Faculty of Technical Science

Electrical and computer engineering

SEMINAR

Creativity and Innovation

Student:
Maksimovic 50/13-E

Profesor:Marko
Slavica Savic

CONTENTS
1. ABSTRACT 3
2. INTRODUCTION ... 4
3. LITERATURE REVIEW 5
4. ANALYSIS AND DISCUSSION 5
5. CREATIVITY .. 5
5.1. Creativity at work .. 6
5.2. Generative research on creativity .. 6
5.3. The four stages of the creative process .. 7

6. INNOVATION . 9
6.1. Innovation in organizations ... 10
6.2. Innovation and market outcome 10
6.3. Sources of innovation .10
6.4. Value of experimentation in innovation .11
6.5. Goals of innovation 12
6.6. Failure of innovation ..13

7. CREATIVITY AND INNOVATION 15

8. CONCLUSION .. 17
9. REFERENCES ...18

1. ABSTRACT

Creativity can be defined as the act of turning new and imaginative ideas into reality.
Creativity involves two processes: thinking, then producing. Innovation is the production or
implementation of an idea. If you have ideas, but don't act on them, you are imaginative but not
creative. Creativity is a core competency for leaders and managers and one of the best ways to
set your company apart from the competition. Corporate Creativity is characterized by the
ability to perceive the world in new ways, to find hidden patterns, to make connections
between seemingly unrelated phenomena, and to generate solutions. Generating fresh solutions
to problems, and the ability to create new products, processes or services for a changing
market, are part of the intellectual capital that give a company its competitive edge. Creativity
is a crucial part of the innovation equation.
In the organizational context, innovation may be linked to performance and growth through
improvements in efficiency, productivity, quality, competitive positioning, market share, etc.
All organizations can innovate, including for example hospitals, universities, and local
governments. Innovation has been studied in a variety of contexts, including in relation to
technology, commerce, social systems, economic development, and policy construction. There
are, therefore, naturally a wide range of approaches to conceptualizing innovation in the
scholarly literature.

2.INTRODUCTION

All innovation begins with creative ideas. Innovation as the successful implementation of
creative ideas within an organization. In this view, creativity by individuals and teams is a
starting point for innovation; the first is necessary but not sufficient condition for the second.
For innovation to occur, something more than the generation of a creative idea or insight is
required, the insight must be put into action to make a genuine difference, resulting for
example in new or altered business processes within the organization, or changes in the
products and services provided.
Creativity is the process of bringing something new into being. Creativity requires passion
and commitment. Out of the creative act is born symbols and myths. It brings to our awareness
what was previously hidden and points to new life. The experience is one of heightened
consciousness-ecstasy.
Creativity refers to the phenomenon whereby something new is created which has some kind
of value. What counts as "new" may be in reference to the individual creator, or to the society
or domain within which the novelty occurs. What counts as "valuable" is similarly defined in a
variety of ways. Creativity is fostered in organizational cultures that value independent
thinking, risk taking, and learning. They are tolerant of failure and they value diversity. Open
communication, a high degree of trust and respect between individuals are crucial.
Creativity leads in to innovation. The word creativity and innovation are interrelated.
Innovation is a new way of doing something or new stuff that is made useful. It may refer to
incremental and emergent or radical and revolutionary changes in thinking, products,
processes, or organizations.
Innovation is an important topic in the study of economics, business, design, technology,
sociology, and engineering. Colloquially, the word "innovation" is often synonymous with the
output of the process. However, economists tend to focus on the process itself, from the
origination of an idea to its transformation into something useful, to its implementation; and on
the system within which the process of innovation unfolds. Since innovation is also considered
a major driver of the economy, especially when it leads to increasing productivity, the factors
that lead to innovation are also considered to be critical to policy makers. In particular,
followers of innovation economics stress using public policy to spur innovation and growth.
Leaders who want to create an innovative business culture must understand the steps of the
creative process, but that alone is not enough. To promote business innovation, executive
leaders should commit certain business practices, and institutionalize them in the culture - by
training managers in these practices and then doling out promotions and rewards to those who
employ them successfully. Leaders who want to encourage business creativity must be sure
also to build talent driven, positive cultures that place a value on learning.
Innovation is generally understood as the successful introduction of a new thing or
method. Innovation is the embodiment, combination, or synthesis of knowledge in original,
relevant, valued new products, processes, or services. Innovation typically involves creativity,
but is not identical to it: innovation involves acting on the creative ideas to make some specific
and tangible difference in the domain in which the innovation occurs.

