Contemporary Perspectives in Management

It is said that creativity is the mother of invention. However, the same could be extended in business to highlight the fact that creativity is the mother of innovation which is the bedrock of the business organization’s success. This is to say that innovation is the spearhead for any business organization that intends to stand out despite the increased competition and unpredictable economic changes.

Given the importance of innovation and creativity, one would want to understand how this culture or practice can be promoted within an organization. Without doubt, it is the role of the management to ensure that an appropriate environment that promotes innovation is created. Scholarship has tried to address the issue with kin interest on the role of management in the promotion of creativity and in handling the various changes that organizations encounter. This paper intends to show the role of management in the promotion of creativity and innovation and how changes within the economic environment can be contained and turned into opportunity (Nonaka & Takeuchi, 1995).

Decision making is the determining factor on the strength and longevity of any given business. This clearly indicates that the management whose major role is decision making is a very important part of the business. Failure to make sound decisions would lead to no competition (Robins, 1991).

Role of Leadership in change management

Each passing day, organizations tend to encounter changes. In fact, one writer indicates that everything changes except change itself. This means that changes are always present and constant. As CISCO Systems’ John Chambers puts it, downturns and market transitions are just currents that propel the organization to new heights. They are learning experiences that should put leaders on their feet to ensure that they constantly fore the likely trends and react appropriately to avoid fading into oblivion.

However, if leaders fail to foresee the future, serious repercussions might follow. Like in John Chambers’ case, failure to fore see the future lead to his laying off of 8,000 workers that would have led to increased production and was also forced to write down as much as $2 billion in inventory (Chambers, 2008). This clearly indicates that if leaders fail to foresee the future, loses are very likely to be incurred. However, how, exactly, can leaders learn to foresee and handle impeding dangers?

Sadly, very few leaders can foresee the future. In fact, Lewin and Regine (2001) clearly point out that the business environment is usually unpredictable due to the many complexities that are associated with it. This means that there is much to be done. It is not about foreseeing the future, but it is about putting in appropriate strategies that would assist the organization to make it through the changes without suffering too much losses.

This will not only help the organization stay afloat through hard times, but will also putting in front and well ahead of its competitors. On his part, Flower (1996) posits that if well dealt with, changes in the business environment could act as nourishment to the organization. Through the changes, the organizations could thrive and rejuvenate getting new energy to forge ahead stronger than earlier. From the arguments above, it is clear that two reactions can be identified in the event of changes. Either an organization gets new energy and forges ahead or grapples and struggles as they fall deeper into trouble. Therefore, it is important to understand what causes the difference between the two organizations. Is it mere luck that other organizations succeed in the event of changes?

The answer to this question is an absolute no. It is not luck that drives organizations to come out stronger when changes set in. What creates differences between a successful and non successful organization after changes are their fundamental attributes (Flower, 1996). To have a clear comprehension of these attributes, it is important that one understands the complexity theory and how it applies in business management. With this in mind, it will be possible to see how the organization works in order to survive the constant changes (Stamm, 2008).

The Complexity Theory

Dann and Barclay (2006) in their analysis of the complexity theory and its application in management argue that being adoptive and self organized is the only solution to dealing with changes. However, an organization will not be able to acquire such attributes unless its leaders understand the specifications of the complexity theory. The complexity theory can easily be understood after identifying its roots. This theory was developed from the prior existing two theories of systems theory and the chaos theory. The systems theory purports that a system is a single unit made up of a collection of agents of which are interdependent but very independent at the same time.

This leads to a basic dependence on feedback as one element within the system depends on another element so that operations are facilitated. Apparently, an element can bring a positive feedback or a negative one. The positive feedback amplifies the whole system while the negative one damps the system. This is what is referred to as the non linear behaviour within a system. This is the fundamental argument of systems theory (Waldrop, 1992).

On the other hand, the chaos theory argues that while systems might work in a defined way, changes in the initial conditions under which the elements of the system operates might result into large impacts. However, the chaotic theory is not completely random as the word chaos might imply. The systems are believed to be not exactly stable while at the same time not unstable. The operations of the system are believed to be within the boundary of stability and instability.

This is termed as the edge of chaos. Therefore, the systems operate in a way that is neither random nor predictable. As a result, the complex theory derives its main arguments from the two theories. It bases its arguments on the fact that systems depend on the environment in order to provide an outcome. This means that the systems have to be adoptive in nature in order to survive longer (Lewin, 1993)

To apply the theory of complexity, Santa Fe institute identifies a complex system as one that is able to adapt to changes through “self organization, and selection into coherent new behaviours, structures and patterns” (Dann & Barclay, 2006, p. 22). The main tools or elements within the system that offer the main advantage are organization, interactions, random events, adaptation and evolution. When properly manipulated, these stages can be very fruitful because through them, an organization will be able to restructure itself in the event of changes. This means that no new and unpredicted changes will be able to subject the organization into a chaotic system.

