Building Innovation Capabilities in Large Organizations

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This essay is written to explain and analyses that how innovation capabilities can be developed in large organizations. The essay has tried to cover all the basic aspects related to innovation, and how innovation can be developed by changing the organization culture, leadership, hierarchies, and focusing on strategies and team work. The essay will focus on the negative aspects of organizations and will discuss how innovation can be developed by transforming them into positive strategies .The essay will provide an in depth analysis of large organization’s structure and their complexities.As a result of team work, an employee follows synergy created and generates new ides through coordination and collaboration with other team members. Through Douglas McGregor, theory X and theory Y, essay will explain innovation capabilities in organizations. The essay will explain large organization’s structure and how large organizations can be adopt flexible culture through various examples, cited form journals articles. The essay will also explain the training and learning capabilities of employees and how that training can be efficient in generating innovative ideas in an organization. Through referring to various authors, the essay will prove how innovation can introduce and can be beneficial in an organization in performing their daily operations and activities. In the end the essay provides a brief conclusion which helps in understanding the factors that can be used for creating innovation in the organization.No matter either large or small organization, organizational culture is an important factor for introducing innovation capabilities within an organization. Organizations have different cultures which are strong as well as weak depending on the orientation of any organization (Ogbonna & Harris, 2000). Organizations need to adopt group focusing strategies because these help the organizations in building strong innovative culture as all employees are working together in the forms of groups (Lam, 2000). Through following this strategy innovation capabilities can be built because groups tend to share ideas among themselves. Integrated units can bring an innovative culture in organization because all the departments within an organization can collaborate and discuss their issues (Hulsheger, et al., 2009).Adaptability and flexibility in the organizational culture also plays a very important role in creating innovation in the organization. When any organization shows flexibility in its culture, the employees tend to become innovative as well as creative because they know their ideas will be acknowledged (Provan & Kenis, 2008). Reward criteria must also be set in an organization for sharing innovative or creative ideas, so that employees get motivated and serve something unique that is beneficial for an organization.Large organizations have more tendency of creating innovative capabilities within themselves, because large organizations have more employees as compared to small organizations (Crespi & Pianta, 2008). In large organizations because number of employees is more, diversity is more and when people from different and diverse cultures work together, they tend to share unique and creative ideas which has a positive impact on the organization (Vegt, et al., 2003). (Hogan & Coote, 2014) in their study agreed that organizational culture specially the norms, values and believes exisiting within an organization have a strong and direct relationship with innovation in organization (Hogan & Coote, 2014). The internal or external organizational culture also has a direct impact on the innovation capability of any organization, if the internal organization supports innovation, employees and management will foucs on generating innovative ideas for meeting the challenges of the external environment (Buschgens, et al., 2013).For maintaining or creating innovative capabilities in organizations, the organizations also need to become risk takers, when any organization agrees on taking risk, it stimulates its employees for thinking out of the box and bringing up ideas that may sound weird or different but present a higher risk and higher return type of situation for the organization (Martins & Terblanche, 2003). Either big or small, innovation capabilites can be created in all organizations but the most important determinent factor of this is the organizational culture of every oganiztion.Leadership is an important aspect for creating an innovation capability in an organization. It is very efficient and best tool in generating creative capabilities in large organizations. Among various factors, leadership motivates employees to interact, think, feel and create something productive that is beneficial for the organization (Carmeli, 2010) As a result, employees will think freely and creatively. Transformational leader always tries to properly convey its characteristics, behaviors, value, norms, superiority, beliefs and ideas to others people working in an organization. The helping and supporting style of transformational leaders is very beneficial for introducing innovation in an organization (Garcia, et al., 2012). Leaders that have knack for innovation are huge sources in large organizations for bringing innovation (Donate & Pablo, 2015).Hence, leader’s knowledge can pass towards the boundaries of an organization, generates new ideas and provides opportunity for employees to think freely. Intel Inc. has adopted leadership to become competitive in market, In past Intel faced many complex challenges that were unfavorable in conducting company’s activities. Intel Inc. developed a platform of leadership with innovative criteria requirement that proved to be very successful for them (Intel, 2017). In the past company had to face many issues because the leaders were not created enough but they overcome this challenge by promoting innovation in the organization (Cusumano & Michael, 2002).