3. LITERATURE REVIEW
Generative research shows that everyone has creative abilities. The more training you
have and the more diverse the training, the greater potential for creative output. Creativity
is a core competency for leaders and managers and one of the best ways to set your
company apart from the competition. Corporate Creativity is characterized by the ability
to perceive the world in new ways, to find hidden patterns, to make connections between
seemingly unrelated phenomena, and to generate solutions. Generating fresh solutions to
problems, and the ability to create new products, processes or services for a changing
market, are part of the intellectual capital that give a company its competitive edge.
Creativity is a crucial part of the innovation equation.
All innovation begins with creative ideas .creativity is typically seen as the basis for
innovation, and innovation as the successful implementation of creative ideas within an
organization.
Innovation is a new element introduced in the network which changes, even if
momentarily, the costs of transactions between at least two actors, elements or nodes, in
the network. Innovation is an important topic in the study of economics, business, design,
technology, sociology, and engineering. Since innovation is also considered a major
driver of the economy, especially when it leads to increasing productivity, the factors that
lead to innovation are also considered to be critical to policy makers. Those who are
directly responsible for application of the innovation are often called pioneers in their
field, whether they are individuals or organizations.

4. ANALYSIS AND DISCUSSION

Innovation typically involves creativity, but is not identical to it: innovation involves
acting on the creative ideas to make some specific and tangible difference in the domain
in which the innovation occurs. Innovation is generally understood as the successful
introduction of a new thing or method. Innovation is the embodiment, combination, or
synthesis of knowledge in original, relevant, valued new products, processes, or services.
All innovation begins with creative ideas. Innovation can be defined as the successful
implementation of creative ideas within an organization. In this view, creativity by
individuals and teams is a starting point for innovation.

5. CREATIVITY
Creativity can be defined as the act of turning new and imaginative ideas into reality.
Creativity involves two processes: thinking, then producing. Innovation is the production
or implementation of an idea. If we have ideas, but don't act on them, we are imaginative
but not creative.

Creativity is the process of bringing something new into being. Creativity requires
passion and commitment. Out of the creative act is born symbols and myths. It brings to
our awareness what was previously hidden and points to new life. The experience is one
of heightened consciousness-ecstasy.
A product is creative when it is (a) novel and (b) appropriate. A novel product is
original not predictable. The bigger the concept and the more the product stimulate
further work and ideas, the more the product is creative. Creativity is the Most Crucial
Factor for Future Success.
5.1. Creativity at work
Creativity is a core competency for leaders and managers and one of the best ways to
set your company apart from the competition. Corporate Creativity is characterized by
the ability to perceive the world in new ways, to find hidden patterns, to make
connections between seemingly unrelated phenomena, and to generate solutions.
Generating fresh solutions to problems, and the ability to create new products, processes
or services for a changing market, are part of the intellectual capital that give a company
its competitive edge. Creativity is a crucial part of the innovation equation.
Creativity requires whole-brain thinking: right-brain imagination, artistry and intuition,
plus left-brain logic and planning.
Creativity is fostered in organizational cultures that
value independent thinking, risk taking, and
learning. They are tolerant of failure and they value
diversity. Open communication, a high degree of
trust and respect between individuals are crucial.
Strategies for developing creativity:
-

Skills Training for leaders, managers and

staff
Coaching innovation champions and teams
Culture Change initiatives.

