8 Creativity and Innovation

A. Swarnalatha

1.   INTRODUCTION

Creativity and innovation are special breeds of planned change that an entrepreneur actively seek to promote their business. Business is a creative activity. Success in business today demands constant innovation. Generating fresh solutions to problems, and the ability to invent new products or services for a changing market, are part of the intellectual capital. They also give a company or business organisation its competitive edge. Creativity is the root of innovation. It is a process and a skill which can be developed and managed throughout the entire organisation.

2. LEARNING OBJECTIVES

At the end of this module the learners will be able to

• Describe the different types of creativity and  Innovation
• Explain the process of creativity and phases of innovation

3.  CREATIVITY-DEFINITION

Creativity is defined in many different ways. A number of scholars suggested that creativity is the generation of imaginative new ideas involving a radical new innovation or solution to a problem and a radical reformulation of problems. It also can be stated that creative solution can simply integrate

3.1.TYPES OF CREATIVITY

Generally, quality of creation determines the types of creativity. Various authors have suggested different types of creativity. Irvin Taylor has suggested the following quality hierarchy:

3.1.1.Spontaneous creativity: It deals with spontaneous creations.

3.1.2.Technical creativity: It involves striking improvement in a process that increases the level of proficiency or efficiency.

3.1.3.Inventive creativity: It involves ingenuous new combination of materials or ingredients. Eg. Edison’s light bulb or Bell’s telephone

3.1.4.Innovative creativity: It involves far-reaching application of more basic ideas such as management applications of principles of psychology to develop a much more effective system for motivating staff

3.1.5.Emergentive creativity: It consists of new revolutionary principles for an art or a science such as the psycho-analytical concepts of Freud or the relatively concept of Einstein or picasso’s cubist ideas.

These are simply different forms of creativity and each can vary enormously in quality. The quality or level of creativity is related to the level of novelty and appropriateness of the creative effort.

3.2.CREATIVE PROCESS:

The creativity process in organisations involves three steps:

3.2.1.Generation of ideas:

The generation of ideas in an organisation depends first and foremost on the flow of people and information between the firm and its environment. It is greatly stimulated by external contacts. For example, the vast majority of technological innovations, have been made in response to the conditions in the market place. If the manager aware of the potential demand for a new product or that there is dissatisfaction with already existing products, they will likely to seek innovation to hold their market share. He generates new ideas based on the information from outside consultants and experts. Idea initiation wihtin the context of a supportive environment is a valuable means of implementing successful innovations

3.2.2. Idea development

Idea development is dependent on the organisational culture and processes within the organisation. Organisational characteristics, values and process can support or inhibit the development and use of creative ideas. Rigidity structured organisation that inhibit communication between departments will often keep potentially helpful people from knowing that a problem exists.

3.2.3. Implementation

The implementation stage of the creative process in organisations consists of those steps that bring a solution or inventions to the marketplace. For manufactured goods, these steps include engineering, tooling, manufacturing, test marketing and promotion.

3.3. Techniques of creative thinking

The following techniques are useful in generating creative ideas:

3.3.1. Brain storming: It is a group techniques, but it can also be used by individuals. Brainstorming is based on the principle that quantity of ideas begets quality and to get many ideas. It needs constant encouragement to generate more and more ideas. The brain stormer takes up a fairly clearly stated problem which has many possible solutions. Eg. How to increase plant productivity or how to increase the sales of a product. The brainstormer initiate the members to generate rapid-fire fashion novel solution to the problem. Features of brainstorming are

• For brainstorming, specific topic is required.
• It leads to many ideas.
• It provides more number of options. It has wide acceptability.
• It is not useful as a technique where the problem has unique solution that can be reached by analysis.

