Smart Innovation Management

in Product Life Cycle

Mohammad Maqbool Waris, Cesar Sanin and Edward Szczerbicki

Abstract The present paper proposes a framework for smart innovation manage-
ment of the product using a Smart Knowledge Management System comprising Set
of Experience Knowledge Structure (SOEKS) and Decisional DNA. This proposed
system will allow the entrepreneurs and organizations to perform the innovation
process technically and quickly as this framework will store knowledge as well as
experiences of the past innovations done in various products. It will also consider
the possibility of introducing the new technology into the product. In short it will
act as the expert innovator capable of doing the innovation technically utilizing the
past experiences and several possible options based on the priorities of the user.

Keywords Smart innovation Innovation management Product life cycle

Set



of experience Decisional DNA Smart knowledge management system

1 Introduction

Since the beginning of life on Earth, humans are continuously gathering knowledge
through experiences they face during their day to day activities. Fortunately, this
knowledge is stored in human mind that can be easily recalled if similar situations
arise. Moreover, based on previous experiences, humans are able to analyze smartly
whenever a new task comes. Further, Innovation can be considered as the outcome
of human minds who think and analyze the knowledge smartly like entrepreneurs.
Both knowledge and experience are crucial attributes of an innovator to find an

M.M. Waris (&)
C. Sanin (&)

The University of Newcastle, Callaghan, NSW, Australia
e-mail: [email protected]
C. Sanin
e-mail: [email protected]
E. Szczerbicki (&)
Gdansk University of Technology, Gdansk, Poland
e-mail: [email protected]

© Springer International Publishing Switzerland 2016 183

L. Borzemski et al. (eds.), Information Systems Architecture and Technology: Proceedings of 36th
International Conference on Information Systems Architecture and Technology – ISAT 2015 – Part I,
Advances in Intelligent Systems and Computing 429, DOI 10.1007/978-3-319-28555-9_16

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184 M.M. Waris et al.

optimum solution for the necessary changes to the established product to increase
the product life. But due to rapid changes in the dynamic environment and enor-
mous amount of ever increasing knowledge, the task of innovation management is
becoming difficult to practice. Innovators need to take quick and proper decisions
so that the changes in the product can be implemented in time.
Similarly, if a Smart Knowledge Management System (SKMS) can be formu-
lated for representing and analyzing data that is able to present results to queries for
possible innovation options, and most importantly, it can store the experience based
on the decision taken for a particular query, such a system will make the innovation
process technically sound as it is dynamic in nature and continue to grow or
capturing knowledge in the same way as the human gene does. A systematic
approach in Knowledge Management (KM) process will help to survive in the
dynamic environment. Decision makers look back on the lessons learnt from the
previous similar situations as a base for making current decisions [1]. However, due
to inefficient knowledge administration and failure to capitalize the experiences
within the organization, the decision making process takes high response time,
repetition of decisions already made, and inability to keep pace with the dynamic
environment. Using a SKMS for taking decisions in product innovation will make
the innovation process faster and smarter.
Product innovation can be broadly divided into two aspects; (a) Technical
Innovation, which is based on technological grounds, and (b) Commercial
Innovation which is based on business and marketing grounds. This present study
deals with the technical innovation of the product. These two aspects are not
entirely independent of each other. In fact, some of the characteristics based on
business and marketing ground can be implemented only by properly selected
technical changes. For example one of the main feature of commercial is the cost
price of the product to compete with other competitors manufacturing the same
product. The cost price of the product can be reduced by controlling the manu-
facturing cost that can be accomplished by replacing the material(s) of the product
with the cheaper one or by replacing the manufacturing process with the one
requiring less manufacturing cost. Similarly some other features of the commercial
innovation can be accomplished by making proper changes in features representing
technical innovation. To perform the task of technical innovation, a knowledge
representation technique is required that is capable of storing knowledge as well as
experience from the formal decision events. Such a system was presented by Sanin
and Szczerbicki [2, 3] known as Set of Experience Knowledge Structure (SOEKS)
comprising Decisional DNA (DDNA).
In short, introduction of the SKMS in product innovation process will help the
organizations and entrepreneurs to take proper decisions on time as this SKMS not
only stores information and knowledge but store experiences of the formal decision
events. These experiences are recalled when similar query occurs in the same way
as humans utilizes their past experiences.

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2 Background

2.1 Product Life Cycle

Every time a new product is launched into the market, it looks that it is going to be
used for a long time due to its initial impact on the customers. But it cannot
continue to be used forever, every product has some life after that it is no longer be
used by the customers, the reasons can be introduction of the new product having
enhanced features like cheaper, faster, lighter, and so on. The life of a product is
represented by Product Life Cycle (PLC). It generally consists of four phases, as
shown in Fig. 1, which are briefly described below:
Introduction: The product is designed and manufactured in the organization and
then launched into the market. The cost of the new product is high due to less
competition and sales rises slowly. The profits are negative due to high cost of
research and development and marketing expenditure.
Growth: As sales increase due to improved product and market penetration, the
profit increases resulting from lower production cost even if the cost of the product
decreases due to more competition. At this stage more organizations jump into the
business and start the manufacturing.
Maturity: The sales continues to increase and reaches the peak, the cost of the
product is reduced to lowest due to shear competition. The product is differentiated
with other brands to attract the consumers.
Decline: The sales starts to decline that may be caused by introduction of better
products, product substitution, trend and mood change.

