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Ch 10 Organizational Innovation
Innovative Team Members
Mathew Lu – Strategy Role of Change
Technology Change
Ann Zerlina – New Products and Service
Strategy and Structure Change
Tianyou Man – Culture Change
Strategies for Implementing Change
Luke Driscoll – Case Study: Google
AGENDAThe Strategic Role of Change
Elements for Successful Change
Four Types of ChangeTechnology change / New Products and ServicesStrategy and Structure change / Culture change
Strategies for Implementing Change
Case Study
The Strategic Role of Change
The Top 10 Most Innovative Companies in the world
1. Apple
2. Google
3. Microsoft
4. IBM
5. Toyota
6. Amazon
7. LG Electronics
8. BYD 比亞廸 ( the first Chinese company to make the list )9. General Electric10. Sony
I have invested BYD . ha ha
Four Types of Change Provide a Strategic Competitive Wedge
Elements for Successful Change
Technology Change
In today’s business world , any company that isn’t continually developing , acquiring , or adapting new technology will likely be out of business in a few years.
In organic organizations , employees are encouraged to promote new ideas but they are not better for implementing those ideas for routine production than mechanistic structure employees. How to solve the Dilemma ??
The Ambidextrous (雙面靈活 ) Approach
Techniques for Encouraging Technology Change
Switching Structures – create an organic structure when needed for creating new ideas.
EX:
The NUMMI plant in California from 1984 to 2012 . Created { Pilot team } , to design production processes for new car and truck models. When the model moved into production , workers returned to their regular jobs on the shop floor.
Techniques for Encouraging Technology Change
Creative Departments – department for innovation , such as R&D , design , systems analysis department.
EX:
Yahoo , Boeing and other companies establish creative departments called { Idea Incubator } , to develop new ideas without interference from company bureaucracy or politics.
Techniques for Encouraging Technology Change
Venture Teams – a small company within the organization , often given a separate location and facilities to free from firm’s procedures.
EX:
Lockheed Martin set up { skunkworks } more than 50 years , that is a separate , highly autonomous and often secretive group which focuses on breakthrough ideas for the business.
Hello , I create FIGHTERs.
Techniques for Encouraging Technology Change
Corporate Entrepreneurship – promote entrepreneurial spirit , may involve the use of creative departments and new venture teams , but it also attempts to release the creative energy of all employees in the organization.EX: Texas
Instruments studied believing in the idea and convincing others of its value decide the success of the idea.
Techniques for Encouraging Technology Change
Bottom-up Approach – useful ideas come from people and daily work , and make sure they get heard and acted by top executives.
EX : IBM held an online town-hall style meeting , called the { Innovation Jam } , inviting employees , clients , consultants , and employees’ family members to an interactive online brainstorming session about new technology ideas.
New Product and Services
New products and services are a special case of innovation
New products uncertainty and success of an innovation is very high.
New Product Success Rate
100 Ideas
33 Developed Projects
28 Pass All Testing
24 Fully Commercialized
14 Succeed in Marketplace
Reasons for New Product Success
Why are some products more successful than others?
Reasons for New Product Success
Tailoring innovations to customer needs
Making effective use of technology
Having influential top managers support
These idea taken together indicate that the effective design for new product innovation is associated with horizontal coordination across departments
Horizontal Coordination Model
Specialization
Key departments – R&D, marketing and production
Specialization component –
the personnel in all three
of these departments are
highly competent at their
own tasks
Boundary Spanning
Each department involved with new products has excellent linkage with relevant sectors in the external environment
Ex :
Horizontal Coordination
Technical, marketing and production people share ideas and information
Ex :
Corning used a horizontal linkage model to create a new product for the mobile phone industry
Open Innovation
Extending the search for and commercialization of new products beyond the boundaries of the organization and even beyond the boundaries of the industry
Requires the involvement of people from different areas of the company, it forces managers to set up stronger internal coordination and knowledge-share mechanisms
Strategy and Structure Change
All organizations need to make changes in their strategies, structures, processes, and procedures more often to adapt to new competitive demands
Achieving Competitive Advantage:
The Need for SpeedThe rapid development of new products and services can be a major strategic weapon in an ever-shifting global marketplace.
Time based competition – delivering products and services faster than competitors
Many companies use fast cycle teams to support highly important projects and deliver product and services faster than competitors
Strategy and Structure Change
Many organizations are preparing for more change by
- Cutting out the layers
- Decentralization decision making
- shift toward horizontal structures
- Empowered teams and workers
- Virtual network strategies
- Incorporating e Business
The Dual-Core ApproachThe dual-core approach to organizational change compares management and technical innovation.
Management innovation refers to the adoption and implementation of a management practice, process, structure, strategy, or technique that is new to organization and is intended to further organizational goals.
The point of the dual-core approach is that many organizations – especially nonprofit and government organizations – must adopt frequent management changes and need to be structured differently from organizations that rely on frequent technical and product changes for competitive advantage
The Dual-Core Approach
Organization Design for Implementing Management
ChangeWhat about business organization that are normally technologically innovative in bottom up fashion but suddenly face a crisis and need to reorganize?
