A study of trends and challenges of embedded innovation (EI) in multinational mobile telecoms in Jordan.
Table of Contents
CHAPTER 1: INTRODUCTION
Background to the study
In a contemporary, technologically advanced era, information and communication technologies play a prime role in corporations’ quest for innovation. However, the environmental complexities and increased competition in the corporate world have made the sole reliance of organisations on ICT services and systems inadequate. Today, organisations must adopt holistic views for attaining sustainable competitive edge based on innovation (Gressgard et al., 2014). Tools, processes and people are responsible for fostering innovation within the organisation as well as capitalising its benefits. Researchers contend that successful integration and capitalisation of innovation relies on the functionality of these three elements. Hence, ICTs should be integrated and aligned with the adaptation of organisational structure and process for effective innovation process (Hafkesbrink & Schroll, (2011).
Successful innovation requires an intricate alignment of both capital and human resources along with efficient distribution and diffusion of knowledge to certify the successful adoption and commercialisation of innovation (Nesheim & Gressgård, 2014). This feature of complexity has triggered an intense argument between proponents of a protective innovation strategy who advocate the protection of the organisation’s innovation process to avoid the imitation of firm’s competitive advantage, and supporters of collaborative innovation approach, founded on effective knowledge disbursement and capitalising organisation’s network (Adner, 2006). Firm’s resource-based view contends that organisations can attain sustainable competitive advantage by possessing non-substitutable, inimitable, rare and valuable resources. In this case, the innovation based success relies on the organisation’s ability to convert these resources into core competencies and strategic capabilities. A technologically innovative organisation can gain competitive advantage through the effective exploitation of its core competencies and valuable resources. In such case, an isolating mechanism is required to maintain the competitive edge, which includes information asymmetry. It means that the organisation has an exclusive access to a transaction as compared to its competitors (Hafkesbrink & Schroll, 2011). However, the current perspective suggests that sustainable competitive advantage could be derived by integrating the innovation into business processes rather than relying on resource based perspective (Li, Huang & Tsai, 2009). Hence, this study aims to highlight the challenges faced by Jordanian telecom organisations and assess their perceptions towards embedded innovation for the accomplishment of business objectives in a highly-saturated market. In doing so, the research will explore the mechanism and processes of building a system for embedded innovation.
Within a resource-based perspective, knowledge is considered extremely important to preserve the competitive advantage (Lin & Wu, 2014). Whereas, recent researchers contend that the resource-based theory has lost its relevance with contemporary era to a great extent. Today, we live in an era where digitalisation of information has made it almost impossible for organisations to attain and sustain a technology based competitive advantage in the long-run. Previously, the knowledge was regarded as a resource, (as suggested by the firm’s resource based perspective) but today, the knowledge is regarded as a process initiated by collaborating with the stakeholders and results in the fulfilment of their implied needs (Li, Huang & Tsai, 2009). Recent theories emphasize the knowledge sharing and collaborative innovation. The theorists contend that it is not possible to develop the innovation in a vacuum (Adner, 2006). They further argue that technological innovation requires a complicated structure of supportive technologies and services that an organisation cannot handle without collaborating with other parties. The debate does not only entail a vibrant research topic in academia, but, contemporary organisations pursuing innovation are also showing extreme concern, as their survival in a highly turbulent environment has become challenging than ever before. These organisations struggle to choose between the collaborative innovation strategies or resource based strategy. In the latter case, they can probably miss out the advantages of supportive knowledge and collaboration with customers, suppliers and competitors (Lin & Wu, 2014).
“Competition is essential to the innovation process and to capitalist economic development more generally. But so is cooperation. The challenge to policy analysts and to managers is to find the right balance of competition and cooperation, and the appropriate institutional structures within which competition and cooperation ought to take place.” (Teece, 1990, p. 1).
