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NSM Focus | 'Successful innovation results from an interplay of different factors'

Most people associate innovation with new gadgets. "Actually, it’s much more than that," says assistant professor of Business Administration Paul Ligthart, who has many years of experience in researching innovation. Ligthart focuses on the manufacturing industry and human resources management, and consciously engages with international networks. "They create a tremendously interesting exchange of knowledge, contacts and activities."

Paul LigthartWith the help of colleagues Robert Kok and Peter Vaessen, Ligthart investigates which combinations of innovation related activities are effective in manufacturing industry. This sector includes all companies that produce physical products, ranging from lightbulbs to cars. The researchers are occupied mainly by process innovation rather than new products. To do this, they regularly send questionnaires to hundreds of companies. "Our questions are very specific, for example, which systems and work processes do you use? Which robots and intelligent machines do you use? Do you use tablets on the work floor? This gives us detailed insight into what innovation means to a company."

The researchers combine these data with the key performance indicators (KPIs) of companies. It turns out that successful innovation is characterised by an interplay between the installation of new equipment, employee training and changed work processes. "Companies that combine technological and process innovation improve their KPIs, while companies that innovate technologically but do little to modernise their work processes are much less successful."

Benchmark report

Ligthart’s innovation research forms part of the European Manufacturing Survey (EMS). The EMS is a network of research institutes and universities from fifteen European countries. The network started in Germany in 1989, initiated by the Fraunhofer institute. Radboud University has been participating since 2006. "All partaking researchers use the same core questionnaire, but they can add country-specific questions. For example, Germany includes additional questions about the car industry, Spain is more interested in family businesses, and we mainly look at how companies manage their innovation process. Together we conduct research at 3,500 to 4,000 manufacturing companies."

Unfortunately, these companies are not always eager to participate. "We’re happy with a response of just five to ten percent. However, in order to increase the response rate we offer companies a benchmark report. This allows them to compare themselves with other companies from the same sector. Consultants charge thousands of euros for this type of report but we give them away to participants for free. That appeals. Three quarters of participating companies ask for this report." Researchers' knowledge is also of interest to non-participating companies. "For example, machine suppliers want to know how far companies have progressed in their innovation process so that they can respond with their own products."

Infancy

Digitisation is an important innovation trend in manufacturing industry. "This goes beyond the computer on your desk", says Ligthart. "It means that you use several intelligent machines that communicate with each other and with external parties such as suppliers. If digitisation is applied well, companies can do business more flexibly and efficiently. It enables them to respond faster to changing customer needs, communicate better with suppliers and thus reduce the costs of the manufacturing process. This can lead to a significant competitive advantage.

However, digitisation is still in its infancy in the Netherlands. "Of course, it’s nice to have a machine that can be, for example, controlled remotely. But the advantage is limited if it can’t communicate with intelligent tools and your employees aren’t sufficiently trained. Companies will have to apply more digitisation technologies to increase their competitiveness."

Financial participation

Ligthart also conducts research in collaboration with Erik Poutsma on strategic participation in human resources management. His focus lies mainly on financial participation, i.e., ways in which employees may be allowed to benefit from the performance of an organisation, such as through bonuses, profit sharing or shares. "In the past this was often limited to top managers, but more and more companies are letting the shop floor take part." Companies where employees become co-owners appear to be more successful. Not only do they deliver better products, but they also feature a more stable development of employment opportunities. "In addition, employees who are able to develop at work and receive matching renumeration become more involved than colleagues who miss out on these opportunities. This sounds logical, but it’s amazing how few companies apply this."

This research is embedded in the Cranet international network. Cranet is made up of universities and business schools from around 35 countries that investigate how 6,000 to 7,000 companies use the capacities and motivations of employees to make their organisations perform better. Similarly to EMS, researchers in different countries are examining different aspects. While Ligthart concentrates on financial participation, his international colleagues focus on, for example, talent management and flexible working.

International research networks are very valuable to Ligthart. "This can be mainly attributed to the giving and receiving of knowledge which students also benefit from. Nijmegen students conduct research at foreign partners for their Master's theses while we host foreign PhD candidates. This creates an extremely interesting exchange of knowledge, contacts and activities."/MvZ