THE INNOVATION IN ORGANIZATION

Running head: INNOVATION IN ORGANIZATION
INNOVATION IN ORGANIZATION
Name of Student
Name of the University
Author Note

1INNOVATION IN ORGANIZATION
Table of Contents
Introduction..........................................................................................................................2
Key theory discussion..........................................................................................................3
Case analysis........................................................................................................................5
Justification and explanation in relation to new industry trends and comparison of
different competitors in different countries.................................................................................7
Critical discussion of existing literature and examples from relevant industries............8
Growth and development.................................................................................................8
Competitive adbantge......................................................................................................9
Meeting the needs of the customers and keeping them satisfied.....................................9
Attractibg talemnted candidates....................................................................................10
Adapting themselves to the external environment.........................................................10
Summary and conclusion...................................................................................................11
References..........................................................................................................................11

2INNOVATION IN ORGANIZATION
Introduction
The term creativity refers to the capability to think something differently and unusual.
Innovation refers to the implementation of the new idea generated creatively. Invention on the
other hand refers to things that were not in existence and therefore includes the introduction of
something new. In fact creativity is an important element of innovation and innovation is not
possible without creativity. Creativity therefore incudes finding new ideas that can be converted
into innovative solutions later on. Creativity and innovation are important in all fields including
businesses. Creativity and innovation can help businesses in solving its problems in a better way.
Moreover innovation and creativity strategies of an organization can provide it a competitive
advantage over its competitors (Kelley 2005). Moreover business can gain a number of benefits
with the help of innovation and creativity such as better quality of goods and services, building a
range of products, handling environmental and legal issues more easily, improved overall
productivity leading to cost reduction and it can also help an organization in retaining its
employees and also in attracting talented candidates. In order to become successful in the long
run, organization need to carry out innovation. The organization selected for the purpose of this
study of Google. The main aim of the paper is to identify and analyses the innovative strategies
adopted by the company under study (Ekvall 1996). The paper will therefore discuss about
theories of innovation, identification of the innovative strategies adopted by the company,
understand the innovative strategies used by the competitors, critical analysis of the existing
literature related to innovative strategies of organization and the paper will also discuss about a
summary of the entire paper.

3INNOVATION IN ORGANIZATION
Key theory discussion
Innovation refers to creative new idea and new imagination and creative thoughts that is
converted into method or devices. Innovation also includes introduction of better solution for
meeting new requirements and the unarticulated needs or some existing needs. Organizations
carry out innovations in order to gain competitive advantage and also for the purpose of adapting
itself to the changing environment. In order to understand the concept of innovation,
Schumpeter’s model of innovation needs to be understood. In addition to that the stage gate
model can also be understood that is used by organization for the development of new goods and
services. According to the Schumpeter model of innovation, an entrepreneur can earn large
amounts of profits by introduction of successful innovations. Therefore according to this theory,
the main function of an entrepreneur should be to introduce innovations and then he will get
profits as a rewards for his work. And according to this theory, innovation refers to all those
activities undertaken by an entrepreneur for the purpose of increasing the demand for goods and
services and also for the purpose of reducing the cost. Therefore according to this theory,
innovation can basically be of two major categories that includes- activities undertaken by the
entrepreneur to reduce the cost of goods and services and the second category includes activities
undertaken by the entrepreneur to increase the demand of his goods and services in the market.
Moreover it is also necessary for the entrepreneurs to remain profitable for a longer period of
time. And according to the theory of Schumpeter entrepreneurs can remain profitable for longer
period of time if they can get a patent of their innovation. This is so because by having a patent
for goods and services, others can be demotivated or discouraged from imitating the goods and
services of the company.

4INNOVATION IN ORGANIZATION
Figure 1: innovation model by Schumpeter
Source: (Pati 2003)
Another model that can be used for the purpose of understanding the concept of
innovations in organization includes the stage gate model. According to the stage gate model,
new products can be developed with the help of innovation for creating more value for the
customers. The stage gate model helps the organization in converting its innovative ideas into
practical solution and new products with the help of a road map and a list of deliverables. If the
stage gate model can be applied properly then there can be continuous innovation and also
development of new products and services within an organization. The stage gate model consist
of 5 major steps: scoping, creation of a business case, development, testing and validation and
the last step comprises of launching the product in the market. The first step of the stage gate
model comprises of scoping that includes- determining the relevance of the creative idea in terms
of the idea and also through the evaluation of the competitors and the market. The step of
creation of business case comprises of conducting an in-depth analysis into the idea in order to
build business simulation and includes identification of the customers’ requirements,

5INNOVATION IN ORGANIZATION
determining the positioning of the product, defining the specifications of the products and also
includes projects scheduling. In the step of development, a new product is developed on the basis
of preliminary test with the potential customers. The testing and validation step includes-
conducting tests in the lab and ratification of the scenarios of product launch. And the final stage
of launch phase comprises of the market entry of the product and also includes monitoring of
quality and the production.
Figure 1: Stage gate model
Case analysis
The innovative strategies adopted by Google comprises of 8 strategies- having a mission
that matters, thinking big but starting small, striving for continuous innovation, and not
immediate action, looking for ideas everywhere, sharing everything, sparking with imagination
and fueling with data, being a platform and never failing to fail(Gupta and Singhal 1993). At
Google, the decisions of the employees and the top management is directed by the common
mission of organizing information of the world and making it accessible and useful globally.

