Opportunity Recognitionand BreakthroughInnovation in LargeEstablished Firms

Gina ColarelU O'ConnorMark P. Rice

"Every day, I try to go out and grab lightning."— T̂erry Fadem, Director, New Business Development, DuPont Corporation

G£ £ ^^^^ Tabbing lightning" is how Terry Fadem characterized opportunity

recognition associated with breakthrough innovations. In recentannual surveys of the members of the Industrial Research Insti-tute (a professional association of the technology leaders of

R&D-intensive firms), "making innovation happen" and "managing R&D forbusiness growth" were cited as the number one challenges facing fRI members(in 1998 and 1999 respectively). Opportunity recognition is the bridge that con-nects a breakthrough idea to the initial innovation evaluation process—which inturn leads to the formation of a formally established commercialization effort.

During the 1980s, U.S. and European firms were competitivelychallenged by Asian finns in many industries, e.g., memory chips, office andfactory atitomation, constmier electronics, and auto making.' In response,these firms dramatically increased their competencies in managing continuousimprovement and incremental innovation in existing produas or processes, withan emphasis on cost competitiveness, quality improvements, and efficiency.̂ Inthe past decade, there has been growing awareness that managerial practiceshad simply shifted from one incomplete approach to an alternative bui equallyincomplete approach. According to Gary Hamel; "Most companies long agoreached the point of diminishing returns in their incremental improvement pro-grams. Radical, non-linear innovation Is the only way to escape the ruthlesshyper-competition that has been hammering down margins in industry after

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industry."^ Although achieving excellence in ongoing operations and incremen-tal innovation has been critical for regaining competitiveness, the demand forcorporate growth and improved financial performance from senior managementand from shareholders has catalyzed an intense and renewed interest in thediscovery, development, and commercialization of breakthrough innovations.

Since 1995, we have followed the evolution of twelve radical innovationprojects in ten large, established firms. In this article, we examine how thesefirms undertook the recognition of opportunities associated with breakthroughinnovations, which from their perspeaive had the potential to 'change thegame." In this context, opportunity recognition is defined as the match betweenan unfulfilled market need and a solution that satisfies the need.** In our twelveprojeas, breakthrough innovations arose out of invention, or insights based onnew combinations of technologies and processes. The technical discovery orInsight typically originated with a scientist or engineer, who frequently was notprepared—either through training or life experience—to make the cognitive leapfrom a technical idea to an envisioned and articulated business opportunity-Markets might not yet exist and would have to be imagined,' or current marketsmight be transformed to such an extent by the innovation that it was difficultfor the scientist or engineer to discern the business model that might emerge.The opportunity recognizer, typically a research manager or senior scientist, wasable to link the breakthrough technical idea with a need in the marketplace—one that already existed, but was unfulfilled, or one that could be created. Whatis striking is that this act must happen not just once, but many times for a singlebreakthrough innovation project to come to fruition in the market (as Figure 1shows). Thus the problem of enhancing the capacity for opportunities to be rec-ognized in a sustained manner is critically important to any firm interested inbreaking new ground.

Creative ability lies within individuals, and the degree of creativity variesacross individuals.* Opportunity recognition is a creative act. In and of itself, it isnot an organizational process.' Yet to simply rely on individuals is an inefficientuse of an organization. As Amabile and others have noted,* while individualcreativity is a critical factor, there are a number of management actions and atti-tudes that can be put in place to enhance the likelihood that the creative side ofindividuals will be developed, motivated, and direaed in useful ways.

Writers in the fields of innovation management and organizational learn-ing have identified a number of problems that established organizations face inenabling the recognition of breakthrough opportunities. Christensen providesnumerous examples of leading firms that have been unable to recognize theimport of novel technologies, develt)ped either within or external to their orga-nizations, to the future of their own industries and markets.' Indeed, the classicbusiness strategy literature emphasizes the importance of organizational experi-ence with familiar technologies and markets in maintaining continuous streamsof successful new products.'" Other writers show that the ability to createand depend on efficient routines, considered a critical aspect of organizational

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F I G U R E I . Opportunity Recognition—Initial and Recurring—within the RadicalInnovation Lifecycle

Reservoirof

TechnicalKnowledge

ideaGeneration

InitialEvaluation

BreakthroughInnovation

CommercializationProject

OpportunityRecognition

Captures breakthrough ideasand triggers the initial evaluationas a precursor to the formationof a commercialization efforL

Opportunity RecognitionEvents 2 -> n in response todiscontinuities in the radicalinnovation project lifecycte

TheMarket

learning and successful performance may, in fact, prevent firms from sensingopportunities that would drag them beyond those programmatic practices, i.e.,the domain of breakthrough innovation." Van de Ven identifies the humanproblem of managing attention.'^ In accordance with the observations of Chris-tensen, he notes that the more successful an organization is, the more difficult itis to trigger people's thresholds to attend to new ideas, needs, and opportunities.Finally, TUshman and O'Reilly elucidate the need for, and challenges associated

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with, building ambidexterity into organizations; that is, to manage current oper-ations and simultaneously develop dramatically new and different ones to copewith turbulent environments.'^ These writings focus on the dual importance ofthe individual and the organizational coniexi, i.e., the role of the creative indi-vidual in seeing an opportunity and championing it,'** and the role of organiza-tional context and organizational learning mechanisms that can facilitate andsupport the creativity required of opportunity recognizers.

Much of the literature on the topic of opportunity recognition focuseson the nature and importance of the phenomenon rather than on how to en-hance the firm's capacity to support it. A number of writers offer prescriptionsregarding the capabilities and sensitivities firms must possess to be effective atopportunity recognition. For example, since the development of a breakthroughinnovation may take a decade or more, the ability to anticipate the direction andtiming of technological development and to identify technological alternativeswill be critical.'^ Shifts in technology, market, and competition need to be recog-nized and interpreted within the context of the firm's environment."" Compa-nies must be able to imagine markets that do not presently exist, and invest intheir development ahead of the competition.''' It is important fora firm toextend its view beyond current operating practice to imagine how a discontinu-ity may develop and look at the potential discontinuity in the context of all pos-sible scenarios.'** It is interesting that these writers refer to the capacity of thecompany for opportunity recognition without offering guidelines for enablingthem. In contrast, in our study opportunity recognition was itself a discontinu-ous act based on individual initiative rather than a process or practice of thefirm.

