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Innovation And Creativity In Organizations: A Review Of The Implications For Training And Development

Author: Ian Roffe, Director of Centre for Enterprise, University of Wales, Lampeter, UK
First published: 2000

Competition and Change

Keeping up with the means of improving performance is becoming an essential part of every training professional's responsibilities. Information is important not only for oneself, but also, through its application and impact on training programmes for others. In recent time, training development professionals have encountered an explosion of management tools, such as: reengineering, total quality management, agile strategies, virtual corporations, benchmarking, de-layering and flattened hierarchies. The explosion is propelled by the demands of increasingly competitive markets and the needs of organizations to improve their competitive advantage in these markets. In response, companies can reduce costs, improve quality, increase productivity or effect innovation. However, the changes introduced by most companies commonly addressed the first three of these factors and less often, the last.

Knowing the strengths and weaknesses of a particular management tool is one challenge, but its practical application inevitably involves another, in the shape of change of one form or another. Such change in turn creates a new set of problems that all too often seem unique to the individual, the department, or the organization. In reality, the problem has already been solved by someone else and the real complications are in finding, and then gaining access to the solution. This dilemma has spawned yet another tool: knowledge management, which develops systems for acquiring and disseminating intellectual assets.

This article begins with an analysis of the reasons why commentators believe that the key to organizational success lies in developing intellectual capital and acquiring a new set of thinking: creativity to yield an idea and innovation to translate the idea into a novel result. It proceeds to a review of the literature on innovation and creativity and the implications for training and development. However, anyone undertaking such a review to yield insights of this subject is soon confronted by certain difficulties: the literature base is vast; it is rapidly increasing; it is multi-disciplinary; and many sources are accessible only with high costs and difficulties (Nayak and Ketteringham, 1987). As a result a broad managerial perspective is taken, rather than a technological focus, to reflect the ideas that have proved influential with the passage of time, as well as contemporary viewpoints, and draws on sources that are reasonably accessible for the international reader.

Innovation and the Changing Work Environment

The prevalent forces for organizational change, including globalization and the supply of ideas at much faster speeds and lower costs, have been evident for some time (Naisbitt, 1982). In view of Kotter (1996) they are not going to mitigate any time soon; if anything competition for most organizations and in most sectors will probably step up even more in the future. The effect of this turbulent environment is that change itself will be different for managers.

Continuous change is an organizational environment characteristic of the past and those managers who understand which changes are coming and where they are heading will be better able to take advantage of those changes according to Handy (1990). The three precepts that underpin this belief are that: changes are different this time because they are discontinuous and not part of a pattern; it is the little, unnoticed changes that make the biggest differences to our lives and the change in the way we work will make the biggest difference to the way we live; and discontinuous change requires discontinuous 'upside-down' thinking to deal with it.

Peters (1997) reiterates the view that the world of business is now in a permanent state of flux, where constant innovation is the only strategy for survival for both the individual and the organization. In a provocative assessment of the current environment, the advocates the importance of building product appeal - since quality is available from everyone it no longer becomes a differentiating factor and in these circumstances it is important to forge an identifiable brand. He advocates that value can be gained within existing organizations from assembling professional services from staff units through addressing five Ps:

1. Projectisation - cementing activities into projects;
2. Professionalism - increasing this facet;
3. Provocation - challenging standards;
4. Partnership - operating as a professional practice; and
5. Performance - setting and attaining standards.

The same notion of complexity of change is perceived by Morgan (1991). In his view an organization will better cope with flux by: identifying and anticipating environmental trends; adopting more entrepreneurial relationships with the environment to anticipate and manage emergent problems; providing first rate leadership at all levels; developing human resource to develop the intelligence, knowledge and creative potential at every level of organization; responding to the Information Society by promoting creativity, learning and innovation; flattening organizational structures which require the right balance of delegation and control; developing managers to understand how technology can change both the structure of organizations and the nature and lifecycles of their products; dealing with complexity and multiple stakeholders; taking a proactive approach with an ability to reshape the socio-economic environment. Morgan argues that these scenes require a set of organizational skills, new competencies and mindsets to better cope with the flux. It appears feasible to group these together as: universal needs - in addressing the impact of IT, improved leadership skills, all round managers and motivators, multidisciplinary team work, self-learning as well as coaching, ethical consciousness and awareness of environmental trends; and the particular need for senior managers to shape the socio-economic environment for the organization and promote creativity learning and innovation.