The current scholarly debate in innovation studies revolves around the transformation from a resource-based, linear innovation model to an open, systematic and user-centric innovation model. There are two types of processes to develop innovation systems. They could be through competitiveness or through cooperation and both of them would be considered leaner. However the current innovation debate emphasises that this linear model will not lead to successful innovation. The other structure is non-leaner innovation model, which is open and systematically consider stakeholders such as including suppliers, users, government, supply chain partners and broader society. Researchers are interested in exploring how knowledge creation develops under unique and new innovation paradigm (Carayannis, Barth & Campbell, 2012). For instance, the quadruple helix innovation model proposes that knowledge creation and utilisation occurs in non-linear and highly interactive modes, in different multifactor innovation networks, and involves collaboration with all stakeholders including suppliers, users, government, supply chain partners and broader society. The issue is how contemporary organisations can select between completely linear and utterly non-linear innovation models (Dubina, Carayannis & Campbell, 2012). Contending on the same note, a previous researcher has made the following comment:
The above comment suggests that while functioning in a hypercompetitive market, the firms cannot ensure sustainability until they adopt a collaborative approach with all stakeholders. Such collaboration depends on the innovative communication style and results into strengthened competitive positioning at marketplace. “Competitive pressure” is one of the biggest challenges of contemporary organisations that can be addressed by ensuring effective collaboration with primary stakeholder- as suggested by embedded innovation (Boyer, 2003).
Invariably, the term “embeddedness” has been introduced to address the current innovation challenges being faced by contemporary organisations. This introduction has marked the increasing challenge of substantial integration of firms into surrounding community to ensure that their exploitable knowledge has been well absorbed organic (Hafkesbrink and Evers, 2010). Granovetter (1985) has already marked the organisations’ social embeddedness approach and researcher has supported the argument in the context of contemporary economic sociology. The shift from innovation 1.0 (closed innovation) to innovation 3.0 (embedded innovation) needs to be realised by proactive organisations if they are seeking a long-term survival in such a turbulent scenario. This shift has transformed various traditional management practices by opening various formal and informal communication channels to foster the knowledge flow. The previous innovation models were closed in a way that they allowed a one-way flow of innovative ideas, hindering the management’s ability to maximise the business potential. Later, the open innovation models were introduced that to a great extent, they resolved the issues associated with previous innovation models. However, the open innovation models also have their own limitations. These include increased reliance on the external knowledge sources and expensive collaboration with the external stakeholders. To overcome these weaknesses, the latest innovation model, “innovation 3.0” has surpassed the closed innovation (also called “Innovation 1.0”) and open innovation (also called “Innovation 2.0”). The innovation 3.0 has theoretically embraced the ambidextrous structural capabilities of using institutional arrangements for the accomplishment of the embedding process (O’Reilly and Tushman, 2008). These institutional arrangements can be explicit (in the form of formal contracts with other parties), implicit (such as cultivation of a trust culture), exploitative or explorative, mechanic or organic (Hafkesbrink and Evers, 2010), depending on the relationship characteristics, the phase and the nature of overall innovation process.
Embedded innovation offers a more inclusive approach to service innovation where multinational telecoms can engage end-users in the experimentation and design of their services. Simon & Hart (2009) defines embedded innovation as the process of creating long-term, sustainable sources of growth and re-embed consumers, potential customers, and producers to generate an infinite number of new services, products, markets and business enterprises in the current economy. Noordhoff et al (2011) define embedded innovation as the interaction between the supplier and the customers’ innovative knowledge to influence innovation, as well as to what degree they benefit from customer relationships. Van der Meer & van Zwieten (2010) define innovation as the total set of activities that lead to the introduction of something new that gives the company defendable competitive advantage. Hassink (2001) defined embeddedness as the firm’s interactive learning from other institutions in the direct environment (rivals, suppliers, and regulators) to a high level of inclusiveness. Schumpeter (1950) points out that innovation not only affects current profits and output of the firms but also makes fundamental changes in the organisations, lives, and people.
The integration of innovation 3.0 or embedded innovation has become crucial for modern business enterprises. The businesses operating in a highly competitive industry need to innovate continuously to strengthen their competitive position in the market and increase the survival chances in a highly competitive scenario (Hafkesbrink & Schroll, 2011). Embedded Innovation (EI) is considered a sustainable approach for enhancing service innovation in multinational information and communication technology providers. Telecom sector is one of the advanced ICT providers facing tight competition in a highly saturated local and global market. However, telecom organisations can mitigate the competitive pressure through effective integration of embedded innovation based on external knowledge acquired from the product users and combining knowledge of market needs and technological solution principles (Hafkesbrink & Evers, 2010).
After describing the background to the study, the next section provides a brief overview of the Jordan Telecom Sector before stating the research problem. The next section clarifies how these issues shape the innovation systems in the Jordanian telecoms.
