Innovation has been a central area of focus for modern organizations. Organizations both new and existing have taken upon themselves to identify and adopt better ways of doing things in order to compete effectively with other industrial players and maintain their market Share. Reliance on outdated technologies and unfashionable ways of doing things have been some of the reasons why Multinational companies that were doing quite well in the past years have gone down in history as classical examples of companies whose lack of focus on innovation caused their downfall. Companies like Nokia, the once global technological giant and Kodak an American based Technology Company failed for issues related to innovation. For Nokia its reliance on an outdated Symbian operating system saw being edged out of the market by modern technologies based on Apple and Android ( Gehani, 2013). Instead of responding to changes in consumer tastes and preferences the company assumed that it would still remain to be a market leader with its aged Symbian platform. For Kodak on the other hand, it did not fail because it did not innovate but due to lack of a strategic approach towards innovation. Although it was the first technology company to invent a digital camera in 1975 the company missed an opportunity of reinventing itself by failing to market its new technology for fear that such a move would hurt its thriving business( Gehani, 2013).IBM Innovative journey dates back to over 90 years since its formation. The company places high significance on innovation and has for over 60 years embarked on research to aid its innovation journey. The company can be described as among the companies that highly value innovation based on its overall spending on research and development and the several years it has focused on innovative research. In order to achieve its innovation objectives, the company has eight research laboratories and a central research organization with over 3000 engineers and scientists. Apart from its heavy spending on research and development, the company also has 24 development laboratories spread across various parts of the world. In order to fulfill its research and development mission, the company has a dynamic technical vision covering all its business which it adapts to the realities of the market on a continuous basis. Based on these facts, it is evident that company places high value on innovation. For it innovation is not only an organizing principle but also a business model. The company uses technological innovation as a way of reinventing itself and meeting the changing needs of its clients. Innovation is the processes through enterprises implement new ideas in order to create value for their offerings. Through innovation organizations come up with new products and services as well as systems and processes in order to improve their efficiency and meet the needs of their customers. Despite the strides made by the organization in its innovation Journey, it is difficult to present or describe its innovation story because of the organization’s complexity. This report documents IBM’s innovation strategy, processes, infrastructure and organization structure.
The competitiveness of a technology organization like IBM is determined by its ability to innovate and create better, efficient and high-speed Technological solutions. The organization’s need for innovation is therefore based on the organization’s desire to be a pacesetter in the technology market. Through innovation, the company is able to stay ahead of its competitors by enabling it to offer unique products to its customers. The introduction of new technologies almost on daily basis makes the technology industry one of the most dynamic industries. The organization need for innovation is therefore as part of its strategy to meet the changing needs of its customers. The ability of an organization to attract best talents in the market is determined by its perception towards innovation. Employees, especially in the technological industry, will tend to work for an organization that provides them with opportunities to be innovative. The organization also needs to innovate in order to attract best talents in the market (Hammer, 2015). Finally, the organization focus on innovation is also likened to its need for growth. Innovations in an organization breed growth. Innovation can either be facilitated by process changes or lead to process changes.
Innovative framework refers to a platform through which organizations tie together their employee’s unique talents while at the same time aligning them with their organizational strategy. An innovative framework provides the organization with a strategic approach for acting on new ideas from inside an organization. The organization’s innovative approach involves supporting idea generation by providing opportunities for turning ideas into action. The organization also supports innovation by creating an enabling environment for creativity. The organization understands that through availing a climate for creativity, it can inspire its employees to become creative. In addition to creating an enabling environment, the organization IBM also provides incubation for new ideas through processes and structures to ensure their maturity. The organization has also invested in technologies and tools that promote the ability of their employees to be more creative (Bjelland and Wood, 2008). It also uses incentives and metrics as part of its innovation framework. The organization’s innovative framework, therefore, involves the creation of a platform for innovative success, engaging employees, management and nurturing of innovative ideas, and celebrating success through recognition.