The fast-changing economy and technology will influence society, organizations, and managers according to Drucker (1992). In his view the Knowledge Society will require all its members to have basic computer skills as well as conventional literacy skills; political, social and historical knowledge as well as the skills of learning-to-learn. Big business, he believes, will be information-based and in general comprise flatter organizations comprising knowledge specialists (Drucker, 1998). Tomorrow's organization will have knowledge located primarily at the bottom of enterprise, in the minds of specialists who do different work and direct themselves. In such an information-based organization, traditional departments will serve several roles: as guardians of standards, as centres for training and the assignment of specialists. Moreover, when a large business organizes around information, it leads to a reduced number of management levels. In his view there are three reasons why large organizations will have to become information based. First, because knowledge workers, who form a growing part of the workforce, are not responsive to common control methods. Secondly, the organization must decide what information it needs to operate otherwise it will be submerged in data. Thirdly is to 'systematise innovation and entrepreneurship which is quintessential knowledge work'.

The notion that knowledge is the only reliable and lasting source of competitive advantage in economic conditions in which the only certain is uncertainty, is also postulated by Nonaka and Tekeuchi (1995). Successful companies, they explain, are those that consistently create new knowledge, disseminate it widely throughout the organization and rapidly include it in new products. These characteristics define the 'knowledge-creating' company whose sole business is continuous innovation. The key to success in the knowledge company is to build the intellectual capital that will create core competencies and distinctive products that will lead to superior results. Everybody is a knowledge worker in the knowledge creating company, where inventing new knowledge is a way of behaving and managers translate, through .structures and practices, the company's vision into innovative technologies and products via metaphors, analogies and models.

Knowledge is central to innovation activities, argues Leonard-Barton (1995); indeed in her view it is a core corporate capability, and she considers mechanisms for importing and absorbing knowledge, transferring knowledge across the organization, and developing new knowledge bases. She also introduces the notion of 'creative abrasion' where different knowledge bases are brought together through open discussion between individuals with different perspectives. If the potential conflict is successfully managed, the result can be new, creative and exciting ideas.

Growing Confirmation of Organizational Types

Two distinctive organizational types have emerged from studies into the management of innovation. Over 30 years ago Burns and Stalker (1994) conducted their well known enquiry into the management of innovation with findings reaffirmed by subsequent observers (Kanter, 1984; Peters and Waterman, 1982). Burns and Stalker analysed the difficulties which Scottish firms faced in adjusting to the situation of continuously changing technology and markets, and led them to describe two types of organization they termed mechanistic and organic, which are at the extreme points of the continuum along which most organizations can be located. A mechanistic type of organization is adapted to relatively stable conditions, with a clear hierarchy of control in which responsibility for overall knowledge and control rests at the top. The tasks of management are broken down into specialisms, with individuals carrying out assigned and defined tasks. Vertical communication is prominent and there is a requirement for loyalty to superiors.

In comparison, an organic type of organization is adapted to unstable conditions when new and uncommon problems continually emerge, and which cannot be split up and assigned among the different specialisms. There is continual adaptation and refining of individual tasks and a supportive rather than restrictive nature of specialist knowledge is stressed. Communication and interaction can occur at any level, as determined by the needs of a process, and there exists a much higher degree of commitment to the aims of the organization. Burns and Stalker (1994) concluded that a mechanistic firm trying to consciously change to an organic one would experience difficulties because of power struggles to obtain control of new functions that divert the organization from adaptation and into perpetuating mechanistic structures and developing systems to retain the existing structure.

The categorization is significant in that it determines the kind of strategies employed by an organization and the way it manages to accomplish the strategy. On the one hand mechanistic structures are likely to emphasize control, particularly at activity levels; on the other hand organic organizations are likely to minimize the number of controls, while permitting risk-taking and emphasizing personal responsibility.

The difficulties in getting change in large corporations led Kanter (1984) to study corporate entrepreneurs, who are capable of anticipating the need for, and leading, productive change. Kanter found a key distinction between organizations which can and do innovate, and those whose style is counter to innovation. Innovative firms take an 'integrative' approach to problem-solving by showing a willingness to see problems as a whole, and in their solutions to move beyond received wisdom, to challenge established practices and generally view change as an opportunity rather than a threat. In contrast, forms that have compartmentalized structures with a large number of departments; that are walled off from one another, see problems as narrowly as possible, independent of their context. When a problem is identified, it is split up and the parts addressed by the appropriate departments. This approach she termed 'segmentalist'. Little or no effort is given to the problem as an integrated whole and the outcome is unlikely to be innovative but rather will follow the structure laid down. In her view, innovation - the introduction of new products, new technology or new ideas and practices - was much better addressed in integrative firms rather than segmentalists. Decentralization is very important as well as the empowerment of entrepreneurial people lower down the organization to have the authority and resources to exploit their ideas. She also highlighted the problem of a complacency which, when at the top of the organization, is a common form of subsequent poor performance, and cautions that stagnation breeds failure.

