A life cycle model of major innovations in operations management

Abstract

Abstract This paper analyses the means by which major innovations in the operations management (OM) practice develop. It describes the process as having a life cycle pattern that starts with a big idea. The big idea concept promises breakthrough operating results, ultimately providing lower price, better quality, faster delivery, or combinations of these and other attributes that add value for the customer. A successful big idea goes through the phases of provenance, experimentation, penetration, consolidation, and absorption. At that point, it is being incorporated into business operations throughout the industry. If the original idea reaches the end of its useful life or proves unsuccessful during development, it is supplanted. Materials requirements planning (MRP) and supply chain management (SCM) are used to illustrate the general life cycle model. The analysis of these two successful major OM innovations discloses a similar development pattern but different final absorption outcomes. While MRP became an everyday tool for tactical level operations, SCM is an important strategic tool for integrated company management. The similarity of their development patterns, however, supports the general nature of the life cycle model introduced.