Jordan Telecom Sector
In response to the substantial transformations occurring at the global stage, Jordanian telecom organisations are facing various challenges. Today, the competition has outdated the traditional ways in which mobile services were designed and developed. The success of modern telecom enterprises is dependent on their ability to develop innovative business strategies that are effectively aligned with the overall corporate strategy (Zabadi, 2016). However, capturing value from mobile data services has proven difficult. One key indicator is that revenues generated from services other than voice telephony and SMS are below expectations (Sutherland, 2016; Loudon 2016), even though the number of mobile users worldwide is continuously increasing (ITU, 2015). This research addresses the motives, diffusion processes and challenges of embedded innovation in Jordanian telecommunication market. The telecommunication industry is constantly changing and growing in line with the customers’ demands and needs. Given the significantly differentiated capabilities and competencies amongst telecommunication firms as an expected contribution, the findings of this study will enhance our knowledge of the innovation diffusion and embedded innovation in chosen research context.
Amid enormous intellectual and administrative momentum, rapid technological advancement, globalisation and increased environmental turbulence have brought major transformations in the business world (Souza & El Ghazouani, 2016). Today, organisations are induced to continually assess the competitive environment and adopt a proactive approach in translating the random data coming from such environment into meaningful insights (Nayar, 2015). The business intelligence can be achieved by making the optimal use of knowledge acquired from various sources. Ironically Jordanian business do not realize that sustainable entrepreneurship cannot be achieved without embedding innovation in the business strategy, especially in a highly turbulent environment (Muita, 2013).
In developing markets like Jordan, such advanced concepts are regarded as virgin research areas. In the western world, these notions have received considerable importance, which is evidence that the world has moved from era of information technology to era of intelligence. According to Schlick, Jordanian Telecoms must integrate and embed innovation into their structure to enhance their competitive positioning and ensure survival in the long-run (Schlick, 2016). Due to the importance of the Jordanian telecom sector, its closer association with the regional and national economy, its rapid development during the last few years, intense market competition and saturation, the key market players must recognise the significance of embedded innovation for successful accomplishment of organisational goals at national and international stage (Dishman & Calof, 2008).
Nevertheless, it is also important to consider that various organisations attempting to integrate the innovation to achieve sustainable competitive advantage get disappointed when they cannot realise the tangible results. Management should understand that innovation system are abstract by nature and often produce intangible results that cannot be evaluated and measured by traditional ways (Calof & Wright, 2008). Resultantly, senior management demonstrates an unwillingness to invest in embedded innovation until a tangible improvement in the form of enhanced financial indicators is visible. Researchers are required to identify the challenges and perceptions of senior management towards embedded innovation with an aim to offer meaningful and convincing recommendations in favour of embedded innovation (Yassine, 2014).
In the context of Jordan, the telecom sector is already facing intense competition and the market has attained its saturation stage. Academic sources have reported that in the Jordanian telecom industry, charges and costs are eating the profits due to market saturation and the continuous influx of new entrants. The market is currently having an extremely high penetration rate of 155 percent (Fraij, 2015). According to the ranking given by an Arab advisory group, such market is the second highest competitive market in the Middle East region, next to the Saudi Arabian market. Oxford Business Group (2014) has reported that the Jordanian telecom sector is facing intense pressure due to various state levies imposed recently.
The telecom report published by Orange, Umniah and Zain Jordan as cited in Alomari & Elrehail (2013) stated that their combined revenue has decreased sharply by 9 percent after the recent increase in tax. The Orange, Umniah and Zain are the Jordanian telecom organizations, and currently the key player of this industry. They proposed that the impact on profits is more severe, resulting in a decline by 30 to 40 percent. The tax on mobile devices has increased from 8 percent to 16 percent, whereas, levy on mobile subscriptions has increased from 12 percent to 24 percent (as cited in Alomari & Elrehail, 2013). Academic sources have further revealed that government is ready to issue a fourth telecommunication license for a new key telecom player in the Jordanian market. Recently, the Jordanian government launched a tender that facilitates the entrance of new market player and paved the way for 4G services. Orange, Zain and Umniah telecom skipped the tender and contended that entry of a new market player will have a substantial negative influence on their earnings as well as on the whole telecom market. The entrance of new players can result in a fierce price war (Jordan’s ICT industry, 2014). However, supporters of new entrant contend that it will result in enhanced telecom services and additional government revenue. Moreover, it will induce the current telecom organisations to adopt innovative techniques and offer a high value telecom service (Alrawabdeh, 2014). Currently, the market is saturated and mature; still, the data usage is low.
