Research on Capability Maturity Model for Organizational

Research on Capability Maturity Model for Organizational
Innovation Management: Focus on Intellectual Capital1
SUN Rui ; SHI Jintao
School of management ,Shanghai Jiaotong University,shanghai,200030;
School of management, Shandong Economic University , Jinan,250014
Abstract: Effective innovation management is the key factor for promoting enterprises’ performance. In
this paper, applying capability maturity model theory, we analyze organizational capability maturity
model about innovation management and its promotion strategy. In the study, the concept of capability
maturity is explain and capability maturity model for innovation management is established, then, we
describes each state content of innovation management maturity and expound the work mechanism of
the framework.
Key word: Innovation Management, Capability Maturity Model, Theoretical Framework
1 Introduction:
Many companies at present are confronted with dynamic and uncertain environments due to the
accelerated rate of technological change, they are forced to develop fast responses to various market
pressures(Shoukry,1993), So innovation has become a major part of corporate strategy. Relevant study
has shown that effective organizational performance, depends to a great extent on the success of the
innovative activities within the organization and particularly y on the way they are managed
(Shoukry,1993).
However, it is highly unlikely that innovation can be promoted, harnessed and managed in one
giant leap. Many organizations are striving to improve their innovation management, which is now
important strategy, impacting all the touch points of business development. In Software engineering
field, there is Capability Maturity Model (CMM), which is one of important systematic tools that can be
used to determine organizational ability to develop and maintain software (Paulk et al.,1995). It
describes five levels of process maturity, higher is supposed to be better. CMM can help organizations
get their software development operations under sufficient control and guide the process improvements.
Based on reviewing the structure of the CMM, the purpose of this article is to expand on the line of
thinking on the organizational innovation management and attempts to introduce CMM’s concept into
study of innovation management. We aim to establish capability maturity model for innovation
management, clarify the avenue in which the levels of organizational innovation management is
upgraded , describes each state content of innovation management maturity and explore some of
important points in this management framework.
2
Organizational Innovation and Key Factors Affecting Innovation
2.1 Definition of Innovation
Innovation is a topic of ever-increasing interest to organization and researcher. Various scholars
have recognized the importance of innovation to organization’s competence. Although practically many
people have this view, innovation has nevertheless uniform definition and understanding. Schumpeter
(1983), defined innovation as encompassing the entire process, starting from a kernel of an idea
continuing through all the steps to reach a marketable product that changes the economy; Kanter (1988)
indicated that innovation has to do with the production or adoption of useful ideas and idea
implementation. In recent years, the concept of innovation has become more complicated as well. West
(1990) note that “the intentional introduction and application of ideas, processes, products or procedures
which are new and benefit to the job, the work team or the organization”. Scott (1994) proposed that
innovation include several process, such as problem recognition , idea generation, idea completing and
1
Supported by the National Natural Science Foundation of China under Grant Nos. 70571052, 70672072
601
prototype production. On the other hand, creativity often be refer to idea generation alone. Finally,
innovation is viewed as a multistage process; creativity is only one stage of a multistage. In all,
innovation is characterized by discontinuous activities rather than discrete, sequential stages, individuals
can be expected to be involved in any combination of these behaviors at any one time (Scott,1996;
West,2004).
2.2 Key Factors Affecting Innovation and Model Of Organizational Innovation
Innovation
Determinants
Individual
Team
Organizational
Innovation Environment
Organizational
Culture
Organizational
Climate
Match
Market
Employee
Innovation
Innovation
Performance
…
Organization
Direct
influencing path
Indirect
path
Organizatio
n target
Figure1: Function Mechanism Model Of Innovation Determinants
King & Anderson(1995) indicated that three level factors: Individual, team and organization are
essential facets for organizational innovation. Many researchers are striving to explore the wide range of
factors at the three levels of analysis found to be associated with innovation in the workplace. A variety
of authors have examined the relationship among individual feature and innovation. Such research result
point to the same set of critical individual factors involved in promoting and implementing innovations,
which cover five-factor traits, generative thinking, conscientiousness, style of solving problem,
self-discipline and so on. At group level, A substantial body of research has now accumulated on such
factors as team task feature, team background, team structure, team processes and relationship between
teams, which have been consistently found relative to innovation across several primary studies. With
respect to the organizational level, the major factors enhancing innovation has been studied involves
strategy, structure and systems, organizational culture, organizational climate for innovation, resources
and skills, teamwork, Leadership and ‘‘in-house’’ research and the like.
