Innovation and Entrepreneurship

1.There are various economic and technological changes and developments that have come up due to the need for improved standards of living. This has lead to the creation of new products and technologies which can be used by human beings in the day to day life in order to make work easier. A good example is the development and advancement of the computer software which has been used to perform the various human tasks. This write up will therefore define the concept of creative destruction, Embeddedness and Liquid networks then explain their significance to the study of innovation, and name specific author that is associated with each of them. It will also illustrate the unique innovation system of the Silicon Valley, discuss why some countries are better innovators than others and provide steps that can be used to close this difference. Finally, it will discus why too much innovation is bad.

Innovation is the process of significant change or modification in the technology or the organizational processes which are as a result of creative thinking. It has therefore led to various developments which have seen the abandonment of the old technological systems. while entrepreneurship on the other hand is the process of coming up with a business idea by an individual known as an entrepreneur who then incorporates the other factors of production which include capital, land and labor. Therefore all these two processes involve coming up with creative ideas in order for the persons involved to achieve their goals.However, these new developments have led to what is referred to as Creative Destruction. It is a concept which was first used by Karl Marx to describe the situation of economic system destruction and the devaluation of its arrangements through wars and the accompanying economic crises. Later on, it was used by Joseph Schumpeter to refer to the process of industrial mutation that revolutionizes the structure of the economy from within while destroying the old ones; this takes place especially in a capitalist economy. The concept further implies that new innovations kill and render the older ones obsolete. For instance, it was experienced in the recent innovations in the computer where the Microsoft and Intel destroyed the many main frame computer companies. This process is therefore very inherent in the free market economy; where there is continuous innovation.

This concept is very important in the study of innovation since it enlightens ones mind on some of the consequences of innovation; hence keeping the potential innovation on toes to continue improving on their innovations. It also portrays innovation as a method of transferring the resources from the less efficient industries to the new and more efficient industries which is important towards the promotion of the economic growth. For instance, a lot of improvements have occurred in the agricultural industry leading to higher yields in the agricultural production. This is therefore very significant to the study of innovation since one can easily embrace and appreciate the process.

Embeddedness on the other hand is used to refer to the degree to which individuals and firms are mutually enmeshed in a social network with each other in a social and economic environment. It is a term which was introduced by Mark Granovetter who was a sociologist. In the innovation process, embeddedness plays the role of information diffusion within the system of the socially networked organizations. But then, it has its boundaries within which a particular organization or individual may network.In the study of innovation, embeddedness is very important since it stresses on the importance of the social network towards the innovation process; therefore providing a guideline to the potential innovators on some healthy steps which can help them bring their ideas together.

Liquid network on the other hand is a term which is derived from the literal liquid state of matter whereby the liquid molecules are free to move and change positions but within a boundary. It is a term associated with Steven Johnson who talked about the various conditions that can help make innovation possible. Liquid network is the situation where people, just like the liquid molecules, are free to move and interact with others; and it is through this interaction that great and innovative ideas are shared.The liquid networks concept is very important in the study of innovation since it emphasizes that good ideas come as a result of sharing personal ideas with one another which can either be in a formal or informal interaction; and it holds that no idea exists in isolation, hence all the good innovative ideas are as a result of collective thoughts. It is concerned with the environment conditions which favor innovation. For instance, Johnson illustrates by saying that a class should be physically arranged in a manner that learners can sit in interactive groups.  It also emphasizes that people of different professions and experiences can have ideas which if shared and integrated then can lead to very good innovations. Finally, this concept encourages the potential innovators that it is from errors that further experiments are done to come up with very important innovations.

Contributing factors to the Silicon Valley Innovation

Silicon Valley, which is the southern part of the San Francisco in California in the Unites States of America is a region known to be the home to the many of the worlds technologically advanced products such as the computer software, automobiles, production processes and so on. In comparison, it is normally likened to natural habitat for the flora and fauna. This is because of the composition of the various innovation factors such as the people of different professions, firms and the other institutions which are dedicated to the region’s industrial activities; the institutions include the universities and research centers, and so on.

The reasons behind this region’s innovation success include the presence of the very unique innovation systems. Therefore the points of emphasis include the availability of the favorable entrepreneurship rules and regulations which are prevailing in the place. It is a place known to operate within the distinctive American system that favors the steps towards innovation and entrepreneurship. This system is composed of the laws and regulations that guide and support the research and development of various entrepreneurial ideas such as technological innovations. Secondly, this area has a high-quality and mobile workforce. It has got workforce of various fields such as engineering, science and entrepreneurs who are also drawn from all over the world. This has therefore led to the continuous integration of diverse ideas which is very important in the innovation process. The workforce is also motivated to work hard since innovative ideas are recognized and talents rewarded accordingly.

Another unique factor in the system is the advanced level of collaboration among the business, government, and the non-profit making institutions in this region. This is seen by the level of the government’s involvement in the support of the business organizations and there innovative ideas through financial subsidies and favorable legislations. On the other hand, the non profit making organizations such as the universities and the other research centers provide for the business incubation centers and the new ideas which are relevant to the innovation activities within the companies.

Additionally, there is a highly specialized business infrastructure in this region. This business infrastructure is very rich because of its composition which includes the venture capitalists such as the bankers, lawyers, accountants, business consultants, among other corporate specialists. The banks in this area are very crucial towards the innovation since they provide the financial support which is needed by the potential innovators and investors. Lawyers on the other hand play crucial role towards advising the inexperienced entrepreneurs and in handling the legal processes. On the other hand, the accountants assist with the entrepreneurs to ensure that their financial reporting follow the recommended accounting rules and standards. Finally, the business consultants are of great importance since they assist in giving entrepreneurial advice in such an advanced technological environment.