(Chesboroh, 2003) Explained that organizations can gain competitive advantage by adopting transformation leadership styles in their policies and procedures. Leader’s communication plays an important role in generating innovation capabilities within an organization. A good leader communicates his strategies and planning throughout the organizational boundaries and gives a chance to their employees to think out of the box. As a result, employees love to dedicate extra skills for successfully doing the operations of an organization (Ali, 2012). Integrity leadership leads towards gaining trust, honesty and power in an organization. God leaders always trust and motivate all the employees working in an organization irrespective of their levels or ranks. In this way, employees and other sub-ordinates are able to produce innovative ideas for the organization. Employee’s honesty and their commitment help an organization to achieve its goal, mission and vision. When an organization is fully aligned with its goals, innovative ideas can generate through it (Aziza & Abid, 2015). Leader’s motivation level increases the employee satisfaction towards their job. Because, a good leader always motivate its employees in any way so that employee can participate in all the activities of an organization and bring innovation.In organizations, horizontal hierarchies can help in creating innovation capabilities and enhances the thinking process that is beneficial for an organization. Organizations mostly deal with two types of hierarchy systems and most preferable hierarchy system is horizontal or flat hierarchy system (Clauset, et al., 2008). Employees and top level management coordinate and communicate with each other regarding daily activities and how to produce better outcomes through it. As a result, innovation can be generated within the organizational boundaries (Hauschidlt & Kirchmann, 2001). Ideas can take place generally and everyone within an organization feels confident and efficient when there are properly acknowledged in a hierarchy system. The performance of an organization can become better through horizontal hierarchy and organization can achieve its goal, mission and vision (Reza, 2017).The world’s biggest company Unilever is following horizontal hierarchy system. UNILIVER is a company which is offering thousands of products to its customers because it’s a very large organization with multiple strategic business units and product portfolios. UNILIVER avoids having vertical hierarchy system and follows horizontal hierarchy system because that helps in creating innovation in the organization (Young, 2017). Through horizontal hierarchy system, the employees in an organization share their beliefs, ideas and thinking to upper level management and if ideas are approved, Top level CEO will be informed about it and everyone has to respect their ideas and work on it. BOSS system is totally excluded in UNILEVER organization (Geoffrey, 2005). Therefore, horizontal hierarchy system is mandatory for building innovation capabilities in an organization. The benefits of horizontal or flat system are that employees are not afraid of their thinking; they feel confident to share and love to achieve smart goals.Horizontal hierarchy system makes employees happy and well committed with the organization. It motivates employees for thinking innovatively and working with full dedication and passion because his efforts are being recognized by the organization (Zingales, 2011) Hierarchies are traditional sources of bringing innovation in organizations and these have been followed by many organizations in the past. Horizontal hierarchies are the best way for finding efficient and effective way for generating ideas for an organization. For example, most famous company known as Nestle follows decentralized hierarchical system and enjoys independent strategies for bringing innovation in an organization. Nestle disapproves of complex hierarchy systems and centralized procedures. Therefore, with the passage of time, innovations are created in the company and Nestle has introduced its multiple product categories across the globe (Broeckx, 2013). Companies can adopt horizontal hierarchy system and become successful brand for thousands of customers. In the recent world, Nestle has been able to justify his success by having its brand names being used in every single household. The hierarchical structure used by Nestle gave it the power of thinking innovatively and brining innovation in the organizations. The hierarchical structures followed by different organizations have different impact on them as they can both increase as well as decrease the innovation capabilities in large organizations.Innovation capability can also be built through applying productive, management related flexible strategies in an organization. An effective and flexible strategy for an organization helps in engaging and making all employee participate in critical thinking about organization, these also provide employees an environment to think logically about what is beneficial for the organization (Wang & Ellinger, 2011). Samsung is one of the world’s largest company that produces televisions and mobile phones as well as many electrical gadgets for its customers. Samsung is following innovative strategy and became world’s third largest company on the basis of its innovative culture.Samsung developed a strategic plan that engages all the employees in an organization and moderates the thinking level of all employees and makes them confident (Borden, 2013). One of the best strategies any large organization could adopt is the blue ocean strategy, the blue ocean strategy imposes that organization should make or introduce anything in the market which is not available already (Chan & Mauborgne, 2004). For this purpose the company needs to evaluate the marketing conditions and assess the needs of the customers. On the basis of customer’s demands any organization can achieve competitive advantage as customers will gain value, and the main motive behind blue ocean strategy is to create such a unique or innovative product which helps the company in overcoming its competitors (Chan & Mauborgne, 2005). Apple is one of the biggest countries in the world who have adopted the blue ocean strategy and have been successful in creating innovation capabilities for gaining competitive advantage. Apple had got the first movers advantage as the company introduced the iOS with touch screen when no other company was manufacturing this sort of product.This has been possible because Apple has adopted the blue ocean strategy and focused on being innovative as compared to following the trends (Sheehan & Vaidyanathan, 2009). Strategies can give direction to an organization for achieving their goals in an efficient and effective way. With strategic direction, innovation can be created in large organizations easily. Strategy helps in reducing the risk in an organization and focuses on making an organization stable and innovative. Strategies in an organization include a proper plan for marketing department, human resource department, operations department and information technology department (Cozzarin & Percival, 2006). An organization with collaborative and communicative strategies is successful in creating new ideas. Employees within all the departments coordinate and integrate, share departmental activities and different system information, and create innovative capability in large organizations through knowledge sharing. Training strategy is very important for an organization for generating innovative ideas (Foshay, 2002) and innovation strengthens the structure of an organization. Through innovative strategies, more customers will be attracted and they will spend high amount of money for buying the product. Adopting proper strategies is very important for creating innovation in an organization, shared plans among employees and organization leads toward successful and innovative path.Team work in an organization can create innovativeness in employees and makes them think uniquely. Team working in an organization will motivate all employees to think, work and create something unique for organization. Traditionally, organizations were focused on individual work of employees, now due to team work, innovative ideas can be generated in an organization. Through team work, conflicts can be reduced and it makes employees innovative and creative (Chen, et al., 2005). Various disputes can be resolved in an organization with synergy of many employees and employees’ focus toward more goal oriented approach.As a result, employees in an organization feel confident and smart and they feel easy about sharing ideas with top management. Team work in an organization reduces many problems and builds innovative capability within team members (Baker, et al., 2006). Team work in an organization makes loyal customers for an organization. With customer’s loyalty, organization can come to know the experience of customers and builds plan’s according to it. As a result, organization will be able to produce innovative products and services through it. Hoopsters adopted team work strategy for creating a platform for all sorts of meeting, appointment and product launch. The company is following team work strategy and its employees always generate creative ideas. Through working in team, innovative ideas are generated which is aligned with latest technology and tools which creates innovation capabilities in organizations (Stagl, 2006).For example: W.L. Gore & Associates is at technology oriented company which on different projects. The company is using team work approach that’s why it’s able to work on all kinds of projects in effective way. Employees are free to discuss any kind of idea which comes in their mind. As a result, innovation is created in an organization. Company can easily handle any kind of project, through innovative team members which give innovative and unique ideas to a company. Hence, team work is very much important for an organization for building innovation, creativity and synergy. Also, organization can reach its goals through team work and generate innovative ideas.It can be concluded that the essay enlightens how innovation can be created in large organizations. The essay focuses on the factors that can bring innovation in an organization such as organizational culture, leadership, hierarchies, strategies and team work. The essay has demonstrated complete hierarchal system and how it affects the structure of an organization to build innovation. The essay focuses on the importance of team work in an organization and explains how it builds innovative techniques within organization boundaries. The essay also focuses on the style of leadership and how it affects the organization for generating innovative ideas among employees and makes them confident.Various companies’ portfolios and their internal systems are also explained in this easy for explaining, how these companies have gained innovation in their organizational practices. The essay also explains that through neglecting all important factors such as organization culture collaboration, team work, leadership, hierarchies and strategies, innovation cannot be produced. The essay also focuses on the tragedies that can be used within organizations for creating innovation in the organization, it explains that how blue ocean strategy can be used within organizations. It has also focused on giving examples for explaining different factors that can help the organizations in creating innovative culture. The essay stresses that innovation can be built within large organizations through the maintaining the organizational culture, adopting proper hierarchy, team working environment and proper mix of strategies.ReferencesAli, A., 2012. Leadership and its Influence in Organizations. International Journal of Learning & Development, 2(2012), p. 6.Aziza, M. & Abid, A., 2015. Enhancement of the Accountability of Public Sectors through. ScienceDirect, 28(2015), pp. 163-169.Baker, D. P., Day, R. & Salas, E., 2006. Teamwork as an essential component of high‐reliability organizations. Health Services Research, 41(4), pp. 1576-1598.Borden, 2013. 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