For firms to become integrative Kanter believes they need to develop three new sets of skills in their managers. These can be summarized as: power skills - skills in persuading people to invest time and resources in new and possibly risky initiatives; skills in managing problems arising from team working and employee participation; and an understanding of how change is designed and constructed in an organization.

While covering similar ground to Kanter (1984), Peters and Waterman (1982) examined the idea of excellence in a study of large US firms. They found eight attributes of excellence which resemble organic types of organization, rather than mechanistic:

1. a bias to action;
2. a customer orientation;
3. internal autonomy;
4. valuing employees;
5. a commitment to basic values;
6. sticking to what they know;
7. simple structures;
8. loose, yet tight, control.

They also conclude that one strong individual was at work during the early development of the culture of excellence in the company.

Innovation Strategy and the External Environment

Innovation is a crucial process for the well-being of an organization. IN the pursuit of it, organizations face strategic choices on the focus of resources. One method of categorizing the strategic option is on the basis of product-market analysis (Ansoff and McDonnell, 1987). The alternative directions of development comprise: market penetration; product development; market development; and diversification. The latter three directions each require a degree of innovation, the extent of which is bounded by the scale of the development plans.

The portfolio approach to strategic analysis is criticised by Porter (1986) for leading to unwarranted diversification. He proposes a competitive model as an alternative that gives specific attention to the current and potential environment of an organization. In this context, the basis on which an innovation would compete long-term can be selected from three generic strategies: cost leadership, differentiation and focus - cost leadership, in which it aims to be the lowest cost supplier in the market; differentiation, in which a unique dimension is determined; focus, in which the service is aimed at a particular buyer group or geographical area to the exclusion of others.

Few competitive advantages are long lasting, according to Hamel and Prahalad (1989), who advocate a policy of 'strategic intent' in which the ends are clear but the means of achieving them are flexible. They consider that an organization's capacity to improve existing skills and learn new ones is the most defensible competitive advantage of all.

Furthermore, in order to create new competitive advantages, top management needs to: create a sense of urgency; develop a customer focus at every level; provide employees with the skills they need to work effectively; allow the organization to absorb one challenge at a time; and establish clear milestones and review alternatives. In their view, the goal for smart companies is not competitive imitation but competitive innovation and four approaches to this are evident from the global expansion of Japanese companies: building layers of advantage; 'searching for loose bricks' - that is searching for the base to attack competitors just outside the market territory that the industry leaders currently occupy; changing the terms of engagement; and competing through collaboration.

Another insight into a Japanese perspective on strategy is provided by Ohmae (1987), who argues that much Japanese strategy was due to creativity, customer care, intuition and innovation. He reports that at the heart of a business there is often a single, talented and forceful strategist with a way of thinking in which company, customers and competition merge. In his writings he cites four ways to achieve an effective strategy:

1. a clear focus on the critical success factors;
2. build superiority by employing technology not currently exploited by rivals;
3. pursue aggressive initiatives that challenge normal rules;
4. use strategic degrees of freedom to focus on areas where competitors are not involved.

Kay (1993) considers that innovation can be competitive advantage and the key to sustained innovation, rather than one-off, arises from the architecture of the organization. Informal structures, speed of response and free sharing of information form part of these foundations. Managers should be able to protect, exploit and appropriate innovation and create time for individuals and groups to consider change and fund the staff resources, familiarization and training needed to turn ideas into implementation. He believes that reputation is also important for the commercial success of innovations, since new ideas by highly reputed companies are more likely to succeed.

Clutterbuck (1994) deals with issues of strategic innovation and how technologies, and the companies that support them, are displaced by newer technologies and new companies. He provides histories of various product developments and how organizations have dealt with declining markets. The relationship between product innovation and industry life-cycles underpins much of his thinking. He asserts that existing organizations must consistently abandon past successes and embrace innovation, even when it undermines their traditional strengths. However, he considers core competencies important in designing new products to meet changing demands and advises managers to increase the quality and robustness of the product architectures that are the foundation of their product families.

The importance of innovation to organizational performance has led to a growing interest in the topic by the European Commission (Commission of the European Communities, 1995) and the UK government (DTI and CBI, 1994). The DTI state that in nine out of ten 'winning' UK companies studied, the characteristics of innovation best practice are: leadership by visionary, enthusiastic champions of change; knowing their customers; constantly introducing new, differentiated products and services; delivering products and services that exceeded customer expectations; and unlocking the potential of people by good communications, team work and training, flattening organizational pyramid and creating a customer focused culture. The relevance of innovation to business success led the UK government in 1993 to support the development of modules for the teaching of innovation on continuing education and Master's programmes in business schools. The resulting curriculum analysis and design led to a framework for innovation management training, comprising five core areas: product innovation; process innovation; technology and strategy; creative problem solving; and implementing technological innovation.

