The global commercial and organizational framework have over the decades, changed and developed considerably, much of which can be attributed to the international phenomena like that of Globalisation, trade liberalisation as well as technological and infrastructural innovations, which in turn, have cumulatively contributed in making the international commercial environment more integrated, inclusive and interconnected (Goetsch and Davis 2014).
With more and more businesses going global and with the global marketplace developing over the years, almost all industries have been observing increasing dynamics in both the demand and supply side and the firms in every industry have been experiencing increasing competition, from both domestic as well as international competitors (Denti and Hemlin 2012). Thus, in the contemporary age of increased competition and awareness as well as uniform distribution of information across the globe (both among the producers and the consumers), it is of utmost importance for the business organizations to stay efficient and consistently innovating in their production as well as operational frameworks. As Baden-Fuller and Haefliger (2013), argue, innovations in the organizational framework are of crucial significance as much of the profitability, operational efficiencies as well as long-term sustainability and competitiveness of the organizations depend on the same.
There exist several factors and drivers, in general, in the organizational scenario, which help in implementing innovations in the operational frameworks of the businesses and which may be both internal as well as external (Norman and Verganti 2014). Keeping this into consideration, the concerned essay, tries to highlight the internal and external drivers which are expected to be present in the aspects of implementing innovations and changes in the organizational frameworks of the businesses for the purpose of thriving in the technologically progressing and automated future, thereby discussing the relative importance and benefits of these factors and trying to infer whether external or internal drivers are more efficient and beneficial in these aspects.
The notion of innovations in the overall global framework and particularly in the business operations, have been becoming increasingly popular and relevant in the recent period, when the world is gradually heading towards automation and higher reliance on technology for every day activities. In this context, there exist different perceptions regarding the meaning and implications of the term “Innovation in the Business”.
In this context, Dawson and Andriopoulos (2014), define the concept of business innovation as the process in the operational framework of the business organizations, of that of introduction of new ideas, methodologies, technologies, work-flows aa well as new services or product, so as to increase the market share, profitability and competitiveness of the concerned business, by gaining a competitive edge over their rivals. The primary objectives behind implementations of innovations in the businesses, as highlighted by Crumpton (2012), are that of improvement of the existing products or services, introduction of new products or services, introducing new and efficient processes, solving existing problems and also that of reaching out to new product markets and customers.
According to Visnjic, Wiengarten and Neely (2016), innovations in a company, can be brought by concentrating on the following forms:
Product innovation- This includes the designing and development processes of different and innovative products offered by the businesses, which in turn attract greater clientele and help the companies in earning economies of scale.
Service innovation- This refers to the changes in the ways of providing the services to the customers, which can be attributed to the increasing age of digitalisation and the improving aspects of service distribution through the mobile channels and greater involvement of the customers in the entire process (Souto 2015).
Process innovation- This aspect of organizational innovations, involve the implementation of new technologies and methods in the overall processes and operations of the companies, with the objectives of increasing the operational efficiency of the organizations as a whole (Keeley et al. 2013).
In the contemporary period of increasing automation and technological reliance in the overall global framework and in the age of increased digitalisation, it has thus become extremely crucial for the organizations to incorporate innovations in their operational and production frameworks, so as to increase their revenue generation, profitability, competitiveness and long-term sustainability in the markets (Bucherer, Eisert and Gassmann 2012).
There exist various factors and drivers which facilitate the implementation of innovations in the organizational frameworks and different operations of the businesses and these factors may be both internal as well as external. The internal drivers, in this context, refer to those attributes and factors which are present within a particular business and are subjective to the concerned business organization itself (Bock et al. 2012). On the other hand, the external drivers of change, in an organization, refers to those situations and factors which exist outside the business organizations, in the external business environment, but have considerable implications on the organizational changes and operations. Keeping this into consideration, the various internal as well as external drivers which are relevant in the aspects of implementation of innovations in the operational framework of the organizations are discussed as follows.
