at least) an unacceptably high risk of failure.
A separate venture organization may be established in one of several ways, the preferred choice being dependent upon the nature of the innovation in relation to the company's other product lines, patenting, and financing considerations and the strengths and weakness of the planned venture team, among other situational factors. Alternative models for establishing a venture are now discussed.
1. The needs to exploit applications engineering opportunities and changes in societal attitudes towards R & D. These are discussed immediately below and are reflected in the venture operations of British Oxygen.
2. The need to exploit a radical/revolutionary innovation of a central R & D facility, that is, one that does not fit into the technology-matrices of existing product market lines, so that the company lacks an established manufacturing expertise to do so.
3. The fecundity of R & D invention that may overload the capacities of the operations divisions to exploit innovations.
4. The enhancement of a project team into a venture team which may bypass the technical and bureaucratic barriers to technology transfer and provide a satisfying outlet for the autonomy needs and entrepreneurial drives of staff. It thus provides a useful mode for stimulating organizational entrepreneurship and compensates for the bureaucratic arteriosclerosis which often develops as the organization matures.
6. The attempt to prevent key members of the project team from resigning from the company to establish an independent venture to exploit the innovation.
7. Attitudinal factors in operations management that are partially reflected in the above and were discussed earlier. That is, qualities that make individuals successful operations managers--the administrative and personal abilities to coordinate workers, material, and money into a continually profitable manufacturing operation--are contrary to those required by the successful entrepreneur. Therefore, operations management may take a jaundiced view of a radical innovative project which promises to dislocate current manufacturing operations, consume scarce resources, and erode perhaps the next several years profit-and-loss records, all with (to them, at least) an unacceptably high risk of failure.
A separate venture organization may be established in one of several ways, the preferred choice being dependent upon the nature of the innovation in relation to the company's other product lines, patenting, and financing considerations and the strengths and weakness of the planned venture team, among other situational factors. Alternative models for establishing a venture are now discussed.