The literature does recognize the importance of individuals through itsconsideration of the roles of technical and market gatekeepers, but it does nottie them specifically to the act of opportunity recognition. The firm that initiatesdiscontinuous innovation must be dependent on, and responsive lo, informationfrom outside the organization.'^ Gatekeepers provide a link between internaland external sources of information, acquiring, translating, and disseminatingnew information.^" Technical, or information, gatekeepers link technical infor-mation they gain through external sources with product development andprocess improvement, generating new technical possibilities.^' Market gatekeep-ers possess competence in the application of technology to potential new mar-kets." They insure the innovation is meeting a market need—information thatwill likely change as the projea evolves. While these writers provide richdescription of the roles involved in opportunity recognition, they do not explorehow firms can enhance the likelihood that it will happen as a result of the pres-ence of gatekeepers. To whom should technical and market gatekeepers providesuch information? How might the organization structure iiseU to be most recep-tive to the information? How can the organization enable opportunity recogni-tion, an individual aa, and leverage it efficiently?

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This article aims lo contribute to the understanding of the initiation ofbreakthrough innovation projects and of the role of recurring opportunity recog-nition events in sustaining these projects in the face of multiple discontinuitiesin the radical innovation lifecycle (see Figure 1). We add to the growing body ofdescriptive literature on innovation processes so richly developed by Van de Venand his colleagues, whose research program has worked across organizationaldomains, organizational sizes, and both product and process innovations.'^'While they have plowed new ground in describing the complexity of the inno-vation process, there is room for a more focused look at key aspects of thatprocess, and for constraining the domain of innovation more tightly to look atspecific contexts. In this study, the context is the large established organizationthat is concerned with creating value through the application of breakthroughtechnology to changing markets.

Though the firms in our study exhibited a variety of organizationalmechanisms for supporting opportunity recognition, in general they were imple-mented in ad hoc fashion with varying degrees of success. None have imple-mented a sustained, comprehensive, and disciplined approach. In this article,we examine several alternative approaches through which organizations may beable to systematically stimulate and support opportunity recognition.

Research Design and Cases

Defining Radical Innovation

We define a radical or breakthrough innovation as the creation of a newline of business—new for both the firm and the marketplace. By "new" wemean a product or process either witli unprecedented performance features orwith already familiar features that offer potential for a 5-1 Ox (or greater)improvement in performance, or a 30-50% (or greater) reduction in cost. Bythis definition, CT and MRI were discontinuous innovations in the field of diag-nostic imaging, but none of the subsequent incremental and generationalimprovements in the technologies were. The first PCs were discontinuous inno-vations, but the many subsequent improvements were not.

Multiple Case Study Methodology

Case study research involves the examination of a phenomenon in itsnatural setting. It is especially appropriate for research in new topic areas, wherethe focus is on understanding "how" or "why" questions concerning a contem-porary set of events, and the objective is on gaining insights to build a theoryrather than on testing hypotheses."^^ Multiple cases are generally regarded asmore robust than single case studies, in that comparisons across cases allow fora greater robustness in the development of insights and a consideration of theircontext dependency.^'

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To guard against post hoc rationalization of the reasons and motives forparticular aaions, a prospective approach to data collection was taken. That is,firms were eniistt'd for iheir participaiion while Ihe cases were ongoing. In orderlo qualify for participation, projects had to have been formally identified, withan associated team and a budget. We colleaed data about the project's history onour first round of interviews, but from there we collected data in real time as theteam was being confronted with successes and challenges in the course of theproject's development. To date, 5 of the projects have been introduced into themarketplace to varying degrees of success, 5 are still under development, and 2have been abandoned.

Information gathering techniques have included in-depth interviews,surveys, reviews of project documentation, and teleconferences. Where possible,copies of materials prepared for early evaluation boards were also collected andanalyzed. All interviews were taped and transcribed. We gathered informationfrom a variety of company representatives associated with each project from avariety of functional pcrspeaives.

During the first year of the study, the participant firms hosted a minimumof two site visits and provided access to the appropriate individuals—seniormanagers, project managers and project team members—who could provideboth historic and current information and insights with respect to the researchquestions of interest. As some projects are beginning to move into operatingunits, new transitional team members are being added to our interviews.

Following Miles and Huberman,̂ ** the transcripts and documents werereviewed and coded in a systematic manner. Any comment that bore on theissue of opportunity recognition and early evaluation was highlighted and col-lected on a summary sheet for each project. Where individuals within a projectteam gave conflicting data, it was so noted. The summary sheets were thencompared to aggregate the data and draw comparisons and contrasts.

The Sampte of CasesThis study is sponsored by the Industrial Research Institute (TRT), an

association of R&D managers and Senior Technology Officers of Fortune WOOfirms in the United States. The IRI is our sampling frame, and it therefore mustbe noted that our results cannot be generalized to all types of innovations, butonly to those whose earliest development was housed in a central R&D function.While the initial opportunity recognition that led to several of the projects aau-ally occurred outside R&D, tbe work was, in all cases, quickly centralized in R&Ddue to the high levels of technical uncertainty associated with them.

The unit of analysis is the project, not the finn or a division of Ihe firm.Members of the IRl volunteered projects within their firms for observation. R&Dmanagers were asked to consider projects that were currently formally identifiedas projects, with an associated assignment of personnel and a budget, and thathad the potential to have the market impact described above in our definition

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of radical innovation. The firms were Air Products and Chemicals, AnalogDevices, DuPont, General Electric, General Motors, IBM, Nortel (now NortelNetworks), Polaroid, Texas Instruments, and United Technology Corporation'sOtis Elevator division."*^ A brief description of the projects follows.

• Air Produas and Chemicals Corporation developed an ionic transport mem-brane (ITM) for separating oxygen from air and is working on systems to meettbe needs of tbree different application domains. The firm believes that ibeoxygen produced through ibe new system will offer a 30% cost improvementover current systems in use, and bas tbe potential to completely change tbecurrent delivery system in medical and metal cutting applications areas, result-ing in new to the world features.

• Analog Devices bas developed a micro-electro-mechanical (MEMS) acceler-ometer, a small microcbip ihat can measure changes in speed. While the appli-cation possibilities are nearly endless {e.g., virtual reality games, medicalapplications to detect changes in the rate of heart pulse), ADI initially used thistecbnology to belp move itself into tbe automotive market space. Even there,potential applications are numerous, but tbe initial market disruption was toreplace electro-mecbanical airbag sensors with accelerometers. The cost to tbeautomotive market for the airbag system fell from approximately $500 to $100per unit.