Organizational Learning

The decision to pursue innovation inevitably leads to managerial choices in support of the policy, not only in terms of finance but also in organizational and personnel terms. The extent of the change of effort needed depends on the starting position of the organization and the particular emphasis will vary because of the diversity in values, norms, attitudes and responsiveness to change in organizations. On the one hand, for segmented organizations the change effort is likely to be great (Kanter, 1984). On the other hand, for organizations that function as open and adaptive learning organizations, as advocated by Argyris and SchOn (1978), who have managed change successfully under a variety of banners including: total quality management, or business process re-engineering, and restructuring, it will be less of a transition.

To create a learning organization, individuals and groups should be encouraged to learn five disciplines, argues Senge (1994). The first concerns personal mastery, the ability to see particular problems as part of a whole, and to devise appropriate solutions to them; the second, mental models of personal learning and growth, whereby individuals should be encouraged to acquire skills and knowledge; the third, the building of a shared vision for the organization and its members of the future that they wish to create. The fourth discipline is a commitment to team learning. The fifth discipline is systems thinking, which forms the foundations of organizational learning and unites the others and brings them together. It lies in the ability to see particular problems as part of a whole, and to devise appropriate solutions to them.

A learning company, according to Garvin (1993), is an organization that is skilled at creating, acquiring and transferring knowledge and at modifying its behaviour to reflect new knowledge and insights. He is critical of the five disciplines approach of Senge (1994) and the assertion that everyone is a knowledge worker by Nonaka and Tekeuchi (1995), because the recommendations are too abstract and too many questions remain unanswered. In contrast he suggests that what is needed is: a plausible, actionable and easy to apply definition; clearer guidelines for management practice, rather than aspiration; and measurement tools for assessing performance. He states that a subtle shift of focus is needed to move organization learning higher on the agenda and away from continuous improvement toward a commitment to learning.

Innovation is implicitly associated with change and as such has always been a challenge for management. In a review of organizational design, Morley and Garavan (1995) distinguish between routine change and more radical non-programmed change. Katzenbach and Smith (1993) consider normal change as new circumstances that are within the normal scope of existing management practices. Major change, on the other hand, involves circumstances that require personnel to become good at skills and behaviours with which they are not very adept. Continuous improvement and innovation requires a commitment to continuous learning, otherwise organizations repeat old practices, and places the process under the first category. When innovation falls into the second category it raises significant issues on the management of change.

There is a body of literature that considers the substantive issues involved in change, from the design of the organization to advice to top management on creating the vision of change and designing the change plan (Beckhard and Pritchard, 1991). They consider that 'change is a learning process and learning is a change process'. Furthermore they advise that this learning process involves 'freezing' oneself from currently held beliefs, knowledge, or attitudes; absorbing new or alternative attitudes or behaviours; and 'refreezing' in the new state. They suggest that the most important factor for ensuring that learning and change takes place is the set of positive and negative rewards that are shown to be management behaviour. Bartlett and Ghoshal (1990) know of no quick or easy way to change the organizational psychology of a company, but provide three characteristics of those that manage the task most effectively: the development and communication of a clear and consistent corporate vision; the effective management of human resource tools to link individual perspectives with corporate goals; and the integration of individual activities into the broad corporate agenda.

Even though the process of transformation and change is well documented, it can fail for a wide variety of reasons, identified by Kotter (1995). The explanations he put forward include: poor communication, fear of failure, employee resistance, lack of planning and preparation, a misunderstanding of what change is, and ill prepared employees are all potential causes of failure.

The Creative Organizational Climate

It is a reasonable premise that every firm aspires to become more creative and innovative, not simply for the influences of global forces, but because of the beneficial outcomes on its business and its prospects. Fortunately, there is a relative unanimity on the requisites to maintain a dynamic of creativity connected to an effective method of innovation. These characteristics have been summarized by Majaro (1998) as: the climate for creative thinking must be right, an effective system of communicating ideas must exist at all levels and procedures for managing innovation must be present. In his view, all three components should exist in harmony, and the absence of anyone would be sufficient to constrain the effective development of innovation in the organization. The three factors are thus interrelated and interconnected.

The climate for creativity needs to be responsive to the whole process according to Majaro (1998). However, a firm's climate is one of the most difficult development areas to change and always needs total commitment and involvement from top management.

A climate open to creativity has certain features: it is open-minded to encourage flexibility and group involvement, perceptive in seeing things from the employees' point of view, respects everyone for the diversity each brings, stimulates the expression of ideas, encourages employees to find answers creatively, and gives clear objectives and specific feedback.

