Innovation, Creativity and Human Resources.
In today’s highly dynamic corporate atmosphere, organizations need to develop new competitive advantages to keep up with the promptness of transformation in knowledge, consumer demands and global competition. In this challenging undertaking, Human Resources can benefit from innovation strategies and tools more than ever, as it helps organizations to optimize their competing power by increasing their performance and efficiency.
Innovation denotes using new invention to transform organizational processes or create commercially viable products and services, Dess et al (2007, p 96). In unobtrusive terms, innovation is the process of making improvements by introducing something different and new. Innovations are philosophies that are developed into new products or processes which result in changes that customers recognize as new.
Innovation is an important concept to understand as a Human Resource Manager and for an organization as a whole. Used in the correct manner, innovation can give an organization the competitive advantage that they need to be a success in their market. Competition among firms is getting harder day by day due to many organizational and environmental reasons such as globalization, deregulation, increasing global and domestic competition, and new technologies.
The act of innovating can provide an organization with the capability to capture a substantial level of market share or create an entirely new market opportunity that enables a firm to reap supernormal profits. The slow response of competitors to such innovation strategies will accrue revenue competitive advantage to an organization.
Innovation stratagem is that part of strategy which deals particularly with the growth of an organization through the development of new products, employee skill base, services, processes or business models. An innovation strategy then becomes a plan of how to use the development of new products, services, processes or business models to achieve certain objectives like sustained competitive advantage, Abbing (2010). Most importantly, to create growth, to sustain performance and to develop performance in such a dynamic and changing environment, one way is to make improvements via the procuring, maintaining and retaining of appropriate Human Resource. Innovation is a main strategic tool to have a competitive advantage in such complex environments, Gardaker et al., (1998). Organizations need to differentiate themselves from other players in the market. In most cases, leading companies continuously use innovative strategies to craft an authority over their competitors.
Competition has also driven local and global corporations to become leaner and more efficient and to react faster to both changes in the marketplace and in the internal business environment. Constantly shifting business priorities, increasing seasonality of products, faster business cycles, and more frequent mergers and acquisitions are just some of the market conditions that lead to intense pressure on organizations to increase efficiency while still providing flexibility to the business to allow it to react to changing demands, Carter et al., (2010).
The concept of competitive advantage is rooted in the logic of value creation and distribution. An organization is said to enjoy competitive advantage when the value that is created is of an economic exchange in which the organization partakes is greater than the value that could be created were the organization does not participate in the exchange. In a highly competitive business world, it is vital for companies to operate efficiently. It involves reducing costs in all areas of the business. Some of the key areas where organizations are able to minimize costs are by saving time, space, effort and energy via training and development. The competitive advantage in this context means the enterprise ‘s capability to offer superior products and services for consumers comparing with the products and services offered by the competitors.
How to achieve a sustained competitive advantage that ensures long-term survival is a major concern for managers everywhere, but even more so for those in smaller organizations, which may have more difficulty surviving under hostile environmental conditions than larger organizations. Because innovation is a key driver of sustained competitive advantage and sustainable business growth, the management of innovation is a central concern for these organization, Igartua et al., (2010). There are varying ways that innovation may be engaged to achieve an organizational competitive advantage, some of these advantages can ascend from the following sources -;
Price; The higher competitiveness level comparing with the competitors is given by price, product ‘s quality, post-selling services quality, the enterprise ‘s capability to adapt the offer to the market demand and technical progress. In Michael Porter ‘s vision, the enterprise ‘s competitive advantage means to assure a reduced cost or to create a distinct product or service that is clearly different through its quality by the competition ‘s offers Lucia (2012). For example, customer service management has become a strategic issue for companies in the new epoch. By improving logistics performances, organizations increase customer satisfaction and gain market shares. Customer service, hereafter understood to be the service performance perceived by customers as a result of logistics processes and activities, has been widely recognized as a mean to gain competitive advantage, Bottani (2006).