3.3.2. Attribute analysis

It attempts to generate ways of satisfying the major characteristics of a product or activity. It is useful for designing or redesigning a specific product or service or an activity. It is useful for designing or redesigning a specific product or service or an activity. Steps in attribute analysis includes

• Identification of major attributes of an objector in activity
• Generation of many alternative ways of securing the possible attribute
• Evaluation of alternative designs in terms of criteria like product design, cost, marketability etc

The more specific the object or activity one wished to change, the better would be the results given by attribute listing. It encourages to concentrate attention on the modifiable attributes. Example for the procedure:

• Listing of all the obvious attributes of an object or activity-like current size, colour, shape, functions, weight, major function, steps for an activity
• Identifying some of these attributes that can possible be altered without destroying the main function of the object or activity
• Stating the alternative attributes as more abstract

   3.3.3.Story boarding

It is a creative technique for strategic and scenario planning based on brain storming and used mainly by groups. It involves 8-12 persons. It includes four phases: Planning, ideas, organisation and communication. The ideas generated by brain storming is arranged in a logical order on a white board creating a story. It helps to interconnect all ideas and how to fix all the pieces together. It facilitates to determine the ways to implement solutions.

3.3.4.Lotus blossom

It is designed for groups and used to provide more in-depth varying solution to a problem. It starts with a central core idea in a circle surrounded by 8 empty circles. Through brain storming 8 additional ideas are developed and each 8 circles is surrounded by another 8 empty boxes and filled through brain storming. This process continues until a satisfactory solution emerges.

3.3.5.Checklist of questions

It provides tentative solution to a barrage of questions. It is mainly used for product improvement or modification. For example: How can we modify the product make it more economical?. It involves applying a series of words, verbs, adjectives or phrases contained in checklists or tables to an existing product or service or its attributes.

3.4. PROCESS OF CREATIVE PROBLEM SOLVING

The following stages are involved in the process of creative problem solving:

3.4.1.Preparation

It involves the investigation of the problem in all directions, including a full understanding of what the problem is and the constrains within which it has to be solved. It requires detailed analysis through known procedures.

3.4.2.Incubation

It is the letting go of the problem by the conscious mind and allowing it to ferment below the level of consciousness. Incubation is often necessary for insights to occur in solving difficult problem.

3.4.3. Illumination

Illumination is the state of inspiration and often accompanied by two distinct and vivid impressions: the sense of possession and the sense of compulsion.

3.4.4.Verification

It is an evolution or verification of perspective solution. It also deals with required and refinement of inherent implications.

4. INNOVATION

Creativity is concerned with the generation of new idea and innovation, translates new idea into a new product or an organisation. Innovation means not only doing new things, it is also doing things that are already existing in a new way. Innovation is the transformation of creative idea into useful applications but creativity is a prerequisite to innovation. Innovation is the specific tool of entrepreneurs. Innovation is the development process.

4.1.Characteristics of Innovation

• Innovation invites and leads to changes
• Innovation can be spontaneous or can be the result of thoughtful plan
• Innovations can bring a complete revolution or can be just an extension of existing products and services
• Innovations provide a unique identify/element to a business
• Innovations are action oriented
• Innovations help in making the products and process simple to understand
• Innovations involve continuous experimentation, testing, trials and revisions

4.2.The Elements of Innovation

• Innovation is the key to entrepreneurship. The presence of innovation distinguishes them from others. The following are the elements of innovation given by Fiona Fitzpatrick
• Challenge- the concept that is going to be changed –“Pull”
• Customer focus – Customer value going to be created – “Push”
• Creativity- Generation and sharing of ideas –the “brain”
• Communication- Flow of information and ideas- the “life blood”
• Collaboration – Joining people together to work on the idea –the “heart”
• Completion- Implementation of newly generated idea – the “muscle”
• Contemplation- reflection of experience leads to higher competency –the “ladder”
• Culture – the playing field of innovation which includes leadership, diverse group of people, Basic values and Innovation values of the firm
• Context- Innovation is shaped by interaction with the world

4.3. TYPES OF INNOVATION

There are two types of innovations; technical and non-technical

4.3.1.Technical innovation

It is concerned with innovations in the processes by which production takes place and also with innovation in the products themselves. It is also called pure innovation. It is creation of something radically different from existing technologies or products. Generally it is also treated as product oriented innovation which involves developing goods and services that incorporate entirely new and novel breakthrough advances.

