Managing for Innovation and Creativity

8/3/2019 Managing for Innovation and Creativity

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Introduction

Creativity and innovations are needed because of fierce business competitions within an

organisations specific market. In recent years, products produced by any companies in any

sector of markets has seen a comparably short product life cycle. As technologies are more

advanced nowadays and customers being more demanding, this implies that companies

require special or unique products to have the competitive edge to rival against competitors in

order for a chance to survive in the competitive market. An organisation will become

successful is because of its abilities in nurturing creativity and promoting innovation within

the organisation. Henry (2006) suggested that creativity is the process of thinking and it is the

driving force that motivates employee to generate one of a kind and useful ideas. Creativity

and innovation are both very crucial to an organisations business development in the

provision of new services and products and it is central to the repositioning of an organisation

in the market. This essay will analyse the role of professional networks, how it improves in

fostering creativity and innovation and what lessons can be learnt by managers from network

analysis. It is believed that fully utilise all the resources within professional networks can

help to foster creativity and innovation to its employees and the expansion of an organisation.

What is Creativity and Innovation

In a traditional culture of any given organisation, creativity was only linked to employees that

are specially gifted in a particular area and often they would be working in an isolation.

Today, creativity exists in a wider range of people and professions and it is no longer an

individuals work. It has slowly drifted from creative personalities to creative process in

recent years. According to Boden (1996), creativity can be found by exploring and mapping

structured conceptual spaces that are have various dimensions and ideas can be found by in-

depth explorations within those conceptual dimensions. There is a growing scepticism

towards individual, trait-base model and often behaviourist models are criticised for not

taking surrounding factors into consideration. Todays theories of creativity are based on

processes and systems that converge with theories of working in teams, innovation and

organisational learning. An example of this is the employment relationship after Fordism,

post-Fordism shifted from individual competences to the social and organisational framework.


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There are three components to creativity: Expertise, Creative-Thinking Skills and Motivation.

Figure 1 shows how three components are combine together for creativity.

Figure 1 The Three Components (Amabile, 1998)

An employee has creative-thinking skills is important, but having the expertise in relevant

field and motivation from the surroundings are also essential (Serrat, 2009). Managers caneasily influence creative-thinking skills and expertise, but this is potentially a costly and time

consuming process. That is because managers have to hire the right person in order to fit the

organisation profile, and it can be considered as one biggest and important decision that an

organisation have to make. Given that the organisation have picked the right employee,

motivation from managers becomes crucial at this stage.

On the other hand, innovation can be defined as the successful exploitation of new ideas

(Besant and Tidd, 2007). Innovations can take place in many forms but it can be broken down

into four dimensions: Production, Process, Position and Paradigm; and into 3 forms: Product,

Service and Process. It can also happen in small increments or in large scale radical change

such as steam and mode of transportation over the years. The work of Joseph Schumpeter in

1934 and 1939 gave a revolutionary perspective that innovation was identify as the golden


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key to any economic development (Andriopolos and Dawson, 2009). In order for an

organisation to advance its position within its market, open innovations is very important as it

allows new ideas to flow into the organisation, whereas closed innovations would stops its

advancement. Table 1 will show the comparison between open and closed innovations (Serrat,

2009).

Closed Innovation Principles Open Innovation Principles

Only smart people in our area work for us We work with smart people inside and out the

organisation

For research and develop, we do it ourselves in order

to make profit

We make use of external research and development in

our internal research and development to claim a

portion of that value

We will get our discoveries into the market first The origin of the research does not matter, we can still

profit from it

We will win if we get an innovation into the market

first

Building a business model is more important

We will win if we have the most and best ideas in the

industry

If we make use of existing internal and external ideas,

we will win

Competitors will not profit from our innovation

process as we have full control over it .

We exchange intellectual property to advance our own

business model

Table 1 A Comparison Between Closed and Open Innovation Principles

Adaptation-Innovation theory stresses the roles of adaptors and innovators. Adaptors produce

ideas based on exiting definitions of problems and likely solutions, with the use of existing

theories, policies and code of practices of organisations. They improve and make things

better. On the other hand, innovators breakdown the existing problems from accepted

paradigms and produce less expected or anomalies results. They are more concerned with

doing things in a modernised way and differently. However, combining adaptors and

innovators together, there will be a more successful solutions. That being innovators come up

with new concepts and ideas and adaptors could use existing techniques to develop these new

concepts and ideas into new models. If they were to act on their own, innovators would

struggle to develop their new concepts and ideas as they were unable to progress and adaptors

would lack the initial inputs for initiation. By the same analogy, employees that are creative

are the adaptors and employees that are innovative are the innovators. In any organisations,


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creative employees are needed to provide the impetus and contents in order for the innovative

employees to provide any forms of innovations (Andriopolos and Dawson, 2009).

