Innovation as the Success of Any Business - Essay Example

?Introduction Innovation is essential for the success of any business, as it has been proven that there is a clear connection between the engagement of an employee and innovation. Businesses and companies value creativity of their human resources and that is why they give them the free will to be creative in their duties to help attain the goals of the business. It is important to note that the culture of a company or business may stifle or foster innovation especially when business leaders are able to create an environment that either favours business innovations or fails to promote it. Innovation is one of the key drivers for growth and profitability in any business and companies have been trying to embrace it as a means of attaining success (Rodenberg, 2007). The need for innovation has been necessitated by the recognition by companies that efficiency and world-class operational performance are important in the creation of a competitive advantage in today’s challenging global market. Innovation is highly dependent on the corporate culture, the people involved in innovating in the business or the company and must be under a proper management, and a program for improvement at all times (Herzog, 2011, p. 91). As businesses and companies have recognized the fact that structured innovation and management is important, they make efforts to get the most from their people, customers and partners in the achievement of their business goals. Improving innovation mostly starts with strategy that must address culture, processes and technology that works in the most reliable and affordable way. Innovation framework includes best practices and solutions that must have techniques that improve innovation and its management. Innovation approaches by organisations Different companies adopt different approaches to innovation and this determines their success and the overall nature of the goods they introduce to the market. It is the ability of an organisation to develop wining ideas that provides the momentum for growth and expansion in the current competitive market. Thus, every company is unique based on its own understanding of innovation and the framework its employs in motivating internal innovation and discoveries. In this paper, the innovation frameworks that have been adopted by two key computer companies in the United States will be analysed in this paper. In this analysis, the different approaches to innovation adopted by the two companies and how each affected the performance of the each company will be discussed. Innovative approaches differ depending on an organisation and their ultimate organisation structure and culture. Some organisations integrate innovation as a strategic organisational policy that is implemented from the top management level to the lowest employees within the organisation. In such setups, innovation is not left to a few people within the organisation but is the responsibility of all the employees at different levels in the company (Kolah, 2003). There are four fundamental components of innovation include co-operation amongst all stakeholders in the business or company, ideation that means the conception and application of ideas, and execution and creation of value for the products of the business. Collaboration is simply teamwork that makes it essential to getting things done and involves the three basic concepts of relationships, processes and outcomes that may result into successes in the development of the business in line with its objectives and missions. Ideation on the other hand is based on fresh new ideas that are important in helping the business or the organization stand out amongst its peers. Implementation involves the organizations engaging the best human resource to help in putting the ideas and make them move forward. Value creation is important in that the ideas implemented must aim at creating value to those concerned with the business or in simple terms create business value. It is the incremental improvements to the products that exist or the creation of new products and services as well as reducing the costs achieved through a process of creative combination of concepts that are aimed at making the business better or high performing. Enablers of innovation There are many enablers for successful innovation in order to make businesses globally competitive and prosperous. Innovation can be achieved through partnership and investment through corporate business strategies that invest in research and development as well as the incorporation of entrepreneurial skills. In order to achieve all this, there must be strategic focus on innovation that creates a conducive environment for innovation through the streamlining of the systemic infrastructure for business enterprising. Leadership is also important as leaders drive the tone and model the criteria that enable innovation through the creation of a culture where people are comfortable with creating new ideas and adopting them. The leadership must construct on the agility and flexibility in the organizational structures and the human resources as well as the processes in attracting and keeping talent and providing a supportive environment. There should be emphasis on learning, creativity and design in order to drive innovation and enterprise creation for businesses in all their enterprise endeavours. Teamwork is key in spurring innovation as the business is able to build on the creative ideas of others as well as their talents that leads to successes and rapid development of the businesses. It is important to change individual and team behaviour in the implementation of change and doing innovative work as the overall result is always about the collective effort of the whole business. In order to promote innovation, the businesses must perform certain things such as awareness through the understanding of human behaviour and thoughts and having strategic intent. Businesses who wish to innovate must make it a strategic priority, ensure that they have put in place strategic priority, and have mechanisms that support, measure and reward innovation. Working to enable innovation helps in the strengthening of performance, productivity