The Importance of Creativity and Innovation in Organizations - Research Paper Example

Abstract Organizations have to be creative and innovative in order to enhance their competitive advantage on the global market. Creativity and innovation is important for companies looking for ways to improve their productivity for their own benefit as well as for the benefit of their customers. This paper contains different aspects of creativity and innovation in organizations and an analysis of how they can enhance their market presence in the global market through creative and innovative opportunities. Globalization has greatly changed the way organizations are run and perform. It is paramount for global organizations to be creative and innovative so as to ensure that they remain relevant in the market. Creativity is the process by which organizations create new ideas that enhance innovation. Innovation on the other hand can be defined as the starting or creation of something new (Griffin and Moorhead, 2009). Innovation is tied to creativity at the individual and organizational level. It is normally said to be the “successful implementation of creative ideas within an organization” (Amabile and Khaire, 2007). This means that creativity among individuals and teams is the starting point of innovation which catapult’s an organization up on the global scene. Creativity in the organization has been credited with creating a competitive edge for organizations. Being ahead of the competition is essential for any organization that wants to leave a mark on the global scene. Creativity also helps organizations find niches in the global market. Creativity can be at the individual or organizational level. How does this creativity translate to innovation? A creative idea by itself is not enough to make some transformational innovation for an organization. There must be a certain degree of willingness to change the idea into action in a way that will make some tangible difference in the company (Gabarro, 1992). This action must result in new business processes, products or services. Amabile and Khaire (2007) state that there must be rules, tools and discipline that emanate from proper management processes to make it possible for the organization to have creative innovation. There are different theories used to explain the importance of creativity and innovation in an organization. These theories normally focus on individual or organizational creativity. In order to understand these theories, it is important to understand what individual and organizational creativity entail. Individual creativity Creativity is probably the single most important factor that determines how organizations run their business (Gabarro, 1992). Individual level creative dynamism plays a major role on the whole innovation process. The organization is a collection of creative people who work together as part of a team for the greater goo of the organization (Griffin and Moorhead, 2009). Since everyone in the company has to work in communion with other individuals, it is necessary for managers to promote creativity among individuals (Weick, 2001). Promoting this creativity requires that all barriers or obstacles that may hinder creativity be removed. The Creative Organization An organization that is creative is a complex technical, social and political system. In order to create a creative organization, there is need to identify those creative outlets among different individuals in the organization. It is also important to implement the mechanisms that need to be in place so as to enhance individual and organizational creativity (Gabarro, 1992). The managers in various organizations that want to conquer the global market through creativity and innovation must provide the required leadership that shows appreciation for knowledge at the individual, team and organizational level. Organizational creativity requires a lot of flexibility at the organizational level (Amabile and Khaire, 2007). This is important for dealing with the risks that come with global businesses. A flexible organization will be able to control any risks that may come its way and at the same time, it will be able to provide freedom that is necessary for creativity. Flexibility is one of those good practices in organizations since it promotes rather than discourages creativity. Innovation: Where Does It Come From? The sources of innovation can be explained using different innovation models. For instance the linear model identifies the source of innovation as the manufacturer. In this model, the person or company that innovates does so for the sole purpose of selling that innovation (Martin, 2007). Another model that explains the source of innovation is the end-user model. In this model, a company or individual creates an innovation to satisfy his own needs since the existing product does not really meet his needs (West, 1988). There are three things that have been identified for innovation to take place. These are: need, technologically savvy individuals and financial base (Gabarro, 1992). One of the industries that rely on innovation for survival is the information Technology industry. The players in this industry have to be on the lookout for any new ideas that may enhance the products that they make. In this industry the end user as well as the linear model can be used to create products that can enhance an organization’s competitive advantage (Martin, 2006). For instance, a subsidiary of Vodafone came up with a mobile money transfer technology that has ensured that makes it easy for people to access cash anytime they need it. This innovation cemented the subsidiary’s presence in the market and it currently controls almost 70% of the market. Creativity Theories Agency Theory This theory assumes that employees in an organization act opportunistically (Hargadon, 2005). This means that if given the opportunity to show their creativity they will be as creative as possible. For employees to be creative there must be some form of motivation. Manager need to be careful about the way they go about behavior control so that they do not inhibit the creativity of their employees (Martin, 2006). Mangers need to be supportive and encouraging to the employees; they need to facilitate the employees’ skill development to boost high level creativity. Organizations