Leadership for Innovation: Analyzing the Essence of Leadership Toward Delivering Innovation Strategies - Essay Example

? Leadership for Innovation: Analyzing the Essence of Leadership Toward Delivering Innovation Strategies Year Level, Section Academic – Professor Date of Submission Introduction In a world where constant technological innovations shape the various facets of society, it is essential for firms to continually look at ways through which it can enhance its overall value to both internal and external stakeholders. It can be said that this examination combines the intensive studies on industry, competitive, and consumers with the detailed understanding of business processes. The linearity of thinking in most firms often lead to backwardness, and this is definitely an issue in a market where customer tastes and preferences change by the minute, and where competition comes from the most unconventional areas with the most uncommon tools and strategies. Thus, there is a need to put the very essence of innovation—of forward and radical thinking—into the business strategy to triumph in this kind of business environment. Although drafting the core business strategies can be coherently and clearly done by top management, applying these innovative practices in current business operations is where the problem lies. Thus, leadership becomes an important value that stakeholders from all areas (top management to low level employees) must adopt and practice. In this regard, this paper is to be divided into three parts. The first part looks intensively at the core concepts of strategic innovation in order to better understand it in principle and in practice. The second part identifies the essence of leadership and how it helps in driving innovation strategies. The last part synthesizes all the gathered observations in order to justify this paper’s thesis that effective leadership drives strategic innovation by influencing and empowering the firm’s enablers of innovation. I. Strategic Innovation In this part, we intend to examine the nature of strategic innovation by looking at its definition and conceptual implications. Then, we intensively discuss the seven dimensions that drive strategic innovation in a firm. A. Definition of Strategic Innovation Strategic innovation is a holistic and systematic business approach that focuses on creating intentional and repeatable processes to enhance the value provided by the firm to its stakeholders (Palmer & Kaplan, n.d.). As a result of these initiatives, strategic innovation is able to generate new business practices that can facilitate growth opportunities for the firm. In order to enhance our understanding of strategic innovation, it is wise to compare its primary attributes with those of traditional business approach. Firstly, it can be said that strategic innovation starts with the identification of the long-term goals of the firm. This is entirely different from the traditional approach that uses the present state of the firm to guide its business directions. Secondly, unlike the traditional approach that assumes a rule-maker (defensive) or rule-taker (follower) posture, strategic innovation assumes a rule-breaker (revolutionary) posture. Thirdly, strategic innovation seeks to create a new competitive space or a ‘blue ocean’ while traditional approach accepts the business boundaries or product categories. Lastly, unlike traditional approach that follows linear business planning models, strategic innovation marries process discipline with creative inspiration. B. Seven Dimensions of Strategic Innovation Now that we know the fundamental differences between traditional approach and strategic innovation approach, let us now focus on the seven dimensions that constitute this strategic innovation. In summary, the seven dimensions are comprised of: (1) managed innovation process that combines traditional and non-traditional approaches to business strategy; (2) strategic alignment to build support from vital stakeholders; (3) industry foresight that underscores emerging trends; (4) consumer insight which builds a holistic view of the consumer’s articulated and unarticulated needs; (5) core technologies and competencies which banks on leveraging and extending corporate assets; (6) organizational readiness; (7) disciplined implementation which manages the path from creative inspiration to business impact (Palmer & Kaplan, 1. Managed Innovation Process Managed innovation process is intended to explore and discover a diverse array of new business possibilities in order to create a strategic alignment between the shared visions and goals of the firm with its internal and external stakeholders. In this sense, by incorporating external perspectives into the firm’s internal capabilities and practices, it is able to enhance its overall value. At this point, it can be stated that this process combines both traditional and non-traditional elements by looking at consumer data, market trend, and competitive analysis in an entirely different perspective. As an inspirational catalyst for breakthrough development and growth in the firm, managing innovation process is rooted on radical re-thinking that challenges the status quo through logical and creative solutions. Building further on this idea, managed innovation process leads to the strategic alignment of the firm. Through the engagement between the senior leadership team as well as the internal and external stakeholders of the firm, long-term goals and visions are developed. It can be said that this kind of alignment galvanizes the firm as it creates ownership, enthusiasm and commitment among the employees; accelerates funding decisions for activities; and builds strong foundation for successful implementation of innovation plans. However, building alignment does not only mean ensuring that the stakeholders are united in vision and principles, but also enabling operational success through the strong coordination among key business units. 