Environmental Engineering Reference
In-Depth Information
product-services, and (4) more far-reaching system changes that not only include tech-
nological innovation, but also e
rm, and
societal demands. Innovation can be of a product-oriented type, meaning that it involves
changes in the design of the
ff
ects on employment, the organization of the
fi
nal product or service. It can extend further to include
shifts to product services, in which the
fi
fi
rm envisions delivering a desired service or
bene
t to the customer in creative new ways, with a goal of minimizing resources, energy
use and pollution. An example is selling copier services to customers - in which the
copier company owns the machine and performs all maintenance and service on it while
in use - instead of selling copy machines. This kind of change is described subsequently
in more detail. Technological innovation can also be of a process-oriented type,
meaning that it can occur as part of the production process of a product or the delivery
of a service.
System changes are the deepest and broadest in scope. They extend outside the bound-
aries of the
fi
fi
rm to include many actors, including suppliers, competitor and collaborator
fi
rms, government authorities and civil society. They involve the reconceptualization and
reordering of entire production chains and stakeholder networks, for example, shifting
from non-local industrial agriculture to locally grown organic food systems, or simulta-
neously altering production, employment, distribution and transportation regimes to
move people and deliver goods more e
ciently, with less energy use and pollution.
In the context of product change, the nature of a technological innovation can be eval-
uated according to whether it serves either to sustain or disrupt established product lines
and value networks of
ned demands (Christensen, 1997).
Christensen's concept of a 'value network' is 'the context within which a
customers with well-de
fi
es
and responds to customers' needs, solves problems, procures input, reacts to competitors,
and strives for pro
fi
rm identi
fi
fi
t'. In Christensen's formulation, sustaining innovations occur when
established
rms push the envelope to continue to satisfy existing consumers with
improved products within the prior but expanded technological trajectory. Disrupting
innovations cater to di
fi
ff
erent, perhaps not yet well-de
fi
ned, customers with product
attributes di
erent from those in the established producer-consumer networks.
6
Alternatively, the distinction between sustaining and disrupting innovation might be
focused on the technological nature of the change, a distinction that invites incentives
focused not only on product changes (which may be the main driver in market-pull inno-
vation), but also changes involving process changes, shifts to product services, and wider
system changes. This is not to downplay the importance of consumer demand, but to put
it in a proper context, since many desirable technological changes will need to come from
more interventionist and regulatory approaches if sustainable development is to be
achieved in a timely fashion. We explore these ideas further in the next section.
Another way of comparing sustaining and disrupting innovation is to depict three
ff
di
erent pathways that innovation could take. In Figure 24.1, the various performance
levels of an existing technology regime (for example, various internal combustion auto-
mobile engines with di
ff
ff
erent fuel e
ciencies) are shown as a function of cost. The most
e
cient existing engine is represented by point 'A' at cost
C
1
.New improvements
(sustaining innovations) to internal combustion engines can be developed within the same
technological regime in two di
erent ways. First, improvements could be made, extend-
ing the capacity of existing technology, but at higher cost, as depicted by the dashed line.
Second, a signi
ff
fi
cant innovation could occur within the same technological regime, giving