• Dupont's Biomax, is a polyester material tbat can be recycled or decomposed,It bolds up under normal commercial conditions for a time period establisbedthrough product specifications. The material decomposes at tbe rigbt time andunder tbe rigbt conditions. It is environmentally safe at every stage of itsdecomposition. Cbemicaily, Biomax* represents a new family of bigbly versa-tile polymers based on traditional polyetbylene terepbtbalate (PET) tecbnology.Its biodegradable qualities are made possible by tbe water-soluble (hydrolyz-able) linkages in its molecular chain. These linkages dissolve as they makecontact witb water, causing the entire molecular chain to break apart. Tberemnants are consumed by microbes, wbicb convert them into carbon dioxideand water. The material itself can be made into fibers, fibns, or resins. Tbismakes it suitable for countless agricultural, industrial, and consumer produaapplications: mulcb containers, mulcbing film, seed mats, plant pots, disposableeating utensils, blister packs, yard waste bags, parts of disposable diapers,blown bottles. In tbe United States alone, where tbe average household createsover tbree tons of disposable waste eacb year, tbe number of potential applica-tions for Biomax* is immense; its development represents a potentially bugebusiness for DuPont and an important solution to tbe mounting problem ofsolid waste in developed countries.

• Dupont's Electron Emitter is a fiber tbat emits light at a rate significantly fastertban any known source. Tbe most promising application areas are in electronicdisplay tecbnologies. Prior to ibis discovery, Dupont was not involved in tbedisplays business at any level.

• GE is well known for its advances in medical diagnostic technology, particu-larly with respect to Imaging systems. One of the most controversial recentinnovations in tbat industry is the advance of Digital X-ray tecbnology. DigitalX-ray not only allows for dramatic improvement in the specificity of tbe image.

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but also can be sent as a stream of data to a diagnostic bank. That alone allowsfor remote diagnosing, and has wide ranging implications for staffing of highlypaid radiologists at local hospitals and clinics. GE has found a way to combineDigital X-ray technology with Fluoroscopy, a technology ibat allows the film-ing and digitization of movement within the body. Tbe combined benefit pro-vides a leap in benefits in the medical imaging field thai GE believes will be tbenexi "game-cbanger."

GM's focus on alternative power systems for automobiles is widely known.One of ihe innovation paths down wbich tbey, and their counterparts, havebeen travelling for some time is tbat of tbe hybrid electric vebiclc. The conceptis tbat power comes from botb electrical and conventional engines, each ofwbich is drawn upon at the speeds al whicb it performs most efficiently. Tbosetechnologies, combined with several others such as regenerative braking, couldserve to offer a vehicle capable of exceptional gas mileage (50-80 miles/gallon)and exceedingly low emissions of pollutants.

IBM has commercialized a new microcbip based on an alloy of Silicon andGermanium (SiGe), wbich promises to become the basis for bigh-performancenew transistors witb switching speeds up to four limes faster than tbose oftraditional semiconductors. SiGe chips also offer several other imponant addi-tional benefits. First, tbey can operate using only a fraaion of tbe normalpower requirements for competing technologies, such as Gallium Arsenide(GaAs) based chips. Secondly, SiGe can be manufactured with tbe same costlyfabrication equipment used to make conventional silicon cbips, potentiallyavoiding billions in new capital investments. The most promising applicationarenas are in telecommunications, wbicb is based on analog tecbnology, anarena in wbicb IBM had not previously participated.IBM's second projea is the confluence of display, power, and memory tech-nologies to enable tbe creation of an "electronic book" that could be used lostore vast amounts of data such as technical manuals, doctor's files, or newspa-per articles, could be portable, and could receive written information as well asbe bighly readable.

NetActive is a spin-off venture of Nortel Networks, tbough it began as an inter-nal organizational innovation. Tbe innovation is a software capability thatallows NetActive to encode game publisbers' software in such a way that a usercould obtain tbe application for a fraction of tbe normal purchase price. Tbecustomer must tben initialize its use over the internet, and cboose from a vari-ety of usage options that allow single use, usage for a specified period of time,or purchase, all with differing fee struaures. The customer's credit card is tbencharged for tbe given usage selection. Game software and utility software sucbas tax filing programs are tbe current most promising applications.Polaroid applied highly innovative manufacturing tecbnology from its tradi-tional product arenas to the creation of low-cost, high-capacity memory stor-age devices.

Texas Instrument's Digital Light Processor Is based on the MEMS devicedescribed above. The TI projector creates a screen image by bouncing light offof 1.3 million microscopic mirrors squeezed onto a 1 square-inch chip, eachmirror has the ability to angle itself independently in order to best reflect light.

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Potential applications exist in the hard copy markets, home movie projectionsystems, and large screen movie theaters, to name but a few. The first that TIis commercializing are large screen movie projeaion systems. Movie theaterowners can now receive movies from Hollywood producers on Digital VideoDisks or even by satellite rather than on heavy reels. Theaters will no longerbe limited by a finite number of film prims, so they have increased flexibilityin show times and the number of screens showing a particular movie.

" United Technologies' Otis Elevator division has devoted considerable energy tosolving tlie problem of the "mile high building." In the commercial construc-tion industry, limits on building heighi are not based on any technical con-straints other than the problem of the elevator systems. Current systems arelimited by the weight of the cable that pulls the elevator. Once the cable getstoo long (more than 130 stories), it becomes too heavy to lift. Designing paral-lel elevator shafts and moving people from one shafi to the other is the currentsolution to very tall buildings, but at some point, that solution becomes uneco-nomic because the amount of the building's real estate needed to house theshafts is too high in proportion to the amount available for rent. Otis has devel-oped a system of people movement that solves the problem. It allows for eleva-tor cars to become separated from the shaft, and to move onto other shafts. Acombination of horizontal and vertical movement allows for a conservation ofshaft space, and opens up the opportunity for thinking about conveyance sys-tems in a completely different light.

Observations

Opportunity recogtiition for radical innovation is highly dependent onindividual initiative and capacity, rather than routine practices and procedures ofthe firm. Opportunity recognizers are in positions in the organization that allowthem to make their cognitive leap. Opportunity recognition can be characterizedas reactive or proactive. On the one hand, individuals may be alert and ready toreact to ideas and information that have the potential to become an opportunity.On the otber hand, through their own initiative or via a challenge from a supe-rior, they may take on the responsibility of searching through the organizationfor ideas that can be developed into opportunities for significant new products orbusinesses.

The report of the initial opportunity recognition that led to the establish-ment of DuPont's Elearon Emitter project is illustrative. The research managerfor the scientist who discovered the light-emitting properties of a material underconsideration for use in composites recognized that it might be of interest to theelectronic materials business unit. The research manager contacted Teny Fadem,the director of New Business Development, and encouraged him to attend thetechnical review at which the scientist would present his discovery. The initialact of opportunity recognition by the research manager triggered a second actof opportunity recognition, which in turn led to a technology evaluation effort.