“The future is clear to everybody. People and businesses are connecting wirelessly, so we should facilitate this as much as possible.” – (Mohammad Al Taani, CEO and chairman TRC). (Jordan’s ICT industry, 2014).
Despite an escalating increase in the telecom users in Jordan there has been a drop in the total revenue derived from the industry. Given the huge investments that telecommunication industries have put in to launch data services, minimal use by users is a critical problem since this lengthens the payback period of the telecoms company investment (The Jordan Times, 2014). Moreover, due to rapid changes in the Telecommunication industry, increasing competition and increasing acceptance of digital communication and services, Jordanian telecom organisations need to constantly improve their products, processes, and services to achieve a competitive advantage, remain relevant and maximise their profits (Jayawardhana & Weerawardena, 2014). Numerous researches have shown the importance of gathering knowledge from multiple sources to improve organisational performance and enhance innovation (Sankowska, 2013; Tubigi and Alshawi, 2015). In Jordan, the main market competitors are Zain, Umniah, and Orange that is hosted by Zain and focuses solely on Jordanian’s residing in Jordan. All these providers have already launched 3G networks which enable them to provide users with an even wider variety of services due to Internet accessibility. However, sources report that Jordanian telecom organisations are facing intense competition due to market saturation. To succeed in this highly competitive environment, these organisations are required to embed innovation into their organisational structure (Zaske, 2014). Hence, the study will be executed to highlight the challenges being faced by Jordanian telecom organisations and assess their perceptions towards embedded innovation for the accomplishment of business objectives in a highly-saturated market. The research problem of this study is also based on the knowledge gaps which are directed towards the fact that there are less theories which are related to the embedded innovation. However, this lack of theorisation has motivated the researcher to carry out the research in this field. Since the previous research does not take into consideration the trends and challenges of the telecommunication sector of Jordan, therefore, this research will fill the gap by contributing significantly to this research and positing a new dimension within the context of embedded innovation. As far as the corporate scenario is concerned, the telecommunication companies at Jordan lacks at strategizing innovative measures in their product and services which eventually results in the dissatisfaction level of the customers. The continuous innovation in the product and services offered to the customers can influence the satisfaction level, however, it is necessary to consider the trends which are the part of telecommunication industry globally. This will help the companies to address their issues of lacking innovation and receive greater attention of the customers.
Research Aim & Objective
This research aims to highlight the challenges being faced by Jordanian telecom organisations and assess their perceptions towards embedded innovation for the accomplishment of business objectives in a highly-saturated market. In doing so the researcher will explore the mechanism and processes to build a system for embedded innovation. The researcher will explore the challenges, benefits, and processes of embedded innovation in Jordanian multinational telecommunication organisations. The accomplishment of this research aim would require a thorough understanding of firm-level learning, mechanisms of embeddedness and the boundaries of innovation systems in multinational telecoms that operate in developing countries.
Following research, objectives have been formulated to accomplish the aim of the underlying research study.
- To explore the concept on systems of innovation at the firm level and innovation in a multinational context
- To critically evaluate the theories of innovation systems, in the Jordanian telecommunication industry.
- To examine the trends and challenges of embedded innovation within the case of telecommunication sector Jordan
- To propose strategies for improving innovation measures at Jordanian Telecommunication Sector
This research will be executed to answer the following research question:
Main RQ: To what extent embedded innovation would improve the telecommunication services delivered in developing markets?
This broad research question has been divided into sub-research questions to facilitate the analysis process:
Sub-Q1: How do telecom professionals perceive embeddedness in service innovation in Jordan?
Sub-Q2: What are the motives, challenges, and processes of embedded innovation in the Jordanian telecoms market?
Sub-Q3: What are the strategies in which embedded innovation can be improved in Jordanian telecommunication sector?
Research Justification & Rationale
Like other communication industries at the global stage, Jordanian telecommunication organisations also seek modernisation, development and innovation that can elevate organisations’ position to the level of excellence and leadership. (Bose,2008). The organisations are being induced to adopt a proactive approach towards innovation due to various influential factors present in surrounding environment. However, achievement of leadership and excellence wouldn’t be possible until organisations are highly effective, efficient, responsible and honest in fulfilling the corporate mission, accomplishing their strategic objectives, maximising the operational efficiency and integrating the innovation in core business activities (Zabadi, 2016). Additionally, the organisations are required to introduce different mechanisms for dissemination, expropriation and utilisation of information to assure the sustainability within this highly competitive and turbulent environment (Jayawardhana & Weerawardena, 2014).
