Importance of Creativity and Innovation in Boosting Sales and Economic Growth

This report discusses the importance of creativity and innovation in boosting sales and economic growth. It covers topics such as creativity and critical thinking, forms of innovation, the 2017 Global Innovation Index, and the benefits of creativity and innovation in driving economic growth, problem-solving, and talent growth.

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Creativity and Innovation
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Table of Contents
Introduction.................................................................................................................................................3
Creativity and Critical Thinking....................................................................................................................3
Innovation and Forms of Innovation...........................................................................................................4
What is innovation?.................................................................................................................................4
Forms of innovation................................................................................................................................4
Incremental innovation.......................................................................................................................4
Disruptive Innovation..........................................................................................................................5
Process innovation..............................................................................................................................5
2017 Global Innovation Index......................................................................................................................5
Outcomes................................................................................................................................................6
Finance....................................................................................................................................................6
Evidence based practice..........................................................................................................................6
Innovative process...................................................................................................................................6
Leadership...............................................................................................................................................7
Policies.....................................................................................................................................................7
Technology..............................................................................................................................................7
Importance of Creativity and Innovation.....................................................................................................8
Drives economic growth..........................................................................................................................8
Helps in problem solving.........................................................................................................................8
Talent growth..........................................................................................................................................8
Conclusion...................................................................................................................................................8
References.................................................................................................................................................10

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Introduction
Over the last decades, creativity and innovation have become the most critical skill required for a
business to achieve success in the market. The Australian and international retail markets have
become very competitive due to the innovation and creation of new distribution networks and
channels for products to the target market (Auernhammer and Hall, 2014, p. 160). Elerium is a
common crafting material, sold by most enterprises in Australian and global markets at large.
Having studied creativity and innovation at the university, I have been an employee of a firm that
makes and sells Elerium direct to the market through a network of ten retail outlets around
Australia and the global markets online. Due to lack of innovation, sales for Elerium in the
market have been declining. Creativity goes hand in hand with innovation, and this forms the
thesis of this report.
Creativity and Critical Thinking
The success of organizations depend on employees creative skills in the creation of new business
ideas that help in improving quality of customers services. In relationship to critical thinking, the
manager of the enterprise needs to understand that creativity entails the skill of coming up with
new, solid, reliable, and relevant ideas that conform to the business operations of an enterprise.
In the context of the manufacture and distribution (selling) of Elerium to consumers by the
enterprise, creativity of new ideas that modify the retail outlets and online services for the
product is vital. Where employees are reluctant and unable to create new ideas, business
operations go down and decline. The concept of creativity seeks to find new ways to solve any
existing problem, and this requires critical thinking. Lack of critical and creative thinking hinders
creativity of new ideas by a manager and other employees in the enterprise. Also, failure to
establish a conducive environment in which creative ideas arise by the management contributes

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to the failure of organization’s business operations. Therefore, increasing the sales of Elerium in
the market requires the management to establish support and a conducive environment in which
creativity of new online selling techniques and distribution strategies by the enterprise can thrive.
Innovation and Forms of Innovation
What is innovation?
According to Forbes, innovation remains among the world’s top business term today. In this
context, most scholars define innovation as the process of turning an idea into a solution that
increases value to an enterprise from the perspective of customers. Creativity is the mother of
innovation, and the application of creative ideas leads to the generation of useful and novel
innovations to an enterprise. Due to the change in demand, tastes, needs, and preferences of
customers both locally and internationally, companies must encourage innovation. In the context
of this Elerium enterprise, the management needs to encourage innovation of new distribution
networks online to meet the target market needs fully. For example, the adoption of advanced
and more modified e-commerce selling channels in order to boost the declining sales.
Forms of innovation
For the manager to understand what innovation is, the report uses three forms of innovations that
help in explaining the concept and its importance in increasing Elerium sales for the enterprise.
Every company has to be innovative in order to become competitive and sustainable in the
industry. The major forms of innovation include:
Incremental innovation
Incremental innovation uses the existing technology to increase the product value and usability
to the consumers in the current markets (Doran, 2012, p. 360). In the context of this enterprise,

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the management needs to adopt incremental innovations by modifying the design and features of
Elerium. Also, the retail network around Australian and international markets must be modified
to suit online levels and needs of the customers. Such amendments add consumer value and
experience hence boosting sales of the company in the market.
Disruptive Innovation
Disruptive innovation involves the application of new technology and processes to the
company’s now/ current market. The innovation is stealthier in nature given its inferiority to the
existing technology in the market (Doran, 2012, p. 361). The enterprise needs to undertake
disruptive innovation in the production and selling of Elerium to the market. Due to
technological movements and advancements, the retail market has become very innovative; this
necessitates the importance of new disruptive innovations in the distribution networks of the
company in order to ensure 100 percent customers efficiency and value in the market place.
Process innovation
Process implementation refers to the process of implementing a significantly improved or new
delivery/production method (Moulaert, 2016, p. 30). In the context of this enterprise, the sales
are said to be declining. The main causes of decreased sales are attributed to poor Elerium
production mechanisms, the use of outdated and less advanced retail distribution networks, and
the poor product design and features. In this regard, process innovation is required in order to
improve the retail network outlets and online sales of the product.
2017 Global Innovation Index
According to the 2017 Global Innovation Index, Australia was ranked number 23 with a value
score of 51.8 percent. This part of the report will compare Australia with Singapore that was