Although the company’s innovative framework can be said to be better off, it is not the best. For more effectiveness in their innovation endeavor, the organization’s innovation framework should be more encompassing and detailed. It can improve its innovation framework by focusing on targeted innovation. This can be done by challenging its employees to come up with specific innovations or challenging them to solve specific problems through innovation. To ensure the success of this innovative approach, the organization should offer their employees with background information on duration and scope to ensure focus. In addition, the company’s innovative framework can be more effective through frequent and rigorous reviewing of innovative ideas to ensure immediate adoption of ideas that align with the organization’s strategic objectives (Brocke, Petry and Gonser, 2016). Other ideas should be kept safe, to be considered at a later date. This approach will ensure that all ideas end up being adopted or banked. This will ensure that business ideas that are of high impact are immediately adopted.
An innovation culture is a leader cultivated a work environment that is focused on promoting the nurturing and application of innovative ideas. Through the creation of an innovative culture, the management of an organization believes that anybody within the organization has the ability to come up with an innovative idea. Most innovative organizations have been known as organizations whose cultures allow thriving of new ideas.
The organization clearly understands that innovative capability does not solely rest on the management but it is the responsibility for all employees and business units. IBM’s innovative culture is therefore founded on giving ownership for innovative ideas. It achieves this by rolling out innovation programs across the entire organization. In order to build an organization culture, the organization has also integrated innovation into all its operations (Bjelland and Wood, 2008). This idea is particularly important in that it ensures that employees both new and existing get accustomed to innovation as part of their daily work. The organization has also given their employees autonomy as a way of promoting innovation across the organization. The company understands that lack of autonomy among employees is one of the major setbacks for innovation among employees. The innovative culture for the organization also based on collaboration. Through collaboration, employees exchange ideas and get an opportunity to be inspired by their fellow employees. The approach towards building an innovation culture within the organization is commendable; however, they can improve their innovative culture by a focus on 70% success instead of 100% success. This will make their employees more willing to take risks. It can also strengthen its innovation culture by challenging its employees with difficult projects and prioritizing the employees less likely to successfully complete projects.
The structure of an organization refers to a system outlining how its activities are directed in order to achieve organizational goals and objectives. Organization structure defines activities such as responsibilities, roles, and rules. The structure also determines the flow of information from different levels within an organization. The different types of organizational structures adopted by an organization include flatachry, matrix, divisional and functional (Hung, 2006). On the other hand organization design is the process used by the organization in aligning its structure with its objectives as a way of enhancing effectiveness and organizational efficiency.
The organization structure for the company can be referred to as a functional organization structure. It involves capacitating employees at all levels and operational units within the organization to be in control of the innovative processes within the organization (Ko, Lee and Lee, 2009). It perceives the ownership of innovation as a responsibility for employees at all levels and functional units within the organization. This means that the innovative power and authority rests with individual employees and units within the organization. Innovation is integrated into employee’s roles and the functioning of every business unit.
This is advantageous in that it removes the possible bureaucratic hurdles that would hinder innovation in the organization especially where there is a heavy reliance on the top management for innovation decisions approval. The disadvantage, however, is that it might be challenging for Nick Donofrio, the company’s second-ranking executive to coordinate communication on innovation matters across different units.
In the IBM case context, a funding model refers to the direct support provide by the organization to supplement and assist in the financial viability of innovation. Funding is an important aspect of the implementation process for innovations. Lack of effective and sufficient funding is detrimental to the innovative capability of both an organization and its employees. External funding is done through co-development with clients, universities or business partners. Internal funding is managed by individual business units whereby each unit determines its financial estimates for innovation and includes it in the budget. The budget is then justified by leaders of specific units. For budgets cutting across the organization, the corporate strategy group is tasked with the responsibility of helping in the funding process for innovation (Chesbrough, 2007). Although the determination of funding for innovation and potential areas of growth is the sole responsibility of individual business units, they can seek the intervention of the corporate level of the organization if need be. The organization’s emerging business opportunity program responsible for the allocation of funding and resources for innovative business opportunities .The program is funded by the organization’s business units and managed by operational and finance staff, EBO leaders, finance and corporate strategy.
The organization has a very comprehensive funding model for innovation. Its model is meant to ensure that all innovations from all the levels are taken care of. Availability of a comprehensive funding model for innovation is a means that the organization’s employees are motivated to become more creative. It also minimizes the possibility of innovative ideas being discarded for lack of funding.
