Abstract 0452226 Rosenthal Innovation in the U.S. service sector is important, but not well understood. The proposed research, the first phase of a broad inquiry on services innovation, concentrates on the important innovation context where services are developed and initiated as extensions of core manufacturing operations. For this target domain, our proposed research seeks to answer the following three questions: 1. How do emergent strategies, structures and general management team composition impact service innovation approaches in a way that produces persistent outcomes and sustainable routines? 2. How does the implementation of new service innovation strategy in such firms compare with innovation for their traditional core products and their negotiation of external dependencies? 3. What new practices seem to be most effective in promoting service innovation processes that are co-determined by partners? Intellectual Merit of this Research: We have developed a conceptual model and associated hypotheses by applying and adapting resource dependency theory at the organization level to the phenomenon of service innovation in manufacturing firms. This frame provides a lens for understanding the dynamics of change associated with service innovation and impacts on persistence. Long-term, this research aims to build a foundation for understanding how new kinds of services emerge generally in all service sectors. Research Approach and Methods to be Employed: Fundamental understanding of service innovation in general, and service extrapolation of manufacturing technology in particular, requires at this point contextual investigation, rather than identifying statistical correlates of success. This project will produce a series of cross-industry case studies designed and conducted to refine the resource dependency theory that we have adapted from the literature. We will test our theory with field research that encompasses both historical and prospective viewpoints, employing modified critical incident techniques. Data collection for these cases will include extensive interviews with key participants plus systematic review of relevant documents produced associated with the strategy formation, intra and inter-organizational initiatives, and staffing for service innovations. Our analysis of findings from individual cases and comparisons across cases will refine, bound and surface new theory for subsequent research on service innovation. Broader Impacts Resulting from this Research: The research findings from this project will apply to all kinds of manufacturing firms that seek to innovate by initiating related service businesses. General insights will also apply more broadly to the field of service innovation. Dissemination activities included in this project will promote the application of these findings and insights by the management of service organizations. Peer reviewed publications will promote additional rigorous research on service innovation, which, over time, could favorably impact the robustness of this critical sector of the economy. We also intend to produce significant new materials (exercises, cases) for use by students of innovation management and industrial engineering.