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Corporate executives seldom play the role of opportunity recognizer. In10 of our 12 cases, a low- to mid-level research manager completed the initialact of opportunity recognition. However, opportunity recognizers are not neces-sarily the champions who provide the energy and persistence required to ensurethat the project receives appropriate management attention.^* In the majority ofcases in the study, the scientists who have envisioned, worked toward, and dis-covered the discontinuous innovations have some idea of the applications fortheir innovations, but they have a limited understanding of the market. Thescientists' research managers, who have recognized the opportunities associatedwith their discontinuous innovations, have sufficient understanding of the mar-ket which, when combined with their technical expertise, allows them to recog-nize business opportunities. The leap in thinking required is illustrated by one ofthe research managers:

"Altbough I didn't do much witb the business unit that would ultimately marketthis technology, I knew something about the field. It did seem important to me. Ifyou look at the history of innovation in this field, there really hasn't been much.Tbis . .. really had tbe potential to change the game."

Early conceptualizations of the commercial opportunity are made andexcitement is generated not based on projections of financial cash flows, marketshare gains or wins, or the typical rules of the game that large corporationsestablish. Every one of our participant teams could articulate a number that themarket promise had to be in order for this to be considered "an opportunity*by the conventional corporate standards. For example, "if it isn't a $250 millionmarket, we aren't interested" was typical of the comments they had heard.Those sorts of estimates, however, bordered on the ridiculous for many of theseprojects. Market uncertainty is simply too high and costs of production, at theoutset, are impossible to predict. Rather, the recognition of the opportunity layIn a conceptualization of what the delivered benefits of the technology might be,and how rich and robust those were. The idea was that, if those benefits couldbe delivered, the market would definitely be "big enough." There was no consid-eration of the timing over which the market would develop to become bigenough to recoup the enormous investment required.

As a breakthrough innovation project proceeds, there is an increasedcommitment of financial and human resources. In this domain, investment istypically staged, rather than committed for the entire development path. Hence,higher-level technical and business managers along with external partners fre-quently engage in opportunity recognition, as a triggering mechanism for theopportunity evaluation process leading to decision making about commitmentof resources. The research manager, as the first to identify the opportunity, actsas the initial catalyst to set off this chain reaction in which technical and busi-ness managers at various levels of the organization engage in the opportunityrecognition process.

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One example of the multiple levels of opportunity recognition is the Gen-eral Motors hybrid-electric vehicle project. Initial technical developmeni beganin 1969. Because of the inability to overcome technical hurdles at that time, theproject was shelved. In the late 1980s, two research managers and a researchengineer had adopted a practice of getting together every week or two for Infor-mal technology reviews, primarily to consider ideas volunteered from randomindividuals and customers outside the firm.^^ The review of one of those ideastriggered the occurrence of opportunity recognition—the "big bang" that becamethe catalyst for the formation of the project {the first opportunity recognition).In the process of explaining why a particular idea violated the laws of thermody-namics, an insight by the research engineer caused the group to come up with anew way to look at the technology, which could meet a well-understood marketneed if a set of technical hurdles could be overcome.

The research manager, using funds under his control, set up a technologyevaluation team in early 1989. The results of ihe evaluation were sufficientlypositive to cause the research manager to approach the head of the researchdivision, who in turn recognized the opportunity (the second opportunity recog-nition) and committed substantial funding. Two years later, one of the projectleaders moved to a development organization, beginning a period in which par-allel and complementary efforts were being conducted in the research group andin the development group. Within twelve months, both projects were in dangerof losing funding, due to the downturn in the firm's sales revenue and marketshare. The two project managers decided to stage a technology demonstrationfor all the corporate executives "to try to save our butt."

Although the demonstration appeared to be successful, the director of thedevelopmeni group informed his project director: "You did a good show, but wegot orders lo close you down. Our budgets can't handle you." That same eveningone of the senior executives, who had seen the demonstration earlier that day,called the director of the development group and said, "That's good stuff. You'vegot to keep that going somehow" (the third opportunity recognition). The pro-ject was resurrected and would continue, albeit under tight budgetary restric-tions. One month later, the director of the development group presented theconcept to a senior official in a federal agency. The senior official recognized theopportunity (the fourth opportunity recognition) and agreed to champion theproject for federal funding, which was authorized about a year later.

In the case of GE Digital X-Ray, there were seven key occurrences ofopportunity recognition, involving: the research scientist (1984); someone fromthe outside firm (1987); the research manager (1987); the first head of the busi-ness unit (1988); the head of central research (1992); the CEO (1993); and thesecond head of the business unit (1997). This pattern of multiple instances ofopportunity recognition, and the necessity for an ability lo articulate the oppor-tunity lo many constituents, arose in every one of our cases. For radical innova-tions, this occurrence is a matter of life and death of the project.

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Given the high degree of technical and market uncertainty associatedwith breakthrough innovation, the understanding of the opportunity oftenchanges over the course of the projea, requiring a repeat of the opportunityrecognition process that may result in a new or substantially redefined opportu-nity. To appreciate this, it is important to understand the difference betweenongoing project evaluation and additional occurrences of opportunity recogni-tion subsequent to tiie initial occurrence that may be required due to disconti-nuities in the projea development path. When an opportunity related to aradical innovation is recognized, invariably assumptions are made related tothe uncertainties associated with the discontinuous innovation. Ongoing projectevaluation occurs through project reviews, which typically focus on achieve-ment of milestones along the projea development path envisioned on the basisof these assumptions. They are, in a sense, incremental steps along the path, areevaluative in nature, and do not involve the cognitive leap required for opportu-nity recognition.

When a major milestone is missed or a key assumption turns out to bewrong, a discontinuity along the project development path occurs. For thosemanagers who do not have the capacity or willingness to make the cognitiveleap required for opportunity recognition, this discontinuity will be a projeakiller, or at least a major setback for the project. For those who do have thecapacity or willingness, it will be the trigger for a new occurrence of opportunityrecognition.

For example, initial technical research for the project that ultimatelybecame Texas Instruments' Digital Light Processor was conduaed in the mid-1970s. Opportunity recognition first occurred with respea to this technology in1978, when an application domain was identified. Prototypes were developed by1980, and tbe technical breakthrough was incorporated into a consumer produain 1983. Within a year, the product was abandoned. At this point the projectcould have died, but two new potential applications were recognized, and mid-dle and senior research managers and senior corporate management continuedto provide financial support to sustain the project, fn 1987, a critical technicalbreakthrough occurred which transformed the nature of the technology. Evenso the project was in danger of being killed off. A major new potential applica-tion of interest to federal agencies emerged in 1989. Senior research managerssucceeded in attracting federal funding and additional funding from an outsidecorporate panner that kept the project alive. In cases where a technical or mar-ket development reacbes a dead end, it requires idea generation and opportunityrecognition that result in a dramatic redireaion of the projea.