In order to manage creativity and innovations in a way that keeps everyone (partners and

clients) satisfied, there are five levers (Serrat, 2009):

1. Let employees feel challenged about their work to stimulate minds2. Allow certain amount of freedom about procedures and process3. Allow them to design their own workgroups to gather ideas from all employees4. Encouragement and incentives5. Support from the organisation

It is important that the workforce has its own autonomy yet an organisation must maintain

and monitor its professional networks both inside and outside the organisation to avoid

segregation between workgroups, otherwise the organisation will face difficulties in

fostering creativity and innovation.

Importance of Networking and How It Helps to Foster Creativity and Innovation

Many people would agree that professional networks help to foster collaboration, co-operation and trust. These professional networks ultimately lead to economic advantage in

the labour market on a personal level. It has been found that maintaining and forming social

and professional contacts is crucial in recruitment and selection. For an individuals career

development and knowledge sharing, networking is also seen as important. Having networks

within an organisation can counterbalance the segregation and fragmented structures,

therefore it can create a sense of security for employees and foster cooperation. On the other

hand, networking is used as job search behaviour, an example of this would be the

popularities in joining fraternity groups in the United States universities. Students would joinfraternity groups to expand its social network for their future job seeking purpose, giving

them an earlier start in planning their career as they might have contacts in the sectors that

they would like to work in.


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Networks can be valued in terms of social capital, social capital is a product of aggregated

resources held within durable networks of a groups relations (Vershinina et al, 2011).

Putnam (2000) sub-divided social capital into two sub groups:

y Bonding capital (with like-minded people)y Bridging capital (with people who shares different values)

In his work, he was more in favour of the negative sides of networks, he commented that

people who has strong-ties within are network will receive more social capital, mutuality

and reciprocity, that is because everyone is like-minded. However, it restricts individuals

social network as it reduces the ability of them to make new contacts, creating an inertia for

themselves. On the other hand, Coleman (1988) sees social capital has both economical and

non-economical outcomes and can be taken place in 3 forms. In a study conducted by

Granovetter (1973), supported by Ruefs research (2003), interconnectedness amongst a

social network is of high importance and he emphasised on the importance of weak-ties in

individuals advantage. Strong ties can lead to alienation and fragmentation within an

organisation as there could be different social circles co-exiting in the same working

environment. He suggests that weak contacts can assist an individual more in job seeking

process in comparison with having strong ties to the industry. Strong ties are developed for

people who are like-minded, giving similar output and opinions to work, however, weak ties

can lead to innovation and diversity in work output, because of differences in opinions within

the network and compromisation is needed, leading to the expansion of the network. It

supports Metcalfes Law that quantity is more important that quality, when mutual

relationships lock in, the circle of acquaintances shrink. Employees that are at the boarder of

the circle have greater access to unexpected connections than those employees that are at the

core of the circle. Those peripheral employees are more likely to cross the boundary and are

likely to be more creative.

Furthermore, it is believed that the use of both internal and external social networks can

increase team effectiveness and innovation performance, contacts with heterogeneous social

circles can help to foster innovations as they are likely to facilitate cognitive processes

related to creativity and innovation such as flexible thinking, workforce autonomy and

diversity in the organisation (Patternson et al, 2009). In a journal title Panorama Inforegio

published by European Union Regional Policy (2009), roughly86 billion was contributed to


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research and development and innovation in order to foster creativity and innovation in