Business transformation refers to the process of incorporating changes in an organization in order to meet specific goals and objectives. Business integration on the other hand is the process aligning technology with business goals and strategy through synchronization of culture and Information technology. It is concerned with the absorption of IT as a business function.
The focus on innovation across major functional areas of the organization is part of the organization is driven by the need of the organization to incorporate changes aimed at enhancing productivity levels, enhancing sales results, increasing the levels of satisfaction and efficiency. The organization has effectively used the two functions to enhance its innovative capability (Longo, Giaccone and Garraffo, 2013). While the adoption of innovation across all levels is an effective way of driving a transformation agenda in the organization, management of the innovation across levels and through collaboration is an effective strategy for creating integration in the organization. The organization needs to continuously work on enhancing innovation through business transformation and facilitating effective integration among its different units
Innovation strategy
An innovation strategy refers to the plan used by organizations through the investment of money in research and development. Innovation strategy is meant to encourage technological advancement. An innovation strategy is effective in driving innovation across the various functional units of an organization.
The organization has a proactive innovation strategy largely driven by the organization’s Global Technology outlook which has been in existence for the last 25 years (Hammer, 2015). The GTO is tasked with the responsibility of projecting Key IT developments and trends and influencing organizational technical strategy. The company’s strategy includes focussing on any opportunities for growth. Through research, the GTO identity’s any trends in the market in both disruptive technologies and likely to affect the IT sector. Its innovative strategy also involves reliance on the generation of ideas. Over 100 ideas are generated by the GTO on yearly basis. These ideas include ideas generated by employees. The process of reviewing generated ideas is a collaborative effort involving the input of 12 teams.
The approach of the organization is towards innovation is quite good. It is both encouraging and motivating to the employees. A collaborative approach is the most effective for enhancing innovation in an organization. The organization has strategically positioned itself as a market leader by constantly engaging in research and maintaining a ready to act attitude towards any opportunities. However, the organization’s innovative strategy lacks some critical aspects that would have made it more effective. An innovative strategy needs to be more specific and inspiring. It should also explain the desirable future states within the organization in as far as innovation is concerned(Majchrzak and Malhotra, 2013).Additionally, the organization’s innovative strategy is more concerned on the competition. An effective innovation strategy needs to focus more on breaking away from competition, beating the competition and maintain a new space in the market.
Business process design and improvement are aimed at meeting certain objectives. The role of leadership in business process design and improvement is therefore very important. The organization’s leadership plays an active role in facilitating the change process. The active involvement of the organization’s leadership is a boost to the process
Business process design and improvement are focused on introducing critical changes in an organization in order to increase productivity and efficiency (Gehani, 2013). With the nature of change process in an organization, collaboration is a major facilitator for the process. The organization perceives the role of Collaboration as significant in driving the innovation agenda throughout the organization. The process involves the input of both internal and external stakeholders. Collaboration is the most effective strategy for dealing with any hindrances to the transition process. The involvement of stakeholders by the organization is, therefore, a strategic move.
Process performance evaluation is the process of assessing the performance of an ongoing process to ascertain whether it is being carried out as per the goals and objectives. The evaluation is also meant to determine the level of achievement of the stated objectives
This the performance evaluation process used by the organization. Balanced scorecard is a tool used to track execution process of a project or activities.IBM majorly relies on this method to measure its innovation and performance. The scorecard is made up of a combination of measures intended to aid in the evaluation of the overall success of innovation. Its balanced scorecard also has both quantitative and qualitative measures (Majchrzak and Malhotra, 2013). The scorecard involves aspects such as goals, accomplishments, patents, eternal recognition and partnership assessment. The main advantage of using balanced scorecard include the fact that it offers a wide range of considerations including financial and human aspects and looks into the impact of these aspects on each other. It does not merely focus on performance of a single aspect. The scorecard also allows a continuous examination of goals and objectives. On the negative side balanced scorecard as a performance evaluation tool does not recognize individual efforts. Its only focus is on the whole. This means that it can affect motivation of individuals. The inclusion of multiple metrics into the balanced scorecard can be difficult to monitor. It makes the evaluation process more cumbersome.
