Are Creativity and Innovation the Keys to Organisational Success - Coursework Example

Creativity and Innovation Name Institution Course Date Creativity and Innovation The organisations that have succeeded over the years are those that are the most creative and innovative. A company’s ability to come up with new ideas and innovate quickly is often the key to its success. Companies that are creative and innovative do not copy what their competitors do; they however may use creative and innovative ideas from others to develop a unique product, service or operational style for themselves. Any Company can be creative and innovative regardless of their services, products or expertise (Hellriegel, Slocum and Woodman, 2001). Application of creativity and innovation to business operations enables an organisation stay ahead in the existing competitive and changing marketplace. For business organisations, change is inevitable. Organisational changes intensify competitiveness since organisations need application of changes in strategy, management style, technology, operational styles to name a few. These changes require exclusive analysis of behaviour patterns, organisational performance and values. Creativity and innovation play a fundamental role in this change process. According to Vrontis, D. & Thrassou, A. (2013), businesses today are knowledge-based organisations whose success is determined by creativity, innovation and inventiveness. In the process of change, organisations are trying to develop a framework where creativity and innovation are acknowledged as the basic cultural norm. This paper will highlight some arguments that supports that creativity and innovation are the key to success of organisation. Creativity can be defined as the function of knowledge, imagination, inspiration and evaluation. This is to say, the greater the knowledge base and curiosity, the greater the ideas and patterns achieved which leads to the creation of new and innovative commodities and services. Creativity entails discovery, invention and creation (Pope, 2005). Creativity starts with the discovery. Discovery is when one becomes aware of something- discover it. Discovery is then followed by invention that is termed as the scientific or technical idea, method or process. This is then followed by creation. Innovation on the other hand is the creation of more efficient and effective products, services, ideas and processes in order to increase productivity and performance (Mohr, Sengupta and Slater, 2010). Innovation process starts with idea generation then idea screening and finally idea implementation. Idea generation involve coming up with novel and new ideas that can contribute towards innovation. On the other hand, idea screening is the selection of particular ideas from a collection of ideas and it may involve convergence of a number of ideas to yield more effective and practical ideas. Idea implementation involves translation of an idea into action plan. There is an existing relationship between change and innovation although they are different components. Change involves new and better ideas that may originate from the creation of new products or services or an idea that leads to a complete change on how business operations takes place. Successful organisations implement innovation and change to satisfy their important stakeholders. Innovation is often termed as a “silver bullet” solution in today’s changing business environment. It is important to note that innovation is required mostly when business organisations are faced with issues that need different solutions, not just good execution, for example, through quality improvement. However, innovation involves specific breakthroughs thus it is different from adaptability. Innovation is adapted by organisations that are focused on growth, expansion and transformation (Mieg and Topfer, 2013). Successful idea generation and implementation is very crucial to business be it improving its processes and products, coming up with new products and services to market, and increase profitability. Innovation can either be a single change that becomes a major breakthrough or it can be a series of incremental changes. Whatever it is, innovation is a creative process (Christernsen and Raynor, 2003). Creative ideas may come from outside the business e.g. Suppliers, customers, competitors, and sources of new technology or from inside the business e.g. Managers, employees or research and development work. Success only occurs through filtering those ideas, determining those that the firm will focus on and using the available resources to exploit them. Success due to creativity and innovation may be inform of improved productivity, gaining of competitive advantage, building the company’s brand, improving relationships and increased profitability. A business organisation that does not innovate is prone to falling productivity, losing key staff, reduction of margins and profits, losing share market and going out of business. For innovation to be effective, an organisation should analyse the marketplace (Blazey, 2009). It is futile to consider innovation in a vacuum. For a business to go forward, an organisation should study the market place to establish how innovation can be valuable to the customers. An organisation should also identify opportunities for innovation. Opportunities for innovation can be established by adapting a product or service according to how the marketplace is changing. One could also identify opportunity for innovation by introducing a new product or new technology, working practice, and better process that leads to quality products. Creativity and innovation are related to technology (Mohr, Sengupta and Slater, 2010). Technology is the systematic implementation of scientific knowledge and skills to a new business process, service and product. Technology is highly embedded in all products, services and processes used. At times, innovation is described as the change in technology. Managing technology requires business leaders to understand how technology come to be, and affects how organisation carry its day-to-day organisational operations. Technology has an impact on the competitive advantage of an organisation and thus managers have to incorporate technology in their organisational strategies (Arnold, 2003). For successful diffusion of technological innovations, the technology should have a great advantage, can easily be adopted and has lesser complexity. For innovation to bring success to an organisation, managers should establish the technological needs of their business organisations and ways that these needs can be met. In addition, for innovation and creativity to bring success to an organisation, there are some key areas that must be taken into consideration. These areas include structure, leadership and people. When we talk about innovation, some people may assume that unstructured approach is the best and that structure will limit creativity and the exploration of new possibilities. However, for effective innovation that will yield productivity and good performance, structures should be put in place in organisations. One essential element of structure is a clearly defined innovation strategy (Tan and Theodorou, 2009). Effective innovation strategies give room for all ideas to be captured and assessed without eliminating