5.2. Generative Research on Creativity:

Generative research shows that everyone has creative abilities. The more training you
have and the more diverse the training, the greater potential for creative output. The
average adult thinks of 3-6 alternatives for any given situation. The average child thinks
of 60.
Research has shown that in creativity quantity equals quality. The longer the list of
ideas, the higher the quality the final solution. The highest quality ideas appear at the end
of the list.

5.3. The Four Stages of the Creative Process

In order to build an innovative culture, leaders first have to understand the four keys
stages of the creative process. They are:
1. Preparation: this is the stage where the creative person or team becomes immersed in
the problem. Its an information gathering stage, and when the effort is a collective one, it
involves the forming of roles, areas of special individual interest and the coordination of
tasks.
2. Incubation: in this stage, the original problem may appear to be on the back burner,
even forgotten or neglected, but the mind is still at work. Not the logical, linear mind, the
part we use most when awake, but the part that dreams, synthesizes, and makes new,
weird, original connections. For a team effort, this can mean that the group may not meet
for a while, appearing to let the project fall by the wayside. But people will still be
thinking, or have ideas occurred to them in the shower, or write down thoughts on
cocktail napkins, etc.
3. Illumination: Without warning, ideas or innovations can come any time - the aha! or
eureka! experience. More commonly, there is no immediate killer insight, but some
new angle that may occur, or some sudden, burning, unexplainable need to return to work
on the problem - often a sign of creative labor pains. When the creative project has
been a team effort, sometimes the only thing needed is to get the original group members
together again after a period of time, and then pow! - The spontaneous exchange
among them can bring forth an idea that no one member could articulate alone.
4. Execution: This is the stage that separates mere creativity from successful innovation.
New ideas require action, stubborn determination, and ability to build change coalitions
while marketing the idea to critical skeptics. Perhaps more than anything else, it takes
courage and persistence. Since the execution stage is more about social skill than it is
about the technical skill that produces the innovative idea, this is the stage where
organizational management can be most actively helpful in promoting business creativity.
Leaders who want to create an innovative business culture must understand the steps of
the creative process, but that alone is not enough. To promote business innovation,
executive leaders should commit to the following business practices, and institutionalize
them in the culture - by training managers in these practices and then doling out
promotions and rewards to those who employ them successfully.
1. Select the most promising innovators, but encourage unexpected surprises: To build
innovative in an organization, executives may want to cull out the most promising ideagenerators and provide them with extra resources. Those are the people who can benefit
most from the buffer zones in step two. But the other practices listed in this section
should be generalized throughout the organization, if possible, so that innovators in
7

unexpected places will have the room to produce ideas and results. Leaders should train
other managers to understand the stages of the creative process, and evaluate managers
based on their ability to promote and shepherd through to completion new ideas that they
encounter.
2. Create buffer zones for the most innovative people: Creating buffer zones means
building a kind of protective cocoon around creative people or around the innovative
teams within an organization. That means eliminating the ways that policies or other
work pressures get in the way or discourage the information gathering involved in the
preparation stage. It also means being sure that the tools and resources are available when
creative people go looking around for data or answers to questions. The executive leader
for such a group should do the advance work and run the interference necessary to let
creative people go through the preparation stage without interference or harassment.
3. Give innovators room to play: For innovators, anything they can do to mess around
with the kinds of data or projects that they see as helpful - will be helpful. That can be
hard to remember when they seem to have lost their minds, or to have lost their focus!
But during the incubation stage, activities that may look like useless diversions - that may
not even look like work - are all necessary to allow the deeper parts of the brain to solve a
problem and make new connections. For typical results-oriented executives, this can be
hard to do - especially when the creative team happens to be a team of executives
working to create a new business process. The senior executive who may have assigned
the task may be hard pressed to let his innovative team have the time and space to
produce truly transformative solutions. The key to letting people have room to play is
to refrain from judgment of their activities or methods.
4. Resist the temptation to look for immediate results: Any team can develop incremental
solutions or recommendations. There is no business or technological process that cannot
be improved through study and modification. But to build a culture that truly encourages
innovation, the pressure to get immediate results will yield only incremental
improvements, and the need to meet deadlines can sometimes kill the creative process
before the illumination stage. While it is true that deadlines can focus creative teams and
encourage timely ultimate illumination, setting deadlines should not be overused because
they often will interfere with the creative process. Close communication with creative
people working on a project can help leaders develop a feel for when setting a deadline
will help, rather than hinder the process.
5. Commit to driving the best ideas through to implementation: Innovators are seldom the
best salespeople for their ideas. They are, by nature, more likely to work in isolation, play
with their ideas, or generally rub others who are less creative the wrong way. The
business leader who wants to encourage innovation must act as the first-line filter to test
the best ideas and solutions, choosing which ones are the right ones to see through to
fruition. Then the executive advocate must commit to the internal sales and marketing
project to build coalitions that will bring the new idea into a reality. This takes courage
and persistence, and an ability to work the political and social process involved in getting
others to adapt to innovation. This is important, not only to reap the rewards of

