Decision Support for Innovation Management: Application to the Lighting Industry.

Abstract

I n t e r n a t i o n a l I n s t i t u t e f o r A p p l i e d S y s t e m s A n a l y s i s , L a x e n b u r g , A u s t r i a RR-83-29 December 1983 INTERNATIONAL INSTlTUTE FOR APPLIED SYSIXMS ANALYSIS Laxenburg, AustriaInternational Standard Book Number 3-7045-0050-5Research Reports, which record research conducted a t IIASA, a r e independently reviewed before publication. However, t h e views and opinions they express a r e not necessarily those of t h e Institute or t h e National Member Organizations t h a t support it.Copyright O 1983 International Institute for Applied Systems Analysis All rights reserved. No part of this publication may be reproduced or transmitted in any form o r by any means, electronic or mechanical, including photocopy, recording, or any information storage o r retrieval system, without permission in writing from the publisher. Cover design by Anka JamesPrinted by Novographic, Vienna. Austria In today's turbulent economic environment, every decision affecting t h e development of industry necessarily carries a n increased risk t h a t t h e anticipated economic and social goals will not be achieved. The description of decision making does not always include t h e notion of risk. Sometimes t h e "volatility of cost factors" or changing economies of scale (innovation being t h e primary reason for t h e change) are held responsible for uncertainty about future development. These phenomena are also used t o explain t h e decline in capital formation and in decisions to invest t h a t we a r e currently witnessing.The economic and decision sciences are trying to cope with this situation by devising more sophisticated methods and procedures for supporting decision making. This Research Report reviews some methods t h a t a r e applicable t o t h e analysis of innovation patterns, with t h e a i m of basing t h e necessary decisions on more sound reasoning. The report t h e n describes t h e application of some of these methods to innovation management i n t h e lighting industry. I t is hoped t h a t their application will result in better decisions being made in t h e allocation of resources for innovation. DECISION SUPPORT FOR INNOVATION MANAGEMENT: APPLICATION TO THE LIGHTING INDUSTRY Heinz-Dieter Haustein and Mathias Weber h t e r n a t i o n a l I n s t i t u t e f o r Applied S y s t e m s Analysis, L a z e n b u r g , A u s t r i a Making d e c i s i o n s a b o u t r e s o u r c e a l l o c a t i o n f o r f u t u r e i n n o v a t i o n s is a c h a l l e n g i n g t a s k in b o t h p l a n n e d a n d m a r k e t e c o n o m i e s . Not o n l y c a n s u c h d e c i s i o n s n o t be r e v e r s e d w i t h o u t considerable l o s s of efficiency, b u t t h e decis i o n m a k e r g e n e r a l l y f a c e s a n u m b e r of conflicting objectives. In this r e p o r t the a u t h o r s t r y t o c o m b i n e t w o d i s c i p l i n e s that have b e e n evolving i n d e p e nd e n t l y f o r a l o n g t i m e : i n n o v a t i o n t h e o r y a n d d e c i s i o n theo...