Underground innovation in USA, Europe, and Japan

Summary form only given. Creative researchers and engineers are often frustrated because management rejects their proposals for technological innovations leading to new products, processes, systems, or services with high business potential. In these circumstances, the employee is faced with three difficult choices: (1) go back to routine work and forget, (2) leave the company to start a new venture (relatively easy in USA, less easy in Europe, very difficult in Japan and Korea); (3) go "underground" with or without management\´s tacit approval. In this paper we study the little known phenomenon of underground innovation, with case histories from USA, France, and Japan. We define underground innovation as all innovation that takes place outside the regular bureaucratic approval and control channels of the company, according to three types: (1) skunkworks, (2) unauthorized but tolerated innovation, and (3) forbidden innovation. The paper concludes with the analysis of the key success factors for underground innovation to emerge, become officially recognized, and contribute to corporate sales and profits: (1) entrepreneurs and champions; (2) higher level sponsors or protectors; (3) organizational slack; (4) longer range vision of the technology, market and industry trends; and (5) potential to make an important business contribution to the company\´s strategic objectives