Product invention as a complex adaptive system: an investigation of the impact of inventors' search heuristics on the rate of invention

Inventors face three key problems when attempting to uncover new product inventions: vast design spaces, interconnected product elements, and uncertainty as to the payoff to a proposed product design. In order to make vast design spaces tractable, inventors rely on search heuristics. The primary objective of this thesis is to enhance our understanding of the role that search heuristics play in the inventive process for physical products. The central metaphor underlying this study is that product invention can be considered as a complex adaptive system. Invention is conceptualised as a search process, on a landscape of product possibilities, by a population of profit-seeking inventors. It is argued that a substantial component of the inventive process can be captured in an evolutionary algorithm, wherein product inventions are continually created, tested in the marketplace, and ultimately displaced by subsequent inventions. A simulation model of the process of product invention is developed using a novel synthesis of two general frameworks drawn from the literature of complex adaptive systems, Kauffman's NK model and Holland's genetic algorithm. The simulation model is used to test a series of hypotheses which examine the sensitivity of the product invention process to the search heuristics used by inventors, under varying levels of product element interconnection, and under varying levels of uncertainty regarding payoffs to proposed product inventions. The key finding of the simulation experiments is that if search heuristics are confined to those which are rooted in past experience, or to heuristics which merely generate variety, successful product invention does not occur. Successful invention only occurs when inventor's expectations as to the relative fitness of potential product inventions are incorporated into the model of invention. The simulations also demonstrate that the effectiveness of the search heuristics of inventors is robust with respect to noisy expectations as to the worth of a potential invention, and is robust with respect to conditions of technical uncertainty. The simulation results underscore the importance of formal product / project evaluation procedures in organisations, and the importance of market information when inventing new products.