Abstract
In a changing society characterized by increasing changes in a wide array of science, technology and market areas, innovation is critical to the continued growth of the technology-based company. It is essential for management to recognize the process in which innovation is created through company activities and diffused into society. A novel framework is needed for the management of technical innovation in the technology-based business organization.While a variety of models for the innovation process have been studied, a cyclic model is proposed which consists of two phases, "differentiation" and "homogenization", and is based on the concept of governance which considers managerial issues. Although many conventional management concepts stress the present and the internal company structure, "governance" is a meta concept which focuses on the future and on the external environment. This study attempts to show that the innovation process is relevant to governance rather than to conventional daily management. The conceptual framework of management for the innovation process is proposed from this governance framework. Managerial problems are discussed as these relate to basic research activities. As example of governance in the introduction of new systems technology in an electric power system is also presented.This paper concludes by stressing that innovative fluctuations stimulated from a changing society result in the introduction of new ideas by researchers. These fluctuations are amplified through operational management and finally a new order is created as these fluctuations are organized through governance. The collaboration or synergism of these three functions; research, management, and governance are the intrinsic ingredients to successful innovation.
