Liberate to innovate
INNOVATION IS a critical competitive factor in the contemporary marketplace and the influence and impact of innovation in the global economy is distinctive. Managers know this, customers know this, economists and employees know it and so do you. However, knowing that innovation is key does not mean that it happens. In addition, knowing how important it is does not mean it is easy to accomplish. The point is that very few companies can afford to feel secure behind their established brands, longstanding customer relationships or proprietary technology. The competitive pressure on all of us is global and immediate.
According to the latest country innovation ranking, the conducted by INSEAD, South Africa occupies the 51st position out of the 132 countries measured. This puts us between Barbados in 50th position and Romania in 52nd. The first 5 positions are taken by Iceland, Sweden, Hong Kong (China), Switzerland and Denmark respectively. In addition, recently released its list of the most innovative companies in the world, with Apple taking podium position, followed by Google and Microsoft in second and third places. Not one South African company features in the top fifty. “What makes the difference?” one inevitably wonders.
Well, it seems that these highly innovative companies go to much greater lengths to tap the creative potential embedded in their employees. They invest in creativity training; instil a desire to be innovative; create the right organisational climate; and involve all employees and their knowledge about customers, competitors, and processes. People and ideas are at the heart of their management philosophy. People are given room to grow and to try new things while learning from their mistakes. If the CEOs of these companies were the only innovators in their respective companies, they certainly would not have reached the levels of success they enjoy today. They succeed because they build a strong sense of openness, trust and community across the company and facilitate the internal mobility of talent. They develop verbal and nonverbal cues to employees that their thinking and autonomy is respected. These cues shape the culture of the company and are often more effective than monetary rewards. Schumpeter, the well-known economist of the 20th Century, believed that innovation is the driving force not only of capitalism, but also of economic progress in general, and that entrepreneurs are the agents of innovation. One could then safely say that these highly innovative companies are filled with agents of innovation – intrapreneurs.
We can surely learn from these highly innovative companies as we journey towards a future in which it is expected that the rate of innovation will increase even faster. Innovation will be the driver for global growth in the future and is also bound to contribute significantly towards potential solutions to some of the most challenging issues that currently face the world.
The development of active innovation infrastructures at both company and country level is central to achieving sustainable financial performance and GDP growth. Innovation leadership will need to be driven from the top by senior management to ensure that the level of priority required is pursued throughout the organisation. Our government will also need to show strong leadership, and ensure that welldirected policies are implemented to strengthen the science and technology foundation as well to provide an innovative infrastructure for South Africa. Hard choices will have to be made in terms of where to focus scarce resources to be able to compete in the global arena in both the short and longer term.