Fostering Innovation System of a Firm with Hierarchy Theory: Narratives on Emergent Clinical Solutions in Healthcare

Abstract

A central finding in innovation research is that firms seldom innovate in isolation. Interaction with other agents such as customers, suppliers, competitors, regulators and various other private or public organizations contributes to the search of novelty by firms. A ‘system perspective’ is useful in understanding and analyzing such interactions. As shown by research scholars of innovation, the concept of system has been intensively explored but it arises several issues: first, the appropriate level of analysis and the closely related issue of identifying the actors or components, second, the measurement of the system. These issues are discussed with the respect to the interpretative hierarchy theory that adequately deals with complexity through a self-reflective process of observation and description. It provides us with some possible associated solutions, (i) the multi-level architecture of order and (ii) narratives on technological innovation. In turn, it fosters the hierarchical deployment of the ‘innovation system’ concept at the firm level and its empirical illustration through the emergence of clinical innovations in medical imaging in particular. Finally, we suggest that firm managers need an appropriate holistic approach to closely capture these emergent clinical solutions associated with lead user interactions.