Consistent corporate creativity can be promoted by managers and organizations through addressing six elements, according to Robinson and Stern (1997). These elements, are, first, alignment, whereby the inclinations and actions of all employees are directed toward organizational goals. Next is self-initiated activity, when individuals and teams own problems and their solutions so that intrinsic motivation is raised. It includes unofficial activity, which occurs in the absence of direct official support. There is, fourthly, an element of serendipity, when fortunate accidents can lead to discoveries through insights. Another element is the presence of diverse stimuli, which is important in providing fresh insight into existing or identifying new activity. The final element is the internal communications of the company, both planned and unplanned, to provide clear lines of communication. In the author's view whenever these elements occur, the probability of achieving corporate creativity increases.

Innovation is best encouraged through social controls, argue Tushman and O'Reilly (1997), by supporting risk taking and change, tolerating mistakes, and stimulating creativity. They liken the methods of social control to the processes of managing culture and consider this method to be better at promoting innovation over long periods than other forms of control. In their view the processes of control involve gaining commitment of employees through individual choice, making innovation visible and irrevocable, making symbolic actions, providing the right kind rewards that are linked to outcomes, giving recognition, and selecting employees carefully. An understanding of the interrelationships within an organization through socialization they consider to be the key to an innovation culture. When the predominant culture is based on assumptions of organizational change and renewal, it stimulates innovation. However, if it is based on a belief in earlier formulations for success and employees are proud and resistant to change, it hinders innovation.

Tushman and O'Reilly consider that long-term organizational success is based on innovation streams, defined as different kinds of innovation over time - incremental, architectural, radical and continuous change. They introduce the concept of an ambidextrous organization which promotes both change and stability. Stability and consistency are necessary to realize the value of innovations and secure success at the present time, while flexibility, speed and change ensure success in the future. They also consider a close alignment and congruence in strategy, structure, people and culture in organizational systems to be a key to innovation.

The degree to which individual employees and groups are subject to different sets of information and stimuli is reflected in their level of innovation (Stacey, 1992). In his view, the more diversity there is then the more likely are the outcomes to be original and innovative. Stacey (1992) suggests that by challenging ideas and creating a constructive controversy between groups, new solutions can emerge and that one way to produce diversity is to encourage dissident sub-cultures within the organization. He describes creative acts as existing at the edge of chaos and disintegration so that organizations must find ways to manage the anxiety which develops when working at this edge in circumstances when traditional business approaches become less relevant. In such conditions he asserts that managers adopt a form of control and development that enables new strategic direction to emerge through a process of self-organizing political interaction and real-time learning.

Continuous innovation occurs largely because top managers appreciate innovation and manage their companies' value system and climate to support it, reports Quinn (1985). In a two and a half-year worldwide study of small and large companies selected for their innovation records, he took a close look at innovative small companies. He concludes that in successful innovatory firms, the culture and corporate strategy are mobilized to support innovation and creativity and that managers take active roles in leading the innovation process. The key is for managers to eliminate risk-averse climates and replace them with organizational cultures in which innovation is expected and failure is accepted.

Management in innovative firms project clear long term-visions for their organizations that extend beyond economic parameters. Such visions have a practical impact in attracting quality people to the firm and provide focus to their creative drives. Moreover, these visions can channel growth by focusing on the actions that lead to profitability, recognize realistic time frames for innovation and serve to attract the type of investors who will support it. In contrast to the positive forces just identified, other characteristics sometimes limit innovation in organizations and a number of common barriers to innovation in organizations are listed in Table 1.

A challenge to conventional wisdoms emerges from work on an international study of 16 major commercial breakthroughs undertaken by Nayak and Ketteringham (1987). They examined the creativity, ingenuity, determination, special skills, politics and perceptions that were necessary to open the way for new products and processes to emerge. Based on their findings, they address and criticise the myths surrounding breakthrough innovations, for instance that success depends on corporate culture, intra- or entrepreneurship, market pull, unfulfilled need and other such simple explanations. Instead, they interpret the findings to reveal a more subtle process of success. Whereas it was true that no breakthrough became a commercial reality unless the people driving it see a market for it, in each case it was 'technology-push' or more accurately the curiosity within the originating person. Neither financial need or market intelligence played a major role in these exceptional innovations.

Effective Communications

The aim of establishing an effective system of communication is to ensure that a systematic channel catches and examines as many ideas as possible and that the wasted element is reduced (Majaro, 1998). For Burns and Stalker (1994), a prerequisite for the adaptable organic innovation organization is a means of communicating ideas that must exist at all levels. It is also a characteristic of those integrative organizations where innovations thrive, according to Kanter (1984). She proposed that several important elements are necessary to reduce the segmentalism apparent in many non-innovative enterprises; the encouragement of a culture of pride in the firm's own achievements; reductions of layers in the hierarchy; but also the improvement of lateral communication and giving increased information about company plans. Organizational structures that discourage the communication of ideas and flexibility impede innovation, since access to other ideas and other innovators is very important.