6INNOVATION IN ORGANIZATION
Therefore the company starts work as soon as it identifies a problem that needs to be solved. For
instance Gmail was introduced by Google to meet the need of people for functioning of more
web mail. Thinking big and starting small means starting as soon as an idea is generated. For
instance when Google decided to introduce its books and worked hard and finally found out that
worlds books can be brought online. The company uses an iterative model for continue
innovation and the company is gaining invaluable lessons through the same. Google believes in
looking for ideas everywhere. This is so because the company tries to hear the ideas of everyone
and therefore the employees are motivated to do the same during breaks. This is how the
company innovated the Google art project. The company also believes in sharing everything that
is the top management at Google keeps its employees informed of all the decisions and actions.
Moreover the employees are also encouraged to take part in discussions, re-interpretation of
ideas and exchange of ideas. The company sparks with imagination and fuels with data. Google
appoints employees who believe that all impossible things can be converted into a reality. One
such example is Sebastian Thrun who is developing driverless cars for reducing the number of
roadside accidents. Moreover the company supports this type of creative thinking on part of the
employees and therefore allows its employees to spend 20% of their time in doing projects that
actually interests them. Moreover the company believes in being a platform. The power of open
technologies enables individuals to apply their skills anywhere for the purpose of creation of a
new products and services and features on top of the platforms provided by Google. This can be
better understood with the help of an example, Google earth help in building layers on top of
maps and sharing the same with the world. The company never fails to fail or the company
believes in learning from its failures and improve its processes for delivering the best to the
customers, For instance people know more about YouTube then Google video player. Therefore

7INNOVATION IN ORGANIZATION
the company believes in learning from failures and taking up risks. It is not afraid of taking up
risks for the fear of failure. For instance Google project of Google answers and AdSense retired
within four years of its launch and therefore the company has learned a lot from the same.
Justification and explanation in relation to new industry trends and comparison of
different competitors in different countries
Some of the major competitors of Google includes- Apple, Microsoft, Amazon and even
Facebook. These organizations also engage in carrying out innovative practices for the purpose
of becoming profitable and sustainable (Shneiderman 2007). For instance Apple carries out
innovation for the purpose of building customers loyalty through innovating new products and
services. This is the main reason why Apple focuses more on innovation than any other activities
such as corporate social responsibility. The company is also able to meet the needs of the
customers at a premium ricing through new product and service development. This is how Apple
is able to occupy a major share of the market irrespective of its premium pricing and it also
maintains the demand for its goods and services. Moreover Apple also gains a competitive
advantage through its innovative practices (Garwin 1993). A competitive advantage is one which
provides an advantage to a company in comparison to its competitors by creating a better image
in the minds of the customers. Innovation also helps organizations in influencing the purchase
intent of the consumers and this is also evident from the company Amazon. Amazon makes use
of innovative practices to influence the customers purchase intentions. Moreover innovation also
helps businesses in gaining new customers and that is much evident from Microsoft. Through
innovation, Microsoft has been able to attract new customers.
Some of the latest trends of the computer software industry comprises of- user friendly
products and services, tech savvy products and services and development of different

8INNOVATION IN ORGANIZATION
differentiation products. BY developing user friendly goods and services the companies of the
computer software industry try to improve the efficiency for the consumers. Tech savvy products
are also much in demand because the present generation is aware of the changing technology and
demands for the latest technology. Moreover all the companies engaged in the computer software
industry tries to products goods and services with some differentiation factor. Therefore from
the above market trends or the industry trends of the computer software industry and after
understanding the reason for competitors innovative practices, the importance of innovation for
all businesses has been understood. Similarly Google also makes use of innovative strategies and
practices for becoming profitable in the long run and for gaining competitive advantage that can
help in differentiating the products and services of Google from that of its competitors. It has
also been understood from the above discussion that innovation not only helps in providing a
competitive advantage to an organization but it helps them in adapting themselves to the external
environment or the present market or industry trends.
Critical discussion of existing literature and examples from relevant industries
It is necessary for organization to innovate such that they can gain a competitive
advantage over the competitors, they can adapt themselves to the dynamic external environment,
be able to attract the talented candidates, to grow and develop and also to meet the customer’s
needs.
Growth and development
Business which innovate can increase their productivity due to the same by adding and
retaining the nest quality of employees. Therefore such companies which innovate continuously
are able to take advantage of market opportunities. Microsoft applied creativity and innovation

