Abstract
Fierce competition has forced firms to be more creative and innovative to increase market share. Differentiating between green products or services with conventional products or services is one of the ways for firms to improve their business sustainability. The objective of this chapter is to explore the eco-innovation enablers and design its typology to measure the current green business practices in industry. Although there are many well-documented enablers or practices of eco-innovation that have been researched, this chapter focuses on practices that contribute towards the successful adoption of eco-innovation by one SME in green furniture manufacturing. This chapter uses the case study method as a source of data collection. Eco-innovation typology has been found in this study to define the effort of green company by looking at the target of eco-innovation versus the mechanism of eco-innovation.
The furniture industry will grow and prosper through constant innovation and improvements in the manufacturing process. (H. Mardiyanto, Central Java Governor, 2013)
TopLiterature Review
Innovation
In extant management literature, innovation is perceived as a relatively new concept (Türker, 2012). However, innovation is no longer a new concept and phenomenon to popular belief. Türker (2012) argued that innovation is as old as humankind itself. According to Fagerberg, Mowery, and Nelson (2006), innovation seems to be something integrally “human” about the tendency to deliberate about better ways of doing things and practice in reality. This deep-rooted and well-established concept had been worked by scientists during the history of the social sciences.
According to Schumpeter (1934), innovation is defined as “to produce means to combine materials and forces within our reach. To produce other things, or the same things by a different method, means to combine these materials and forces differently”. To explain the statement above, Schumpeter (1934) used the concept named “new combinations” for his explanation. It is a strong connection between the definition of innovation that commonly being adopted today and Schumpeter’s “new combinations”. The “new combinations” can be any new product with which customers are not familiar; a new technique of production that not yet being practised in the branch of manufacture concerned; a new supply source of raw materials and resources; a new target marketplace; or a new organization of any industry (Schumpeter, 1934). Therefore, “new goods” do not fully reflect the meaning of innovation.
Key Terms in this Chapter
Online Ordering System: Is system to capture customer demand and record of type of materials, components and additional information for company to forecast the demand.
Eco-Innovation: Innovative in production process which consent to a reduction of environmental risk and benefited to society and stakeholders.
Green Industry: Can be in the shape of various criteria such as clean production, energy conservation, resource efficiency, and adopt eco-design and low carbon technology.
Green Network: Falls between networking and the green supply chain, it must not be mistaken for a green supply chain as the green network is about sharing knowledge, contacts and fostering a relationship between the supplier and customer with the firm to sustain in the green industry.
Built to Order: The furniture produces when customer ordered and paid. This system is able to let customers know the price of their custom made furniture and the delivery method they want.
Typology: Is a framework to study eco-innovation target and mechanism. This tool identified ‘products and processes’, ‘organizations and marketing’ ‘methods and institutions’ as eco-innovation targets while ‘modification’, ‘re-design alternatives’ and ‘creation’ are standard mechanisms for eco-innovation.