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"Every day, I try to go out and grab lightning."
-Terry Fadem, Director, New Business Development, DuPont Corporation
Grabbing lightning" is how Terry Fadem characterized opportunity recognition associated with breakthrough innovations. In recent annual surveys of the members of the Industrial Research Institute (a professional association of the technology leaders of R&D-intensive firms), "making innovation happen" and "managing RED for business growth" were cited as the number one challenges facing IRI members (in 1998 and 1999 respectively). Opportunity recognition is the bridge that connects a breakthrough idea to the initial innovation evaluation process-which in turn leads to the formation of a formally established commercialization effort.
During the 1980s, U.S. and European firms were competitively challenged by Asian firms in many industries, e.g., memory chips, office and factory automation, consumer electronics, and auto making.1 In response, these firms dramatically increased their competencies in managing continuous improvement and incremental innovation in existing products or processes, with an emphasis on cost competitiveness, quality improvements, and efficiency.2 In the past decade, there has been growing awareness that managerial practices had simply shifted from one incomplete approach to an alternative but equally incomplete approach. According to Gary Hamel: "Most companies long ago reached the point of diminishing returns in their incremental improvement programs. Radical, non-linear innovation is the only way to escape the ruthless hyper-competition that has been hammering down margins in industry after industry."3 Although achieving excellence in ongoing operations and incremental innovation has been critical for regaining competitiveness, the demand for corporate growth and improved financial performance from senior management and from shareholders has catalyzed an intense and renewed interest in the discovery, development, and commercialization of breakthrough innovations.
Since 1995, we have followed the evolution of twelve radical innovation projects in ten large, established firms. In this article, we examine how these firms undertook the recognition of opportunities associated with breakthrough innovations, which from their perspective had the potential to "change the game." In this context, opportunity recognition is defined as the match between an unfulfilled market need and a solution that satisfies the need.4 in our twelve projects, breakthrough innovations arose out of invention, or insights based on new combinations of technologies and processes. The technical discovery or insight typically originated with a scientist or engineer,...