In another example, discontinuities in the development path of Dupont'sBiodegradable Material projea required reoccurrence of opportunity recogni-tion. First, when the initial application was killed by the business unit, the man-ager of the research team identified a new market opportunity through industrycontaas. He precipitated the development of a new product that embodied acharacteristic of the original product that was not deemed important in the

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original application but which was the technical breakthrough for the new prod-uct. Next, when anticipated government regulations requiring biodegradablediapers did not materialize, a key customer pushing for the development of thetechnology suddenly became disinterested. A non-application specific (strategic)opportunity was recognized as important for the firm by the director of the busi-ness development group in central research, however, and the project was main-tained on life support, with one person and almost no budget. Finally, a seniortechnical researcher in another business unit recognized an opportunity associ-ated with a new application for this technology in a market of interest to hisbusiness unit, and reinvigorated the effort.

Again, this pattern is repeated in nearly every one of the twelve cases inthe sample. When the technical and/or market assumptions related to an oppor-tunity turn out to be incorrect, a project associated with a discontinuous inno-vation faces a high probability of being killed (as it should be if no attractivealternative opportunity emerges). At these critical junctures, a new occurrenceof opportunity recognition is required to sustain the project. In some instancesit is the same individuals who engage in the new instance of opportunity recog-nition, and in other instances, different individuals, even in other business units,recognize new opportunities. In most of the instances, a senior researcher orresearch manager engaged in the subsequent occurrences of opportunityrecognition.

Although opportunity recognition is usually an act of individual initiative,informal networks play an important role in propagating waves of opportunityrecognition within and external to the firm. The twelve projeas in this studyhave undergone long gestation periods. Eleven of the twelve originated morethan 10 years ago, and several can be traced back more than twenty years. Theyoungest project in the set, one based on the lightning-paced information tech-nology industry, is entering its seventh year of development. While personnelturnover is inevitable under these conditions, for len of the twelve projects, oneor more of the early champions have been involved for the entire life of theproject, although sometimes in different positions.

The capacity of the firm for opportunity recognition is related to thecontinuity of the informal network of individuals engaged in the conversion ofbreakthrough innovations into new ventures. Upward networks (access to seniormanagers) provide protection and access to pockets of money, while the broad-based lateral and downward networks appear to provide information, confirmationof the recognizer's perception of the opportunity, and other resources.

In the case of IBM's Silicon Germanium project, the opportunity wasbased on a scientific breakthrough that was in conflict with commonly acceptedresearch results that turned out to be incorrect. In addition, the market for thetechnology represented a market discontinuity for the firm. As a result, therewas substantial resistance on both market and technical dimensions to recogniz-ing the opportunity. The well-established network of the research manager wascritical to success in getting the opportunity recognized at multiple levels in the

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organization and in getting the opportunity re-recognized when market-relateddiscontinuities occurred along the projea development path.

First, in order to prove the initial research assumptions incorrect, heneeded access to a fabrication line. No such resources were available to him,since this research was not funded at the time. He called a manufacturing spe-cialist that he knew in another business unit and "called in [his] chits with him."In other words, were it not for the informal relationship he had with someonein a business unit, he would not have had access to the resources he needed.Later in the project, the research manager used his network of connections topotential customers to provide testimonials for his senior management about thepotential of the technology in a new application market. A manager previouslyconnected to an earlier incarnation of the project by that time held a manufac-turing manager position. Because of his history with the technology and theresearch manager, he recognized the new opportunity and played a key role inenabling the pursuit of this new market. Four years later, this same individualbecame a vice president in the business unit in which the Innovation is beingcommercialized and is a strong advocate for the innovation, even against astrong organizational resistance.

The evidence here is of senior management behaving as a protectorwithin a resistant organization, and lateral networks providing resources (thefabrication line) and confirmation of the value of the opportunity (other scien-tists he met at professional conferences who were employed by potential cus-tomer firms), in seven of our twelve cases, senior managers behaved asprotectors of potentially game changing opportunities. Thus, in more than halfour sample, the project would have died had it not been for the projea cham-pion gaining access to a senior manager sponsor {Vice-President or above) andconvincing him thai the project was important. Senior managers provided pro-tection from conventional forms of evaluation or from organizational resistancethat arose in reaction lo some of these projeas. Ralher than basing their deci-sions on promise of specific economic payback hurdles, sponsors commonlycited both their gut feelings that the project could have significant impact on thelong-term success of the firm and their trust in the projea champion. Thus theyrecognize the potential opportunity, rather than relying on ihe safety of a tradi-tional evaluation process that uses criteria inappropriate for a breakthroughinnovation. Many of the projects would "fall between the cracks" of the existingbusinesses of their corporations. The sponsor of each of these projects workedto keep them alive (even unofficially), and encouraged business units to adoptthem. Thus, upward networks provide paths around conventional organizationalprocesses that become pathological when applied to radical innovation.

The implication of these stories is that networks are efficient and costeffective. They are based on personal friendships, histories, and favors. Organiza-tions today that are not promoting or leveraging long-term employment, jobrotation, and building of networks may be missing opportunities to help theirpeople think and act creatively.

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Summarizing the Observations

Taken together, these data suggest that the process for moving from afirm's reservoir of technical knowledge to the initiation of a project with poten-tially game-changing opportunity appears lo be almost capricious and, to a largeextent, dependent on chance events, supra-nomially motivated individuals, andrich informal systems, many of which have been destroyed with early retire-ments and downsizing aaivities. Further, the individuals in positions to seeopportunities aren't always as motivated as the champion literature would leadone to believe.'" Criteria applied by opportunity recognizers in the initial evalua-tion of breakthrough innovations are different from the conventional criteriaapplied to decision making regarding incremental innovation. The initial assess-ment is highly dependent on an individual's capacity lo clarify the ways a tech-nology can be used to substantiate a large enough market. This requiresdistinctive skills and access to many varying types of people to test early assump-tions. It also requires multiple waves of opportunity recognition as the projectconfronts discontinuities, critical sponsors come and go, corporate strategieschange, and the projea's development path takes it into unexpected domains.All of this points to the need for sustained effort and mechanisms to help makethe transitions easier.