need to give some space to their employees so as to enhance creativity. Employees need to feel that they have the ability to contribute towards the well being of the organization (Linstead, Fulop and Lilley, 2009). If there has to be any form of behavior control for the employees, it has to be done in a way that the employees will feel pressured (West, 1988). This way they will have the intrinsic motivation to work and come up with various ideas to improve their work. When an employee is given the chance to be creative, this creativity should not be left to go to waste. It should be implemented in a way that the employee, the organization and the organization’s customers will all benefit. Creativity and Innovation: Organization Theory According to Hatch (2006), there are four perspectives to the management of people and organizations. These perspectives are: classical, modern, symbolic interpretative and post modern perspectives. Hatch says that the classical model is like a machine which is designed and structured for the sole purpose of achieving a specific goal. The modern perspective is likened to an organism which is a live system whose purpose is to those functions that are required for survival and adaptation to a hostile world. The Symbolic-interpretative perspective is like culture. It is a set of patterned meanings that are made and maintained by the association of humans by way of shared traditions, values and customs. The post modern perspective is like a collage which is created from pieces of understanding and knowledge that are totally different, but when they are brought together, they form a new perspective with a reference to the past. Creativity and innovation in organizations can be achieved through the various perspectives of organizational management (Grant, Keenoy and Oswick, 2004). Creativity and Innovation Barriers Poor leadership and management There are some leadership and management styles which hinder the creativity needed for positive innovation in an organization. Too much control by supervisors is a good example of leadership style that is not good for innovation (Hatch and Schultz, 2004). When employees work under too much control, they may feel pressured to produce results. This hinders their creativity, which in turn affects the organization’s innovation capabilities (Martin, 2006). Poor leadership also discourages employee involvement in decision making. When the employees are left out in important decision making processes, they will not be motivated to be creative and innovation will not be possible in such as environment (Linstead, Fulop and Lilley, 2009). Poor Communication Communication is very important for success. In the absence of proper communication and communication channels, it is very hard for an organization to achieve anything. Lack of communication can exist between the managers and their employees as well as between the employees themselves (Tan, 1998). When the managers fail to communicate what they expect from the employees, then the employees may not perform the way that they are required and this negates all the creativity that they put on their efforts (George, 2007). When there is lack of communication among the employees, it means that they do not share content or knowledge with each other. Team creativity is therefore hampered, making it hard for the company to be innovative. Poor communication may also exist between an organization and its target market. When there is no communication between an organization and its customers, it is very difficult for the organization to know exactly what the needs in the market place are (Martin, 2007). Feedback from customers is a good way of identifying in what areas an organization needs to change in order to make products that the customers will be happy with. When this feedback is missing or when the organization does not treat it with the seriousness it deserves, then there is no way that there will be form of creativity and innovation (Tan, 1998). Most innovation in organizations is propelled by the need to satisfy the needs of customers. If an organization does not realize what these needs are, that means that it does not appreciate creativity and innovation (Grant, Keenoy and Oswick, 2004). Lack of Clear Organizational Goals Organizational goals are very important as they enable companies to plan ahead and maximize on the available resources in order to satisfy customers and make maximum profits. These resources are not just the finances and time that the organization needs; they also include the workforce within the company (Hosking, Dachler and Gergen, 1995). When the organization has well formulated goals, then it will be easy for the employees to know and understand exactly what is required of them (George, 2007). With clear goals, the company will also be able to enhance its productivity through creativity and innovation. However, a lack of clear goals in an organization is tantamount to having no map in a foreign land. This lack of proper direction will spell doom for the company since the employees are not motivated to accomplish a certain task (Grant, Keenoy and Oswick, 2004). Employees who lack motivation rarely ever come up with new innovative ideas to help their companies move forward. With this kind of environment, a company cannot get its footing in this highly competitive global world. Risk Aversion Success in the business world is about taking those risks that have the potential of enabling the organization multiply its returns and provide the customer with the best services. Most the global companies that are currently riding high it the market did not get to where they are by chance. They had to take a few chances and risks which later proved to have been the right moves to make. Risk aversion is a big hindrance to individual and team creativity within the organization. When organizations avoid taking risks, it also closes door to many opportunities that could have helped enhance creativity (Hosking, Dachler and Gergen, 1995). Lack of Skills The lack of skills among employees is another barrier to creativity. If the workforce within a certain organization lacks skills or the necessary empowerment to come up with unique ideas, then it is quite difficult for the said company to advance locally as well as internationally (Griffin and