Exploring problem finding in a medical device company

Purpose – The purpose of this study is to investigate the implementation and use of a systematic and collaborative approach for environmental scanning in a medical device company aiming to identify opportunities for both incremental and radical innovation. The study seeks to address the present gap in research on challenges associated with achieving a balance between exploration and exploitation on a micro level. Design/methodology/approach – The implementation and use of a systematic and collaborative approach for environmental scanning to support the identification and analysis of opportunities for radical and incremental innovation and its related challenges is described and analyzed. Experiences and observations from a single case study, conducted in an R&D organization in an international medical device company during two years forms the basis for the study. During 2009‐2011 an empirical investigation at an R&D unit composed of 200 employees at a Swedish site in an international medical device company, known as a market and pioneering leader was conducted. A qualitative evaluation and analysis was utilized using the gathering of relevant data from specified documents and surveys, compilation of databases in use for external information search, observations during formal meetings and semi‐structured interviews with individuals representing different departments and hierarchical levels to collect substantive and relevant data. Findings – The study points to the importance of balancing the degree of formalization in the process in order to motivate different individuals and to create learning and innovation outcomes. Research limitations/implications – The study contributes to the body of innovation management literature by providing empirical data on how companies are organizing work to systematically acquire and use information about events and trends in the external environment defined as environmental scanning as means for building innovation capabilities in practice. Practical implications – The selection of direction and scope of search, the design and implementation of the scanning process and IT tool, the mechanisms needed to integrate different hierarchical levels and functions to identify new ideas and strategy implications are found to be factors critical to manage. Originality/value – This study provides rich multi‐level longitudinal empirical data and addresses the current gap in research on challenges associated with achieving a balance between exploration and exploitation on a micro level. It specifically contributes to the need to better understand how firms build capabilities to identify opportunities and problems in the early phases of product innovation when aiming to generate both radical and incremental innovations.