In the next few subsections the research presents the research rationale in relation to theory, the embedded innovation discipline, as well as the under-covered context of the Jordanian telecommunication. The researcher tends to discuss the limitations of the current innovation models, thereby highlighting the need to adopt the concept of embedded innovation to assist the organisations operating in highly competitive markets. Through the findings of this research, suggestions would emerge for the organizations to make a shift from a dis-embedded approach to innovation embeddedness.
A shift from dis-embeddedness to the embeddedness
To handle the environmental complexities, the contemporary organisations are required to embed the innovation into different business processes to capitalise the existing business opportunities (Simanis and Hart, 2008). Successful application of advanced management techniques can assist the organisations in achieving their corporate and business objectives, and embedded innovation are the basic characteristics of an effective management systems (Bose, 2008). Embedded innovation is comparatively new terms that have recently emerged in the innovation and management literature. In the contemporary era, organisations’ ability to survive and maintain high standards of competitiveness is grounded on its ability to gather, spread and utilise meaningful insights to develop its innovative capabilities (Jayawardhana & Weerawardena, 2014). Stating differently, the contemporary era suggests to embed the innovation into business processes and adopt an opportunity creation ideology instead of opportunity identification (Simanis and Hart, 2008).
However, the review of innovation literature provides an inadequate evidence to support the application of embedded innovation in organisational settings due to the newness of the concept. It has caused the modern organisations to integrate tested innovation strategies for dealing with the prevailing environmental complexities (Lawson-Lartego & Mathiassen, 2016). In this regard, the theories of open and inclusive innovation have been increasingly used to deal with the complex business challenges (Heeks, Foster & Nugroho, 2014).Today, the proactive management seeks to integrate the open innovation model, which allows the purposive inflow and outflow of knowledge for accelerating the internal innovation and expanding the markets for external innovation use (Ryzhkova & Bengtsson, 2013). Based on this model, the firms operating in highly competitive industries seek to generate the ideas from inside as well as the outside of the focal firm. The ideas collected from external and internal sources are combined into systems and architectures. This theory suggests the management to actively seek geniuses inside and outside the firm to provide the fuel for the business model (Patra and Krishna, 2015).
Futhermore, it is also important to note that enterprises integrating the open innovation model still face challenges in developing an efficient business model that can sustain in a highly complex market for long. Although, various telecom organisations have integrated the open innovation model, still the model is unable to resolve the core issues at hand. For instance, recently, the Orange (Jordanian telecom network operator) shared how the management is developing the innovative solutions by engaging with innovative eco-system. However, the Jordanian telecom sector is still facing a number of challenges that seek immediate consideration (Zabadi, 2016). The recent reports suggest that Jordanian telecom sector lacks the innovation, which can affect their survival in a highly competitive global telecom market. The analysis further suggests that Jordanian telecom sector lags the required innovation pace and despite its efforts to foster the innovation, the environmental complexities lessen the positive impact of innovation initiatives taken by organisations (Zabadi, 2016; Al-Zoubi, 2013).
This analysis suggests a review of the current innovation practices of the Jordanian telecom organisations and analyse if the increasing environmental complexity requires an innovation model beyond the open innovation. For this purpose, this research tends to explore the current organisational practices to foster the innovation. The research will also assess different innovation models and emerging innovation concepts to explore the innovation system practices of Jordanian telecommunication organisations.
As discussed earlier, the open innovation model is the latest development in the innovation literature. The model is tested in different settings to become a theory, but the review of innovation literature has highlighted various limitations of the open innovation model, which suggests a need to develop a new innovation-model that can cater the complex business needs in a highly turbulent scenario (Chesbrough, 2017). At organisational level, the integration of open innovation model causes the organisations to bear high process coordination and implementation costs. It is also reported that open innovation results into more errors in the routine work. The integration of open innovation model also results into heavy reliance on the external knowledge that results into a loss of knowledge control (Lazzarotti and Manzini, 2009). Grimaldi, Cricelli, Rogo & Iannarelli (2012) contend that open innovation results into loss of strategic power, creativity and flexibility. The intellectual property spill over also causes significant challenges.