Communication and collaboration are well recognized factors in stimulating ideas since individuals, groups and organizations can learn from each other only if they communicate (Nonaka and Tekeuchi, 1995). Thus cross-functional communication, by means of internal communication or cross-functional teams, enables people to become involved in all parts of the organization and makes innovations useful to everyone. Openness, sharing and knowledge transfer they observed as crucial factors in ensuring that ideas are implemented into valuable organizational innovations, by increasing the quantity and quality of information and helping people to gain different perspectives.

Large organizations are trying to capture the flexibility of smaller ones, especially the strong emphasis on lateral communications and cross-functional teams and task forces (Drucker, 1992). In his view, research and development in particular - traditionally a separate and independent function - is being integrated into a team setting. He observes that successful innovations are now being turned out by cross-functional teams with people from marketing, manufacturing and finance participating in research work from the very beginning. Innovative organizations are also reorganizing to create many smaller divisions to allow creative teams, or 'skunkworks', to operate and encourage new ventures (Quinn, 1985). However, such techniques of internal venturing or through undirected process of entrepreneurship, do not ultimately lead to positions of global leadership (Hamel and Prahalad, 1989).

Effective Procedures

To create a viable innovation, the creative idea must be identified and accompanied by a viable means of converting the new idea into a product or service which customers need (Adair, 1990). Once initialized, the process of maintaining a dynamic to the innovation typically requires continued investment in research and development and continuing monitoring to identify and provide managerial impetus to the initiative (Roffe, 1998).

The process of commercializing innovations has been categorized by Roberts (1988) as compromising four basic elements: ideas creation, initial application, feasibility determination, and final application, each of these elements being characterized by certain features, see Table 2.

Roberts also believes that one of the major feats of organizational innovation is that the entire process must be related to the needs of the organization and and marketplace - a theme echoed in the writing of Wiersema (1997), where knowing the market increases the chances of high value innovations, and the value of an innovation is determined by market success. In his perspective, the notion of customer intimacy is central to gathering information that stimulates creative ideas and turns them into successful processes and marketable products. To this end, both individual and organizational adaptability are necessary to collaborate closely with the customer and be able to respond in flexible ways. It needs employees to be empowered to take decisions and make changes and having open, flexible and co-operative internal processes and operations. A readily available source of new product ideas exists in the form of products devised by customers in the view of Von Hippel (1982), which can be more easily accessed through customer intimacy. He proposes general strategies for finding innovations user stimulus strategy, which causes users to screen their own items bringing the most promising to the manufacturer's attention; and a user analysis strategy, which analyses the self-screening and self-identification behaviours of users.

The process of innovation is, in the view of Drucker (1994), a 'disciplined, systematic, organized and purposeful activity with its own relatively simple rules that offer a rational and repeatable way to convert an idea into an innovation'. He believes that an organization must have an effective means of monitoring sources of opportunity and then it can apply conventional managerial practice to transform the opportunity into a viable product or market entrant. When approached in this way, the process of transforming an idea into a new activity becomes relatively predictable. The need to systematize innovation leads Drucker (1992) to propose that new skills will need to be practised by an effective manager. He maintains that the old skills are still required but the new ones that are likely to be increasingly important are: 'management by going outside' that is learning to work, and understand, the outside of the firm where the results are achieved; 'finding out the information you need to do your job' defining information needs and devising how to achieve them as well as determining what; and 'building learning into the system' which requires continuous learning by individuals, with a focus on building strengths and applying effective feedback on learning outcomes. Additionally, he suggests that an ability to focus and prioritize is essential for the effectiveness of top managers and that working in cross-functional teams is necessary for successful product development.

The advice on undertaking a regular opportunity audit is reiterated by both Kanter (1997) and Majaro 1988). Majaro advocates a strong emphasis on auditing the organization's effectiveness in the area of creativity and innovation: an audit that extends from corporate level across the range of functional specializations and which is repeated on a regular basis. Once the ideas have been defined he believes that a funnelling and filtering process takes place during which ideas are progressively screened for their feasibility and viability for converting into a new product, and on the basis of his experience proposes that typically some 60 ideas are needed to produce one successful innovation. The process of examining, screening and evaluation ideas can be approached methodically to ascertain the attractiveness of an idea together with its compatibility for the firm's special needs; these two parameters can be used to form a matrix in which the merit of an idea is scored, or an algorithm method applied to scrutinize the potential value of the idea to the organization. Such structured and systematic processes have led to the emergence of software applications that aid the screening and sorting process (reference under Tools).