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ranked number 7 in the same index report with a score value of 58.7 percent based on the seven
pillars of innovation. The comparison of the results is summarized below;
Outcomes
Outcomes entail the drivers of innovation and the entire scope of the project. Singapore
outshines Australia in innovation outcomes hence offer better services, supplies, and quality
products to the market than Australia. Singapore has done better in the recent past when it comes
to the innovation of new business ideas in the retail sector.
Finance
Finance as a pillar in retail sector innovation is very crucial. In this regard, Singapore has been
more productive in financing the internal and external retail operations of its domestic companies
in an attempt to encourage innovation when compared to Australia. There is more research and
development of new products and delivery technologies that boost innovation activities in
Singapore as compared to Australia (Sarooghi, Libaers, and Burkemper, 2015, p. 30).
Evidence based practice
In the context of innovation, evidence based practice involves the practice of gathering and
sifting via new research and current data so as to make objective innovative decisions. In this
regard, Australia outshines Singapore and uses more funds and time in supervising employees in
the implementation of new innovative policies (Florida, Mellander, and Stolarick, 2011, p. 10).
Innovative process
Innovative process is another pillar of innovation that entails the steps taken in collaborating
team ideas together in order to improve product, process, and structure features of a given brand
(Markides, 2013, p. 320). In this perspective, Singapore has been more productive than

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Australia. Most retail companies in Singapore thrive in teamwork unlike most Australian retail
companies that fail due to lack of teamwork in the innovation processes.
Leadership
Innovation leadership involves managerial collaboration efforts employed to promote, manage,
and drive innovation in an enterprise. With conflict of interest in most Australian retail
companies, innovation leadership has been poor and tough (Dutta, Lanvin, and Wunsch-Vincent,
2015, p. 88). However, Singapore has a legislation that requires managers to establish an
innovative culture hence encourage new ideas in the business unlike Australia.
Policies
Policies such as innovation policy and health policy are established to guide an organization in
promoting innovation (Pollock, 2008, p. 10). In this perspective, Australia and Singapore are
rated at 71 percent and tie. However, Australia is expected to progress more in innovation due to
policing based on the past global index reports which shows its improvement from 59 percent.
Technology
Singapore thrives most in technological innovations that Australia. Most retail companies in the
country have adopted the use of e-commerce and other technology driven channels in the
production, distribution and selling of products to the market. Data technology is more advanced
in Singapore than Australia.
Therefore, Australia needs to invest more in innovation in order to improve its competitiveness
in the industry.

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Importance of Creativity and Innovation
Creativity and innovation play important roles in the success of a country’s economy. The major
benefits attributed to the two concepts in any country include:
Drives economic growth
Creativity and innovation have a direct and positive impact on the rate of economic growth of
any country. The future of success of any economy lies on its ability to create and innovate new
business ideas. Creative destruction in particular help in the discovery of new technologies that
benefit the entrepreneur and his country at large (Dahlander and Gann, 2010, p. 700) New
innovations create job employment opportunities to the citizens, hence economic growth.
Helps in problem solving
Creativity and innovation of new ideas helps the government solve the existing problem in the
country using the newly invented idea (Amabile and Pratt, 2016, p. 180). For example, the
creation and innovation of e-citizen has helped most world governments in the registration and
identification of people in different industries.
Talent growth
Creativity and innovation helps in growing more talents in a country. As a result, most citizens
become self-reliant and independent in terms of jobs (Wonglimpiyarat, 2010, p. 250). Also, this
helps in opening up new startups that create jobs for the unemployed in the society; this boosts
economic growth too.
Conclusion
Creativity and innovation play significant roles in the growth, development, sustainability, and
competitiveness of an enterprise in the market. Companies need to engage in disruptive, process,
and incremental innovations so as to advance the design and quality of their products and

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services for the benefit of consumer needs. Also, investing in creativity and innovation helps
countries boost economic growth, solve existing problems, and establish a pool for talent growth
in the society. Therefore, countries and companies should encourage creativity and innovation in
order to improve sustainability and competitiveness in the market.

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References
Amabile, T.M. and Pratt, M.G., 2016. The dynamic componential model of creativity and
innovation in organizations: Making progress, making meaning. Research in Organizational
Behavior, 36, pp.157-183.
Archibugi, D., Denni, M. and Filippetti, A., 2009. The Global Innovation Scoreboard 2008: the
dynamics of the innovative performances of countries.
Auernhammer, J. and Hall, H., 2014. Organizational culture in knowledge creation, creativity
and innovation: Towards the Freiraum model. Journal of Information Science, 40(2), pp.154-
166.
Dahlander, L. and Gann, D.M., 2010. How open is innovation?. Research policy, 39(6), pp.699-
709.
Doran, J., 2012. Are differing forms of innovation complements or substitutes?. European
Journal of Innovation Management, 15(3), pp.351-371.
Dutta, S., Lanvin, B. and Wunsch-Vincent, S., 2015. The global innovation index 2015. Effective
Innovation Policies for Development, Geneva: World Intellectual Property Organization.
Florida, R., Mellander, C. and Stolarick, K., 2011. Creativity and prosperity: The global
creativity index.
Markides, C.C., 2013. Business model innovation: What can the ambidexterity literature teach
us?. The Academy of Management Perspectives, 27(4), pp.313-323.

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Moulaert, F., 2016. Social innovation: Institutionally embedded, territorially (re) produced.
In Social innovation and territorial development (pp. 27-40). Routledge.
Pollock, K., 2008. The four pillars of innovation: An elementary school perspective. The
Innovation Journal: The Public Sector Innovation Journal, 13(2), pp.2-17.
Sarooghi, H., Libaers, D. and Burkemper, A., 2015. Examining the relationship between
creativity and innovation: A meta-analysis of organizational, cultural, and environmental
factors. Journal of business venturing, 30(5), pp.714-731.
Wonglimpiyarat, J., 2010. Innovation index and the innovative capacity of
nations. Futures, 42(3), pp.247-253.