Technological innovation is widely accepted to be a complex learning process through which firms try to acquire and develop distinctive technological competence. But there is a second dimension to such learning which relates to the ways in which the innovation process is managed, which also involves a developmental, cumulative progress. Not all firms have the same level of skill in managing projects, in understanding user needs, in search behaviour, in managing inter-firm relationships, etc.; these are all abilities which are learned over time. This paper reviews the concept of capability development as it applies to the management of technological innovation. It illustrates this with the example of continuous improvement (CI)-a key capability which is associated tenth high levels of involvement in the innovation process through the contribution of regular incremental improvement ideas from a large proportion of the workforce. CI is a simple concept but is proving very difficult to implement successfully in practice; arguably, this is because it involves extensive learning and adaptation. In exploring this issue the paper draws upon the results of a 5-year empirical study into the adoption and implementation of CI within European enterprises. The paper concludes with some comments on the process of 'learning to learn' and argues that managing this process is a key component of strategic technology management.

Continuous improvement (CI) is increasingly being seen as an important complement to more radical, step-change forms of innovation. In essence, it involves a company-wide process of enabling a continuing stream of focused incremental innovation. It has found particular application in recent years in the area of quality improvement, but the principle can be applied to many other. divisions of business performance.Although simple to define, the achievement of such CI activity and its maintenance over the long term is a major source of difficulty. This paper reports on research in this area and highlights key areas within CI which need to be addressed.