innovation in practice, but to encourage other innovators by showing them that their best
efforts will actually be adopted and see the light of day - in your organization, and not
your competitors!
Leaders who want to encourage business creativity must be sure also to build talent
driven, positive cultures that place a value on learning. To see if your organization fits the
bill, heres one quick test: can any employee at least two steps removed in the
organizational chart openly ask a question that challenges a firmly held opinion of the
CEO? If the answer is no, then your organization is probably not as open as you think it
is, and youll need to reassess your culture if you genuinely want to promote innovation and reap innovations rewards.

6. INNOVATION
Innovation is a new way of doing something or new stuff that is made useful. It may
refer to incremental and emergent or radical and revolutionary changes in thinking,
products, processes, or organizations. The goal of innovation is positive change, to make
someone or something better. Innovation leading to increased productivity is the
fundamental source of increasing wealth in an economy. Innovation is an important topic
in the study of economics, business, design, technology, sociology, and engineering.
In the organizational context, innovation may be linked to performance and growth
through improvements in efficiency, productivity, quality, competitive positioning,
market share, etc. All organizations can innovate, including for example hospitals,
universities, and local governments.
While innovation typically adds value, innovation may also have a negative or
destructive effect as new developments clear away or change old organizational forms
and practices. Organizations that do not innovate effectively may be destroyed by those
that do. Hence innovation typically involves risk. A key challenge in innovation is
maintaining a balance between process and product innovations where process
innovations tend to involve a business model which may develop shareholder satisfaction
through improved efficiencies while product innovations develop customer support
however at the risk of costly R&D that can erode shareholder return. In summary,
innovation can be described as the result of some amount of time and effort into
researching (R) an idea, plus some larger amount of time and effort into developing (D)
this idea, plus some very large amount of time and effort into commercializing (C) this
idea into a market place with customers.
Innovation has been studied in a variety of contexts, including in relation to
technology, commerce, social systems, economic development, and policy construction.
There are, therefore, naturally a wide range of approaches to conceptualizing innovation
in the scholarly literature. Fortunately, however, a consistent theme may be identified:
innovation is typically understood as the successful introduction of something new and
useful, for example introducing new methods, techniques, or practices or new or altered
products and services.