Fig. 1 The product life cycle with the introduction of innovation at later phases

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Due to continuous rapid changes in the technology and preferences of the

consumers, new products can no longer be developed by organizations solely based
on their ideas [4]. The organizations need to consider the consumer needs and
strategies adopted by their competitors. This will lead to a better innovative changes
in the product at proper time.

2.2 Innovation

Innovation has been an important topic of study in various fields including eco-
nomics, management science, business, engineering, science, hospitality, sociology,
among others. In spite of the fact that it is widely studied, it is often confused with
terms such as invention, creativity and improvement [5]. Innovation is defined as
the process of making changes to something established by introducing something
new that add value to users and contributes to the knowledge store of the organi-
zation [5]. It is important to note that innovation necessarily adds value to the
customers. Invention on the other hand is the creation of something new and does
not need to fulfil any customer need. Invention however can be exploited and
transformed into a change that adds value to the customers; thus, becoming an
innovation. Some inventions are not considered to be incorporated into the products
as it will not result in addition of some value to the user or even it may result in
higher cost. Drucker [6] defines innovation as the specific tool of entrepreneurs, the
means by which they exploit changes as an opportunity for a different business or
service. According to him the sources of innovation are changes in industry
structure or market structure, demographics, changes in perception, mood or
meaning and application of new knowledge.
Innovation is often associated with physical products. However, innovation is
broadly divided into three categories viz. product innovation, process innovation
and service innovation. The present study is concerned with the technical inno-
vation in the domain of product/process innovation that is tangible products in
general.

2.3 Set of Experience Knowledge Structure

and Decisional DNA

The Set of Experience Knowledge Structure (SOEKS or simply SOE) is a smart

knowledge structure capable of storing explicitly formal decision events [7–9]. This
smart knowledge based decision support tool stores and maintains experiential
knowledge and uses such experiences in decision-making when a query is pre-
sented. The SOE has four basic components: variables (V), functions (F), con-
straints (C) and rules (R) (Fig. 2) [1] and it comprises a series of mathematical

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Fig. 2 Structure of set of experience

concepts (logical element), together with a set of rules (ruled based element), and it
is built upon a specific event of decision-making (frame element). Its structure is
motivated by Artificial Bio-inspired intelligent techniques supporting
knowledge-based solutions of real world problems and has enormous potential to
enhance automation of decision making and problem solving for a number of
diverse areas, creating unprecedented research opportunities in an extent of fields.
Our research converges on the application of SOE in the development of smart
innovation management platform that could cover processes of the whole product
life cycle.
A formal decision event is uniquely represented by the set of SOE components
as shown in Fig. 3. Variables are considered as the root of the structure as they are
required to define the other components. Functions are the relationship between a

Fig. 3 Set of experience and decisional DNA [9]

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dependent variable and a set of input variables. Functions are used by the SOE for
establishing links between variables and constructing multi-objective goals.
Constraints are also functions that are used to set the limit to the feasible solutions
and control system performance with respect to its goals. Rules, on the other hand,
are the conditional relationships among the variables and are defined in terms of
If-Then-Else statements.
A formal decision event is represented by a unique set of variables, functions,
constraints and rules within the SOEKS. Groups of SOEs are called chromosomes
that represent a specific area within the organization and store decisional strategies
for a category. Properly organized and grouped sets of chromosomes of the orga-
nization is collectively known as the Decisional DNA of the organization.
Applications of SOE and DDNA have been successfully applied in various fields
like industrial maintenance, semantic enhancement of virtual engineering applica-
tions, state-of-the-art digital control system of the geothermal and renewable
energy, storing information and making periodic decisions in banking activities and
supervision, e-decisional community, virtual organisation, interactive TV, and
decision support medical systems for Alzheimer’s diagnosis to name a few. For
details see Shafiq et al. [10].
In the next section it is shown that how the Set of Experience Knowledge
Structure and Decisional DNA can be applied in taking proper decisions in product
innovation. The framework for smart innovation management is discussed that
explains how solutions to the particular query are provided utilizing the knowledge
of the past decisional events at the same time.