Efficiency in Operations; An organizations economies of scale offers competitiveness, starting from access to more customers and to building and growing new markets. Exploiting competitor’s resources like labour and technology. Extending the products life cycle by selling older, tried and tested products in lesser developed markets.
Risk; An organization may Diversify its macroeconomic risks by perfectly correlating its business cycles on the markets and by diversifying its operational risks like labour problems, and an organization may gain completive advantage by being flexible and diversifying its portfolios.
Strategy; An organization may use as a matter of strategy the first mover advantage to gain competitiveness as an only provider of a product to a market such that even when the competitors catch on the organization will still remain with the first mover advantage. Cross over customers between markets by employing reputation and brand identification can be used by an organization as a matter of strategy to gain competitive advantage.
In the strategic enterprise ‘s option must be inserted the innovation implementation methodology that is the main source and tool to gain the competitive advantage, to change and improve is like the organization giving itself a second chance. To be forced by others to change is like being discarded. Those organizations who refuse to learn, change and improve to gain competitive advantage will definitely one day become irrelevant to the industry or the world, Lucia ( 2012).
Innovation is precarious to enable firms to compete in domestic and global markets, Hitt (2001). The importance of innovation for firms and start-up is summarized by Lee et al. (2001) when he stated that: ‘head-to-head competition with established players is bound to result in failure due to resource shortcomings, scale diseconomies, and questionable reputation’. he stated that innovation is the key to competition as competitors cannot easily impressionist innovativeness.
Modern economies are often referred to as innovation economies. Individuals engaged in the business world are continuously in the pursuit of wealth through innovation. It is an open truth that a company's success does not come from its chandeliers, gardens, environment or acres of lands rather it comes from its intellectual and systems capabilities. Innovation and information are the crucial assets of a business and there is a need to learn to handle these assets in new ways. Traditional monitoring systems which were designed to deal with tangible inputs & outputs are no longer adequate to survive in the current markets. Organizations are required to share information & innovation internally and learn to adapt more quickly to external circumstances in order to retain their competitive advantage.
Innovation management refers to the process of generating value to the organization through the creation, dissemination, renewal and proper application of innovation. It can be defined as a creative way of utilizing information and people throughout the organization. Innovation management is the channel that facilitates the smooth flow and distribution of innovation of the individuals, groups or teams across the organization in certain ways that directly affects the performance and potential levels output. It aims at getting the right information within the right context to the right person at the right time for the right business purpose. It comprises of a range of practices used in an organization to identify, create, represent, distribute and enable adaptation of insights and experiences. Such practices contribute in the things like improved performance levels, competitive advantages, innovations and sharing of lessons learned and continuous improvement of organization.
Innovation mixed with innovation management can be termed as innovation. Innovation is the creation, evolution, exchange and application of new idea into marketable goods and services, leading to the success of an enterprise, the vitality of a nation's economy and the advancement of society. In simple words we can explain the term innovation as generation of novel ideas and their implementation to create new products and services to gain competitive advantage and achieve new heights in the market. One strategy may be to build up an innovative organization by getting people to accept that the way they work just might not be the best.
Innovation is all about taking risks. It is required to encourage innovation when an organization is doing well because the last thing which is desired is to gain sustained competitive advantage and for that innovation is required. For achieving the new heights in the business, it is required to encourage not only product innovation but innovation in every field.
Finally, the advantages that a firm had yesterday will be fast replaced by the trends of tomorrow. A firm doesn’t have to do anything wrong, as long as its competitor’s catch the wave and do it right the firm can lose out and fail. If organizations do not change, competition shall surely remove them from the market. It’s not wrong if organizations don’t want to learn new things, however, if its strategies cannot catch up with time, they are eliminated and organizations lose their chance of continued survival, the same applies to individual employees. It can be clinched that in this competitive world where complexity and uncertainty increases every day, the only way to survive is to manage the innovation with the help of creativity. Innovation can be managed through capturing and making the full use of a firm's collective expertise. In fact, innovation management is the energy or raw material for innovation which is the only competitive advantage that a company can use for sustainability in the unpredictable business environment.to a diversity