Moorhead, 2009). Organizations need to find ways through which they can sharpen the skills of their employees so as to enhance creativity and innovation. A highly skilled workforce is a big asset to the organization. This is because such individuals are able to think outside the box and come up with ideas which the company can implement to improve their services to their customers and in the long run, increase their revenue (Czarniawska, 2008). Creativity and Innovation: New Opportunities and Future Trends There are many opportunities that are presenting themselves to enable organizations enhance their creativity and innovation on the global scene. One of these opportunities is the emergence of different information and communication technologies. Today’s business world is very hi-tech, and organizations have to adopt high level technology in order to keep up with the rest of the world. Information and communication technology allows organizations to carry out their communication without any problem (Hosking, Dachler and Gergen, 1995). This technology makes it possible for organizations to share content at the organizational and individual level on both the local and global scale. New technology not only makes information sharing easier, it also opens up other markets for an organization. Organizations can make use of this technology to create new niches for themselves. There is no limit to the number of customers that a company can get for its goods or services. Innovation plays a major role in the way organizations use the technology at hand to improve their competitive advantage (Griffin and Moorhead, 2009). If an organization intends on becoming a market leader in the kind of business it does, then it does not have a choice but to find the most innovative ways to reach out to as many people in the market as possible (Czarniawska, 2008). This means that the organization has to have employees who are not afraid to think and come up with new ideas which can be transformed into money generating ventures for the organization. The organization on the other hand, has to have motivational mechanisms to enable and encourage its workforce to be creative and innovative in their different capacities. Nowadays, there are many people who are highly skilled and have the ability to come up with creative ideas to help companies. Organizations that are looking to leave a mark on the global market have to make use of the skills of creative individuals and implement the resulting ideas into innovations. The organization must however, be ready to motivate its skilled workforce to come up with any creative idea (Czarniawska, 2008). The major organizations that have operations in many different parts of the world mostly rely on innovation to stay at the top. It is not enough being ordinary; one has to be extra-ordinary to be appreciated, especially in the business field. Companies should embrace and encourage employee creativity which will in turn be implemented as innovation. It is only through innovation that successful organizations are able to meet their customers’ needs and at the same time, fulfill their own organizational objectives and goals. Conclusion There is no doubt whatsoever on the importance of creativity and innovation in organizations. Through creativity, an organization is able to come up with innovative ways of being at the top of the competition. This is necessary for survival in today’s global environment. Innovative companies have been able to perform better and produce better products and services for their customers all over the world. Managers in organizations need to look for ways through which they can enhance productivity through creativity. Motivation for employees plays a big role in enhancing creativity. When an organization has a highly skilled workforce that is equally motivated, then innovation should not be a problem. Organizations should also take advantage of the numerous opportunities and trends in the market to improve their creativity and innovation. Technology is changing everyday and companies have to find ways to keep up with this ever changing technological world if they are to remain relevant in the market. Organizations also have to adopt good leadership and management if they want creativity to thrive in the workplace. Proper management is crucial in enhancing creativity and innovation which leads to increase in performance and productivity. There should also be open communication channels within the organization. This, combined with clear organizational goals is important in enhancing a company’s competitive advantage through innovation. It is high time that organizations realized that in this globalised world, innovation is a lifeline that should not be taken for granted. For this innovation to occur, the organizations must ensure that the environment is right for creativity among the employees at the individual, group and organizational level. References Amabile, T.M. and Khaire, M., 2007, Creativity, Entrepreneurship and Organizations of the Future, Accessed 8 Dec. from: Czarniawska, B., 2008, A Theory of Organising. Cheltenham: Edward Elgar. Gabarro, J.J., 1992, Managing People and Organizations, Boston, Mass: Havard Business Press George, J.M., 2007, Creativity in Organizations, The Academy of Management Annals, Vol. 1, pp. 439-477 Grant, D., Keenoy, T. W., Oswick, C., 2004, The Sage Handbook of Organizational Discourse, London: Sage. Griffin, R.W. and Moorhead, G., 2009, Organizational Behavior: Managing People and Organizations, London: Cengage Learning Hargadon, A.B., 2005, Group Cognition and Creativity in Organizations, Research on Managing Groups and Teams, Vol. 2, pp. 137-155 Hatch, M.J., 2006, Organization Theory: Modern, Symbolic and Postmodern Perspectives, Oxford: Oxford University Press Hatch, M. J. & Schultz M., 2004, Organizational Identity. Oxford: Oxford University Press. Hosking, D.-M., Dachler, H. P., & Gergen, K. J., 1995, Management and Organization: Relational Alternatives to Individualism. Aldershot, Brookfield, USA: Avebury. Linstead, S., Fulop, L. & Lilley, S., 2009, Management and Organization: A Critical Text, Hampshire: Palgrave MacMillan Martin, G., 2006, Managing People and Organizations in Changing Contexts, Butterworth Heinemann, Oxford. 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