6.1. Innovation in organizations

Innovation is generally understood as the successful introduction of a new thing or
method. Innovation is the embodiment, combination, or synthesis of knowledge in
original, relevant, valued new products, processes, or services. Innovation, like many
business functions, is a management process that requires specific tools, rules, and
discipline.
6.2. Innovation and market outcome
Market outcome from innovation can be studied from different lenses. The industrial
organizational approach of market characterization according to the degree of
competitive pressure and the consequent modeling of firm behavior often using
sophisticated game theoretic tools, while permitting mathematical modeling, has shifted
the ground away from an intuitive understanding of markets. The earlier visual
framework in economics, of market demand and supply along price and quantity
dimensions, has given way to powerful mathematical models which though intellectually
satisfying has led policy makers and managers groping for more intuitive and less
theoretical analyses to which they can relate to at a practical level.
In the management (strategy) literature on the other hand, there is a vast array of
relatively simple and intuitive models for both managers and consultants to choose from.
Most of these models provide insights to the manager which help in crafting a strategic
plan consistent with the desired aims. Indeed most strategy models are generally simple,
wherein lie their virtue. In the process however, these models often fail to offer insights
into situations beyond that for which they are designed, often due to the adoption of
frameworks seldom analytical, seldom rigorous. The situational analyses of these models
often tend to be descriptive and seldom robust and rarely present behavioral relationship
between variables under study.
6.3. Sources of innovation
There are several sources of innovation. In the linear model of innovation the
traditionally recognized source is manufacturer innovation. This is where an agent
(person or business) innovates in order to sell the innovation. Another source of
innovation, only now becoming widely recognized, is end-user innovation. This is where
an agent (person or company) develops an innovation for their own (personal or inhouse) use because existing products do not meet their needs.
Innovation by businesses is achieved in many ways, with much attention now given to
formal research and development for "breakthrough innovations." But innovations may
be developed by less formal on-the-job modifications of practice, through exchange and
combination of professional experience and by many other routes. The more radical and
revolutionary innovations tend to emerge from R&D, while more incremental
innovations may emerge from practice but there are many exceptions to each of these
trends.

10

Regarding user innovation, a great deal of innovation is done by those actually

implementing and using technologies and products as part of their normal activities.
Sometimes user-innovators may become entrepreneurs, selling their product, they may
choose to trade their innovation in exchange for other innovations, or they may be
adopted by their suppliers. Nowadays, they may also choose to freely reveal their
innovations, using methods like open source. In such networks of innovation the users or
communities of users can further develop technologies and reinvent their social meaning.
Whether innovation is mainly supply-pushed (based on new technological possibilities)
or demand-led (based on social needs and market requirements) has been a hotly debated
topic. Similarly, what exactly drives innovation in organizations and economies remains
an open question.
More recent theoretical work moves beyond this simple dualistic problem, and through
empirical work shows that innovation does not just happen within the industrial supplyside, or as a result of the articulation of user demand, but through a complex set of
processes that links many different players together not only developers and users, but a
wide variety of intermediary organizations such as consultancies, standards bodies etc.
Work on social networks suggests that much of the most successful innovation occurs at
the boundaries of organizations and industries where the problems and needs of users and
the potential of technologies can be linked together in a creative process that challenges
both.
6.4. Value of experimentation in innovation
When an innovative idea requires a new business model, or radically redesigns the
delivery of value to focus on the customer, a real world experimentation approach
increases the chances of market success. New business models and customer experiences
can't be tested through traditional market research methods. Pilot programs for new
innovations set the path in stone too early thus increasing the costs of failure. On the
other hand, the good news is that recent years have seen considerable progress in
identifying important key factors/principles or variables that affect the probability of
success in innovation. Of course, building successful businesses is such a complicated
process, involving subtle interdependencies among so many variables in dynamic
systems, that it is unlikely to ever be made perfectly predictable. But the more business
can master the variables and experiment, the more they will be able to create new
companies, products, processes and services that achieve what they hope to achieve.

