High-Leverage Innovation, Part Three

Money isn't the key to successful innovation. In fact, many companies spend far less than their competitors on R&D to achieve far better performance. To learn why that's the case, strategy+business and Knowledge@Wharton spoke with Kevin Dehoff, a partner at Booz & Company, and Karl Ulrich, Wharton professor of operations and information management. In this final part of a three-part series, Dehoff and Ulrich talk about innovation in the auto industry -- what constitutes it, why some manufacturers, like Toyota, are more innovative than others, and the role that customers play in innovative product development.