Required managerial roles and competencies for digital innovation
Unpacking digital innovation
From an organization perspective, innovation refers to the introduction and application of new products, processes, and ideals that have or can have a significant and positive net impact on organization performance.2'' This definition of innovation refers to both the process or practice of innovating as well as the outcomes of the innovation process. Thus, innovation discussions or efforts can be focusing on how innovation occurs (e.g. what processes, activities, stakeholders, tools) or on what types of new products/services/ other benefits are realized from innovation efforts. Digital technology advancements.
Digital strategy, innovation, learning, agility 71 digital transformation, and digital business change or expand the nature of innovation and the potential impact of innovation. That is, they change or expand how innovation can be done (i.e. innovation processes/practices), the nature of innovation outcomes (i.e. new products/processes/value created), and or the impact of innovation outcomes (e.g. enabling near instant global scalability to billions of consumers). The new or expanded way that innovation can occur, the types of new products/services/value creations that can occur, and the speed/scope of their impact, is what is referred to as digital innovation. Digital innovation has been formally defined by researchers as both the new products/ services/business processes/models and other forms of stakeholder value created through the use of digital technologies, and as the process of using digital technologies to create (and subsequently change) these new products/services/business processes/models and other forms of stakeholder value.21' Other formal definitions include that it is "the carrying out of new combinations of digital and physical components to produce novel products,”27 that it is "the use of digital technologies in the process of innovating,” and that it is the infusion of digital technologies into innovation outcomes and processes.28
Digital innovation differs from traditional innovation in four important ways. First, the nature of innovation outputs differs in that the outputs have digital or digital/physical hybrids that are programmable/reprogrammable.29 Thus they are malleable, editable, open, transferable, and continuously shifting. They can, and often need to, continue to be improved even once they are in customers hands. This continued evolution/improvement can even be done by customers30 or other stakeholders outside of the organization. ’1’2” The innovation outputs can be both products and platforms. The outputs can have several layers (e.g. device layer, network layer, service layer, content layer), with an organization competing on one or more layers but collaborating on other layers.34 The outputs can be made to think for themselves, continue to work for their creators (e.g. collecting data), improve themselves (e.g. using Al), collaborate with other outputs (e.g. AI/IoT products), exist as orchestrated collections with other outputs, and more (e.g. Apples iPhone can tick most of these characteristics). Second, the nature of the innovation process differs in that digital innovation processes are digitized, have blurred boundaries between stages of the innovation process (e.g. continuous iterative cycles of empathizing, defining, testing, releasing a new innovation), are much more fluid and nonlinear, and more open.35 For example, digital innovation processes can be both intra- and/or inter-organizational and leverage community-based generativity and platform-based network effects (e.g. crowdsourcing, crowdfunding, network-centric innovation platforms). Third, digital innovation differs from traditional innovation in that the innovation actors, or the people/entities/things doing the innovation, aren’t just employees. Instead, they can also include dynamic and often unexpected collections of actors (or innovation collectives) with different interests, motivations, abilities, and tools.31'-3'38 Concepts such as distributed innovation, open innovation, network-centric innovation, shared cognition, and joint sense-making reflect different approaches to facilitating innovation among diverse actors.39-40-41 Fourth, digital innovation involves use of different tools to facilitate the innovation process and act as components in innovation outputs: for example, a broad swath of new digital technologies (e.g. 3D/4D printing. Al. blockchain, big data) and tools (e.g. crowdsourcing/crowdfunding platforms, smart devices and algorithms, data analytics/data science models) can facilitate innovation processes or be used in innovative new products.42,43,44 Exponential growth in the number and abilities of these technologies and tools is rapidly expanding their role in facilitating innovation processes/practicesand as key components of innovation outputs.47’ Fortunately for innovation leaders and innovators, digital innovation can simplify, democratize, and drastically lower the cost of innovation outputs. Table 7.1 provides examples of the different ways digital technology advancements impact digital innovation and provides examples of these impacts in action.
New or enhanced managerial roles and competencies required for digital innovation
Hospitality and leisure managers at all levels can play a range of critical roles in digital innovation. Examples of these roles include setting or clarifying the innovation vision and direction, effectively leading/managing/facilitating innovation processes, identifying/ensuring use of the right tools for optimizing innovation process and outcomes, effectively engaging innovation collectives across relevant networks and ecosystems, instituting the right mindsets and behaviors for digital innovation, building/continuously upgrading organization innovative capacity, and ensuring effective capture of organization value from innovation efforts and outputs. To play such roles, hospitality and leisure managers need to understand digital innovation, have working knowledge of different digital innovation platforms/tools/ methodologies/practices, have a working knowledge of digital innovation collectives and how to best leverage them, have working knowledge of important digital technologies to the innovation process and to innovation outputs, and have strong digital leadership skills.