11

Diffusion of innovations

Once innovation occurs, innovations may be spread from the innovator to other
individuals and groups. This process has been proposed that the life cycle of innovations
can be described using thes-curve' or diffusion curve. The s-curve maps growth of
revenue or productivity against time. In the early stage of a particular innovation, growth
is relatively slow as the new product establishes itself. At some point customers begin to
demand and the product growth increases more rapidly. New incremental innovations or
changes to the product allow growth to continue. Towards the end of its life cycle growth
slows and may even begin to decline. In the later stages, no amount of new investment in
that product will yield a normal rate of return.
The s-curve derives from an assumption that new products are likely to have "product
Life". i.e. a start-up phase, a rapid increase in revenue and eventual decline. In fact the
great majorities of innovations never get off the bottom of the curve, and never produce
normal returns.
Innovative companies will typically be working on new innovations that will eventually
replace older ones. Successive s-curves will come along to replace older ones and
continue to drive growth upwards. In the figure above the first curve shows a current
technology. The second shows an emerging technology that current yields lower growth
but will eventually overtake current technology and lead to even greater levels of growth.
The length of life will depend on many factors.
6.5. Goals of innovation
Programs of organizational innovation are typically tightly linked to organizational
goals and objectives, to the business plan, and to market competitive positioning.
Companies cannot grow through cost reduction and reengineering alone .Innovation is
the key element in providing aggressive top-line growth, and for increasing bottom-line
results
In general, business organizations spend a significant amount of their turnover on
innovation i.e. making changes to their established products, processes and services. The

12

amount of investment can vary from as low as a half a percent of turnover for
organizations with a low rate of change to anything over twenty percent of turnover for
organizations with a high rate of change.
The average investment across all types of organizations is four percent. For an
organization with a turnover of say one billion currency units, this represents an
investment of forty million units. This budget will typically be spread across various
functions including marketing, product design, information systems, manufacturing
systems and quality assurance.
The investment may vary by industry and by market positioning. One survey across a
large number of manufacturing and services organizations found, ranked in decreasing
order of popularity that systematic programs of organizational innovation are most
frequently driven by:
1. Improved quality
2. Creation of new markets
3. Extension of the product range
4. Reduced labour costs
5. Improved production processes
6. Reduced materials
7. Reduced environmental damage
8. Replacement of products/services
9. Reduced energy consumption
10. Conformance to regulations
These goals vary between improvements to products, processes and services and dispel
a popular myth that innovation deals mainly with new product development. Most of the
goals could apply to any organization be it a manufacturing facility, marketing firm,
hospital or local government.
6.6. Failure of innovation
Research findings vary, ranging from fifty to ninety percent of innovation projects
judged to have made little or no contribution to organizational goals. One survey
regarding product innovation quotes that out of three thousand ideas for new products;
only one becomes a success in the marketplace. Failure is an inevitable part of the
innovation process, and most successful organizations factor in an appropriate level of
risk. Perhaps it is because all organizations experience failure that many choose not to
monitor the level of failure very closely. The impact of failure goes beyond the simple
loss of investment. Failure can also lead to loss of morale among employees, an increase
in cynicism and even higher resistance to change in the future.
Innovations that fail are often potentially good ideas but have been rejected or
postponed due to budgetary constraints, lack of skills or poor fit with current goals.
Failures should be identified and screened out as early in the process as possible. Early
screening avoids unsuitable ideas devouring scarce resources that are needed to progress
more beneficial ones. Organizations can learn how to avoid failure when it is openly

13

discussed and debated. The lessons learned from failure often reside longer in the
organizational consciousness than lessons learned from success. While learning is
important, high failure rates throughout the innovation process are wasteful and a threat
to the organizations future.
The causes of failure have been widely researched and can vary considerably. Some
causes will be external to the organization and outside its influence of control. Others will
be internal and ultimately within the control of the organization. Internal causes of failure
can be divided into causes associated with the cultural infrastructure and causes
associated with the innovation process itself. Failure in the cultural infrastructure varies
between organizations but the following are common across all organizations at some
stage in their life cycle :
1. Poor Leadership
2. Poor Organization
3. Poor Communication
4. Poor Empowerment
5. Poor Knowledge Management
Common causes of failure within the innovation process in most organizations can be
distilled into five types:
1. Poor goal definition
2. Poor alignment of actions to goals
3. Poor participation in teams
4. Poor monitoring of results
5. Poor communication and access to information
Effective goal definition requires that organizations state explicitly what their goals are
in terms understandable to everyone involved in the innovation process. This often
involves stating goals in a number of ways. Effective alignment of actions to goals should
link explicit actions such as ideas and projects to specific goals. It also implies effective
management of action portfolios. Participation in teams refers to the behavior of
individuals in and of teams, and each individual should have an explicitly allocated
responsibility regarding their role in goals and actions and the payment and rewards
systems that link them to goal attainment. Finally, effective monitoring of results requires
the monitoring of all goals, actions and teams involved in the innovation process.
Innovation can fail if seen as an organizational process whose success stems from a
mechanistic approach i.e. 'pull lever obtain result'. While 'driving' change has an
emphasis on control, enforcement and structures it is only a partial truth in achieving
innovation. Organizational gatekeepers frame the organizational environment that
"Enables" innovation; however innovation is "Enacted" recognized, developed, applied
and adopted through individuals.

