Exploring product/service innovation process in UK University spin-offs from practice-based lens

Dr Ning Baines, School of Business, University of Leicester;
Dr Te Klangboonkrong, Research and Enterprise Division, University of Leicester;
Professor Helen Lawton Smith, Department of Management, Birkbeck, University of London

The process of product and service innovation – progressing from concept to successful products and services – is a continuous practice for connecting market demand with technology. While the linear approach still dominates (Salerno et al., 2015), critics have long suggested that the applicability of the existing linear model is limited, especially when it comes to new and innovative micro firms that develop radical or new-to-market technology product or service (Barr et al., 2009). This oversight is unfortunate given that in 2021 there were 5.3 million micro firms in the UK (tech start-ups and university spin-offs included), accounting for 95% of all businesses (Hutton and Ward, 2021). Among the innovative start-ups, university spin-offs (USOs) created by academic staff are specifically focused on cutting-edge knowledge emerging from universities (Druilhe and Garnsey, 2004; Lawton Smith and Ho, 2006), thus engaging in the provision of novel, technologically advanced products and services (Baines & Lawton Smith, 2019).

In this study, we explore the process of product/service innovation of USOs by adopting a practice-based perspective (Ellström, 2010) which characterises the learning process of a firm through logic of production and logic of development. We address the research question of “What are the practices of product/service innovations adopted by USOs?” We reconcile the traditional linear process (formal stages in product/service innovation) with the two practice-based logics. In so doing, in-depth interviews with 20 founders of UK USOs were conducted; an immersion approach and thematic coding were adopted.

Overall, the findings show that USOs rarely follow standardised product/service innovation process. Stages that are part of the linear development process are recognised and utilised by the USOs, but the process tends to be more cyclical and iterative as a result of real-time learning and feedback loop involving customer knowledge. Practice-based perspectives shed some light as to how the lack of formality is not a mere haphazard response to poor resources, but could be understood in terms of the interactive and flexible interplay between the logics of production and development. This approach also resonates with how small companies have used agile products/services development project planning and repeated the production, creation, selection, and alteration of targets and concepts (Berends et al., 2014).

We have made a few academic and practical contributions based on the findings. By applying the practice-based perspective, we extend the current understanding of both academic entrepreneurship and practice-based innovation through exemplifying and substantiating the interactions of the logics of development and production (Ellström, 2010) in USOs context. Practically, this research supports the wider argument that the norms and principles of product/service development in small firms are fundamentally different to those of large businesses (Gimenez-Fernandez et al., 2020; Silva and Moreira, 2021).

Finally, reconciling practice-based and linear models gives some structure to the complexity faced by academic entrepreneurs and technology transfer offices (TTOs) with regards to the operationalisation of the products/services development processes. This information might be helpful to TTOs as they continue to improve a support infrastructure that is fit for purpose. Support for USOs involves a delicate balance of multiple challenges, such as the learning capacity necessitated by novel technology vs. finding a route to market under time and resource constraints, which could be further explored using the practice-based perspective. 

To read the full article, please follow the link: https://link.springer.com/article/10.1007/s10961-022-09985-3