and learning as it engages employees and satisfies the customers of the business in meeting the objectives of the business. Maintaining open dialogue between employees and upper management is important for innovation as it motivates employees as well as engaging them. Encouraging communication between different departments of the business as well as collaboration is important in driving the business strategies and processes geared towards innovation. Organizing brainstorming sessions by giving employees regular opportunities to share ideas is important for innovation and engaging employees in sharing creative ideas. It is important not to force people to be innovative but encourage them to present creative ideas for true innovation to be realized and keep track of company innovations. Knowing the innovations have been implemented and how successful they are has the benefit of having a clear picture of the activities by employees and indicating the implemented programs as well as the culture of the business. Microsoft Innovation Management Framework Microsoft defines innovation according to early definition by Rajagopal as the conversion of knowledge and ideas into new or improved products, processes, or services to gain a competitive advantage embodied in its framework known as the Microsoft DIRA Framework that covers three core business imperatives critical to the growth and profitability of the business enterprise (Rajagopal, 2013). These include innovate which manages cross boundary innovation and perform which is to deliver operational excellence with reliable business continuity as well as grow which observes and serves customers globally to drive growth with profitable proximity. The Microsoft Innovation Management framework identifies five primary processes to innovation that include Envision, Engage, Evolve, Evaluate, and Execute, processes which give a cycle of business models and products that must be continuously innovated in order to have a feedback from existing products and services in the innovation cycle (Kelly, 2013). Envision is an important step of innovation critical in the achievement of the innovation goals and puts in place the strategy and plan for achieving it. Therefore, this requires an innovation strategy that commences below the corporate strategy and takes the growth targets and the goals of the business in an attempt to drive its strategies. Microsoft achieves this through setting of high level goals, high-level areas that are funded for innovation to drive ideation and portfolio management processes. This strategy also calls out innovation approaches aimed at co-creation and open innovation that have been significant in innovation for Microsoft products and business processes. In regard to engage which refers to “the front end of innovation” ideas are generated in a process known in innovation terms as ideation whereby Microsoft engages its workforces, clienteles, associates in an innovation community in order to capture, generate or share innovative concepts. It works under the guide of the importance of engage that makes it easier for the company to get closer to the customer, their desires, how to make lives better and how the product will displace other products of similar nature. However, there may be difficulty in the generation of new ideas that are aimed at innovation at Microsoft. In the generation of new ideas, Microsoft has created a digital innovation environment through the Microsoft Innovation Hub that captures and manages ideas (Frazer, 2013). It also makes it personal by branding the innovation environment with the identity and terminology that lends credence to the need for innovation. Microsoft also comes up with profiles, capabilities and communities that provide access to expertise and the ability to make a discovery of new innovations and the people to collaborate with in order to implement the innovation envisaged. The company also evaluates the opportunity to collect ideas automatically through the mining of data from social media to gain insight and discover trends about products and customers. Microsoft also focuses its innovation efforts by creating targeted challenges that specifies a specific problem to solve the issues addressed. It also forms explicit centres for diverse groups of people and solicits concepts for specific type of a problem or market segments while at the same time constrain ideas to a limited number of strategies (Microsoft Corporation, 2013, p. 27). Evolve derives the output of the engage process to the level that follows through the evolution of ideas, either as a team or individuals in order to increase the value and quality of the innovated product. This is achieved through early feedback to allow great ideas to be improved upon and issues rose so that they can be solved in good time. In order to get the most out of ideas, they are left to mature by developing them in a virtual team setting that provides the medium to have group knowledge in one pool that enhances the final product that has been innovated. Microsoft also gains value for its products and services by developing insights into their organization, gathering information on trends and current ways of their stakeholders and creation of proposals for projects, which must be validated. In order to develop concepts and increase their value, Microsoft facilitates collaborative development of ideas to mature their definition and further exploration of their validity as well as encouraging people to test ideas. Microsoft stresses the organization, duplication and the merging of ideas in order to come up with better innovative steps aimed at making the company grow in strides to mean that ideas that are likely to succeed are adopted and implemented in an organized manner. It takes the thousands of ideas that are generated then evaluate them through filtering and search mechanisms that identify and address areas of interest. The execute process by Microsoft takes the input from the aforementioned processes and executes a formal project to further develop the idea and make it commercially viable. The company ensures that it follows standard product development processes that are aimed at ensuring repeated results as well