9INNOVATION IN ORGANIZATION
for developing and launching new products and services into the market. The innovate products
and services of Microsoft helped it in increasing its sales and revenues continuously.
Competitive advantage
Competitive advantage includes the advantage that one company enjoys over the other
due to a better image in the customers mind. In today’s generation where the competition is so
fierce it is necessary for the organization to stand out in order to take advantage of opportunities.
Therefore innovation can help companies stand out from other companies in some way. For
instance, Steve job was once questioned why he did not invest into traditional CSR activities and
to that he answered that he did not invest into CSR activities purposefully because the main aim
of the company is to satisfy the customers instead of investing into traditional CSR activities.
Apple therefore makes huge amounts of investment in research and development for the purpose
of innovating new products and services. Moreover Steve Jobs also said that it is because of
innovation of goods and services only that helps him in satisfying his customers and maintaining
their loyalty. Steve jobs urge for innovation is the main reason behind the success of his
company and also in gaining the maximum share in the consumer electronic markets. The
capability of steve jobs in gathering such a market share has helped him in gaining a competitive
advantage over his competitors (Gumusluoglu and Ilsev 2009). He has been able to create a
strong brand image due to his innovative goods and services.
Meeting the needs of the customers and keeping them satisfied
The needs of the customers are continuously changing and the customers are more aware
than before (Bharadwaj and Menon 2000). Therefore through innovation different products and
services can be offered to the customers which can help them in ,keeping satisfied. For instance,
Apple is a customer centric company that offers the best quality of consumer electronics and

10INNOVATION IN ORGANIZATION
different variety of products and services to the niche market customers of the company in order
to meet their needs successfully. The company has been able to do so with the help of innovative
goods and services. The customers of the brand are completely loyal towards the brand which
shows that the company has been successful in completely satisfying its customers.
Attracting talented candidates
The most talented candidates are usually creative and therefore they want to become a
part of a company where they can discuss about their creative ideas. Therefore it is necessary for
the company to innovate such that it can attract highly talented candidates. These candidate need
a culture of where they can feel challenged and they can communicate about their ideas openly.
Once talented candidates have been attracted then they will also give new ideas about product
and service development. This in turn will help the company to grow, develop and become
sustainable. This way the company will become even more innovative and it will be able to meet
the needs of the customers in a better way (Cummings 1965).
Adapting themselves to the external environment
One of the major reasons why innovation is important for businesses is the fact that the
external environment is continuously changing and as a result it has become necesasry for
organizations to adapt themselves to the external environment. Organization can easily adapt
themselves to the external environment through continuous innovation. For instance if the
technological environment of a country is changing then it becomes necessary for businesses to
innovate new technologies that can help in meeting the changed needs of the customers or the
external technological environment. For instance, Mark Zukerberg introduced Facebook keeping
in mind the tech savvy demand of the present generation.

11INNOVATION IN ORGANIZATION
Summary and conclusion
Therefore from the above discussion, it can be concluded that innovation and creativity
play a very important role in business. This is so because it provides a number of advantages and
opportunities to businesses and the same can be said for Google. Google, as has been understood
from the paper, makes use of innovative strategies such as thinking big and starting small,
striving for continuous improvement and innovation and not looking for immediate perfection or
action and others for gaining a competitive edge and becoming successful in the long run.
Moreover Google has been able to implement its innovative strategies due to the creative culture
of the organization. The innovative culture of the company can be understood from the fact that
Google allows its engineers to spend 20% of their working time on projects that they find
interesting and this enables the company to have a more creative environment. This is so because
when people like their work they start thinking of different ways for solving a problem or start
thinking more creatively. Moreover from the paper, the innovative theory of Schumpeter has also
been understood which focuses on the strategy of earning profits with the help of innovations.
Further from the paper the innovative strategies adopted by the competitors of Google have also
been understood. For instance, apple makes use of innovative strategies for gaining a larger share
of the market. Moreover the 8 innovative pillars or strategies of Google has made the company
successful and profitable.

12INNOVATION IN ORGANIZATION
References
Kelley, T., 2005. The ten faces of innovation: IDEO's strategies for beating the devil's advocate
& driving creativity throughout your organization. Crown business.
Ekvall, G., 1996. Organizational climate for creativity and innovation. European journal of work
and organizational psychology, 5(1), pp.105-123.
Pati, P., 2003. MANAGING CREATIVITY & INNOVATION.
Cummings, L., 1965. Organizational climates for creativity. Academy of Management
Journal, 8(3), pp.220-227.
Bharadwaj, S. and Menon, A., 2000. Making innovation happen in organizations: individual
creativity mechanisms, organizational creativity mechanisms or both?. Journal of Product
Innovation Management: An International Publication of the Product Development &
Management Association, 17(6), pp.424-434.
Gumusluoglu, L. and Ilsev, A., 2009. Transformational leadership, creativity, and organizational
innovation. Journal of business research, 62(4), pp.461-473.
Shneiderman, B., 2007. Creativity support tools: Accelerating discovery and
innovation. Communications of the ACM, 50(12), pp.20-32.
Garwin, D.A., 1993. Building a learning organization. Harvard business review, 71(4), pp.73-91.
Gupta, A.K. and Singhal, A., 1993. Managing human resources for innovation and
creativity. Research-Technology Management, 36(3), pp.41-48.