Ex :
Organization Design for Implementing Management
ChangeTop-down changes related to restructuring and downsizing can be painful for employees
Top managers should move quickly, authoritative and humane
Top-down change means initiation of the idea occurs at upper levels and is implemented downward, but it does not meant that lower level employees are not educated about the change or allowed to participate in it
Culture Change
What is culture change? Refers to changes in the values, attitudes, expectations, beliefs and behavior of employees.
Why we bring culture into the needs for change?
Any change eventually involves changes in people
Culture Change
What are the effects of culture change? -> changes in corporate
cultural values and norms -> lead to renewed
commitment & empowerment of employee
-> stronger bond between company & customers
Culture Change
What are the Forces for culture change? Mergers and acquisitions Reengineering & Shift to
Horizontal Organization Diversity Emphasis on learning and
adaptation
Culture Change
How to bring about Culture Change? --Organizational development (OD) Culture Change Intervention OD focuses on the human and
social aspects to adapt and solve problems
OD uses knowledge and techniques to create a learning environment
OD interventions involve training of specific groups
So, what are the techniques for improving people skills through OD?
Culture Change
Large Group Intervention Key stakeholders from inside and
outside, Off-site to limit interference and
distractionsTeam Building
PP working together as a team to discuss, overcome problems
Training task forces, committees, etc.
Interdepartmental Activities Representatives gather in a neutral
location to expose problems or conflicts
Strategies for Implementing Change
What’s the role of Leadership for Change? innovation champion—reinforce
value and importance of innovation
set up the tone for adaptation Transformational leadership style
Strategies for Implementing Change
What will employees feel and act when facing changes? -- Curve of change for psychological process
Barriers
Strategies for Implementing Change
What’s the Barriers to Change?Excessive focus on costsFailure to perceive benefitsLack of coordination and
cooperationUncertainty avoidanceFear of loss
Strategies for Implementing Change
What’s the Techniques for Implementation?
Establish a sense of urgency for change Establish a coalition to guide the change Create a vision and strategy for change Find an idea that fits the need Create change teams Foster idea champions
Strategies for Implementing Change
What’s the Techniques for Overcoming Resistance?
Alignment with needs and goals of users
Communication and training An environment with
psychological safety Participation and involvement Forcing and coercion
Design Essentials
Change, not stability, is the challenge for managers
There are four types of change Organic structures can foster
innovation, a top-down approach is best for change and strategy
The implementation of change can be difficult, managers must lead and force it
Case Study – Innovation at
Company Profile
Founded and Incorporated in 1998 by Larry Page and Sergey Brin
Headquarters in Mountain View, California
55,000 employees, offices in over 60 countries, and services in 130 languages.
“We need flexible thinkers, because the problems change, too.”-Bill Courgran
Google`s Eight Pillars
Have a mission that MATTERS – “To organize the worlds information and make it universally useful and accessible.”
Think big but start small – Google Books and Ad Sense
8 Pillars – (cont.)
Strive for continual innovation, not perfection - Genius is one percent inspiration and ninety-nine percent perspiration. –Thomas A. Edison
Look for ideas everywhere – “Everywhere”
8 pillars - (cont.)Share everything – Information sharing not only allows for feedback but helps idea generation
Spark with Imagination, fuel with data – Allow for free thinking, but test along the way, i.e. Results per page
8 Pillars – (cont.)Be a platform – Crowdsourcing and Open Technologies
Never fail to fail – learn from mistakes, and know that they may be potential solutions for other problems
`20 percent time`Innovation at Google is focused on technological development and centers around its engineers.
`20 percent time`
The Ideas Meeting – The Approval Meeting
Challenges and Solutions
Technology Changes – Ambidextrous Approach: Acquisitions, `20 Percent Time`,
New Products and Services – Horizontal: Iteration, Data,
Strategy and Structure – From Services to Products
Cultural – Marrying the Geeks and the Business People
Projects and Innovations
Some of the current projects and innovations that Google has developed or is developing:
Google Glasses: http://www.youtube.com/watch?v=JSnB06um5r4&NR=1&feature=endscreen Google Self-Driving Car: http://www.youtube.com/watch?v=cdgQpa1pUUEGoogle Street View: http://www.youtube.com/watch?v=PTeCqnBuDdU
Questions
Comments
Sourceshttp://www.thinkwithgoogle.com/quarterly/innovation/8-pillars-of-innovation.html
http://www.fastcompany.com/3000500/what-google-gets-others-don’t-innovation-evolves-customers
http://www.forbes.com/sites/quentinhardy/2011/07/16/googles-innovation-and-everyones/
http://www.mckinseyquarterly.com/Googles_view_on_the_future_of_business_An_interview_with_CEO_Eric_Schmidt_2229
http://www.businessweek.com/stories/2005-10-02/managing-googles-idea-factory
http://www.youtube.com/watch?v=EHy9JirbDdA#t=11m10s