Transcript Personal Selling, Database Marketing, and Customer

CREATIVITY AND
INNOVATION IN
BUSINESS
By
Norhaniza Abdul Latiff
Chapter
1
Introduction to Innovation
& Creativity in
Entrepreneurship
What Is An Entrepreneur?
ENTREPRENEURSHIP
The pursuit of opportunity through
innovation, creativity and hard work
without regard for
the resources currently controlled.
Entrepreneurship
•
Entrepreneurship: a way of thinking, reasoning,
and acting that is:
– opportunity obsessed
– holistic in approach
– and leadership balanced
(This definition of entrepreneurship has evolved over the past
two decades from research at Babson College and the Harvard
Business School and has recently been enhanced by Stephen
Spinelli, Jr., and John H. Muller, Jr., Term Chair at Babson
College.)
Development of Entrepreneurship
 Earliest Period- Marco Polo
 Middle Ages- Theater, Architectural
Works
 17th Century- Mississippi Company
 18th Century- Edison & Whitney
 19th & 20th Centuries
 Organize/Operate
 Innovation
McGraw-Hill
© 2004 The McGraw-Hill Companies, Inc. All rights reserved.
Entrepreneurs: Born or Made?
 Is there inborn talent required?
 Assume that the answer is YES:
 then we can identify the main characteristics
 if we have them, fine - no others need to apply!
 we could start spotting talent in kindergarten
 we could "stream" these people
 we could discourage people without these talents
Entrepreneurs: Born or Made?
 Assume the answer is NO:
 then schools could teach anyone
 would be a "profession" like law or medicine
 companies could establish "nurseries" for them
 government "incubators" would be successes
 The real answer lies somewhere in-between
 Talent and education is the way
Who is an Entrepreneur?
Situational more than personality
Flexibility
Ability
Age
Distribution
for
Starting Company
20
25
30
Age
35
40
45
Who is an Entrepreneur?
Manager’s Opportunities
Future Goals
Change
Possible
Status Quo
Entrepreneur
Satisfied
manager
Frustrated
manager
Classic
bureaucrat
Perceived
Capability
Blocked
Who are entrepreneurs?
 Common traits
 Original thinkers
 Risk takers
 Take responsibility for
own actions
 Feel competent and
capable
 Set high goals and enjoy
working toward them
 Common traits
 Self employed parents
 Firstborns
 Between 30-50 years old
 Well educated – 80% have
college degree and 1/3 have a
graduate level degree
Skills Required of Entrepreneur
Technical
Business
Management
Personal
Writing
Planning
Inner Control
Oral
Communication
Monitoring The
Environment
Decision
Making
Human
Relations
Marketing
(Selling)
Use Technology
Risk Taking
Innovative
ChangeOriented
Visionary
Successful Entrepreneur
Initiates Creation Process
Devotes Time/Effort
Assumes Risk
Receives Rewards
• Independence
• Satisfaction
• Money
Successful and Unsuccessful
Entrepreneurs
 Successful
 Creative and Innovative
 Position themselves in
shifting or new markets
 Create new products
 Create new processes
 Create new delivery
 Unsuccessful
 Poor Managers
 Low work ethic
 Inefficient
 Failure to plan and
prepare
 Poor money managers
Characteristics of Entrepreneurs
Key Personal
Attributes
Strong Managerial
Competencies
Good Technical Skills
Successful
Entrepreneurs
Entrepreneurship Characteristics
 Commercial leanings
 Lack of structure/self-control
 Visionary tendencies.
 Risk-taking/appetite for uncertainty
 Persistence
 Doer/high initiative
 Charisma and extroversion
Entrepreneurship Characteristics
 High-energy level
 Strong self-image
 Team building skills/uses contacts and connections
 Views failure as learning
 Commitment and fun
Innovation, Creativity & Entrepreneurship
 Creativity: ideas going beyond the current boundaries,
whether those boundaries are based on technology,
knowledge, social norms, or beliefs
 Most people are creative at some time
 May involve combining and synthesizing new things
 Knowledge-creating organization: an organization where
innovation is going on at all levels and in all areas
17
Concepts
Why Creativity and Innovation?