Improving the Organizational Capacityfor Opportunity Recognition

Based on the observations, following are methods that can help build anopportunity recognition capability in established organizations along with mech-anisms to improve the gaps and potential difficulties.

Articulating a Call to Action

There are aaions managers can take that establish a context to encourageidea generation and opportunity recognition. When senior managers communi-cate a need for breakthrough ideas, they get a response. These communicationscan either happen explicitly, as singular events, or be part of the fabric of thefirm's culture. For example, Jerry Junkins, former CEO of Texas Instruments,announced the need to "find businesses in the white spaces between our exist-ing business units." The Digital Light Processor project was one of several resultsof that call. At Nortel, a new ventures group was set up and began issuingRequests for Proposals for new business ideas. Their first taker was the groupthat is now the NetActive project. This was originally a group of individuals whohad been assigned in one of the business units to "play in the idea sandbox" totry to develop applications for broadband technologies that were diffusing inlohomes. A number of ideas were generated, but this one did not exactly fit thebill of broadband communication. Had the Requests for Proposals not beenissued, it may never have gone beyond the limits of the sandbox. In both ofthese instances, the message was simply a call for new directions for growth.

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which was currently being limited by the operating units' focus on current cus-tomers, current business models, and current combinations of technologies. Itwas a clear message about a need for new growth in any domain, and aboutorganizational receptivity to new ideas.

A large percentage of our projerts ensued from management's articulationof strategic intent to grow in a particular technology or market domain. A well-known example is the case of Jack Welch's commonly known order to "be Num-ber 1 or Number 2 in all of our lines of business." This, in itself, provided animpetus for a mid-level researcher working in avionics at GE's Corporate R&Dcenter to recognize the potential for the fluoroscopy technology he was develop-ing as having possible applications in medical systems. He ihen made his coun-terpart in the medical systems group of the R&D lab aware of il. Similarly, il wasAnalog Devices' president Jerry Fishman's explicit statement of strategic intentduring the early 1980s to "gel into automotive" thai motivated the effort thatultimately led to the accelerometer device as an airbag actuator, andsubsequently into numerous other applications.

Investing in Organizational Enablersfor Opportunity RecognitionBeyond the direct attention that senior management can give to stimulat-

ing breakthroughs, there are a number of activities organizations can engage inthat help connect opportunity recognizers to internal and external sources ofinformation. These activities reinforce the opportunity recognizers and steepthem in diverse types of data that they use as fodder in making connections.Rather than simply relying on individuals to pursue access to a wide variety ofsources of data on their own, R&D organizations can build enabling activitiesinto people's jobs to increase the probability that opportunity recognition willoccur.

Although we saw no evidence of firms providing special professionaldevelopment programs to enhance the skills of opportunity recognizers, some ofthe firms did have mechanisms to stimulate divergent thinking among personnelin a position to engage in idea generation and opportunity recognition. Forexample, research scientists at GE described periodic conferences ihai broughttogether people from GE Medical Systems and Corporate Research and Develop-ment in which "people would talk about things that were a little bit more radi-cal, wilder ideas and so forth. IThese meetings promoted] cross-fertilization ofideas and exposure to what other people were doing." Interactions with otherscientists in the opportunity recognizer's technical discipline and associated pro-fessions played an important role in our cases. Attendance at professional con-ferences and interactions with research labs and universities stimulated therecognition of a number of opportunities. Other enabling activities includedthink tanks, brown bag lunches with world-renowned scholars and researchersin particular fields of expertise that may become arenas of strategic focus tor thefirm, technology forecasting exercises, and idea generation sandboxes. These

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aaivities are frequently put in place for some short period of time when a newmanager comes in and are the first to be cut when budgets need tightening. Yetthese aaivities were a part of the genesis of each project we observed. Projectteam participants bemoaned the fact that, while management was benefitingfrom ihose activities through a current project, they would have no similarlyenabling activities in the future.

Sustaining Attention: The Need for a Project Oversight Board

Strategic priorities in organizations shift over time. Firms that purport lovalue investments in potential breakthroughs are not consistent supporters. Asenior technical manager in one of our participant companies described a recur-ring 17-year cycle during which strategic attention to the development of dis-continuous innovations, opportunity recognition, and pursuit of new businessopportunities waxed and waned."

Changing expectations create inefficiencies in organizations, especially inthe realm of highly uncertain, long development span, high investment oppor-tunities. The stops and starts documented in these projects result, in part, fromchanging strategic contexts. The long investment horizon required, turnover insenior management, resistance posed by operating units that perceive it as athreat to their existing product lines and revenue models, and resistance fromcorporate funding boards as the projea continues to require investment overlong periods of time, all require some need for continuity, reminder of purpose,and continued articulation of the strategy.

We have documented the positive impact on opportunity recognitionof senior management's articulation of strategic intent for growth. We have alsodocumented the requirement for renewed opportunity recognition over timeand across organizational sub-units as the players change. There is a need for anoversight board for each innovation project that protects the project fromturnover in senior management champions and changes in key breakthroughinnovation players, sub-units, and strategic contexts. The purpose of such aboard would be to continue to articulate the opportunity in a manner meaning-ful to the firm, rather than to subject it to re-recognition by players who maynot understand it or feel threatened by it. Hence, the board should include indi-viduals with a long-term strategic view of the importance of breakthrough inno-vation who can make the long-term commitment to board participation neededto provide continuity and perseverance. Appropriate company outsiders (such askey members of project alliance partners or technical experts) should be consid-ered for inclusion on the board. The firms in our study ihat structured suchboards without including external members subjected the projea to the normalbureaucratic haggling that comes with typical corporate resistance. Those thathuilt the board based on needed expertise and alliances were more likely tosucceed.

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Promoting and Nurturing Informal NetworksOpportunities are frequently recognized by developing boundary-span-

ning capabilities in individuals. A broad-based awareness and sensitivity to busi-ness issues has been mentioned as a key component of opportunity recognition.For research managers who are most often the initial opportunity recognizers,sensitization to the key lines of business, current and potential customers, andfuture market directions enhances their effeaiveness in this role. While we arenot suggesting that they become market research specialists, our results point tothe importance of the muiti-dimensionality required of these individuals. Theactive promotion of informal networks is an activity management could under-take to allow researchers to gain this sensitivity. As one of the Senior Managersdescribed the process:

"The true genesis of the idea is technical. The vast number of ideas comes fromthe technical side. But they come from [technical people] with an understandingof market needs...They [get this through] interacting with their counterparts onthe operating side. It's important that the scientists have enough [market] knowl-edge, and that knowledge either comes from their own experiences or workingwith the development folks."