Creative People

The rate of decay of ideas during the stages of screening and evaluating is such that it is important to have a large pool to begin with and a means to ensure that a sufficient flow of new ideas is maintained. Thus the generation of ideas is a crucial part of the innovation process and creativity is the thinking process that helps generate these ideas. If creativity can be improved, then more alternatives, novel approaches or unique solutions are likely to emerge in response to a problem. From a study of the social psychology of creativity, Amabile (1996) cites the three main origins of creative performance as: task motivation, domain-relevant skills and creativity relevant skills. She differentiates between intrinsic and extrinsic motivation, proposing that the intrinsic motivation enhances creativity, but that the extrinsic motivation can hamper it. Amabile also classifies specific environmental factors which affect an individual's inclination for creativity: group climate, freedom, autonomy, supervisor support and rewards. Her work has led to a tool called KEYS (reference under Tools), designed to produce an inventory by assessing stimulants and obstacles to creativity in the organizational workplace.

The notion that creativity needs a supportive environment to prosper finds a resonance in the writings of Kao (1996) who likens creativity to playing jazz and applies the metaphor to suggest ways that managers can stimulate creativity in their employees, originate new ideas and develop them into realizable value. In his view, clearing the mind by fantasy and guided imagery and creating a distinct physical place for creativity are necessary prerequisites. He also signals the opportunities presented by the Internet and terms this method 'cyberjamming', He also recommends that senior managers should undertake a creative audit of the organization to establish the facts and enable tracking of improvement to occur. A similar evocation of metaphor is evident in the advice of Morgan (1993), who advocates the use of imagery to stimulate employees' own perceptions and understandings about their organization, and, moreover, to appreciate them in their own right as well as a means of generating creativity.

Nonetheless, creativity is a rather elusive quarry and there are many approaches that seek to stimulate thinking and exercises that aim to develop the ability. In order to generate good ideas, an understanding is needed of the creative process from concept to reality, in the view of Adams (1986) who sets out creative exercises and games, an approach to problem solving and how to get rid of bad thinking habits. Many exercises, stories, techniques and insights into creativity are provided in the writings of Von Oech (1983, 1986). Moreover, Majaro (1988) explains how a range of techniques can be applied to generate ideas: brainstorming, metaphorical analogy, trigger sessions, wildest ideas session, morphological analysis, scenario writing and suggestion schemes.

The biggest problem of thinking is complexity that leads to confusion, according to de Bono (1986). He suggests that an individual tries to do too much at the same time involving many different thoughts: emotions, information, logic, hope and creativity. He proposes a simple concept, which allows a thinker to do one thing at a time, based on six different 'thinking hats': a control, a creative, a negative, an optimistic, an emotional and a neutral hat. Putting on anyone of these hats, defines a certain type of thinking and provides simplicity and clarity; a second purpose it that it enables a switch of thinking to occur, say from persistently negative judgement to creative thinking. In other writing he describes and introduces the now well-known concept of lateral thinking (de Bono, 1990) as a contrast with vertical logical thinking. He advocates the method as a means of enhancing creativity and problem solving. In the process of lateral thinking it is unnecessary to be right at every step, and the process permits a delay in judgement to allow the interaction of ideas to occur. The 'intermediate impossible' is introduced as a step between conventional thinking and new insights that at first glance appear to be based on wishful thinking. In his experience, it happens quite often that impractical, or even ridiculous, ideas trigger the imagination of a group and stimulate them towards developing remarkable solutions.

Mind mapping and fishbone diagrams are two more techniques with applications in creativity. Mind mapping has been pioneered by Buzan and Buzan (1993) and its radiating structure enables the rapid expansion and exploration of ideas to occur. It is well suited to creative thinking because it utilizes all the skills commonly associated with it, especially imagination, association of ideas and flexibility. The fishbone diagram was first developed by Ishikawa (1990) and the aim of the technique is to help a group to identify and list all the possible causes of a problem. The problem, sub-problems and causes resemble the bones of a fish when it is complete, and the whole process of analysis and discussion can be a useful trigger point for the creative thinking as it focuses the mind fully on a problem. Moreover, experience has shown that in group discussions it helps keep focus and brings each relevant factor into the open. The technique is often applied in quality improvement groups or circles. Indeed the work and benefits of quality circles on continuous improvement in organizations can be equally relevant for a broader concept of creative circles, with wider terms of reference and activities.

