Innovation process. Make sense using systems thinking

Several theories have been developed and try to communicate to managers how innovation occurs in a firm and which factors affect the outcome of this process. These theories come from different perspectives that either focus on management, economic or social sciences and create a complex net. This complexity often makes managers take a decision, the outcome of which contradicts their original aims. The objectives of this paper are to communicate innovation theory to the different actors in the system under a common perspective and to reveal the complexity of innovation systems. The new concept has at its centre the firm, which is the generator and promoter of innovations in the market, the industrial sector and the nation. The model's main focus is the Knowledge Creation from public or industrial research; the New Product Design and Development process, and the Product Success in the market. This process is affected by other internal factors of the firm as well as by the National Innovation Environment. This innovation system has been codified, under a system dynamics approach, to create a model, the 'Creative Factory' that includes all the aspects that academia, a firm or the policy making bodies need to consider around innovation activity. (C) 2005 Elsevier Ltd. All rights reserved.