In organization, the business entity must put in place adequate and well identified structures and rules through which the several elements should interact. Interaction involves the way through which the organization handles interchanges with the external environment. It also involves the way information process is distributed and how problems are solved. Random events involve those that happen without stability. These involve those events that could not have been predicted and hence not planned for. Adaptation involves the organization’s ability to adjust to the environmental changes that might occur and finally evolution is “the occurrence of events altering the course of evolution: ‘frozen history’ (p. 22).

This part of the essay takes us back to the point where attributes of a successful organization can be identified. This will be done in relation to the complexity theory. To begin with, Steinberg (1999) identifies knowledge accumulation and dissemination as the core of creativity and innovation. It is the role of management to ensure that the organization is well nourished with knowledge through gathering and its transformation.

This knowledge is essential because it is the one that later is transformed into marketable products and services. Therefore, how the knowledge is collected and transformed is imperative to the future success of the organization. The concept of Critical Knowledge Function (CKF) which involves the identification of the most essential knowledge domains and applying them within the organization’s activities and structure forms the most important tool for future success. This means that one attribute of successful organizations is the proper collection and management of knowledge (Luthans, 1989).

McElroy (2003) argues posits that the development and adoptability of the organization totally depends on its ability to use the accumulated knowledge to handle the external environmental changes which include shifts in the market, development of new technologies, increase in the number of competitors, reduction in the life span of the organization’s products and several other uncertainties.

All this can be achieved through the development of an appropriate approach to utilization of the two basic knowledge forms; tacit knowledge and explicit knowledge. This approach must involve socialization, externalization, internalization and combination. All these processes ensure that the tacit knowledge and explicit knowledge within the company is weaved into a single great knowledge that enables the organization to adjust and easily adapt to the changes in the environment (Judson, 1991).

In her argument of the future of management, Wagner (2009) also posits that accumulation of knowledge is integral to success in business organizations. He argues that social networking is one way through which managers can accumulate relevant information that will enable them survive through unexpected changes. In her argument, she reports that through social networking, an organization leader is able to learn collaborative skills which are essential to success. This is especially true considering that the contemporary leaders who are young and vibrant find working and learning to be one. They therefore find networking as a form of information gathering that is fun and entertaining. This means that social networking should be given priority as one way of collecting information (Isaksen & Tidd, 2006).

A good example of organizations that have succeeded in using knowledge and complexity theory to improve on their quality and innovation is Alessi. This is a company that manufactures home furnishings. Since 1985, the company incorporated the knowledge (tacit knowledge) of engineer Graves who designed the whimsical kettle that later sold five times the expectations of the company. According to Verganti (2000), it’s not just the complexity of the model that has led to the success of the kettle.

The company had a good knowledge management that allowed them to appropriately mix tacit knowledge and tacit knowledge, tacit knowledge and explicit knowledge and explicit knowledge with other explicit knowledge to come up with a design that would stay in the domestic market for long. Verganti posits that this organization is a “free-floating community of architects, suppliers, photographers, critics, curators, publishers and craftsmen among many other categories of professionals, as well as the expected artists and designers” (p. 116).

As mentioned in the complexity theory, Alessi as an organization is a single system that is made up several elements that depend upon each other to come up with a market capturing equipment. Just like the theory specifies. Each element is independent but at the same time dependant on other elements through feedbacks. For instance, a designer is unique with his skill. He does not depend on a photographer to be good at his skill. His prowess in designing is a tacit knowledge.

However, for the organization to succeed, the designer will need the photographer to come up with good images that will attract the eyes of the buyers. Marketers will on the other hand develop good marketing strategies while suppliers will ensure that they have penetrated the deepest parts of the country to ensure maximum utilization. The designer will therefore need the feedback from marketers who will have direct information from buyers. Through the feedbacks, the designer will improve on the mode so that it meets the clients’ desire. This forms a system made up of diverse elements that eventually help the organization to succeed (Davenport & Prusak, 2000; Hersey & Blanchard, 1988).

