Understanding Value in Innovation: A case study of mastitis management in the Waikato dairy industry

Abstract

Innovation is crucial for the success of society. Innovation drives competition, gives consumers more choice and contributes to a more sustainable society. The value associated with innovation is imperative to adoption, and it is important to understand how this value is created. The Waikato dairy industry is a key target for innovation; its complex network and costly mastitis related issues highlight the need for constant innovation that meets the needs and values of stakeholders within this network. Utilising a qualitative case study approach, this study explored value creation in a complex buyer network in response to innovation, using mastitis management in the Waikato dairy industry as an empirical example. This case was chosen as mastitis is a key issue to the industry and innovations combating mastitis are in development. The findings of this research highlighted the complexity of farming, the temporal shift of farming practices, the nature of farmers, drivers of value for farmers and vets in the dairy industry, and the notion of competing with the status quo. Key drivers of value for farmers included those related to financials and those associated with time, due to dependence on the dairy payout and the inherent pragmatic nature of farmers. Value creation in response to innovation in the dairy industry is extremely complex. Continuous knowledge transfer and increased transparency between stakeholders contributes significantly to value creation. The process is not linear, as there is constant interaction between stakeholders to address drivers of value and target issues accordingly. Diffusion of innovation theory provided a good model to show a complex network’s response to innovation, with proposed changes added to the framework to acknowledge the entrenched behaviours and traditional nature of some farmers.