14

Individuals are the 'atom' of the organization close to the minutiae of daily activities.
Within individuals gritty appreciation of the small detail combines with a sense of desired
organizational objectives to deliver (and innovate for) a product/service offer.
From this perspective innovation succeeds from strategic structures that engage the
individual to the organizations benefit. Innovation pivots on intrinsically motivated
individuals, within a supportive culture, informed by a broad sense of the future.
Innovation, implies change, and can be counter to an organizations orthodoxy. Space for
fair hearing of innovative ideas is required to balance the potential autoimmune exclusion
that quells an infant innovative culture.

Process of Innovation

The Innovation process can be depicted as a series of funnels each getting progressively
smaller.
Typically sixty ideas into the top funnel only produces just one innovation.
The funnels are labeled as the four phases in the process - idea generation, idea screening,
feasibility and implementation.

7. CREATIVITY AND INNOVATION

It is often useful to explicitly distinguish between creativity and innovation.
Creativity is typically used to refer to the act of producing new ideas, approaches or
actions, while innovation is the process of both generating and applying such creative
ideas in some specific context.
In the context of an organization, therefore, the term innovation is often used to refer to
the entire process by which an organization generates creative new ideas and converts
them into novel, useful and viable commercial products, services, and business practices,
while the term creativity is reserved to apply specifically to the generation of novel ideas
by individuals or groups, as a necessary step within the innovation process.
15

Innovation begins with creative ideas. Creativity by individuals and teams is a starting
point for innovation; the first is a necessary but not sufficient condition for the second.
Although the two words are novel, they go hand in hand. In order to be innovative,
employees have to be creative to stay competitive.

16

8.CONCLUSION
A company can increase efficiency through number of steps: exploring economies of
scale and learning effects, adopting flexible manufacturing technologies, reducing
customer defection rates, implementing just in time systems, getting the R&D function to
design products that are easy to manufacture, upgrading the skills of employees through
training, introducing self- managing teams, linking pay to performance, building a
companywide commitment to efficiency through strong leadership, and designing
structures that facilitate cooperation among different functions in pursuit of efficient
goals. Creativity and innovation is the way to achieve the goals of the organization. We
can way out different processes and techniques to introduce innovation and creativity in
to an organization. It can bring a number of benefits to an organization which can be:
1. Improved quality
2. Creation of new markets
3. Extension of the product range
4. Reduced labour costs
5. Improved production processes
6. Reduced materials
7. Reduced environmental damage
8. Replacement of products/services
9. Reduced energy consumption
10. Conformance to regulations
Companies have to recognize transformation is a reality. In order to maintain a
sustainable competitive advantage, the companies not only should be good at exploring
todays certainties but, at the same time, they need posses abilities to explore new
opportunities- they have to be ambidextrous. Effective management of creativity and
innovation plays a critical role in developing this trait. However, with many theories
emerging both from academic and the corporate worlds, the world of innovation itself
undergoing transformation.

17

9. REFERENCES
1. Charles W. L. Hill, Gareth R. Jones Strategic management An Integrate Approach
biztanatra publications sixth edition 2005 New Delhi
2. http://www.cforc.org/news
3. Prof. Sushil Kumar and Prof. Abhishek Nirjar Indian Institute of Management
Lucknow creativity and innovation for sustained business development

18