Based on literature review, we propose a function model of innovation determinants (See figure 1).
Facilitators of innovation at deferent level have direct and indirect way to influence individual
innovative behavior. Individual innovation is a function of all these antecedents. The organizational
final innovation performance lies on the match between individual or team innovative behavior, market
demand and organizational target. It is not enough to only consider the individual, team and
organization level factors separately to propel innovation. We believe it is important to consider the
effects of each of these factors and their interrelationships in making the organization more innovative.
It is necessary to build a synthetical framework to integrate all the facilitators.
3. Analysis About Capability Maturity Model for Software
3.1 The concept of Capability Maturity Model (CMM)
Gabor Klimko(2001) indicated that each entity develops through the levels over time until it
reaches perfection-up to the highest level, the maturity model are defined as “the description of any
entity’s developing process over time”. The most well known example of maturity modeling is the
Capability Maturity Model (CMM) for Software (Paulk et al.,1995). It provide a yardstick against which
it is possible to judge, in a repeatable way, the maturity of an organization's software process and
compare it to the state of the practice of the industry (Kitson,1992).
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Maturity Level
Indicate
Continuously
improving
process
Contain
Process capability
Key Process Area
Achieve
Predictable
Process
Standard
consistent
process
Organize
Goals
Common features
Address
Implementation
Institutionalization
Contain
Disciplined
Process
Key practices
Describe
Infrastructure/Activity
5．Optimizing
4．Managed
3．Defined
2．Repeatable
1．Initial
Figure 3. The Five Levels of Software CMM
Figure 2.Structure of the Software CMM
The framework established by the CMM is organized into five maturity levels,each capability
maturity levels describes special process capabilities and are composed of one or more key process areas
(KPA) ,which help software organizations improve their maturity of the software processes, from a ad
hoc,chaotic state, to a mature, disciplined state. Each key process area identifies a cluster of related
activities that, when performed collectively, achieve a set of goals considered important for enhancing
process capability.(Paulk et al.,1995). This can be described as a “staged” representation, what provides
a layer in the foundation leading to continuous improvement for maturity in the range 1-5. According to
relative studies(Paulk et al.,1995),KPA is organized into five sections, called “common features”,which
are specify the key practices that, when collectively addressed, accomplish the goals of the key process
area. Key practices describe the infrastructure and activities that contribute most to the effective
implementation and institutionalization of the key process area. When managers are implementing the
task of software development, it can provide references for managers to insure to achieve the goal
successfully.This structure of the CMM is illustrated in Figure2.
3.2 The Framework of Capability Maturity level
The CMM is a framework with five levels characterizing a path for software process
improvement.The five levels proposed by the CMM are labeled “Initial”, “Repeatable”, “Defined”,
“Managed”, and “Optimizing” in the range of 1-5,as shown in Figure3.Every level reflects special
characteristics of the organizational actual state,and emphasizing the needs for organization to perform
software process improvement, assessments, or software capability evaluations. For example, at the
initial level, Few processes are defined, and success depends on individual effort and heroics; at the
repeatable level, basic project processes are established, the necessary discipline is in place to repeat
earlier successes on projects and etc. The model designed an evolutionary path to improve the maturity
of software development step by step.
4. Maturity Model for Organizational Innovation Management
4.1Organizational Innovation Management
While some argue that innovation cannot be managed – that it just happens – most researchers and
theorists agree that the organizations can be designed to have a structure, a culture, and processes that
are conducive to innovation (Kanter 1998; Hamel 2000; Kathryn, 2006). Tidd (2001) argues that it is
important to see innovation as a management question, since there are choices to be made about
resources, their disposition, and coordination. The management of innovation does hence not pertain to
the taking of decisions or directing business activities, but it focuses on what has to be done in practice.
Innovativeness is the result of a deliberately chosen and pursued policy (Keizer et al.,2002).
Cummings and Oldham (1997) found that organizations, which provided a supportive innovation
context for creativity, tend to reap greater benefits from employees who are innately creative.Van de
Ven (1986) noted that it is recognized that firms rely on managerial support to form positive work
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environment when developing innovations. Sweetman,(2001) proposed that how to influence the work
environment by managerial practices is the major problem to foster innovation within organizations..
According to Nelson (1982) and Dirk& Gerrit(2004)successful innovation is based on the creation of
organization specific routines. Organizations develop particular ways of behaving, by which firms learn
over time through trial and error. A useful approach developed for managing innovation is the
Capability maturity approach from, which focuses on dynamic change, Continuously improving and
life-cycle method.