2. Strategic Alignment Strategic alignment, as a result of the innovating the management process, can be viewed as either internal or external. The success in internal alignment is driven by four factors: first, the selection of a cross-functional core team comprised of visionary and energetic individuals. Second, the choosing of a good mix of seniority levels—typically from executive to middle management to lower level employees. Third, members coming from four key categories—subject matter experts, decision makers, implementers, and the creative and free-thinkers who will balance both the logical with the innovative ideas. Last, a right balance between logical and results-driven people with creative and maverick free-thinkers. Although not commonly, external alignment may also be done to gather more insights and ideas on innovation by partnering with organizations. This usually calls for building a core or extended team from the third-party organizations. 3. Industry Foresight According to Palmer and Kaplan (n.d.), industry foresight is a ‘top-down’ approach that scans the drivers, trends, enablers, and dislocations in one or more industry. In this light, visionary firms establish a process of monitoring the complex interplay of significant trends that may potentially affect, either positively or negatively, the firm. This usually comprises looking at the forces of deregulation, analyzing industry convergence and emerging markets, and assessing the social, demographic, technical, and environmental trends. ‘Foresighting’ is hinged on the premise that since the world today is constantly changing, it is just reasonable to look at future to determine the present activities of the firm. Industry foresight, therefore, goes beyond traditional market trend research by taking a speculative, ‘what if’ perspective. Monitoring emerging trends, as Palmer and Kaplan (n.d.) noted, enables the firm to not only avoid threats but also identify market opportunities. Indeed, when an organization looks beyond its historical operating practices, technology capabilities, and business boundaries, it is able to enhance its ability to identify platforms for breakthrough growth. Proper focus on the future, therefore, is essential in strategic innovation approach. 4. Consumer Insight Although a lot of firms aim to be consumer-driven in order to identify unarticulated consumer needs, only few are able to understand the consumers’ deep-seated behaviors, perceptions, and needs. Consumer insight, in this regard, is a qualitative approach that leverages insights into the behaviors, perceptions, and needs of the competitive and potential customers by involving them as partners in the innovation process. It is, more specifically, a non-traditional and imaginative approach to research that seeks behaviors that the customers cannot express themselves. The traditional harnessing of consumer insight is usually focused on product development that consists of focus group discussions, panel interviews, and web-based surveys. In reality, this process goes no further than soliciting consumer response to internally-generated product concepts or specific executions such as feature preferences, packaging, or advertising directions. In this light, it can be claimed that although validating ideas with consumers is key, limiting such consumer interactions to mere feedback gathering is a missed opportunity. Therefore, the innovative consumer insight approach uses conventional tools to spark fresh thinking that leads to gaining deeper insights and identifying concepts that have a greater degree of ‘emotional impact’ on consumers. 5. Core Technologies and Competencies A firm understanding of the firm’s core technologies and competencies helps in translating the gleaned consumer insights into practical and investment-worthy activities. Thus, a keen sense of the firm’s inherent strengths and competencies can guide in better translating these ideas into actions. Thus, for innovation strategies to be viable, they must possess a tight connection to the core competencies of the firm. This does not only mean technologies and other resources that the firm currently possesses, but also the significant opportunities that could be acquired by partnering, outsourcing, or tapping new technologies. 6. Organizational Readiness Organizational readiness points at the ability of the firm to act upon and implement innovative ideas and strategies, and to successfully manage the operational, political, cultural, and financial demands that follow (Palmer & Kaplan, n.d.). Readiness to implement, therefore, translates innovative ideas into innovative practices and is usually evaluated in three sub-areas: cultural, process, and structural readiness. Cultural readiness pertains to the mindset and norms that allow individuals and teams to think imaginatively, to take calculated risks, and to introduce new and innovative solutions to business issues. It includes a look at senior leadership’s operating styles and directives, short-term and long-term focus of firm, employee profiles and thinking styles, and overall business models. 