3 Innovation in Product Life Cycle

Organizations involved in product manufacturing cannot grow only through cost

reduction and improved engineering processes. To survive and prosper, they need
to innovate continuously to find out new ideas. The reasons are rising costs of
material and energy, competition at international level, new technologies, frequent
changes in lifestyles and automation. Schumpeter [11] describes innovation as the
use of an invention to create a new product or service resulting in the creation of
new demand. The introduction of a new product into the market destroys the
demand of existing products and creates demand for new ones, and so on. He
termed it as creative destruction.
Despite the fact that we one cannot predict future, a systematic and proper
approach can increase the life of the product. The most important point is to
determine the proper time for applying innovation at later phases of the PLC. Many
organizations fail to recognize an alarming time for starting innovation process (the
critical zone is shown enclosed by a red circle in Fig. 1) so that the resulted
innovative changes can be applied to the product at the proper time (preferably at
the end of maturity or at the beginning of decline phase); they start the innovating
process when the sales start to decline or at least becomes stagnant. By the time

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they introduce changes into the product, sales are almost declined to the minimum
and do not find time for further necessary innovations to survive in the market. The
sales continue to increase exponentially in the maturity phase. The alarming time
should be the point of inflection i.e. the time at which the rate of increase of sales
starts decreasing or the curve changes from concave to convex. At this point, the
organization needs to analyze the factors for innovation, on both technical and
business ground.
Once innovation is implemented on suitable time, at the end of maturity phase or
during the start of the decline phase, product sales increase again. And this can be
repeated few times until the effect of innovation does not results in appreciable sales
of the product or the product becomes obsolete [12].
Once the data from the above sources is available, organizations can find out
which features or functions of the product need to be upgraded, which ones may be
excluded and which new features or functions may be added to the product. These
features and functions are attributed to some component(s) of the product.
Innovative changes in the product can be performed by modifying one or more
components of the product. Accordingly, the required changes can be incorporated
into the product to complete the innovation process. Product innovation is a con-
tinuous process; no organization, however big or successful, can continue to grow
on the past achievements. In fact, like PLC, innovation also has some life and after
some time it is replaced by another innovation. If organizations do not innovate
regularly, their product will become non-competitive. Okpara [12] says that
enterprises that rely exclusively on innovation will prosper until their products and
services become obsolete and non-competitive.

3.1 Framework for Smart Innovation Management

The framework for the technical innovation incorporating SOEKS and DDNA is
shown in Fig. 4. It consists of user interface, integrator, prognoser, solution and
decisional DNA. The detail about these components is explained as follows:
User Interface: Users can interact with the system by inputting data into the user
interface. The data can be a simple query for innovation or addition of any new
technology/process to the knowledge base of the platform; for example a query for
suitable replacement of fuel injector of a particular car, or addition of the new
technology/device used for fuel injection.
Integrator: The integrator receives data from the user interface and acquires
information through various applications. It produces sub-solutions according to the
objectives of the users; for example size and weight of the fuel injector, its
input/output considerations, cost, service life, and so on. Next it transforms the
information into a unified language and measurement system. It gathers and
organizes the data and transforms it into sets of experience described by the unique
set of variables, functions, constraints, and rules. The integrator interacts with the

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Fig. 4 Framework for smart innovation management

decisional DNA for similar sets of experiences and sends the results to the prog-
noser for further processing.
Prognoser: The prognoser first produces sub-solutions provided by multiple
applications according to its established objectives. Then depending on the various
scenarios new sets of model can be built taking into account measurements of
uncertainty, incompleteness and imprecision. The prognoser finally produces set of
proposed solutions that are sent to the solution layer.
Solution: The solution layer allows the user to select the best solution out of the
proposed solutions. Based on the priorities defined by the user it chooses the best
solution among the possible solutions provided. The decisional event is then sent to
the Decisional DNA of technical innovation.
Technical Innovation DDNA: It is where the sets of experience, formal deci-
sional events, are stored and managed. One set of experience represents a decisional
DNA gene [7]. Same category of genes are grouped together which is collectively
called as decisional chromosome. Group of such chromosomes; product chromo-
some, process chromosome and technology chromosome, constitute a decisional
DNA of technical innovation. It also interacts with other components of the
framework during the solution process and presents similar experiences that helps
in finding a reliable solution in less time.

3.2 Capturing Knowledge for Technical Innovation

Innovation is done on the bases of new ideas based on collected information. This
results in the creation of new knowledge and decision making events. If a
knowledge structure can be made that store the data from various sources

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mentioned above and captures formal decision events, whether successful or past
failures, the innovative decision can be made by enquiring the SOEKS-DDNA
structure. Any query sent into this system will return with some options corre-
sponding to the priorities and preciseness of the proposed changes. Once the
decision has been made, the decisional event will be stored in the system as an
experience in terms of a defined set of variables, functions, constraints and rules.
Such experiences are stored every time the query is made and decision has been
taken. This way the system grows dynamically in collecting knowledge and
experience. These experiences will useful when similar query comes to the system
and this way the repetition process is avoided.

4 Conclusion

This paper presented the smart innovation management process utilizing the
SOEKS and DDNA. It was explained how the innovation can be done on technical
grounds based on the previous innovative experiences of the similar products. It
was also demonstrated how the present decision event can be stored in an organized
manner so that it can be utilized in future. The concept of SOEKS/DDNA is a novel
knowledge representation structure, it enabled the innovation process to be dynamic
and ever increasing in experience.

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