The review of recent innovation literature suggests that innovation researchers have started recognising the need to introduce a new model. Recently, the innovation researchers have introduced some new innovation models that still require further testing in different contexts. These proposed concepts require further construction and testing in different settings to transform into a complete model. For example, to overcome the challenges associated with open innovation, the researchers have proposed the concept of open-inclusive innovation.The open-inclusive innovation helps the management to understand the relationship dynamics between intellectual, ethical, social and natural capital within the institutional context of innovation (Gupta et al., 2016). Another emerging concept is the embedded innovation that is based on the innovation from inside out. The embedded innovation is built over the open innovation and open-inclusive innovation concepts (Poirier, Staub-French & Forgues, 2015). The concept has grabbed the attention of various researchers as it adopts holistic view and proposes to embed the innovation in every business process for maximising the potential. However, this concept requires further refinement and testing to transform into a verified theory (Gupta et al., 2016).
The underlying research will apply the concept of embedded innovation besides deriving the theoretical support from open innovation and open -inclusive innovation. The rationale for choosing the embedded innovation is that ineffectiveness of dis-embedded innovation framework has become visible with time. In continuous efforts to serve the geographically dispersed mass markets and meet corporate growth objectives, the organisations’ innovation strategies historically reflect the dis-embedded, production-driven quality (Simanis and Hart, 2008). The dis-embedded innovation notion suggests the firms to view the communities as target markets and ecological system as natural resources providing the essential raw-material. Despite the tremendous advancements in the innovation theories, almost all models are based on the concept of dis-embeddedness (Milstein, London & Hart, 2007). Here is the framework of dis-embedded innovation:
The dis-embedded innovation provides limited insights to integrate the innovative practices and maximise the business potential. For example, Groves (2015) argued that this approach is only valid when there are clearly set industry benchmarks to evaluate the offered products/services. The dis-embedded model is built over the wrong assumption about the customers’ needs. This model suggests that dis-embedded innovation practices can reinforce the customers’ needs by searching out the data from field visits and confirming the pre-determined needs and viable business opportunities(Milstein, London & Hart, 2007). Usually, the data collection processes are ineffective, violating the base of pyramid that suggests to think beyond the market research phase (Simanis and Hart, 2008). The current open and inclusive innovation models though integrate the concept of inclusiveness, still the dis-embedded ideology persists to some extent that leads towards the formulation of sub-optimal business models. This would consequently weaken the competitive positioning at marketplace. In most of the organisations, the lack of shared commitment and trust hinders the knowledge inflow and outflow (Dahlander & Gann, 2010).
The emerging embedded innovation concept urges to reverse the business practice and management thinking, which typify the traditional dis-embedded innovation strategies. For instance, in B2C, the embedded innovation proposes to view the C as community instead of customer. When viewed as a community, the locally-rooted relationship forms the primary value source instead of products or services(Milstein, London & Hart, 2007). Hence, if Jordanian telecom organisations adopt the embedded innovation practices, it will lead them to engage with the rich as well as poor communities in a spirit of mutual sharing and joint learning, which entails face-to-face, sustained interaction. Moreover, the firms will co-evolve the value by collaborating with the community. Embedded innovation model creatively marries the abilities of both partners, that is, firm and the community. There are three essential attributes of embedded innovation. They include long-term partnership orientation to all stakeholders, community centred value propositions and creation based opportunity approach (Boyer, 2003). It has been that one of the major reasons behind the lack of innovation in Jordanian telecom industry is the limited growth opportunities available in the market (Zabadi, 2016). The embedded innovation will guide the enterprises to create the opportunities by collaborating with the community instead of searching them in the highly competitive market. Here is the pictorial presentation of embedded innovation model:
From the foregoing, this research will derive the theoretical support from open innovation theory and open inclusive innovation model, and will attempt to explore how Jordanian telecom organisations can embed the innovation by collaborating with the stakeholders. The researcher will also analyse the challenges faced during embedding innovation and how the structural resistance could be minimised to enhance the performance.
Previous discourses on innovation have not actually focused on exploring the dimensions of embedded innovation. The significance of this emperical evidence on embedded innovation lies on its commitment to go beyond the single issue of open innovation to fuller concerns of its conceptualization and theorisation.
The emerging concept of embedded innovation fills this gap and meets the complex needs of turbulent environment, however, the innovation researchers have under-explored this concept despite its huge potential to address the contemporary business issues related to innovation. This concept requires rigorous exploration by the researchers to transform into a new theory in the innovation literature. This study will fill the literature gap, and will be a milestone in setting the basis for the new innovation paradigm, i-e innovation 3.0- embedded innovation. The information obtained from this current study may also aid production managers who lack information on new strategies.