Developing Organizational Structure Mechanismsthat Support Breakthrough Innovation

Since opportunity recognizers are not always driven to champion theidea, it is imperative that organizations develop mechanisms to make it easy foropportunity recognizers to come forward. These mechanisms enhance the orga-nization's capacity for radical innovations by focusing on and supporting threetypes of opportunity recognizers: gatherers, hunters, and radical innovation hubs.

Gatherers are passive opportunity recognizers. A good R&D manager canunderstand the potential business implications of a breakthrough idea broughtto him by a bench scientist. These individuals have the experience, skill, judg-ment, and motivation to be aleri and receptive to the ideas ihat bubble up out ofthe normal R&D environment. Not everyone is equipped to be an effective gath-erer. They must have enough scientific or engineering knowledge to understanda technical concept, and they must also be sufficiently "market wise" to envisionthe technology's potential impact on the market. First-line or mid-level researchmanagers or senior scientists usually play the role of gatherer.

Hunters are aaive seekers of opportunities in organizations. Their man-date is lo search for opportunities among the activities in research labs andother arenas of the organization known to be sources of innovative ideas. Theirskills and experiences are similar lo the gatherers', but they are more orientedtowards marketing and business development, with a broad rather than a spe-cialist technical background. They use their extensive networks in the organiza-tioti to quickly and inexpensively make connections between technologies theyuncover and potential market applications. They often extend themselves out-side of the organization as well. A key skill that a hunter must develop is the

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ability to articulate the opponunity in a compelling way for management. Onehunter descrihed his job as follows:

"I was brought in to tnanage long-term produa and market strategy.! startedlooking through R&D lo find out where there was intellectual properly that 1could leverage into ihe marketplace. I was actively scanning and I knew Ihe] hadbeen running around evangelizing the technology for iwo or ihree years. Theyhadn't made any progress. They jusi weren't able to build a case thai got it recog-nized and funded. What we had here was a [Corporate Research] Fellow, one ofthe smartest guys in the world, but be couldn't get the attention lo til[ tbis thingup."

A Radical Innovation Hub is a known home for ideas. Creating an organiza-tional repository for ideas is an important approach to establishing idea receivingand opportunity recognition capacities in organizations. The hub's staff shouldhave the ski]Is and ta]ents necessary to be opportunity recognizers themselves.They can convene informal and formal evaluation teams (expens from outsidethe organization if necessary), record evaluation outcomes, and provide feed-back to idea generators. If the decision is made to form a team, the hub staffcan play the role of catalyst. If the initial evaluation turns out to be negative,tbe hub staff can provide shelf space to store the idea (or possible future use.Although we have seen several partial manifestations of a radical innovationhub in a few of our case studies, most firms don't have one. Just as there needsto be an organizational mechanism for capturing the results of opportunityrecognition, there also needs to be a capacity for taking the results of a positiveevaluation and establishing and supporting a breakthrough innovation projectteam. Clearly managing the handoffs between individuals and organizationalstructures is critically important for the stirvival and progress of breakthroughinnovation projects. Hence, the individuals responsible for these sets of activitiesmust be skillful at managing organizational interfaces.

We have observed several models of hunters, gatherers, and hubs thathave not functioned well. The first is the single Business Development Managerlocated in Central R&D. whose job is to behave as a hunter and evaluator. Thisperson floats from project to project within R&D to evaluate and guide the com-mercial development aspecl of each project. In this case, the floater became soinvolved with one project that he ultimately joined the development team. Theadvantage of building the hub capability was lost. A new person had lo be foundto begin the process again. It was known as a rotational job position.

The second model we have seen is an informal group of scientists withinR&D that convened monthly, under the direaion of the R&D manager, toreview ideas that came from anywhere. This was the fertile ground from whichthe technical insight sprang for one of our projects. However, there were twochallenges associated with this board's structure. First, it served as a technicalreview only. There were no business development personnel on the board, andso early questions about markets and costs were not considered. Secondly, tbe

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board was not a permanent fixture. The monthly meetings evaporated once theR&D manager retired, and the firm no longer engages in this activity.

The successful hub, then, will require a staff that is broad based in theirexperiences, known wiihin the organization as the group to contact with radicalideas, and skilled at evaluating and helping articulate the benefits of novel tech-nologies. Persistence and organizational slaying power are key.

Conclusions

Though developing a robust and persistent capacity for opportunityrecognition has proven to be a difficult challenge for these firms, approacheswithin the sample have aided the opportunity recognition practice. The in-depthdescriptions and insights of these firms can contribute to grounded theory devel-opment and offers the potential to improve practice for the technology-inten-sive, established firm. Systematic methods to enable opportunity recognizersto leverage their skills are imperative for those organizations that compete basedon technological innovation.

Notes1. J.G. Morone, Winning in High Tech Markets (Boston: MA: Harvard Business School

Press, 1993).2. Frederick Betz, Strategic Technology Management (New York, NY: McGraw-Hill,

1993); D. Gerwin, "Integrating Manufaauring into the Strategic Phases of NewProduct Developmeni," California Management Review. 35/4 (Summer 1993): 121-134; G. Hamel and C.K. Prahalad Competing for the Future (Boston, MA: HarvardBusiness School Press, 1994).

3. G. Hamel, Leading the Revohition (Boston, MA: Harvard Business School Press,2000).

4. M.P. Bhave, "A Process Model of Entrepreneurial Venture Creation," Journal ofBusiness Venturing. 9 (1994): 223-241. See also l.M. Kirzner. Competition and Entre-preneurship (Chicago: The University of Chicago Press, 1983). wherein on p. 81the author states: 'The important feature of entrepreneurship is...the ability toperceive opportunities which others have not yet noticed...to see where newproducts have hecome unsuspectedly valuable to consumers and where newmethods of production have, unknown to others, become feasible." Our thanksto an anonymous reviewer for reminding us of this reference.

5. Hamel and Prahalad, op. cit.6. Most researchers in the field of creativity acknowledge that the level of creativity

varies across people, and they note the power of organizational support mecha-nisms to help encourage creative aaions. See for exatnple A. \an Gundy, "Organi-zational Creativity and Innovation," in Scott G. Isaksen, ed.. Frontiers of CreativityResearch: Beyond the Basics (Buitalo. NY: Bearly Limited, 1987), pp. 358-381.

7. T.M. Amahile, *A Model of Creativity and Innovation in Organizations," in B.M.Staw and L.L. Cummings, eds.. Research in Organizational Behavior, Vol. 10 (Green-wich, CT: JAI Press, 1988). See also H.L, Angle, "Psychology and OrganizationalInnovation," in A.H. Van de Ven, H.L. Angle, and M.S. Poole, eds.. Research on the

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Management of Innovation: The Minnesota Studies (New York, NY: Ballinger, 1989),pp. 135-170.