18
Introduction
iPod by Apple
• Since 2002:
• 162 million sold
• 90% of market
• Today we’ll ask
ourselves again
why this has
been so
successful…
19
Concepts
Key Concepts
Development
of new ideas
• new ideas:
•
knowledge
• concepts
• inventions:
• technologies
• business
models
• useful
implementation:
• products
• services
• experiences
Purposeful
implementation
of those ideas
Exploitation
of inventions
to create
economic and
social value
20
Concepts
What is Innovation?
 A process of intentional change made to create value by
meeting opportunity and seeking advantage
 “…is the specific function of entrepreneurship…”
 Peter Drucker
 Process:
 Invention  Change  Useful implementation
21
What Are Innovations?
 Innovations are new ways to achieve tasks.
 Types of innovations include:
 Mechanical—tractors, cars.
 Chemical—pesticides.
 Biological—seed varieties.
 Managerial—IPM, extra pay for work, overtime.
 Institutional—water users’ association, patents, banks, stock
market, conservation districts, monks.
 It is useful to distinguish between process innovations
(new biotechnology procedures) and product
innovations (Bt cotton).
The Innovation Process
 An innovation starts as a concept that is refined and
developed before application.
 Innovations may be inspired by reality. The
innovation process, which leads to useful
technology, requires:
 Research
 Development (up-scaling, testing)
 Production
 Marketing
 Use
 Experience with a product results in feedback and
leads to improved innovations.
The Innovation Process
F ig u re 1. Typ ic a l ste p s in th e life cyc le o f a n ew tec hno lo g y
R e sea rch
D isc overy
Deve lop me
nt
P a ten ti ng
and
App rova l
P rodu ct ion
M a rke ti ng
Adop ti on
Concepts
What is Creativity?
 “The imaginatively gifted recombination of known
elements into something new.”
 Ciardi
 “Fruitful combining which reveals to us unsuspected
kinship between facts, long ago known but wrongly
believed to be strangers to one another.”
 Poincare
 Process:
 Existing ideas  Recombination  New ideas
25
What is Creativity?
 Taking an idea beyond
Normal boundaries
 What we believe to be true
 What we see as socially acceptable
 Our current technology

-OR Combining unrelated ideas to make a new one.
7/21/2015
26
Concepts
Can you create creativity?
 “20% time” at Google
 Let people work on what they want to work on
 Innovation will follow
 50% of products come from Google’s 20% time
 www.businessweek.com/magazine/content/05_40/b3953093.htm
 www.podtech.net/home/?p=632
 Is this realistic for a new business?
 Can a small business do this?
 Can most businesses do this?
 Other ways?
27
Concepts
Do you have to invent to
innovate?
 Innovation is different from invention
 You don’t need to invent to innovate
 Guy Kawasaki says:
 “COPY SOMEBODY … clever people have pretty much
invented every business model that’s possible. You can
innovate in technology, markets, and customers, but
inventing a new business model is a bad bet. You have
plenty of other battles to fight.”
28
The practice of Innovation
 Systematic Entrepreneurship
 Innovation is the specific tool of Entrepreneurs
 It is capable of being presented as a discipline, capable of bein
learned, capable of being practiced
 In US, the entrepreneur is often defined as one who starts his
own, new business. Not every one of these represents
Entrepreneurship
 McDonalds was Entrepreneurship!
 JP Morgan did not aim for ownership
Principles of Innovation
 The Do’s
 Analysis-importance at different times
 Conceptual and Perceptual
Look, ask, listen.
 Focused, Start small

 The Donts
 Don’t be too clever
 Don’t bring in too many things at once, they will remain
as ideas not innovations
 Don’t innovate for the future. Do it for the present.
Infrastructure Needed for
Innovation
Long-Term Thinking
Investment Community
 Banks
 Venture Capitalists
 Informal/Informed Private
Investors (Angels)
Entrepreneur vs Intrapreneur
32
Entrepreneurs V. Intrapreneurs
 Entrepreneurs are people that notice opportunities
and take the initiative to mobilize resources to
make new goods and services.