4.3.2. Non-technical innovations

It is also termed as process innovation. It is incremental and evolutionary. Its purpose is to make existing industries more efficient. It refers to small changes in design, product formulation and manufacturing, materials and service delivery that firms make to keep their product up-to-date and their costs down.

4.3.3. Innovation also can be classify as

Invention: Invention is the creation of a new product, service or process

Extension:  Extension is the expansion of a product, service or process already in existence.

It makes a different application of the current idea.

Duplication: Duplication is not simply copying but adding one’s own creative touch to enhance or improve the concept to beat competition.

Syntheses: It is the combination of existing concepts and factors into a new formulation. It involves taking a number of ideas or items already invented and finding a way so that they together form a new application

4.4.SOURCES OF INNOVATION

4.4.1.Unpredicted occurrences:

Sometimes unexpected success or failure prove to be a major innovative surprise for the enterprise. These happenings are normally anticipated and unplanned

4.4.2.Incongruities

These occurs whenever a gap or difference exists between the expectations and reality. The gap motivates the entrepreneur to innovate with all the more vigour.

4.4.3.Process needs

These needs are created whenever situation and surrounding circumstances generate demand for the innovate to satisfy the requirement of process needs.

4.4.4.Industry and market changes

Changes in the customer preferences, styles, advance technology demands modification in the product quality. These changes provides tremendous opportunities for innovation.

4.4.5.Demographic changes

Urbanisation, increasing education, occupation, income etc create more opportunities for innovative entrepreneurship

4.4.6.Perceptual change

The change occurred in people’s attitude, emotions, interpretation towards certain concept leads to new innovations

4.4.7.Knowledge based concept

Knowledge based concepts are basis for the development of new products and market.

These require testing and modifications and needs more time.

4.5. DIFFERENT FORMS OF INNOVATIONS

4.5.1.Product Innovation

Product innovation is the result of finding a new way to customers problem through a developing a new products or through altering the properties of already existing product for the benefit of the customer as well as for the sponsoring company. Example:

• Automobile: Introducing advance model of cars and bikes
• Agriculture: Introducing enhanced variety of pesticides

4.5.2.Process Innovation

Process innovation includes introducing new process technology or modification of already existing technology to next higher order level for improved production. Process innovation enhances bottom line profitability, minimizes the cost, increases efficiency and improves productivity.

4.5.3.Business innovation

Business innovation involves a wide spectrum of original concepts, including development of new business models, organizational innovation, business application of technology and communications, new management techniques, environmental efficiency, new forms of stakeholder participation, transport and finance.

These consist of new business models, new management models, new approaches to value chain management, new approaches to information, idea and knowledge management, new forms of strategic partnerships, new forms fo selling and customer service

4.5.4.Organizational Innovation

More efficient innovation metric, associated with organizational innovation, reflects the recognition that new ways of organizing work in areas such as work force management through employee empowerment, new people partnership, or positive action to involve all employees in order to make organization of work a collective resource for innovation, knowledge management, value chain management, customer partnership, distribution, finance, manufacturing can improve competitiveness. Organizational innovation also includes business model innovation.

4.5.6.Technology Innovation

Technological innovation covers innovation derived from research and development of technology, that is independent of product and service initiative.

4.5.7. Marketing Innovation

Innovative distribution and customer service methods are an inseparable part. It helps a company to develop new value added services, enter new markets, and create new market segments / categories, new distribution methods, and new forms of customer service and customer partnership. Marketing Communication can also be more effective with Innovative Strategies.

4.5.8. Strategy Innovation

It consists of reinvented strategy of the enterprise, innovative corporate growth strategies, improved competitive strategies. It is about challenging existing methods of industry of creating value for customer in order to meet newly emerging customer needs, add additional value, and create new markets and new customer groups for the sponsoring company.

4.6. PHASES OF INNOVATION

Innovation has two phases

§   Design phase

§    Implementation phase

4.6.1. Design phase

The design phase involves divergent thinking and creativity, brain storming, search for alternatives. The management of design phase needs to be marked by great administrative flexibility and authority exercised by the expert in a given situation, open communications, sharing information, much discussion etc.