Characteristics and Behaviours of Innovative People

Organizations need people with different kinds of skills to succeed in all steps of the innovation process: idea generators who create new insights, information gatekeepers linked with knowledge sources, product champions who advocate adoption of new practices, project managers who undertake the technical functions needed to maintain an innovative project on track; and leaders who actively encourage, sponsor and coach others to pursue innovation (Roberts, 1988). In the view of Kanter (1997), innovative organizations need innovative people to work and 'cultivating innovators is one of the most important things that companies can do to make sure that they lead and not lag change'. There are certain observations available on the characteristics of innovators and the management of innovation that can inform the recruitment, selection, and development and retention process. She describes the characteristics as: comfort with change, clarity of direction, thoroughness, participative management style, persuasiveness, persistence and discretion.

As Quinn (1985) notes in his analysis of innovative small companies, even though not every case follows the same pattern, certain factors in the inventor and the entrepreneur are crucial to the success of innovative small companies; these are listed in Table 3. A more personal behavioural inventory of the characteristics of innovators emerges from Adair (1990), who took as an organizational context the big corporation but involved a much more limited base of study. In observing innovation as an outcome of R&D departments, strategic planning processes and more incremental, evolutionary organizational processes, he identifies certain attributes of innovators, which are also shown in Table 3.

Rewards and Incentives for Innovators

Creative ideas can arise from anywhere, at any time, but if managers seek to harness creative individuals to foster innovation, they should not only provide an organization structure in which innovative ideas are encouraged to appear but also ensure an appropriate award system is in place so that they continue to emerge. The range of rewards that innovators are likely to value are important for a number of practical reasons such as their performance attainment, retention and recruitment. However, the question as to what forms the best incentives for innovators has exercised many commentators, and a common understanding reached that recognition of achievement is a strong and important motivator and one less obvious than the lure of money.

Following this vein of thought on complementary incentives, Adair (1990) offers the advice that the content of reward packages might include one or all of the following: first, stimulating contacts through colleagues able to provide intellectual stimulation; second, the encouragement of creative individuals to rake calculated risks since they respond well to this environment; third, the organization should provide the freedom to innovators to work in the broad areas that interest them, provided the organization's mission is properly focused and communicated; fourth, recognition, since appreciation can be much more important to the individual than money.

The same emphasis on success is evident in the views of Adams (1986) who strongly advocates recognition of creativity through celebrating its success. This is reiterated by Kanter (1994) who advises on creating a culture of pride by relating success stories and inspiring employees through charismatic leadership. Quinn (1985) also identifies the importance of achievement for the innovator and observed that innovation can provide for these individuals clear satisfiers of economic, psychological and career goals, all together, and in ways that are available along few other paths. Individuals thus often want acknowledgment for technical contribution, recognition, power, or independence as much as money.

Synopsis of Training and Development Implications

It is now timely to reconsider the query underlying this review: if successful creativity and innovation can lead to manifold benefits for an organization, what are the implications for training and development? In summary, there is, first, widespread assurance that the ramifications extend from the strategic to the operational level. Next, even though the development can be aided in some circumstances by company take-overs or recruitment, ultimately the training development plans and actions cannot be left entirely to anyone outside the organization, since it is crucially linked to the organization's future success. There is unanimity that an integrated-type organization is best suited to develop innovation and that innovation can be systematized, but that problems can arise through the management of the change process. Although creativity techniques for the individual are plentiful, there are relatively few reports on embedding creativity in an organizational setting. It is noteworthy that, as most commentators stress the importance of communications in the innovation process, applications are rapidly occurring of Intranet internal communication networks, that can serve to improve internal work and understanding, while the Internet, for external communications, can aid the search for ideas and permit new forms of working. This is likely to become a fruitful field for analysis and interpretation, since the full effects have yet to emerge in the literature base.

The process of stimulating creativity and innovation is fundamentally based on building the intellectual capital within the organization, that will yield the competencies and capabilities for improved performance. In this respect, the notion of a learning organization and the core activities of training: needs identification, setting objectives, designing and delivering content, getting feedback and evaluating - when taken together, mean that training itself has a central role. However, in assessing the full implications of innovation and creativity on training and development, since it is interlinked to all other organizational activities, there is a clear risk that any resume will be overly simple. Nevertheless, a synopsis of the implications under the main elements addressed in this paper is attempted in Table 4.

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Tools

Invention Machine. IM- Phenomenon, Computer Aided Innovation Software Tool. Web address: http://www.invention-machine.se

Seren Software. Ideas Manager guides user from initial concept to compete project proposal. Email: innovation@seren.demon.co.uk.

Prometheus Consulting, The Business of Innovation, a self-assessment and organisation toolkit. Web address http://www.prometheus-consulting.com.

KEYS: Centre for Creative leadership. Greensboro, North Carolina. KEYS: Assessing the Climate for Creativity. Web address: http://www.ccl.org

Links to other Resources

ESRCs Innovation Programme. Web address:http://www.esrc.ac.uk.

Reprinted from Journal of European Industrial Training, 1999 23/4/5 by kind permission of the author and MCB University Press