8. T.M. Amabile, "The Delicate Balance in Managing for CreatJvily,* R^D Innovator(August 1994); T.M. Amabile, "How to Kill Crealivily," Harvard Business Review,76/5 (SepiembtT/Ociober 1998): 76-87; T.M. Amabile, R. Conti. H. Coon. J.Lazenby, and M. Herron, "Assessing the Work Environment for Creativity," Acad-emy of Management Journal. 39/5 (Oaober 1996): 1154-1184.

9. CM. Christensen. The Innovator's Dilemma: When New Technologies Cause Great Finnsto Fail (Boston, MA: Harvard Business Schooi Press, 1997).

10. H.I. Ansoff, The New Corporate Strategy (New York, NY: John Wiley & Sons, 1988);C.K. Prahalad and G. Hamel, "The Core Competence of the Corporation," HarvardBusiness Review, 68/3 (May/June 1990): 79-91; R.R Rumelt, Strategy. Structure andEconomic Perfontmme (Cambridge, MA: Harvard University Press, 1974).

11. A.S. Miner, "Struaural Evo!ution Through Idiosyncratic Jobs: The Potential forUnplanned Learning," Organization Science. I (May 1990): 195-210; M.L, TUshmanand P. Anderson, "Technological Discontintiities and Organization Environmenis."Administrative Science Quarterly. 31 (September 1986): 439-465; R.A. Burgelman,"A Process Model of Internal Corporate Venturing in the Diversified Major Firm,'Administrative Science Quarterly. 28 (June 1983): 223-244; D. Dougherty and C.Hardy, "Sustained Product Innovation in Large, Mature Organizations: Overcom-ing Innovation-to-Organization Problems," Academy of Management Journal. 39/5(1996): 1120-1153.

12. A.H. Van de Ven, "Central Problems in the Management of Innovation," Mattage-memSdence. 32/5 (May 1986): 590-607.

13. M.L. Tushinan and C.A. O'Reilly III, "Ambidextrous Organizations: ManagingEvolutionary and Revolutionary Change," California Management Review. 38/4(Summer 1996): 8-30.

14. J.M. Howell and C.A. Higgins, "Champions of Technological Innovation," Adminis-trative Science Quarterly. 35 (1990): 317-341; D. Day, "Raising Radicals: DiflereniProcesses for Championing Innovative Coqwrate Ventures," Organization Science. 5(1994): 148-172; S.K. Markham, "A Longitudinal Examination of How Champi-ons Influence Others to Support Their Projects,' Journal of Product Innovation Man-agement. 15 (1998): 490-504; S.K. Markham and A. Grilfin, "The Breakfast ofChampions: Associations between Champions and Product Development Environ-ments, Praaices and Performance," Journal of Product Innovation Management. 15(1998): 490-504.

15. See, for example. Richard N. Foster, "Timing Technological Transitions,' in M.L.Tlishman and W.L. Moore, eds.. Readings in the Management of Innovation (Cam-bridge, MA: Ballinger, 1988). See also Betz, op. cit.

16. Mark B. Myers and Richard S. Rosenbloom, "Research Management and Corpo-rate Renewal,' Conference on the Future of Industrial Research, Harvard BusinessSchool, February 1993.

17. Gary Hamel and C.K. Prahalad, "Corporate Imagination and Expeditionary Mar-keting,' Harvard Business Review. 69/4 (July/August 1991): 81-92.

18. Paul Strebel, Breakpoints: How Managers Exploit Radical Business Change (Boston,MA: Harvard Business School Press, 1992).

19. J. Gluck, "Radical Innovation through Creative Leadership," in R.L. Kuhn, ed..Handbook for Creative and Innovative Managers (New York, NY: McGraw-Hill. 1988).See also Betz, op. cit.

20. Michael L. Tushman and David Nadler, "Organizing for Innovation," CaliforniaManagement Review, 28/3 (Spring 1986): 74-92.

21. Edward B. Roberts and Alan R. Fusfeld, "Staffing the Innovative Technology-Based Organization," Shan Management Review. 22/3 (Spring 1981): 19-33. See

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also Michael J. Martin, Managing Technological Innovation and Entrepreneurship(Reston, VA: Reston Publishing Company, Inc., 1984)

22. Robert A. Burgelman, "A Prtxess Model of Internal Corporate Venturing in theDiversified Major Firm," Administrative Science Quarterly. 28/2 (1983): 223-244. Seealso Martin, op. cit.

23. A.H. Van de Ven, H.L. Angle and M.S. Poole, eds.. Research on the Management ofInnovation: The Minnesota Studies (New York, NY: Harper & Row. 1989). See alsoA.H. Van de Ven, 'Central Problems in the Management of Innovation,' Manage-ment Science, 32/5 (1986): 590-607; A.H. Van de Ven and D. PoUay, 'LearningWhile Innovating," Organization Science. 3/1 (February 1992): 92-116; Y.T. Chengand A.H. Van de Ven, 'Learning the Innovation Journey: Order Out of Chaos?'Organization Science. 7/6 (November/December 1996): 593-614.

24. K.M. Eisenhardi, 'Building Theories from Case Study Research,' Academy of Man-agement Review. 14/4 (1989): 532-550.

25. R.K. Yin. Case Study Research (Thousand Oaks, CA: Sage Publications, 1994).26. M.B. Miles and A.M. Huberman, Qualitative Data Analysis. 2nd edition (Thousand

Oaks, CA: Sage Publications, 1994).27. For a more detailed description of the characteristics of these projects, see G.C.

O'Connor, "Market Learning and Radical Innovation: A Cross Case Comparison,"Journal of Product Innovation Management. 15/2 (March 1998): 151-166.

28. This observation implies that relying on the literature about championing behav-ior may not be leading us in the right direction in our thinking about opportunityrecognition. We find they are two independent sets of skills.

29. The informal technology review practice has been discontinued since the researchmanagers' retirement, which reinforces our point that these praaices are ad hocand dependent on individual initiative.

30. In this regard, the champion literature suffers from a fundamental methodologicalflaw. Typically the researcher identifies champions after a project's been initiated,and then studies his behaviors, attitudes, and skills. What this implies is that theliterature has not identified those who recognized opportunities but elected not tochampion them, which is something we identify in this work.

31. Parry Norling and Robert J. Statz, "How Discontinuous Innovation Really Hap-pens/ Research-Technology Management, 41/3 (May 1998): 41-44.

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