The primary internal drivers or factors which are inherently present within the operations of an organization and which have considerable influences in the aspects of incorporation of changes and innovations in the process, products and services of the organizations, as highlighted by Love and Roper (2015), are as follows:
Organizational culture- As asserted by the author, the culture of a business organization refers to the overall assumptions, the underlying beliefs, values and the set of unwritten but existent guidelines which help in creating the unique social as well as psychological environment in which the concerned organization and its members operate. According to Triguero, Moreno-Mondéjar and Davia (2013), assert that the culture of an organization develops from the aspects like the employees, nature of operations, products and services offered, markets of interest and the strategy frameworks of the organizations and the culture of an organization incorporates the vision, locations, habits, environment and norms in which the concerned organization operates. For implementation of any kind of change and innovations in the operations of an organization and for sustaining the same in the operations, the organizational culture, thus, plays a crucial role as it determines the level of acceptability of such innovations and adoption of the same (Stange, Olsson and Österblom 2012).
Technological Framework- As discussed by Jacobs, van Witteloostuijn and Christe-Zeyse (2013), another crucial driver for organizational changes and incorporation as well as implementation of innovations in these scenarios is the technological framework of the organizations and technological capacity of the same. With constant new discoveries and technological progresses in the global scenarios, the old processes become obsolete and inefficient, which in turn, makes it crucial for the companies to adopt abruptly and efficiently to the changes in the technologies and innovations and to incorporate the same in their operational frameworks (Choo 2013). In this context, the technological capacities and frameworks in the organizations play crucial roles as the level of ease and efficiency of the organizations of that of incorporation of innovations in their operational framework depends on the same.
Employees and their attitudes- Another crucial internal driver to any kind of change or innovations in the operations of organizations, subjective to the organizations themselves, is that of the types of employees present in the organizational and their overall behavioural patterns and attitudes (Zhu and Engels 2014). As highlighted by Al-Haddad and Kotnour (2015), the level of dedication, confidence and loyalty among the employees of an organization and the extent to which they are motivated and accepting to changes, determine the level of success of the implementation of any kind of organizational change and incorporation of innovations in the production and operational aspects of the organizations.
In this context, Steiber and Alänge (2013), discussed the incorporation of innovations in the process and products or services of business organizations, with reference to one of the most robust companies in the global framework, in the aspects of continuous and efficient innovations, the Google Company. According to the authors, much of the success which the concerned company enjoys, in the aspects of continuous innovations and successful application as well maintenance of the same in the concerned company, can be attributed to the presence of highly motivated, skilled, dedicated, happy as well as ambitious employees and an overall flexible and creative organizational culture in the concerned company.
Financial Framework- The financial framework of a company and the level of efficiency, transparency and accuracy in the same, also play crucial roles in the aspects of bringing any kind of organizational change and incorporation of innovations, as the incorporation of any new process or development of any new product and service, requires investment of money, the possibility and prospects of which can be clearly ascertained with the help of a robust and effective financial management system within the businesses (Inauen and Schenker-Wicki 2012).
Apart from the above-discussed ones there also exist other internal drivers which have significant implications and influence in the incorporation of innovations in the organizations and also on the level of success of such innovation incorporations. Innovation and changes in an organization, the flexibility and level of acceptance of such changes in the organizational frameworks and also the success of incorporation of such innovations depend on the internal drivers like that of the employees, the overall organizational culture, the financial management as well as the technological capacity of the organizations, which in turn indicates towards the considerable significance of such drivers in the aspects of implementations of innovations in the organizational frameworks.
Acur, Kandemir and Boer (2012), in their research paper, opine that apart from the internal factors and drivers present within the operational framework of a business organization, there also exist various external factors and drivers, which in spite of not being components of the organizations themselves, play crucial roles in determining the operations and decision-making aspects of the same, especially in the aspects of changes and innovations in the organizational framework of the businesses. In this context, Tarí, Heras-Saizarbitoria and Dick (2014), highlight the primary external drivers which, in a generalised framework, influence the incorporation of innovation in the business organizations to be as follows:
Overall economic and commercial scenarios- As per the arguments put forward by Qian (2013), the overall economic environment and markets in which a business organization ventures and also the commercial scenarios and developments in these aspects, have considerable implications on the decision-making strategies of the organizations, especially in the aspects of incorporations of changes and innovations in the organizations.