worthy ideas. A well-structured innovation strategy starts with identification of most relevant problems, generation of solutions to the existing problems, identification and implementation of the effective ideas and finally evaluation of innovation strategy success. The major problem in innovation strategy is the means organisations use to evaluate ideas. Business plans resulting to generated ideas can only be effective when it is possible to predict the future. The success of a business is based on the ability to generate new ideas and knowledge and react quickly to the generated knowledge (McDermott and Connor, 2002). There exist a number of innovation strategies that enable an organisation to survive in this ever changing and uncertain business environment. One innovation strategy is the rationalist strategy that is influenced by military experience and describes, analyse and evaluate the environment, determine the action to be taken after the analysis and implement the course of action. This strategy is intended to assist organisations prepare for a changing future, be careful of the trends arising from the competitive environment and ensure attention is focussed on achieving long-term objectives. However, this innovative strategy has faced criticism as managers are faced with challenges in appraising accurately their situations and also future prediction is very difficult. Another innovation strategy is the incremetalist strategy that argues that it is impossible to predict the future and that organisations have limited knowledge of their environment, strengths and weaknesses. The steps followed in the incrementalist strategy include making deliberate changes towards set objectives, measuring the effects of the changes and adjusting the set objectives and deciding on the next change (Garcia and Calantone, 2002). When organisations implement innovation strategies, they cannot ignore the national innovation systems they are embedded on (Spencer, 2003). Through their influence on demand, corporate governance, and human resource provision, national innovation system can open opportunities and limit what organisations can do. Although executions of innovation strategies are influenced by national innovation systems, they are not determined by them. Acquiring information from the competitors and other external sources is very important in developing creative and innovative abilities for an organisation. However, this is a very costly investment. In order to drive innovation that will lead to transformational change, innovation must start with the leaders. Managers and senior executives must be innovators themselves. Thus, the innovative success of a firm is largely attributing to organisational leaders leading by example. Leaders play a fundamental role in creating a climate that supports innovation. Some factors that create innovative climate include intellectual stimulation, challenge, and strong sense of cohesion to name a few. Leaders can play a great role in making sure that these factors are present in the work environment for the creation of climate for innovation. Ideas would not be present without people. One method of enhancing the innovative potential of the employees in any organisation is ensuring that they are well trained in the knowledge and skills that support innovation. Innovation is considered as one of the work competencies. It’s not a must for an individual to be born a great innovator; with the right training and knowledge, any employee can acquire innovative skills. If organisations what to boost innovation and creativity among the employees, they will need to build capabilities in this area. An example of a company that has succeeded due to creativity and innovation is Amazom.com (Mahdavi, Mohebbi and Cho, 2011). Amazon has tripped its profits and revenues since 2002, to approximately $13 billons. The key to their success is putting their customers first before anyone else. Innovation and creativity in the company started with the company identifying a new potential area by establishing new customer in the IT unit. Serving the IT customer’s need required different profit formula, processes and resources (Jordan, 2012). This meant that another new business model was required. Establishing of this idea allowed Amazon to launch a web services platform. Within 5 years of operation in the new model, the company grew to become the seventh largest site in the world. Amazon did not stop there. In 2007, the company came up with a new product- the Kindle e-book reader that was foreign to the company’s DNA. To launch this product, Amazon wrapped up this product in an integrated iTunes-type media platform. The company partnered with content producers in successful innovative ways and developed an open back-end that made it possible for the independent publishers to create new content for the device. This led to the expansion of the market and it positioned itself for success. Also, Amazon’s new digital offering such as the e-books and music has increased its menu options for the customers. Its music digital store launched recently already has 3 million songs that are compatible to any digital device and music software. In addition, Unbox allow the consumers to rent and buy TV shows and movies and watch on various players. In this era of piracy and format fighting, this is called for and is an effective innovation. Amazon culture is based on innovation and creativity. When it gets an opportunity to expand its customer base or serve its existing customers with new products, the company conceives new business models to exploit this opportunity. The company has the ability to develop and run new types of businesses by extracting value from already existing businesses (Matthews and Brueggermann, 2015). In conclusion, innovation is the process of developing and implementing of new ideas. It involves conversion of useful ideas into products, services or methods of operations. These new ideas result from creativity which is termed as the ability to create useful association among ideas. Creativity and innovation provide new ideas that lead to the success of an organisation. For innovation and creativity to bring success to an organisation, there are some key areas that must be taken into consideration. These areas include structure, leadership and people. If implemented effectively, creativity and innovation definitely becomes the key to organisational success. This can be witnessed by Amazon.com, a company that as incorporated creativity and innovation in their culture. References Arnold, H 2003, Technology shocks : origins, managerial responses, and firm performance, Heidelberg New York, Physica-Verlag. Blazey, M 2009, Insights to performance excellence, 2009-2010 : an inside look at the 2009-2010 Baldrige Award criteria, Milwaukee, Asq Quality Press. Christensen, C. and M. Raynor 2003, The Innovator’s Solution: Creating and Sustaining Successful growth, Harvard Business School Press, Boston, MA. Garcia, R. and R. Calantone 2002, A critical look at technological innovation typology and innovativeness terminology: a literature review, Journal of Product Innovation Management, vol. 19, p. 110-32. Hellriegel, D., Slocum, J.W. & Woodman, R.W 2001, Organizational behavior (9th ed.), Australia, South-Western College. 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