Innovation refers to the process where a firm comes up with new creative ideas on how to produce new products and services that suit customer requirements. In the current business, environment competition has become so stiff that only innovative firms can survive. New products and services are hitting the market on almost a daily basis, organizations are busy reviewing their structures and management styles, marketers are on track to monitoring consumers’ needs and so on. In order to establish a good customer relationship by offering a variety of customer-tailored products, creativity should be a priority.
Most organizations both small and medium are struggling hard to gain a competitive edge and overcome their rivals. This can only be achieved if a firm has a creative workforce with the necessary skill base to initiate such changes. An innovative workforce will definitely make a firm maintain its competitive advantage over time. The purpose of this paper is to provide the reader with the knowledge of understanding the concept of innovation in an organization.
The paper also looks at how innovation can provide a competitive advantage to a firm especially now when most economies both small and big are under the wrath of the world’s largest economic and financial recession. In this chapter, Dapej is used to study this topic by highlighting how an organization can use innovation to meet both its long-term and short-term strategic objectives. Dapej is an accounting firm that specializes in providing its clients with accounting services including auditing, taxation, financial consultancy, and management.
Dapej is a medium-sized regional accountancy firm with numerous branches located across East and Central Mesopotamia. Over the past few years, Dapej has gained considerable popularity that has been attributed to its dedication to customer care and satisfaction. Dapej has been providing a number of consultancy services for the last five years until last year when it began experiencing some management hiccups. A study conducted by Jimpan Limited revealed that Dapej was under threat due to its recruitment policies. Over the past years, the company has been outsourcing its recruitment to Africa Prowess a company known for Business Process Outsourcing.
Dapej’s mission is to provide excellent and professional services which are tailor-made for its clients. However, there is a growing concern over how Africa Prowess is handling its recruitment process. A local newspaper had reported claims that Africa Prowess is technically and professionally incompetent to handle a credible recruitment process and that any company contracting it is bound to be subject to serious violations. This has caused a row in the company and already the company has lost three major potential customers who form the backbone of our revenue reporting centers.
I have been in the company for two years and am now charged with customer relationship directorship. I graduated from Strathmore University with a First Class honors upper-division in Bachelor of Science in Applied Accounting and a professional qualification in Association of Chartered Certified Accounting (ACCA). I had summoned my immediate assistant director for a meeting in the board room together with the Dapej’s chief executive. I had a proposal that was dubbed the Final Success in Dapej. This was just an idea whose time had just come; it was about creating a human resource management department. When I explained this idea to the members of the board, they became so excited with the general audit manager suggesting a reward at the end.
Relevance of the Human resource Department at Dapej
The main reason behind the creation of this idea was to help the company achieve its mission by employing a team with professional and technical competencies. This was to erode the perception that Dapej was incompetent and help bring back the glory that was purportedly sinking into the mire of mediocrity. The human resources department would look into employees’ affairs and further identify any training needs as may be deemed fit. Having our recruitment would also reduce any operational costs that are associated with outsourcing from Africa Prowess.
By undertaking a training program for all staff, the organization will be innovative and creative and therefore devise new ways of servicing clients. This would enhance our talent base and build our reputation from a wider view both internally and externally. Through looking at the staffs’ welfare and constantly reviewing terms of service, employees will be motivated and will always surpass that of the firm’s performance hence efficiency. The human resource department will also help reduce the possibility of conflict arising by inculcating a culture of behavior change and conflict resolution. This happens when an organization sets and gives rules that become the responsibility of a job holder. No confusion can arise and therefore there will be effective communication throughout the organization hence reducing any probability of disagreements now and in the future.
Challenges/issues associated with this innovation
- Business relationship: the creation of this idea led to the development of a sour business between Dapej and Africa Prowess. Since we depended on each other, Dapej being a customer to Africa Prowess and vice versa it was difficult for us to continue getting incompetent services from Prowess. Dapej had to cancel all the transactions with the Prowess. This adversely spoilt the business relationship that had hitherto existed between the two organizations.
- Budget planning and Adjustments: the management had to alter the organizational structure in order to accommodate the new department. The department became independent with its own autonomy. We had to employ a human resource manager and an assistant to help him in carrying out his day-to-day tasks. There was also a recruitment committee chaired by the human resources manager.
- Cooperation from other departments: human resources department is always a sensitive department in an organization with particular emphasis on every department’s affairs. Human resource has to liaise with the production center i.e. the audit and accountancy team managers to determine how much pay can be attributed to every employee. If this is not done then a conflict can arise as to the poor calculation of remunerations and benefits as prescribed in the firm’s Pay Acts.
The idea is proposed to be implemented immediately after the first month. This is because the company is seriously under threat of losing its customers who have already developed a perception that Dapej relies on Africa’s prowess to recruit its workforce. This should be eliminated before the information goes overboard. This is why we intend to implement this idea immediately. Our game plan is to conduct a rigorous and vigorous recruitment procedure to ensure that only an employee sought is hired. This could be through online or face-to-face interviews with candidates.
In order that the implementation of this idea becomes successful, the following resources will be required:
- Personnel: human resource department can never be successful without appropriate personnel. The department will need people who meet the required qualification to charge the officer. He, therefore, oversee the overall functions of the department in order to help build a strong force that will not only record the required performance but will also ensure that the company achieves a considerable competitive edge.
- Finances: without money, there can never be a properly conducted interview, officials who will form the interview panel will require compensation for their effort and energy. Equipment and materials also need to be bought. This can only be possible with money.
- Time: this idea needs ample time to be implemented. Little time may lead to poor implementation of the proposed idea.
- The office: An office is required to be set aside for this department.
Independence and accountability are always the characteristics of a good functioning department. For any department to be independent, it must operate on its own. This is why an office is important.
There are quite a number of benchmarks that can be put into place to ensure that the idea is implemented and is effectively functioning. These include performance appraisals, reviewing the level of customer satisfaction and looking at the firm’s position in the industry.
This refers to the process of constantly reviewing the employees’ performance over a while and rewarding accordingly. Performance appraisals will reveal the level of knowledge possessed by an individual employee. Where the level identified does not meet the organizational standard then it will be possible to know how far training is being carried out by the human resource department. This will help us know whether the human resource department is effective or not. Another one is through looking at the firm’s overall position in the industry. Dapej is rapidly losing popularity due to a perception that its workforce is incompetent. If the firm improves its effectiveness in the eyes of the public by coming up with new product and service delivery ideas then it can be said to be effective.
customers are running away from Dapej and the situation does not look good in the near future either. If the perception of customers can be changed then it can be assumed that the new department is effective. The role of human resource department is to ensure that the organization has adequate skill base with professional and academic qualifications and that regular training session is conducted to improve existing skills for present and future organizational challenges.
Creativity and innovation is the key to effective performance. Today’s economic world requires firms to constantly keep on inventing unique methods of production. The technological pace in our society has created a situation where new markets are created and old ones dispensed. For a firm to maintain its competitive advantage in the current competitive world it should be creative enough. Creativity is achieved through training and setting a standard for performance where every employee is yearning for change. This is the only way that firms can survive in the modern world.