Technological environment- Another external driver of immense importance, which influences the incorporation of innovations in the operational frameworks of the organizations, is that of the overall technological scenario in the country as well as in the global framework and the developments in the same with time. In the contemporary period of continuous developments and progress of technologies and innovations, across the globe, the need for implementation of innovations in processes, products, service and overall operational frameworks are also felt by the business organizations.
In this context, Zaied, Louati and Affes (2015), draws the examples of different technological improvements in the global business organizational frameworks and incorporations of innovations in the same, which can be attributed to the technological progresses in the overall global framework. For instance, the authors, highlight the increasing usage of computers and software for the purpose of carrying out different operations in a business as well as the recent usage of internet and social platforms for the purpose of marketing and promotion of the products and services of the businesses, in the age of increasing digitalisation and internet usage by increasing number of people across the globe (Camisón and Villar-López 2014).
Socio-political conditions- The political frameworks in a country and the operations of the governments, their ideologies, policies, strategic frameworks and also tax and subsidy policies play crucial roles in the operations of the businesses operating in a country and in their decision-making processes. Ackermann (2012), in this aspect, asserts that when a company operates in a market or a region, whose government is pro-technology and supports technological progress and innovations, by encouraging the firms to invest resources in these aspects (encouragement being provided through incentives like tax cuts, subsidies, assistance in research and development and protection from acute foreign competitions), the businesses become more interested in developing their infrastructural and operational frameworks by developing and implementing new innovations in their activities.
However, this argument can be seen to be countered by Wang et al. (2012), according to whom, presence of protection and subsidisations as well as other benefits from the government, in general, tend to make the business operating in that country, more relaxed and less enterprising as they tend to enjoy high security from external competitions. However, when the governments of the countries play in a competitive framework, by encouraging the foreign multinationals to invest and operate in the domestic periphery, this forces the domestic firms to increase their efficiency to survive and sustain in the face of stiff competitions, which in turn, encourages implementation and incorporations of innovations in different domains of the operational frameworks of the business organizations in those regions.
Competitions- Hashmi (2013), rightly asserts that one of the primary external drivers of organizational changes and incorporation of innovations in the operations of businesses is the level of competition which the businesses face in the industry and market in which they venture. As per the arguments of the author, when the level of competition is considerably high, due to large number of suppliers and alternatives present for the customers, the business organizations tend to concentrate more on increasing the level of efficiency, cost effectiveness and desirability of their products or services in the eyes of the customers (Bröcker, Dohse and Soltwedel 2012). This in turn influences the companies to incorporate innovations and other changes in their organizational frameworks.
Customer Satisfaction- For any business to be profitable and sustainable, it is of immense importance for the same to have a happy and loyal customer base, with high levels of customer satisfaction. This, in the age of dynamic and diverse consumer behaviours, preference patterns and increasing number of options, implies that the companies continuously need to develop and innovate their products, services, processes and marketing and promotional activities (Calzolari et al. 2015).
Thus, like that of the internal drivers, the external drivers and factors can also be seen to hold equal level of significance in the aspects of implementation of change and innovations in the businesses across the globe.
Conclusion
From the above discussion, it can thus be asserted that that in the contemporary period, innovations in the organizational frameworks have been becoming increasingly significant for any kind of businesses. There exist both internal as well as external factors or drivers, within or outside the business organizations, respectively, in the aspects of implementation of changes and incorporation of innovations in the operational frameworks of the businesses. As is evident from the above discussion and the scholarly and literary resources, both of these internal as well as external driver are considerably significant and beneficial for the aspects of implementation of innovations in the operational frameworks of the businesses and there also seems to exist a bilateral relationship between these two types of drivers as both of them affect and get affected by the other.
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