European, national and regional levels and much of this money was invested in fostering

networks cooperation and clusters. Moreover, it is more than just about the finance in

fostering creativity and innovation. European Cohesion Policy (ECP) actively promote

cooperation, encourage regions to exchange experience and best practices to develop new

opportunities. To put it into an organisational context, organisations should incorporate

similar polices as ECP, to invest money into improving its existing professional network and

foster creativity and innovation. Burns and Stalker (1961, cited in Lam, 2004) explains that

there are Mechanistic and Organic Structures exist in an organisation. In a mechanistic

organisation, knowledge of the whole organisation exist at the top of the hierarchy, at the

same time, interactions between employees tends to be vertical (answer to superiors). On the

other hand, in an organic organisation, knowledge may be located anywhere within the

network, the communication tends to be laterally rather than vertical. Thus these factors can

lead to a more innovative responses. For example, Japanese firms have gained the

competitive advantage in industries such as automobiles over the United States by integrating

shop-floor workers and enterprise network, this allows them to plan and utilise organisations

work-floor resources in planning and coordinating labour in specialised division and making

innovative investment strategies.

Lessons c

an be

Learnt by M

anagers from Network An

alysis

Sometimes, organisation did not fully utilise existing resources inside the organisations

circle. An example of this would be where excessive resources are not being used by the

organisation or suppressing employees talent by not allowing them to voice their opinions.

What managers should do is to learn the lesson from Japanese automobile industries, where

they integrate shop-floor workers with the enterprise network, so that they can suggest

creative ideas and making innovative investment strategies. At the same time, managers

should encourage socialisation within the network so that there will not be fragmentations of

social circles within the organisation. One would argue that a loosely tied network is unlikely

to produce practical outputs because the organisation would receive a lot of opinions

expressed by the workforce, therefore, the decision making process will be time consuming.

However, a closely tied network consist of employees that are like-minded, they are able to

similar and productive output, but in comparison with a loosely tied network, it lacks the


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inputs of creativity and innovation. Employee that are nearer to the boarder to the circle are

more likely to gain access to other circles and brings in innovation and creativity.

Moreover, managers should make use of statistical analysis to analyse the efficiency and

output of the professional network, through the use of graphs and charts. So they can

effectively identify areas that require immediate attentions to make any necessary adjustment.

For example, if a particular in a production line has a sudden drop in production rate on a

statistical report, managers should investigate the cause of the decrease in rate. These often

can often be because of the lack of challenges or lack of encouragement and incentives to

employees in that network. Managers can use the five levers mentioned about as an approach

to problem arises from network analysis, in order to foster creativity and innovation.

Conclusion

Without a doubt, the role of professional networks has play an important part for

organisations in fostering creativity and innovation as knowledge and process can be shared

amongst employees within networks, both internally and externally. There are advantages

and disadvantage to both strong and weak ties within the network, however managers

should encourage employees to have weak ties in the professional network so that they is adiversity in the organisation and in order to foster creativity and innovation. Managers should

also fully utilise all the resources within professional networks can help to foster creativity

and innovation to its employees and the expansion of an organisation.


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References

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Andriopoulos, C. and Dawson, P. (2009)Managing Change, Creativity & Innovation. London: Sage.

Bessant, J. and Tidd, J. (2007)Innovation and Entrepreneurship. Chichester: John Wiley.

Boden, M A. (1996)Dimensions of Creativity, USA: MIT press.

Burns, T. and Stalker, G.M. (1961) The Management of Innovation. London: Tavistock.

Coleman, J.S. (1988) Social Capital in the Creation of Human Capital The American Journal of Sociology, Vol.

94, Supplement: Organizations and Institutions: Sociological and Economic Approaches to the Analysis ofSocial Structure, pp. S95-S120.

Granovetter, M. (1973) The Strength of Weak Ties,American Journal of Sociology, 78 (6) pp. 1360-1380.

Henry, J. (2006) Creative Management and Development, London: Sage/OUP.

Lam, A. (2004) Organisational Innovation, Handbook of Innovation. Oxford University

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Patterson, F., Kerrin, M. and Gatto-Roissard, G. (2009) Characteristics & Behaviours of Innovative People in

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Ruef, M. (2003) Innovators Navigate Around Cliques, Stanford Business Magazine. Retrieved 10 January

2012, from http://www.gsb.stanford.edu/news/bmag/sbsm0305/idea_ruef_networking.shtml

Serrat, O. (2009) Harnessing Creativity and Innovation in the Workplace.Knowledge Solutions, 61.

Vershinina, N., Barrett, R. and Meyer, M. (2011) Forms of Capital, Intra-Ethnic Variation and Polish

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Managing for Innovation and Creativity