as developing different project templates for different types of projects that it undertakes. Microsoft also collaborates with other companies to support solutions to innovation and its management as well as implementation, for example, it collaborates with NewsGator to improve productivity and employee engagement through advanced capabilities in social computing and other innovative ways (Microsoft Corporation, 2013, p. 27). NewsGator also enable Microsoft to deliver advanced social business solutions from ideas that have been generated to come up with innovations that are real, actionable and competitive (Microsoft Corporation, 2013, p. 20). Microsoft also collaborates with Avanade to turn inspiration into tangible and manageable results through driving of ideation and the integration of best practices to enable change. This has enabled the businesses to have a competitive advantage, as it is adaptive to the unpredictable market forces that Microsoft operates in. Further, the Microsoft Standards of Business conduct which is an extension of its values and business tenets reflect on their collective commitment to business practices that favour innovation. It also ensures that it complies with the regulations which when supported by the principles and policies that are geared towards innovation produce the best work environment for innovation. These Standards of Business Conduct provide information and education on the best business practices that help in making informed decisions when it comes to innovation, practices which enable the company to enhance its culture in ways that benefit its customers and partners in achieving their business missions as well as actualizing their full potentials. This requires that all its workers of Microsoft fully understand and comply with the values of business behaviour including its policies as well as the government conventions implying that Microsoft innovation was realized mainly through compliance to the ethical concerns and policies of the company in realizing its business goals (Ballmer, 2013). Microsoft also ensures that it has diverse, cooperative and productive work environment that embodies respect, honesty and openness, which allows for the sharing of ideas and thoughts that has the effect of producing the best input for innovation. The diversity of the work force that is obtained at the recruitment stage ensures that the work environment created attracts, retains and fully engages talent. The net effect of this is that there is enhanced innovation and creativity in the products and services that Microsoft comes up with. Collaborative Idea Management at Ericsson Ericsson a leading provider of telecommunication equipment and services to mobile and fixed network has also undergone a series of innovation especially in terms of businesses, organizational and process innovation. The setting up of the Collaborative Idea Management at Ericsson was triggered by many factors firstly being the failure of the traditional suggestion box initiatives due to lack of personal innovation and overload (Karlsson, 2013). It was also developed due to the emergence of several local idea management systems that prevented collaboration, transparencies and synergies. Moreover, the ambition to involve the entire organization in the effort to innovate required a uniform approach in the management of ideas that meant that innovation had to reach beyond the usual research and development. Since the year 2010, the company has developed a set of principles that sets the expectations for every employee in the organization whereby innovation is deemed part of every employee’s duty and includes every aspect of the business such as the transformative business opportunities and improvement at every level of the business. Through its brand strategy and corporate mission that states that, it is aimed at innovation that empowers people, businesses and the society that is achieved through increasing the spectrum of innovation (Karlsson, 2013). The motive of this is to ensure that the business is driven more through market and consumer insights while at the same time having a focus on the organizational structure. Ericsson as a business emphasizes the need to be more collaborative in that it involves people from all disciplines and perspectives that go within and outside the organization. To overcome the challenges, the different divisions in the company used different ideation and innovation approaches that suit the business model as per the company mission and strategy. As a means of innovation, Ericsson put in place Idea Boxes that is meant to engage the employees whereby when an innovation initiative is started, an innovation manager is assigned the particular effort (Karlsson and Kakhadze, 2011) and the manager then solicits ideas and specific needs of the initiative. The employees can thereafter see the ideas and comment about them depending on the scope and the processes to evaluate and implement them. The IdeaBoxes are the key to innovation at Ericsson and are supported and followed up in the organization, for example the personal development of employees is evaluated in relation to the innovation strategies of the company. Ericsson aims at engaging the community in the generation of ideas around specific innovation needs, which was achieved through a review of a number of systems used in different parts of the business that must meet its demands. The attainment of these systems was achieved through development of its own innovation management solution that incorporates collaborative idea management. The net effect of these IdeaBoxes is that it has integrated hundreds of innovation initiatives throughout the organization by engaging its employees from all business units and functions of Ericsson. The comments generated from the IdeaBoxes have grown at a faster rate indicative of the significance of a social and collaborative process. An important success factor for the use of IdeaBoxes by Ericsson is the effect of the viral marketing effect that it has had within the organization as well as its implementation. It is also appealing as employees are able to highlight their ideas that are then implemented as a corporate-wide approach that has one