Cycle time refers to the total time taken from the initiation to the closure or termination of a process. Having a specific cycle time for a process can be an effective strategy for evaluation performance. Performance is measured according to the time taken in the development of a product or creation of a service. The organization has different cycle times for various products. For microprocessors, the cycle time is usually three to five years. The software takes 6 months to one year while services might take a few months. These differences are the main reasons for the decentralization of the product development process. Decentralization is an effective strategy for ensuring that each product is developed accordingly within its cycle time (Majchrzak and Malhotra, 2013). The use of cycle time can especially where it is kept as small as possible can lead to competitive advantage by enabling an organizations products to reach the market within the shortest time and lead to improved profitability by allowing saving of costs. The disadvantage of using cycle time is the variance in the time taken to create different products.
Change management refers to the process organizations apply tools and techniques to help their employee’s transition successfully to organization change. The process is more centered on the people within an organization. The change process is critical for an organization and must be effectively managed if an organization is to achieve the desired business outcome. Failure to manage change within an organization can be detrimental to its change process. While the change in an organization is inevitable irrespective of the success or size of an organization, sometimes it can be quite difficult to implement because of the various roadblocks that affect the process
Depending on how well the change process is managed, it can lead to two possible outcomes, success or failure. Both the success and failure of the change process need to be effectively managed. Successful transition does not mean that an organization is guaranteed long-term success. In the same way, failure to transition successfully into the change process does not mean that it is the end of an organization’s change journey (Van der Aalst, 2013). The organization manages failures by constantly engaging in the identification of deviation and instituting any corrective action through a myriad of approaches. However, these approaches are used selectively depending on the part of the company that is involved. The organization also constantly improves on its methods of driving innovations into the marketplace as a way of managing failure The Organization perceives failure as a possible outcome, especially in some scientific risky projects.
Managing failure through identification of deviations in the entire lifecycle of the project is an effective strategy for the organization. It ensures that any factors that can lead to the failure of the change process are identified and dealt with in their early stages. The identification of key stakeholders is also an effective strategy for managing failure.
Innovation barriers are factors that can lead to failure of the innovation process. On the other hand, barriers to innovation are the factors that can significantly tamper with the innovation process. Understanding of the enablers and barriers of innovation is an effective strategy for organizations manage their innovation process (Röglinger, Pöppelbuß, and Becker, 2012). The identification of innovation enablers enables an organization to optimally utilize in order to successfully drive the innovation agenda. On the other hand, the identification of possible barriers ensures that such barriers are effectively managed to avoid any innovation failure. Meeting of innovation enablers on regular basis can lead to the development of an innovative culture within an organization, which can be quite effective in driving innovation within an organization.
Most notable enabler within the organization is an innovation infrastructure rolled to all major operating units of the organization. The innovation infrastructure is important in that it ensures that innovation is perceived across the organization as part of the daily operations.
Support from the top. A successful innovation campaign within an organization must be supported from the top. Support from the top means that the financial aspect of the innovation process can be effectively solved. If it is supported by the management, it can also have a motivation aspect and be more sustainable. This is a major enabler of innovation within the organization.
Innovation strategy. Having an innovation strategy is also a major enabler for the organization’s innovation journey. A clearly aligned innovation strategy is key in successfully driving an innovation agenda. The organization’s innovation strategy brings together both financial and human resources and ensures that resources are effectively managed in situations where barriers are identified.
Some of the possible barriers to innovation in the organization include a focus on the short-term result in the organization’s management reward system, lack of focus on new markets and products, focus on sustained profits rather than the process of achieving that. Barriers have also been as a result of inadequate market research. The innovation process needs to be more strategic; it more centered on the process rather than the outcome and should involve long-term planning (Weske, 2012). Barriers have also been as a result of inadequate market research
Critical success factors are elements necessary for a project to achieve its objectives. The organization is focused on becoming a market leader in the technology industry through its unmatched focus on innovation (Trkman, 2010). Its innovation journey is also meant to ensure that it adapts on a continuous basis to the technological realities in the market while meeting the changing need of its consumers.