4.6.2. Implementation phase

It requires much planning and careful coordination and control and evaluation of progress.

4.7. RISK, UNCERTAINTY AND INNOVATIONS

Innovative entrepreneur often like to have uncertainty. Uncertainty is a situation in which the entrepreneur understands the problem but does not have complete information on the possible alternatives and the likely consequences of each alternative. Different types of uncertainty are as follows:

4.7.1. Structural uncertainty

It relates with certain structural conditions and constraints generally imposed due to the entry of a new venture into emerging industries. Technological uncertainty is best example for structural uncertainty.

4.7.2. Strategic uncertainty

It deals with the situation where complete information is not available regarding level of competition, number and name of competitors types of products and process on which competitors are working and government policy about new industry. New ventures in emerging industries are often unaware of these important variables and this type of uncertainty creates problem before them.

4.7.3. Resources uncertainty

It is concerned with availability of resources in the firm’s input markets. New ventures generally fall problem in their fund raising programme form the financial markets because financial sources are unfamiliar with the new industries risk and return profile. Professional managers also face a career risk and economic uncertainty when joining firm in emerging industries. The procurement of raw material supplies and parts may also be difficult during the industry’s emergence.

4.7.4. Customer uncertainty

It relates with output or customer market. Generally, incomplete information is available with regard to buyer needs and wants, income levels, demographic characteristics, psychographics profile and buyers perception etc and new ventures in emerging industries fail together these information on sound footings. They also face uncertainty about customers resistance over the prices and the points of products.

Innovation usually means embarking on an uncertain voyage. Uncertainty can be of many origins. There may be uncertainty as to the approach needed to get to the innovative product creativity.

5. CREATIVITY, INNOVATION AND ENTREPRENEURS Entrepreneurship = Creativity + Innovation

   Creativity – thinking new ideas

Innovation- Doing new things

Entrepreneurship -Creating value for the new idea in the market

Entrepreneurship is the result of a process that apply both creativity and innovation to capitalize on marketplace opportunities. Entrepreneurship means much more than starting a new business. It denotes the whole process whereby individuals become aware of the opportunities that exist to empower themselves, develop ideas, and take personal responsibility and initiative. In a broader sense, entrepreneurship helps young men and women develop new skills and experiences that can be applied to many other challenges in life. Entrepreneurship is therefore a key priority area with the potential to stimulate job and wealth creation in an innovative and independent way.

Growth and development cannot be sustained without additional innovations (usually in the product or services or in its marketing) with additional innovations, firms become “glamorous” Introducing new products is usually seen as part of the process of innovation, which is itself seen as the engine driving continued growth and development.

Successful entrepreneurs require an edge derived from some combination of a creative idea and a superior capacity for execution. The entrepreneur’s creativity may involve an innovation product or a process that changes the existing order or entrepreneur may have a unique insight about the course or consequence of an external change. Entrepreneurship is the vehicle that drives creativity and innovation. Innovation creates new demand and entrepreneurship brings the innovation to the market. Innovation is the successful development of competitive edge and as such, is the key to entrepreneurship

SUMMARY

Creativity and Innovation are at the heart of the spirit of enterprise. Innovative entrepreneur always sees what everybody has seen but think what nobody has thought. Thus the value of creativity and innovation is to provide a gateway for perceptive entrepreneurs who are actively searching for opportunities to do new things, to do existing things in extraordinary ways.

Web links

• https://www.slideshare.net/kunaldrizzy/creativity-and-innovation-in-entrepreneurship
• http://www.asiaentrepreneurshipjournal.com/AJESIII2Okpara.pdf
• https://www.youtube.com/watch?v=FXJUDyqobbM
• https://www.youtube.com/watch?v=zO2LdDpx-Tc
• https://www.youtube.com/watch?v=HD-yFYQ5UPM
• https://www.researchgate.net/publication/46510531_The_Role_of_Creativity_in_Entrep reneurship