The research work will derive its base from academic journals, official insurance reports and press releases, surveys such as different surveys on Insurance sector conducted by Insurance Development and Regulatory and Development Authority of India (IRDA) , online resources and books. Case studies and journals concerning the insurance sector such as Innovation in medium-sized insurance companies:how marketing adds value, Indian Journal of Marketing, Journals published by IRDA like Key to business new products (IRDA, 2010), Journal of Product Innovation Management, Successful market innovation - European Journal of Innovation Management will be studied where user lead growth and innovations will be identified and evaluated for their applicability. Emergent themes and relationships among the case studies and the literature will be analysed and documented from which to hypothesise and present cases for strengthening interpretations.
Additional background knowledge would be gathered from such literary publications as Mishra, M.N. (2008) Insurance Principles and Practice, Best Company, A.M. (2007). The Guide to Understanding the Insurance Industry 2007-2008: Dig into the Financials That Drive Insurers, Burns & Stalker. (1961), The Management of Innovation, Treacy & Wiersema, (1995), The Discipline of Market Leaders, Afuah, A. (2003) Innovation Management.
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The importance of customers as a source of co-creating novel products and services has recently been growing. Also there is a wealth of literature confirming the importance of users (customers) that can lead to innovative products and services. But now much has been written how the active collaboration between financial companies and its customers can lead to the generation of new ideas, which in turn can lead to the creation of new and enhanced financial products and services. The key inputs to an innovation are ideas as they form the basis of the product and/or services that will be offered to the market and the primary objective of customer satisfaction can be achieved. Moreover, ideas and product innovation as per the market trends and customer requirements are central to organizations in achieving their commercial objectives. Insurance companies are no exception and new ideas can be the starting point of new and enhanced insurance product and services. Cooper (1986), describes ideas as the initiator of the new product introduction process. According to Cooper and Yoon, customers can be a very good source of new ideas (Cooper, 1986; Yoon, 1988). In a research study of two hundred and fifty two new products in one hundred and twenty three firms Cooper found that 20% of ideas came from customers, 17.4% from the sales force, 13.3% from internal managers and 12.3% from R&D. Furthermore, Yoon in an another study of 135 industrial firms using a scale of 1 to 10 to classify the sources of ideas (1 = not important 10 = very important) found the following;
Customers = 7.6;
Market research on customer needs = 7.1;
Overseas technology source = 6.6;
Competitor = 5.3;
Production staff = 5.2.
Also, Eric von Hippel, Professor of Management and Innovation at MIT, has explored these practices using his notion of ââ‚¬Ëœuser-centered innovationââ‚¬â„¢. His empirical research shows that manufacturers (Insurance companies and R&D in our case) are not always the source of innovation (Hippel, 1994). Customers, the different divisions in an organization, complementary innovators, financiers, distributors, and any other entity that benefits from an innovation can also be a source of the innovation (creation of new products and services). Users of new products and processes have been shown to differ on the level of benefit they can obtain from these. The greater the benefit a given user can obtain from a needed novel product or process, the greater his effort to obtain a solution will be. Therefore, Von Hippel, argues that users able to obtain the highest net benefit from a given new product (or process or service) are the ones who have devoted the most resources to understanding it. And it follows that this subset of users should have the richest real-World understanding of the need to share with inquiring market researchers.
A pressing topic for research for both theoretical as well as practical purposes is how innovation is best started. This topic is of importance to marketing specialists because it is claimed by analysts that marketing inputs are critically important in steering innovative business development (Day and Reibstein,1997; Kim and Mauborgne, 1997; Johne, 1999).
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The working hypothesis for my research work is that the companies which achieve a greater number of major innovations will do so by pursuing the newer simultaneous approach to managing change. The hypothesis was developed from a review of current management literature (Lewin & Stephens, 1993; Ghoshal and Bartlett, 1995; Barham and Heimer, 1998; Volberda, 1999) which shows that new-style organisations pursue a simultaneous ``holistic'' approach to managing whereby they attend to a wide range of management tasks simultaneously. In contrast, it has been observed that chief executives in less successful innovator companies will pursue the older, apparently more logical, sequential approach to managing change. Despite growing interest in new-style organisation configurations, it is surprising that there are at present few comprehensive schemata which capture the complex organisational elements involved. Lack of agreement on what precisely is to be measured made for difficulties in formulating hypotheses. I have selected the extensive schema of Peters and Waterman (1982) for the purpose of hypothesis formulation and testing. It has been widely used because it is easier to interpret and comprehend by academics and managers. The schema has been applied previously in investigations into innovation management by Dwyer and Mellor (1991) and Johne and Pavlidis (1996).The Peters and Waterman (1982) schema is centered around seven main variables which are under the control of management. Each variable begins with the letter S, for the reason which the schema is often referred to as the 7Ss framework. It was these seven dimensions of innovation capability which were chosen to gain detailed insights into the management of change. Of the seven dimensions, two are the ``hard'' Ss of strategy and structure; the remaining five are the ``soft'' Ss of systems; staff; shared values; style and skills. The dimensions are listed in Table I below.
The field of this research work will examine how Insurance companies can innovate new and enhanced products and/or services, enter market segments and ehance there internal processes in order to retain its leading position in the modern financial world. The findings will also give an idea about the necessary steps needed to be taken by insurance companies in order to be more profitable. The main constraint of the research is that it will be conducted using case studies and data reported in the insurance journals and literature. However, they will include credible amount of information in user-led innovation. The conclusion reached in the research work will provide a basis for the hypothesis and create useful insights in the field of Insurance and innovation management in the insurance sector which plays a key role in survival of the companies in the highly competitive market of Insurance sales and marketing.. The findings will also be of potential relevance to other long-established suppliers of financial services, such as banks.
Dimensions of innovative capability measured
The comprehensiveness of the innovation game plan in terms of the following elements:
mix (market, product and process)
balance (major vs. incremental)
Type of top leadership style practised as far as innovation is
Transformational vs. Transactional
H3 Shared values
Congruence of personal aspirations with organizational aspirations for innovation:
Motivation to drive change in a participative way
Degree of collective support for corporate level innovation strategies
Degree of collective support for business level innovation strategies
The official organizational decision-making patterns for innovation in terms of:
Levels in the organizational hierarchy
Explicit customer focus v. supply competence focus
The control and coordination procedures for innovation in terms of:
The functional specialisms involved in innovation:
Range of specialist staff employed at the business level
The change management skill training provided for staff:
Range of functional specialisations provided with such training
Source: Based on the 7Ss schema of Peters and Waterman (1982)