Innovation in Swedish and Norwegian Manufacturing Business Units - A qualitative cross-sectional study on barriers to innovation in business units

Abstract

Practitioners have highlighted an untapped potential for innovations within business units of organizations. However, despite the large potential for innovation with business units, one central issue is that only a few ideas outside of R&D and innovation departments tend to be selected and implemented within organizations. Therefore, there is a gap between the innovation potential and realized innovations within these business units. Moreover, why these barriers to innovation exist is a question that still puzzles practitioners. There is also lacking knowledge with regards to how innovation processes are characterized internally at the business unit level. There has been substantial research on the topic of innovation, but with regards to innovation practices within the business unit level, the academic body is sparser. Therefore, the central question this thesis aims to answer is how the innovation process is characterized at the manufacturing business unit level. To do so, the components of the innovation process at manufacturing business units are mapped out and explored, as well as the enablers and barriers to innovation within business units. The researchers use a qualitative approach with a cross-sectional research design to examine 15 large Swedish and Norwegian manufacturing firms using thematic analysis. A framework of analysis was developed based on the literature on the topic, showcasing five major themes of barriers and enablers of business unit innovation. These themes are: 1) Culture, 2) People, 3) KPIs, 4) Knowledge Sharing, and finally 5) Organizational Structure. Based on these prior themes, interviews were conducted which resulted in 21 identified barriers to innovation, and 15 enablers of innovation at the business unit level. Lastly, a mapping of how the innovation process at the manufacturing business unit level was conducted to showcase the characteristics of the innovation process. The findings from this paper indicate that the innovation process within manufacturing business units is often conducted on an arbitrary basis, leaving much of the idea selection power to one single manager. Furthermore, time management is the largest bottleneck which explains the lack of established innovation processes, as managers are often occupied with daily operations and maintenance management, which reduces the possibility of an innovation focus.