common tool as opposed to several but isolated systems. Further, the company has adopted a seamless integration process for the management of the ideas that helps it successfully implement its innovation strategies. Ericsson has also increased innovation through collaboration capabilities that also include social networking, tracking of innovation and management of projects under the company innovation strategies and programs (Karlsson, 2013). Ericsson aimed at accelerating innovation in order to meet increased competition and put an emphasis on services and business model innovation through a strategy that strives to have a market and insight-driven innovation that is closer to the business such as the customers, partners and the users. The strategy for innovation is aimed at widening the front-end to source for ideas both internally and externally through the establishment of a network of innovation channels spread across the organization. These include a corporate incubator aimed at addressing business opportunities beyond the strategic growth areas and the performance indicators. The collaborative idea management by Ericsson is therefore open to all employees of Ericsson globally, which has increased the participation of employees in the generation of ideas relevant for innovation. The IdeaBoxes have led to the adoption of innovation across all the business units of Ericsson as a company including the areas of research and development, sales and marketing and the internal processes of the company. This approach that is pull-based ensures that there is creativity of all employees in the organization that leads to innovation backed by management that is willing to evaluate and act on the ideas created. The transparency and openness of the system creates a link between those who submit ideas and those who are supposed to act on them. Both employees and managers have also readily adopted this approach as a useful tool for innovation practice (Karlsson, 2013). The organizational culture at Ericsson is such that it promotes diversity in its human resources in order to promote innovation and have a competitive advantage. Through this structure and culture of the company, it seeks to achieve competitive advantage through diversity of its human resource by constantly creating a work place that thrives on respect and values for individual differences in achieving innovation. The diversity ensures that there is professionalism, respect and perseverance, which enables an environment where people can share ideas and ensure that they are implemented to achieve the overall goals of the company. At Ericsson, the company strives to have a complex but highly dynamic market environment that will enable it meet its innovation needs and growth targets that is achieved through on-going change processes that retains and develops a competitive advantage over its rivals. It improves its ability to respond to the changing business environments that makes it better comprehend the needs of the customer and respond to their needs through creativity and innovation. It therefore ensures that it understands and predicts their need for innovation through the attracting and retaining of the best human resource that impact positively on the business. It also strives to give its stakeholders and collaborates fair value for their cooperation as well as identifying and seizing opportunities for innovation on their behalf. To motivate their staff, Ericsson has got a strong commitment to ensure that it offers its staff equal opportunity for employment, development and compensation for their efforts that ensures continuous innovation of the business by the company (Karlsson and Kakhadze, 2011). General lessons From this analysis, it is evident that both Erickson and Microsoft appreciate the role of all employees in the development of innovation. Innovation is not a practise left for the top management but a collaborative practise that thrives in an environment where all the ideas from whichever corner of the organisation are taken into consideration. Microsoft engages and involves its employees through processes that allow proactive development of ideas and projects that are aimed at improving the competitive advantage of the company (Kolah, 2003). From this discussion, I have learnt that innovation is a process that is not preserved for the top management but an activity that involves all employees. Innovation should be an organisation’s culture as captured by the two companies whose policies encourage internal innovation and development of ideas. Erickson and Microsoft have advanced to be great technology and telecommunication giants due to the innovation spirit and culture that they developed within and encouraged employees to follow. Conclusion From the foregoing discussion, it can be noted that innovation is both essential to the success of both Microsoft and Ericsson in that the companies are able to meet their business objectives by constantly innovating. Though the approaches may seem different, the two companies have been able to create a competitive advantage over their rivals by tapping into the creativity of their employees and creating an environment that favours business innovation. Through constantly innovating, both Microsoft and Ericsson have increased their profitability as well as meeting their other business goals with the potential to further innovate to improve the profitability of the business. References Accenture. 2011. The Innovation Death Spiral, How Companies Get Stuck Throwing Good Money After Bad Ideas—and What that Mistake Is Costing Them, Accenture High Performance Delivered. [Online] Available at: http://www.accenture.com/SiteCollectionDocuments/PDF/Accenture_The_Innovation_Death_Spiral.pdf [Accessed o8/11/2013] Ballmer, S.A., 2013. Microsoft Standards of Business Conduct. Microsoft. [Online] Available at: http://www.microsoft.com/en-us/legal/compliance/Buscond/default.aspx [Accessed o8/11/2013] Frazer, G. 2013. How to nurture innovation in your business, Computer Weekly. [Online] Available at: http://www.computerweekly.com/opinion/How-to-nurture-innovation-in-your-business [Accessed o8/11/2013] Herzog, P. 2011. 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