One of the key success factors is having in place a culture that both rewards and recognizes innovative thinking (Trkman, 2010). The use of Rewards and recognition are effective ways of motivating employees to try new and more efficient ways of carrying out their day to day activities. Employees will try new technologies and work towards becoming more effective in their operations if at the end of it all they know that they will win recognition from the management, monetary or non-monetary rewards. These rewards should, however, be focused on long-term goals
Collaboration is the other key success factor used by the organization. The organization recognizes collaboration as an effective way of encouraging and sustaining innovation. Under its collaborative strategy, the organization is focused on ensuring that its initiatives are implemented successfully without any hurdles (Dittrich, Duysters and de Man, 2007)Collaboration is advantageous in that it helps employees solve fundamental challenges encountered in the innovation process. Besides it also plays a role in ensuring that all employees remain on course and motivate each other towards achieving sustainable innovation in the organization. A collaborative approach can also improve the innovative capabilities of an organization and enable the least innovative employees to catch up with others. However, the collaborative approach to innovation may not be the most effective for all employees and situations requiring innovative solutions. For some employees, they are more innovative when working on individual projects. Collaboration also means that the innovation process is focused on seeking the input of multiple players which can lead to time wastage especially for challenges requiring timely innovative solutions.
From the IBM case study, we can learn a number of lessons. The first innovation is an important aspect of the growth of an organization (Gehani, 2013). Through innovation; technology organizations like IBM are able to come up groundbreaking inventions which not only give them a competitive edge but also improve their ability to satisfy changing customer needs. We can also learn the importance of investing in research and development as a way of enhancing the innovativeness of an organization. Thirdly, the role of management in driving organization innovation is also explicitly brought out in the case study, the chances of success for a management driven innovation are high as compared to employee-driven innovation (Rosemann and vom Brocke,2015). In addition, external relationships are an important part of the organizational transformation. In the course of bringing about substantial changes in an organization, challenges are inevitable. It is therefore important that change management processes are established to effectively drive the change process.
One of the major focuses of the organization is minimizing cost in its operations. While the company is viewed as one of the most innovative in the world, its innovation is not centered on product differentiation. This fact, therefore, means that its competitors can easily imitate its technological products. One of its focuses in future should, therefore, be using its innovative capability to create more unique products, unlikely to be copied by its competitors. The company should also focus more on diversifying its products. Diversification will enable it to enter more markets and act as a buffer to the risks associated with.
Conclusion
In conclusion, IBM is one of the most innovative organizations in the world; the organization which is majorly involved in technological inventions has had an impressive innovation journey dating from over 90 years ago. Its focus on being a market technological innovation leader has seen the organization has seen the organization invest a significant amount of resources in its research and development endeavors. To strengthen its innovative journey, the organization has over 3000 engineers and scientists and 24 development laboratories distributed across the world. The organization has incorporated innovation as part of its business model and views it as an integral organizing principle. It also relies on technology as a way of reinventing itself and to meet the changing needs of its clients. To achieve its innovative objectives, IBM has a comprehensive innovation framework that is divided into idea generation, Creation of a workplace environment that supports innovation, offering necessary support including incubation for generated ideas and availing innovation centered technologies and tools. The organization also used success to drive its innovation agenda. The organization has also created an innovation culture by incorporating innovation into all operational business units and adopting a bottom-up approach in driving the innovation agenda. The organization has rolled innovation programs across the various functional units as a way of creating and maintaining an organization culture. This has also been enabled by the integration of innovation into the organizational operations. The organization also uses various sources of funding to facilitate its innovation agenda. The funding of various innovation processes is carried out by the organizations emerging business opportunity program which is internally funded by various operational units. Having a funding model for innovation is also a strategic approach used by the organization to facilitate the implementation of the most promising innovative ideas. It also ensures that no innovative idea is terminated for lack of funding thus helping the employees to optimally utilize their creative abilities. IBM evaluates the performance of its operation through the use of balanced scorecard and cycle time. In addition it manages failure through collaboration and continuous monitoring of its processes. In order to effectively achieve its objectives, the organization uses the following critical success factors. First the organization has culture where innovation is recognized and rewarded. This motivates employees to become more innovative. In addition, it uses a collaborative agenda to drive its innovative agenda. The innovation process has both its enablers and barriers, some of the identifiable barriers include the availability of an innovation infrastructure, support from the management and presences of an innovation strategy. The possible barriers include lack of sufficient market research, lack of focus on product diversification and differentiation and focus on profits instead of the process of achieving those profits
References
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