Additionally, the region operates under the concept of open business environment. This is whereby despite the fierce competition among the businesses, there is room for sharing of business ideas; which is either formal or informally. This is very important since the various diverse ideas are normally combined to come up with quite new entrepreneurial ideas which have seen the constant innovations in this region.

2. As far as innovation is concerned, some countries are more innovative than the rest. It is a fact that is evident by the fact that some countries normally have wider technological productions than the rest. For instance, the countries such as Japan and U.S are more innovative compared to some other countries which are mostly found in Africa. This is because of the level and the diversity of the products. This therefore can be attributed to various factors which include the education systems. Education is a key factor that plays a major role in instilling the innovation urge in the young people. This is because the education system in these highly innovative countries is designed in such a manner that the learners’ talents are identified early enough then they are given orientation in their respective areas of interests. For instance, if a learner shows interest in engineering, then he or she is groomed towards becoming an engineer. Therefore it is by this nurturing process that leads to expertise and the need to learn, know more and to come up with something new.

Such governments also have their governments supporting research and innovation which is through the offer of some needed resources such as the funds and business incubation facilities. The government also normally recognizes the contributions of individuals towards innovation activities. With this credit therefore, people are encouraged to carry out various research which leads to innovations. This is unlike the less innovative countries where innovators are not properly recognized. The innovators property rights are also highly protected in such countries by the government. This therefore makes the potential innovators confident that they will be the sole entitled owners of their work.  But in the case of the less innovative countries, the property rights are not properly protected and so potential innovators are discouraged to do any innovation.

Finally, it is a common habit that the highly innovative countries welcome the potential innovators from the less innovative countries; which are also less developed to their countries in order to utilize their talents and expertise. This has therefore denied most of the less innovative countries the chance to have consistent innovators.

However, it is not impressive to have this global divide whereby some countries are known for better and many innovations than the others. There are thus various steps that can be taken in order to ensure that all the countries are capable of carrying out innovations almost at the same rate. First, the highly developed countries should desist from obtaining the potential innovative talents from the less innovative countries. This is in order to also give these countries the opportunity to come up with their own innovations. Then education systems in the less innovative countries should also be reviewed such that it favors the nurturing of the learners talents. This is by emphasizing on the specialization by the learners on their areas of interest at early stages of education; to improve their expertise and the urge to come up with more innovations.

The government of the less innovative countries should also come up with strategies to encourage innovations in their respective countries. For instance, they should be ready to assist in the funding of the innovative ideas of their citizens. Such governments should also have very strict property rights in order to protect the innovators’ rights to their innovated property. Again, the government should be ready to give credit to the innovators; which can be done by publicly rewarding them and giving them national recognition. Finally, the highly innovative countries, together with the less innovative ones, should be allowed to carry out joint innovators programs where the potential innovators can share some of the innovation ideas. This is in order to help boost their knowledge towards the innovation process.

Is too Much Innovation Dangerous?

Even though innovation has got various advantages to the current corporate world, too much of it has also proved to be bad. This is because of the various negative consequences which it has on the general economic and people’s welfare. For instance, it is as a result of innovation that there have been series of environmental problems. These environmental problems are majorly the environmental degradation that is highly caused by the technological innovations such as machines. For instance, most of the new technologies used in the industries are responsible for the massive air and water pollution. Additionally, the waste materials which are in form of fumes released in air are destroying the ozone layer.

Economically, too much innovation has also led to the demise of so many companies and industries on various ways. Firstly, the innovative companies which produce consumer commodities have managed to come to the top of the market competition; hence denying the less innovative firms the ability to compete favorably. On the other hand, the companies which are already successful because of the innovations activities normally take advantage of their profits to buy the less but potentially innovative ones. This is in order to limit the competition which may arise in the future.

Too much innovation has also contributed to the global unemployment issue. This is because it has seen the continuous coming up of new machines which perform the tasks which were initially performed manually by people. Therefore employees have been retrenched and the young professionals kept out of work because of the few numbers needed. Innovation also consumes a lot of money and time. This is because it requires a lot of research which takes time which could be utilized in performing other activities. It also uses the other resources such as money which could be easily put to other better use.

People’s ability and the urge to study have also been very negatively affected because of the innovated facilities. For instance, the machines such as the computers can be used to perform so many activities which were initially performed manually. This can be seen in the computation of the accounting figures. The accounting figures in the financial statements can be comfortably done using the computer software such as the quick books, sage and pastel without much accounting knowledge. This has therefore hindered the human beings ability to think critically over some issues.

Too much innovation has also led to the abandoning of some commodities which were comfortably used by households without any problem. For instance, people may prefer to purchase new commodities in order to keep up with the new technology and maintain their social status. But then, it adds no economic value to their lives. To some extent, it has also led to the increased wars between communities and countries. This is because the war facilities are ever in improvement and hence making it easier for the highly innovative countries to start up war at any slightest provocation by their enemy countries. The testing of these weapons is also very dangerous to the aquatic life since sometimes they are tested in the large water bodies; oceans and seas.

It is also noted that in a company setting, innovation can end up putting a lot of pressure on the employees in order to perform. This occurs mostly in the highly innovative industries where competition is very high and so the employees are required to come up with every means possible in order to win clients from their fellow competitors. Finally, innovation has led to the rising in the prices which is dangerous to the economy and households standards of living. This price hike is done in order to cover for the inflated cost of production.

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