Innovation Architecture
Innovation Architecture
Innovation is essential for the development of all businesses. It is crucial for the management of the company to provide an environment that encourages development. Miller and Wedell-Wedellsborg (2013) argue that leaders should be innovation architects in addition to being innovators. The primary role of a leader is to ensure that the structures, processes, as well as culture, are conducive for the employees to be innovators. This paper is set to discuss the processes, culture, management styles, as well as systems of Netflix, General Electric (GE), and Lego that enable them to create a culture of motivation throughout the firms. Besides, it explores the factors that hinder other businesses from up taking innovative ideas. It also suggests processes and structures that can be used to foster the culture of innovation in an institution.
Innovation is regarded as the act of creating results through indulgence in new things or ideas. On the other hand, an architect refers to an individual with a potential of making people innovate. The architect encourages innovation through the provision of a favourable environment (Miller & Wedell-Wedellsborg, 2013). The role of innovation architect is to determine the significance of creating institutional structures and systems that empower the employees to be innovative.
The establishment of a creative environment does not require any formula. However, it is essential for managers to conduct an analysis on the successes of particular systems and structures employed by other business entities (Skarzynski & Gibson, 2013). Netflix has often focused on its human resources as a way of creating an innovation culture. Besides, Lego was able to revive the dwindling fortunes of the business through a focus on innovative customer collaboration. The General Electric has ensured the development of innovative culture through crowd sourcing and partnerships. These methods have been successfully used by the businesses to develop innovative environments.
Human resource is regarded as the most valuable resource for every business. It is crucial to the development of the culture of innovation. Once an institution realizes the economic and strategic value of creating a broad innovation capability, it shifts focus to human resource (Skarzynski & Gibson, 2013). Netflix recognized the importance of the human resource to innovation. The recognition led to the development of innovative ways to attract, manage, as well as retain their best talents. The main aim of the management is to hire, train, and select only the best. The company does not practice common human resource policies but encourages the employees to embrace common sense (McCord, 2014).
Additionally, the company developed a different approach that allowed the managers to own the jobs by ensuring they create great teams. The policy allowed managers to employ individuals with excellent skills for the company. The employees are encouraged to act in the best interest of the enterprise. According to Miller and Wedell-Wedellsborg (2013), the success of the innovators depends on the freedom given to them by their leaders. The Netflix allowed its employees freedom for innovation. Netflix is an example of a company that uses human resources to create an innovative culture.
In addition to hiring and retaining of best talents, some innovation architects out-source for creative ideas. It is essential to expose the business to particular external input with a potential of rejuvenating the institution (Miller & Wedell-Wedellsborg, 2013). The General Electric (GE) invests an enormous amount of money in creating partnerships for innovation. The investment arm of the company taps into external intellectual resources for its research as well as development. The business models of the GE ensure that the firm is often open to innovative ideas.
The GE collaborates with other companies to improve its innovation culture. However, other companies collaborate with customers. Companies such as Coca-Cola and General Mills use creative customer collaboration. They request their customers to suggest new products to be explored by their research as well as development units. Besides, the Lego Group has gone a notch higher by the introduction or management of the innovation communities (Antorini, Muñiz, & Askildsen, 2012).
The members of the community share their innovations among themselves. The Lego's Ambassador Program has been essential in the development of new ideas as well as external partnerships for creativity. The customers often influence the direction of Lego’s products. Through innovative customer collaboration, the group can test their innovations in an attempt to avoid market failure. The partnership benefits both the company and the innovation communities (Antorini, Muñiz, & Askildsen, 2012). As the users push the group for the required products, the company learns the innovative ideas from their discussions in the communities.
Capitalization on Innovation and Entrepreneurship by Organizations
Several big businesses struggle with innovation. In most cases, the size of a given company affects its entrepreneurial potential leading to reduced progress within the enterprise. Individual companies become comfortable with their successes in the past. They are unwilling to introduce entrepreneurship within their businesses (Entrepreneurship). The General Electric, Netflix, as well as Legos Group have encouraged innovation despite their sizes (Skarzynski & Gibson, 2013). This has enabled these companies to remain relevant and productive in the market. For instance, the GE allows their employees to use twenty to thirty percent of their time on innovative ideas. The culture of entrepreneurship enables individuals to concentrate on the development of new ideas.
Barriers to Culture of Innovation in an Organization
Despite the success of Netflix, Lego Group, as well as General Electric in the development of innovation cultures, certain processes and systems hinder innovation. Some structures and systems such as strict budgeting and the use of outdated techniques hinder innovation (McCord, 2014). Adequate resources are an essential component of the development of innovative ideas. It is crucial for business entities to be flexible in their budgeting because of the uncertainties that often surround creative ideas. The companies must also be willing to reallocate funds from other areas of their operations. Investing in business entities is vital for the development of innovative cultures. Additionally, innovation involves risk taking and tolerance to failure. Business institutions that fear taking risks often lag behind regarding innovation.
Innovation and technology go hand in hand. Creativity requires technology to ensure it produces the desired effect. Some companies still use traditional ways of managing institutions (Tian & Wang, 2014). These traditional approaches do not offer a favourable environment to the innovators. It is crucial for the management of business entities to ensure they are up to date with current technological advancements. This gives the employees a chance to share their innovative ideas. For instance, the Lego Group encourages innovation by using the internet. It has developed a platform for sharing these creative ideas.
Structures for Fostering Culture of Innovation
The development of unstructured time within institutions is essential in developing innovation culture. The management should ease up pressure on the employees to ensure they get some time to contribute to the innovations within the institution (Tian & Wang, 2014). Giving employees paid leave to work on their projects can assist in raising creativity levels. Additionally, time can be used as a reward or motivate employees. For instance, Intuit Company gives her best performing employees three months of innovation time. Provision of free time to employees to work on their innovative ideas can lead to the next big thing.
In summary, it is vital for companies to create an environment that is innovation friendly. The environment must be aligned to the culture and objectives of the business entity. Innovation architecture involves every department of the institution. The employees from different departments need to collaborate to ensure the goals of the institution are met. Innovation architects must also be provided with ample resources for the development of favourable innovative environment.
References
Antorini, Y. M., Muñiz, A. M., & Askildsen, T. (2012). Collaborating with Customer Communities: Lessons from the LEGO Group. MIT Sloan Management Review, 53(3), 73.
McCord, P. (2014). How Netflix Reinvented HR. Harvard Business Review,92(1), 71-76.
Miller, P., & Wedell-Wedellsborg, T. (2013). Innovation as Usual: How to help your people bring great ideas to life. Boston: Harvard Business Review Press.
Skarzynski, P., & Gibson, R. (2013). Innovation to the core: A blueprint for transforming the way your company innovates. Brighton: Harvard Business Press.
Tian, X., & Wang, T. Y. (2014). Tolerance for failure and corporate innovation. Review of Financial Studies, 27(1), 211-255.