This study will provide meaningful insights to the comprehension of the role of embedded innovation in enhancing service innovation in the telecom sector. The researcher will offer new insights by identifying different government (telecom policies and procedures, relevant regulations, tax rates, other incentives) and organisational aspects (including information technology, human capital, organisational structure, and organisational culture) that facilitate or hinder the integration of embedded innovation Jordanian telecom sector. The research will contribute to the existing body of knowledge by creating a linkage between embedded and service innovation based on empirical evidence. The research results will be highly meaningful for the management of selected telecom organisations for refining their innovation system practices by collaborating with the external environmental actors to gain meaningful insights. The strategic application of such market insights can transform it into business intelligence that defines, gathers, analyses and distributes the intelligence about competitors, customers and products/services. It can also be relevant in any other important environmental aspect with an aim to assist the management in their strategic decision-making process.
Moreover, findings will enhance the management’s ability to exploit competitive positioning through embedded innovation. The researcher will fundamentally examine the challenges, benefits, processes and motives of telecommunication organisations for embedded innovation in the context of Jordan. In addition, it will determine the extent embedded innovation would improve the telecommunication services in the Jordan market. Overall, the research will fulfil its main motives to understand the concept of embedded technology within the Jordanian telecommunication industry, expand the knowledge of embedded innovation and subsequently improve the telecommunication service in Jordan, and influence the policy makers and regulatory authorities in creating an innovation friendly environment in the telecommunication industry in Jordan.
Briefly summarising the research purpose and its theoretical and practical contribution, the underlying research will analyse the Jordanian telecom organisations’ innovation practices to evaluate the fit between dis-embeddedness and embeddedness. The researcher will adopt a holistic approach and will collect data from three main entities, firm, community and government. “Firm” will include the Jordanian telecom management. The exploration of the managerial perceptions will suggest important insights to determine the extent to which firms’ structure can embed the innovation, and what could be possible challenges. The overview of prevailing legislations will also determine the intensity legislative pressure that could be faced while adopting the embedded innovation practices. Finally, the viewpoints of “community” will determine whether the customers, suppliers and other business partners are willing to collaborate with each other to produce the shared value and create opportunities in a highly competitive market. It is clear from the discussion that each empirical research dimension will make a significant contribution in achieving research objective that is, enhancing the performance of Jordanian telecom industry by embedding innovation. Findings will also be useful to refine the embedded innovation concept that is still emerging, and requires rigorous testing before transforming into a tested and verified model. The results will help the researchers, analysts and policymakers to understand where the Jordanian telecom industry fits on the embeddedness continuum. The purpose will be to locate the current positioning and develop strategies to shift towards embeddedness.
Contribution of Objectives
The objectives which are proposed in the research will contribute significantly towards the existing research. Moreover, the first objective of the study is theoretical in nature which is focused towards exploring the concept of embedded innovation within the global context and understand its significance. This objective will be achieved by referring to different theories and descriptions postulated by the authors previously for understanding the concept of embedded innovation. The second objective proposed will help in identifying the trends and challenges associated with the embedded innovation within the context of Jordanian Telecommunication Sector. In addition, the objective will help in proposing strategies for effective implementation of embedded innovation in the light of telecommunication sector of Jordan.
Scope of the study
Review of literature has revealed that Jordanian telecom sector has grabbed the attention of various researchers due to its rapid development during last few decades (e.g. Zabadi, 2016). Analysts are increasingly interested in exploring the factors promoting the rapid development of the industry. Hence, Jordan forms an ideal environment to carry out this research due to its rapidly growing telecommunication services in the Middle East. The country has grown in the statute to be named the hub of telecommunication services within the region. Furthermore, due to competitive nature of the Jordan telecommunication market, the concept of innovation is very invaluable. The effective integration of innovation into organisational structure ensures the survival of firms in a highly competitive and turbulent scenario (Jordan, 2014). Embedded innovation is a concept that not only assist the firms in building their brands but also benefits the customers in meeting their explicit and implicit needs. Embedded innovation in telecommunication services integrates both the organisation and the clients in attaining sustainability since it builds strong trusts and loyalty between both parties (Yassine, 2014). The research will focus on exploring the challenges benefits, processes and motives entailed in the concept of embedded innovation involving the three key players in the Jordanian telecommunication market. The research will further limit its concentration to the extent, which the embedded technology can improve telecommunication services within a rapidly developing market, using Jordan Telecom as a case study.