7. Disciplined Innovation This dimension goes more specifically into the actual implementation of innovation ideas into the key business units that need to be improved. In the context of strategic innovation, implementation include a broad set of activities within the firm that calls for support and involvement with across the organization—from technical product development to managing channel support. II. Leadership for Innovation This part of the paper will focus on the role of leadership in driving innovation by highlighting on two key areas: firstly, the role of leaders and their styles in leadership that often foster an environment critical for building, developing, and implementing business strategies; and secondly, the enablers of innovation in a firm which can be seen as the execution of innovative ideas and concepts. A. The Role of Leaders in Innovation The Advanced Institute of Management Research or AIM (2005) asserted that since organizational leaders usually determine the direction, vision, and momentum of the business, they can be deemed as the true catalyst for strategic innovation. In this light, critical to the success of a firm are certain kinds of leadership styles and models. For this part, let us take a look at five leadership theories that have been applied in the past, which are: (1) trait and style; (2) contingency; (3) motivational approach; (4) distributed leadership; and (5) ‘structuralist’ approach. Firstly, trait and style approach identifies the primary characteristics of an effective leader by banking on psychographics and behavior. Generally, this approach brings forth the two independent clusters of effective leadership behavior, which are people-centered and task-centered leadership (AIM, 2005). This approach, however, has been heavily criticized for the difficulties involved in specifically defining such traits. Furthermore, it does not consider situational factors which cause the interaction of such behavioral classifications in a person. Secondly, contingency as a leadership theory negates the universal concept of effective leadership and believes that leadership should be applied variously depending on specific cases or situations (AIM, 2005). This theory, however, identifies four leadership styles which can be used as tools in evaluating leadership behaviors: directive (clarity in task assignments); supportive (showing concern for employee’s welfare by fostering good working environment); and participative (inviting employees to take actions and claim full responsibility on assigned tasks). Thirdly, the motivational approach sees leaders as the active promoter of values that provide shared meaning about the nature of the firm. As such, leaders under this type of approach are said to possess both transactional and transformational behaviors. Indeed, not only do they act as role models through motivating and inspiring the employees, they also encourage creativity and innovation through coaching and mentoring, as well as through creating new learning opportunities. Fourthly, distributed or dispersed leadership is premised on the idea that leaders are found in all levels of the firm. As such, this type of approach marries team-based leadership with self-managed team works in order to advocate the greater sharing of power between the leaders and the followers (AIM, 2005). Since it fosters quasi-autonomous groups, multiple leadership roles are usually distributed, which are comprised of improving team’s environment, managing channels of influence, and handling external relations. Lastly, ‘structuralist’ approach, contrary to the social psychological process entailed in the previous four approaches, argues that the task of the leader focuses on designing the learning processes whereby employees throughout the firm can deal productively with the critical business issues that they face. As such, they design the ‘social architecture’ that describes the ideas that underpin the policies, strategies, and structures of the firm (AIM, 2005). At this point, it can be claimed that although effective leadership involves the cooperation among the numerous individuals with various skills and capabilities, it is the leader’s ability to inspire, empower, and exert broad influence in the organization that truly deliver strategic innovation within the firm (Agbor, 2008). Central to this mindset is the acceptance that: firstly, no individual has all the ideas, skills, and time to carry out the complex tasks of effective leadership; and secondly, that the firm will not survive if application of leadership is limited to the top management only (Agbor, 2008). B. Enablers of Innovation By taking into consideration the power of leaders in providing a broad influence on the firm, as well as the vitality of employees in attaining the success of effective leadership, it can be stated that innovation-focused leadership sets the organizational context not only through its effect on the motivation of employees, but also on the administrative coordination of operational processes and systems (AIM, 2005). At this point, we now look at the three enablers of innovation which are: (1) leadership processes, systems, and structures; (2) culture and competencies; and (3) networks. 