4. 2 Framework of Maturity Model for Innovation Management
The innovation management goal for any organization must lead to leveraging the organizational
innovative intelligence for the business benefits, the path to reach this goal is to upgrade the capacity
maturity level of innovation management continuously. The motivation for the Innovation Management
Maturity Model (IM -CMM)is to radically improve the ability of organizations to develop, motivate,
organize and propel the intellectual’s innovative activity and to steadily improve their innovation
management capability. The is designed to guide organizations in selecting immediate improvement
actions based on the current maturity of their innovation management practices.
The states of maturity can be achieved by systematically addressing the three basic pillars of
innovation management: people: the actors who engaged in the innovation activity; process: these are
the enablers that help people harness the maximum out of the innovation initiative; environment:
organizational policy, strategy and pratices to guide the efforts of actors to release their creative power
and utilize their genius. These three pillar are the key foundation areas(KFAS). The path to maturity is
of continuous improvement and must be governed by a strong maturity framework, which has the ability
to assess and benchmark the various aspects of organizational management level in a holistic manner.
On the basis of theory about CMM, a five-level model for innovation management can be proposed, as
shown in figure 4. A brief description is given for each level as followed.
Table 2. Characteristics
haracteristics of IM -CMM
Management focus
Key Process
1.Initial
Innovation layout
2.Repeatable
Organizational
structure;
Innovative talents
Innovation unit
3.Defined
Resources;
Performance;
Process
4.Managed
Leadership
Organizational
5.Optimizing
culture and
climate
Transform Structure;
Select talents;
Team building
Resources supply
Technical scanning
Innovation
appraising;
innovation Support;
Supervisitory
Encouragement
Shape climate for
innovation
Manage climate for
innovation; Foster
innovation culture
Institutionalize;
Supervisitory
encouragement;
4．Managed
Sufficient resources;
Performance reward;
Autonomy or freedom
Flexible structure;
Talents selecting;
Work redesign
5．Optimizing
3．Defined
2．Repeatable
1．Initial
Figure 4. The Five Levels of IM -CMM
At the Initial level,the innovation management is characterized as ad hoc, and occasionally even
chaotic;few management processes are defined, and innovation success depends on individual effort and
heroics, people, process and environment are not integrated. The management should be with an eye to
organizational innovation conceive and layout.The primary objectives at the repeatable level are to
eliminate hindrance of employee’s innovative behavior and to establish a foundation of workforce
innovation practices. Management focus at this level is to perform primary Management practices,such
as technical scanning, transform to be flexible structure, select creative talents, strengthen innovation
unit and to establish effectively innovation team.Organizations at the second level have establish a
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innovation basis that can be continuously improved in organization, but the practice and policy is
inconsistent. The organization is motivated to achieve vigorous and integrated management system at
the defined level. At the third level, the organization typically provides forms for activities such as
optimal resources supplying, rewarding for innovation, and performance appraisals.On this stage, cross
functional processes involved in innovation are defined and integrated.At the Managed level, detailed
measures of the innovation process and product quality are carried out, both the innovative process,
group and employee are quantitatively understood and managed. Organization lays emphasis on
comprehensive leadership to prompt innovation,such as transformational leadership and LMX
behavior ,which has been proved to stimulate innovation effectively .On the highest Level, continuous
innovation process improvement is enabled by quantitative feedback from the process and from piloting
innovative ideas and technologies.key process areas points to such issues that both manage climate for
innovation and foster innovation culture. Innovation occurs as a result of the interplay between
individual and work-context factors, an striking element in the process is organizational climate. So
Shaping climate for innovation is a very complicated task for innovative organization.
The states of innovation management maturity can be achieved through consistent and concentrated
effort. To sustain continuous growth, one needs to progress step by step to attain the higher levels of
management maturity.There cannot be a short cut to reach the highest maturity state.
5 Conclusion
Innovation is a key driver of organizational success.The IM -CMM model provides a framework
to identify, prioritize, and describe the status quo as well as necessary changes to develop an
organization’s innovation capabilities to achieve higher maturity levels and a guidance on how to
improve the organizational capability of innovation management continuously. The argument that each
organization is individual and, therefore, is the innovation process does not conflict with the inner logic
of maturity models (Peisl, 2004) stating that the consistent use of tools and processes will lead to a
greater potential.
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