Research is a systematic way of gathering and analysing information, which is targeted at developing or contributing to generalizable knowledge. It is a process through which a particular subject can be studied elaborately for better understanding in order to make future predictions. However, the research approach for this study will adopt theoritical assumption upon which this research is concentrated and the implication of this for the method adopted to acquire and examine research data.
The approaches that form the philosophical basis of research include qualitative and quantitative approaches. The quantitative is also called positivist approach while qualitative is a post-positivist approach. However, a clear divergency exists between the two approaches. Positivism deals with a clear quantitative approach to investigating phenomena and does not offer a required instrument for measuring human behaviours sufficiently. On the other hand, qualitative approach seeks to explore phenomena and its instruments use more flexible style in eliciting and categorizing responses to questions. It also adopts semi-structured methods such as indebt interviews, focus groups and participant observation. It involves analysing and interpreting texts and interviews in order to discover meaningful patterns descriptive of a particular phenomenon´´ (Auerbach & Silverstein, 2003).
Qualitative research analysis appears to be the suitable method for this research. This method could be used to gather in-depth data by discovering the meaning of the business problem and reconstructing the stories of participants on a conceptual level (Guba & Lincoln, 1994). The qualitative method is appropriate for this research because it will be able to interpret the nature of the context by answering the problem being explored (Yates and Leggett, 2016). This approach has several obvious strengths, firstly, because, it examines issues in details. Researchers conducting interviews are also not restricted. They have the advantage of asking any question in real time. As the research takes a new direction, the research framework can be revised to match existing new information. In order words, participant’s response affects how and which questions the researcher asks next. In addition, the data collections and research questions are adjusted according to the knowledge obtained. Moreover, data from qualitative research has been found to be more compelling and powerful as opposed to quantitative data, which dwells more on numbers.
Qualitative research also has its limitations. The quality of the research depends entirely on the researcher. Cases exist where the researcher’s personal ideologies and perspectives affect the quality of the discourse. Their presence in data gathering may also influence the subjects’ responses. Qualitative data is often voluminous thus, it takes the time to analyse and interpret it.
However, the quantitative method is not the chosen method for the study because quantitative methods are used to correlate data between variables (Horsewood, 2011). For the purpose of this study, the quantitative method is not appropriate because researchers use a quantitative method to test hypotheses (Palinkas et al., 2015). Additionally, the mixed method also is not an ideal approach for this study. Mixed method approach enables researchers to juxtapose qualitative and quantitative techniques to explore the research question (Hay, 2016).
The current research has chosen the qualitative research approach and the research paradigm that complements the qualitative study nature is interpretivism. To examine the extent to which embedded innovation can improve the telecommunication services in Jordan market; the research will collect the qualitative insights from telecom organisations and the clients using the telecommunication services. Moreover, the researcher will also adopt multiple case-study approaches to conducting an organisation specific in-depth investigation of three telecom organisations selected for the research. An effective comparison and contrast of these organisations will determine their levels of adoption on embedded innovation and how this has influenced their service innovation. Semi-structured interviewing approach will be used to collect the data and rationale for choosing semi-structured approach is that it allows the researcher to use the probing technique while maintaining an overall structure. Interview will be conducted with senior management of each selected organisation. For this purpose, researcher plans to interview branch manager, chief operating officer and chief strategy and business development. The researcher has selected the purposive sampling technique to draw the required number of respondents. The thematic analysis will be conducted to analyse the qualitative insights.
Definition of Terms
Before turning to the discussion of the concept of Embedded Innovation, it is necessary first to define the terms, which will be used throughout this work and in relation to the purpose of this study. The most important of these terms are innovation, embedded innovation and dis-embedded innovation.
Innovation- The term innovation involves the application of imagination, information and initiative for deriving great values from the resources which mainly includes different ideas that are then converted into the useful products (Jacobsson & Bergek, 2011).
Embedded Innovation- The embedded innovation is explained as the paradigm which takes the approach towards how a company develops at creating sustainability. Moreover, the new concept is focused on integrating the company within the community perspective (Abu, 2014).
Dis-embedded Innovation- The dis-embedded innovation is associated with handling of environmental complexities, the contemporary organisations are required to embed the innovation into different business processes to exploit the existing business opportunities Finegan, 2000).