 Intrapreneurs also notice opportunities and take
initiative to mobilize resources, however they work
in large companies and contribute to the
innovation of the firm.
 Intrapreneurs often become entrepreneurs.
Intrapreneurship
 Learning organizations encourage intrapreneurship.
 Organizations want to form:
 Product Champions: people who take ownership of a product from
concept to market.
 Skunkworks: a group of intrapreneurs kept separate from the rest of
the organization.
 New Venture Division: allows a division to act as its own smaller
company.
 Rewards for Innovation: link innovation by workers to valued
rewards.
“Intrapreneurship”
Instilling
Entrepreneurial
Spirit Within An
Existing
Organization To
Innovate And
Grow.
Organizational Culture
Corporate
Intrapreneurial
Climate/Reward
Develop Vision,
System Favors
Conservatism
Follow Instructions,
No Initiative
Hierarchy Of
Authority
Goals, & Plans
Suggest, Try,
Experiment
Flat Organizational
StructureNetworking &
Teamwork
Cultural Norms/Values
Corporate
Intrapreneurial
Fragmented
Instruction
Controlled
Outer-Directed
Alienation
“Chores”
Defined Limits
Interference
Distrust
Expendable
Limiting People
Whole
Vision
In Control
Inner-Directed
Responsibility
Enthusiasm/Motivation
Space/Freedom
Trust
Belief In People
Expandable
Growing People
Interest In Intrapreneurship
 Rising Interest in “Doing Your Own Thing”
 Corporation
 Support To Retain Creative Employees
 Fund Startups
 Hypercompetition
 Corporate vs. Intrapreneurial Culture
Intrapreneurial Activities
New Business Venturing
Innovation
Self-Renewal
Proactive
Climate for Intrapreneurship
Technology
New Ideas Encouraged
Trial/Error Encouraged
Failure Allowed
No Opportunity
Parameters
• Resources Available &
Accessible
•
•
•
•
•
•
•
•
•
Multidiscipline Teams
Long Time Horizon
Volunteer Program
Appropriate Reward
System
• Sponsors/Champions
Available
• Support of Top
Management
Establishing Intrapreneurship
 Commitment of Top Management
 Identify Ideas/Areas Interested In Supporting
 Use Technology For Flexibility
 Managers Share/Train Employees
 Get Closer to Customers
 Be More Productive With Less
Establishing Intrapreneurship
 Establish Strong Support Structure
 Tie Rewards to Performance
 Implement Evaluation System
Evaluating
Intrapreneurship Proposals
Corporate Fit
Initial Investment
Experienced
Venture Champion
Experience With
Product/Service
Competitive
Threat
Proprietary
Technology
Gross Margin
Rate Of Return
Intrapreneurship Characteristics
 Understands the environment.
 Visionary and flexible.
 Creates management options.
 Encourages teamwork.
 Encourages open discussion.
 Builds a coalition of supporters.
 Persists.
Dimensions of Intrapreneurship
(Antonic and Hisrich, 2003)
Dimension
Definition
New Ventures
Creation of new autonomous or semiautonomous units or firms.
New Businesses
Pursuit of and entering into new
businesses related to current products
or markets
Product/Service
Innovativeness
Creation of new products and services
Process
Innovativeness
Innovations in production procedures
and techniques
Dimensions of Intrapreneurship
(Antonic and Hisrich, 2003)
Dimension
Definition
Self-renewal
Strategy reformulation, reorganization
and organizational change
Risk Taking
Possibility of loss related to quickness
in taking bold actions and committing
resources in the pursuit of new
opportunities
Top management orientation for
pioneering and initiative taking
Aggressive posturing towards
competitors
Proactiveness
Competing
Aggressiveness
Barriers To Intrapreneurship






Inherent Nature of Large Organizations
No Long-Term Commitment
Lack Of Autonomy For Decision Making
Lack of Intrapreneurial Talent
Inappropriate Compensation Methods
Constrained Environment
Problems and Benefits of Intrapreneurship
 Problems
 Performance
 Benefits
 Resources
 Successes
 3M, HP, IBM