Organisational Creativity

INDIVIDUALS T|TTEAMSO|OORGANISATIONAL CREATIVITYC|CCREATIVITY TRAININGL|LLEADERSHIP

 

There has been an increasing focus on understanding how organisations are placing creativity at the centre of their strategies, process improvements and how creativity lies at the heart of entrepreneurialism, high performance and agility. There has also been a focus on the macro issues that will underlie economic growth and profitability.

 

Strategy

The Boston Consulting Group’s 2010 strategy survey of 1600 executives found that creativity and innovation had returned to the top of the strategic agenda – a trend that had been evident since 2003. The executives felt that creativity was essential for successful recovery from the downturn. Further, the report suggested that companies in ‘mature’ economies are underestimating the importance of investment in innovation. The report predicts that a new world order will occur, because companies in ‘emerging’ economies are planning to invest far greater effort in promoting innovation. Similar themes were found in the Ernst & Young 2010 Connecting Innovation to Profit report.

 

Business processes

The NESTA Everyday Innovation report found that creativity was perceived to be fundamental in improving products, processes and services.

 

Similarly, one of the respondents in the Ernst & Young 2010 Connecting Innovation to Profit report suggested that “We assume that 50% of our revenue in 5 years’ time must come from sources that do not exist today. That is why we innovate.” Respondents identified creativity as a key driver of new business processes.

 

Entrepreneurial companies

The Ernst & Young 2010 Connecting Innovation to Profit report outlined the prominence of creativity for aggressively entrepreneurial companies. They conducted research with 263 entrepreneurs from more than 50 countries and 90% of the global economy. The entrepreneurs surveyed were judged by a jury of senior entrepreneurs and business leaders. The results indicated that “the ability to manage, organise, cultivate and nurture creative thinking is directly linked to growth and achievement”. Further, the report highlighted that “Innovation ‘for the sake of it’ is often essential, but the speed at which a fast-growth company moves forward will depend on its ability to connect creativity to profit.” Some of the key themes in the report centred around growth, business advantage, scalability, the identification of creative talent and the development of a culture of creativity. Below are some selected quotations from the report.

 

  • 82% of the entrepreneurs strongly agreed that innovation was critical to the growth of their business. The same percentage said it was the one genuine advantage they had over their rivals.
  • Fast-growth companies need to make innovation a predictable, scalable activity. It has to be nurtured, managed.
  • Successful fast-growth companies looked to innovate and encourage creativity in areas not normally considered like human resources and finance.
  • 77% of respondents believed that a key driver of creative performance involved the identification and hiring of creative people.
  • As entrepreneurial businesses grow, they need to protect the free-thinking, creative behaviors that launched them on their journey to market leadership. They need to foster a culture of creativity.

 

The survey concluded that businesses looking to grow quickly need to ask themselves five key questions:

  • How can you make innovation a targeted, strategic and funded priority?
  • How well do you combine process and spontaneity?
  • How do you innovate around product or service details and the big picture?
  • How do you allow ideas to flower while exploiting those with potential?
  • How well do you innovate around how the business works, not just what it does?

 

Agile companies

Bottani (2010) conducted a comprehensive review of the available research and also surveyed 190 agile companies. Her review revealed that agile companies more effectively met customer requirements (price, specification, quality, quantity and delivery). Agile companies react quickly, customize offerings, are more cost-efficient, have lower manufacturing costs, increased customer satisfaction and increased competitiveness. The general consensus of the research is that agile companies react most effectively in volatile and turbulent markets.

 

Bottani’s research shows there are some key characteristics of agile firms that are firmly related to creativity:

  • Quick responses to changes
  • Flexibility in the face of unpredictability
  • Process flexibility
  • Tendency towards innovation

 

The BTM Corporation has conducted a number of studies on the financial return on business agility. Overall, the findings show that companies with highly mature business agility characteristics exhibited superior financial performance:

  • 13% to 38% performance advantage in capital efficiency and value
  • 10% to 15% performance advantage in margins
  • Up to 5% performance advantage in revenue and earnings growth

 

And this advantage has been shown to be sustainable over time based on monitoring of these companies during both 1-year and 5-year timeframes.

 

Highly agile companies were found to adopt three primary practices:

  • Strategic Experiments: Companies were prepared to innovate and experiment with creative approaches to emerging technologies, work practices, product or service concepts, and customer segments or product markets.
  • Adaptive Business Architectures: Structures that can quickly realign competitive assets to meet changing conditions and competitive challenges
  • Radical Renewal: Continuous and disruptive learning founded on a culture of competitiveness.

 

Macro Issues

The 2010 Standard Chartered Winning Ingredients report explored how large corporations and economies should look to grow profitably. The three winning ingredients for success were considered to be Commodities, Cash and Creativity.

 

The report ventured:

“Creativity may be the most powerful of all the resources to be rich in. With vast numbers of people entering the workforce, huge improvements in productivity, and continued globalisation, the rewards for innovation and creativity will become even greater”.

 

Further, given the state of the economies of many developed nations the following quotation from the reports’ author and Chief Economist at Standard Chartered, Gerard Lyon is particularly pertinent:

“To succeed, countries will need cash, commodities or creativity — and, given that we have pretty well exhausted our supplies of the first two — it all hangs on our ability to be creative”.

 

 

References