1. Leadership Processes, Systems and Structures Most marketing scholars argue that there is a need to standardize business processes in order to better manage innovation strategies. As noted by AIMS (2008), this approach of managing innovation strategies is especially important in the development of new products. Since there are numerous tasks in product development, there is a need to identify similarities and differences in the techniques. Nonetheless, it must be pointed out that the concretization of formal business processes does not necessarily lead to strategic innovation, especially when considering radical innovation. For this matter, AIM (2005) revealed the ‘Pentathlon Model’ which states that innovation should be delivered in key areas of the firm. Oke and Goffin, 2001 cited in AIM, 2005, p. 15 In this model, emphasis must be placed on its middle framework which comprises the process of developing and delivering innovation. Thus, this part includes the process of generating, selecting, and developing ideas into commercially viable new products and services (AIM, 2005). However, it must be pointed out that this process is not enough in the delivery of innovation. Thus, both the top and the bottom parts (innovation strategy and people and organization) provide organizational factors that help in the creation of a business climate that enhances innovation performance. Leadership, therefore, is required to create a climate suitable for innovation. Top management support for innovation is crucial as it provides the adequate funding for the various business approaches to innovation. 2. Culture and Competencies The competencies and motivation of people who work on innovation projects are important. In this light, leaders of innovation projects require particular skills in motivating the team members through the proper management of communications internally and externally. However, it is important to point out that the culture of an organization could either help or hinder the innovative efforts of the firm. Thus, AIM (2005) suggested that having an effective human resource policy that supports innovation is a key practice that firms need to employ. Specifically, human resource management can initiate creative and exploratory efforts that highlight risk taking and tolerance of mistakes. In addition to this, the firm can also encourage norms that reinforce the implementation and exploitation of ideas through effective group functioning and through the encouragement of speed to take actions (AIM, 2005). In this regard, leaders play a vital role in upholding a working environment that allows mistakes in the process of creating and sustaining innovation in a firm. 3. Networks Networks also play a crucial role in promoting innovation. For one, inter-firm networking that is built on trust can help drive innovation. When insights, technologies, and innovation are shared with the competitors in the early stage of innovation process, costs, risks, and benefits of bringing ideas to the market are also shared (AIM, 2005). In maintaining the effective and honest exchange of ideas, independent intermediaries are usually appointed to facilitate the transmission of sensitive information among firms without revealing their principal identities and motives. Application of Leadership into Innovation At this point, let us now incorporate the ideas on leadership into organizational context and innovation outcomes. As such, it can be stated that since innovation is viewed as an organizational process that is comprised of sub-areas that target at analyzing the external and internal factors surrounding the firm, which in effect, guides in the re-structuring of the business model in favor of strategic innovation. Thus, leadership must be seen as a tool that affects not only in the level of product development and process enhancement, but also on the overall organization of the firm. Firstly, on the product development level, leadership can focus on the creation of an organizational context that encourages tolerance for ambiguity, experimentation, and rich communication, which can be done through the use of transformational leadership (AIM, 2005). After obtaining new and fresh ideas, they can be further refined and elaborated which can be more effectively done through the employment of formal business practices that bank on transactional leadership. Secondly, on the overall organization level, leadership can better integrate organizational contexts in order to balance a steady stream of incremental innovations against occasional radical innovations (AIM, 2005). The role of the proper leadership styles come into play since there are different ways of fostering incremental and radical innovations. Conclusion In conclusion, it can be stated that the key challenges of attaining, maintaining, and sustaining strategic innovation lie, firstly, on the recognition and development of appropriate leadership styles for the three enablers of innovation; and secondly, on the strong cooperation among key stakeholders to ensure the enhancement of the seven dimensions of innovation. Bibliography Palmer, D. & Kaplan, S., n.d. A Framework for Strategic Innovation: Blending Strategy and Creative Exploration to Discover Future Business Opportunities. [online] Managing Principals, InnovationPoint LLC. Available at: [Accessed 10 April 2012]. Agbor, E., 2008. Creativity and Innovation: The Leadership Dynamics, Journal of Strategic Leadership. [online] Available at: [Accessed 9 April 2012]. Advanced Institute of Management Research, 2005. Leadership for Innovation: Summary Report from an AIM Management Research Forum in cooperation with the Chartered Management Institute. [online]. Economic in Social Research Council. Available at: . Read More