Another role of management in ensuring that the organization is able to deal with changes is through ensuring that learning is facilitated within the organization. Learning is an integral component to organizational existence and competition. Calantone, Cavusgil & Zhao (2002) purport that “learning will become the most viable alternative to corporate extinction” (p. 45). Through learning, organizations can identify the errors made in the course of operations and make the relevant corrections. This notwithstanding, learning can also be done on positive outcomes. While negative results lead an organization into identifying the faults and correcting them, positive results offer the organization the chance to identify the factors that led to their success and hence make use of such advantages.

McKee (1992) further argues on the issue of learning by positing that learning can be constructive to the organization if the learners are receptive, have a shared vision, are open minded and are ready to share their knowledge within the organization. He further identifies three stages of learning which he terms integral to success. These are single loop learning which are the basis for incremental product innovation, double loop learning which causes discontinuous product innovation and finally meta learning which involves making innovation a culture within the organization.

From these arguments, it becomes clear that learning is integral to success within an organization. Learning entails individual and organizational learning. In addition, learning can occur from mistakes which are referred to as mismatches and from successes which is referred to as matches. Finally, what learning is to be done and its impact on the organization depends on the organization’s structure, its culture and the communication pattern of the organization. Therefore, if all these are well managed, the organization will be in position to deal with changes at any time.

Finally, it is the role of leaders to ensure that the whole organization is talking one language. Just like a system operates, the organization must ensure that all of its elements are contributing towards a common goal. Any failure within the chain could lead to abject failure. As Flower (1996) puts it, “healthy, flexible individuals have a clear sense of purpose and all parts of the personality are lined up behind that purpose” (para. 12). This is the way a healthy system should operate. Similarly, this is the way a healthy organization should operate.

In conclusion, it is true what Lewin and Regine (2001) argue that “Companies that operate in the zone of creative adaptability will experience perpetual novelty, constant surprise, as new patterns of behaviour ceaselessly emerge… Surprise is the currency of adaptable change, as the business environment constantly shifts and predictability is difficult’ (p. 75). Therefore, to be on the safe side, organizations must ensure that information is well accumulated and put to use.

The information and knowledge must be incorporated within the organization’s activities and structure. This is important because it is this information that is eventually transformed into important products and services. In addition, leaders must ensure that a learning environment is well developed within the organization. It is through learning that the knowledge base (individual and organizational knowledge can be merged to come up with one large innovative knowledgeable organization. This can be achieved through merging the various forms of knowledge that are available within an organization.

List of References

Calantone, R, Cavusgil, T. & Zhao, Y. 2002. “Learning orientation, firm innovation capability and the firm perform-ance”, Industrial Marketing Management, 31(6), pp 515-524.

Chambers, J. 2008. CISCO sees the future. Interview by Bronwyn and Stewart. Harvard Business Review.

Dann, Z and Barclay, I., 2006. “Complexity Theory and Knowledge Management Application” The Electronic Journal of Knowledge Management. 4(1), pp. 11-20.

Davenport T H and Prusak L., 2000. Working knowledge. Boston: Harvard Business School Press.

Flower, J.,1996. The five fundamentals of dealing with change. Web.

Hersey, P. & Blanchard, K., 1988. Management of Organizational Behavior: Utilizing Human Resource. NJ: Prentice Hall

Isaksen, S. & Tidd, J., 2006. Meeting the Innovation Challenge. New York: John Wiley and Sons

Judson, A.,1991. Changing Behavior in Organizations: Minimizing Resistance to Change. London: Blackwell Publishers

Lewin, R.,1993. Complexity: Life at the Edge of Chaos. London: Macmillan.

Lewin, R. & Regine, B. (2001) Weaving Complexity and Business. New York: Texere.

Luthans, F.,1989. Organizational Behavior. New York: McGraw Hill.

McElroy, M., 2003. The new knowledge management, complexity, learning and sustainable innovation. London: Butterworth-Heinemann.

McKee, D.,1992. An organizational learning approach to product innovation. Journal of Product Innovation Management, 9(3), pp. 232-245.

Nonaka, I. & Takeuchi, H.,1995. The knowledge creating company. London: Oxford University Press.

Robins, S., 1991. Organizational Behavior: Concepts, Controversies and Applications. NJ: Prentice Hall.

Stamm, B., 2008. Managing Innovation, Design and Creativity. New York: John Wiley and Son.

Steinberg, R.,1999. Handbook of Creativity. Cambridge: Cambridge University Press

Verganti, R., 2006. Innovating through design. Harvard Business Review.

Wagner, C., 2009. Innovation and creativity in a complex world. The world Future Society.

Waldrop, M.,1992. Complexity: The Emerging Science at the Edge of Order and Chaos. London: Penguin.