Most of the greatest progress in human history has been driven by innovation. The use of fire and tools witnessed the beginning of human civilisation; the use of steam power brought us into the industrial age; the technology of electric power transmission and transformation gave our economic and cultural evolution another boost; the birth of information technology marked the dawn of the information era and is still revitalizing our day to day life.
As has been pointed out by many, the speed of innovation is exponentially increasing. As innovation can substantially improve what already exists, its importance has long since been recognised. The ability to innovate is regarded as one of the most important qualities for individuals, organisations and even for nations. In this world with increasing abundance of material and information, and the astonishing speed of socioeconomic development and globalisation, business success is largely determined by the ability to innovate. Innovation helps businesses to distinguish themselves from others by exploring new business models, providing new services, and redefining customer relationships. Consequently, to understand the nature, value and process of innovation is of great importance.
Innovation is self-reinforcing as it allows the emergence of new technologies, products and services, new ways of working, and even new culture. Newly developed components will in turn accelerate the innovation process. While the conversion between innovation and technology is not automatic, optimising the interplay between innovation that leads to new technologies and the new technologies that accelerate innovation can be seen as key to realising the value of innovation. However, in general people encounter difficulties in mastering the transformation process between innovation and technology.
In fact the interdependencies between innovation and technology are so sophisticated that it is not enough to just embrace innovation from the perspective of the outcomes such as technologies, products, services or other artefacts which we call the concrete sphere. An innovation is unusually not incidental, but arises from knowledge, experience and expertise that have been accumulated from previous practices. What has accumulated can be only accessed through the use of notes, language, data, information and other forms of signs which constitute the virtual sphere. The effective interplay between the concrete sphere and virtual sphere is essential in conceiving innovation and benefiting from it.
The concrete sphere is characterised by objects, technologies, artefacts, processes and people and their actions; while the virtual sphere contains notes, languages, data and information that can be regarded as a digital or sign-based sphere. The benefits brought from an innovation often lead to an increase in productivity which takes place not only in the concrete sphere but also in the virtual sphere, in the form of human knowledge, skills and capabilities. In turn, the virtual capital (i.e. knowledge, skills and capabilities) accumulated in the virtual sphere may potentially lead to innovation. How do we understand, measure and benefit from the relationships between the two spheres?
Organisational semiotics, the doctrine of signs applicable to business and organised activities, offers a rich philosophical and theoretical foundation for understanding the connections and interactions between the concrete and virtual sphere. Organisational semiotics treats a business as a system consisting of human activities involving both concrete and virtual resources. For a business organisation to attain its objectives, activities must be organised and coordinated through norms. The norms govern the behaviour of the members in the organisation towards the goals. The norms are a set of specific guidance for human behaviour which is acceptable within a certain context or situation. Norms have two functions, namely the descriptive and prescriptive functions. The descriptive function, which is also called informative, guides humans to understand the facts and phenomenon of the concrete sphere; meanwhile, the understanding or the knowledge is reflected in the enrichment of the virtual sphere. The second function of a norm is the prescriptive function, which is also called normative. As such, a norm instructs the members in performing actions or governs human behaviour. Customs and patterns of behaviour will become norms over time which reflect some regularities and help others to predict and coordinate if necessary.
Innovation through interplay between human behaviour and norms.
Following an organisational morphology, human behaviour in the concrete and virtual spheres can be categorised as substantive, communication and control behaviour. Substantive behaviour directly contributes to the objective and realises the intended value of the innovation; and such behaviour may lead to changes in the concrete and virtual spheres, including transferring the philosophy from the virtual to concrete sphere and interpreting the facts from the concrete to the virtual sphere. The second category, communication behaviour, is about informing the relevant stakeholders in the innovation; such behaviour aims to coordinate those who are involved in the innovation to take the right actions with the right resources at the right time and space. An example of such behaviour is the scheduling of human and other resources based on the intended work content and procedure, i.e. to inform the relevant people about when and what actions are to be taken, and by whom. The third category, control behaviour, aims to reinforce the overall connection between the concrete and virtual sphere, particularly to monitor and evaluate substantive and communication behaviours. An innovation that creates value for a business will normally require a team to work together effectively in all three categories of activities in both the concrete and virtual spheres. Leadership in a business organisation that sets up an effective organisational morphology and promotes the culture of innovation is critical in building an innovative organisation.
This book addresses innovation in an organisation from an extremely interesting perspective by looking at the organisational culture. Unlike most other literature, it treats the organisational culture as an important asset and offers practices for managing and benefiting from the culture’s pivotal role in innovation as compared to other factors such as economy and finance. Innovation may bring economic and financial value, but only focusing on these factors may be counterproductive. The authors logically argue that leaders in an organisation must find out how to hone their business acumen at the same time as they unleash their passion for innovation. Furthermore, the book provides an effective methodology and a set of tool for entrepreneurs, managers and business leaders to nurture innovative behaviour in three different dimensions: people, the business organisation and motivation. The authors recognise the impact of an individual’s innovation potential in terms of three key factors: creativity, technological profile and psychological profile. In relation to the individual’s impact on innovation, the importance of women is explicitly discussed with convincing propositions and suggestions on how to benefit from female talent in organisations.
The authors propose their Innova 3DX methodology to categorise different influencing factors into three dimensions which are the creative ecosystem, individual innovative potential and the passion factor for innovation. The dimension of the creative ecosystem includes the factors within an organisation or a workplace that contribute to innovation. Such factors include corporate culture, work climate, leadership and management style. The second dimension zooms into the individual innovation potential and the influence of individual factors on organisational innovation, e.g. creativity, relationship with new technology, and psychological profile which are the restraints on innovation capability. The third dimension focuses on the passion for innovation, which motivates both individuals and organisations to engage in innovative activities while taking advantage of the creative ecosystem and individual creative power. By understanding the factors that lead to innovation, organizations will be better positioned to lead, promote and sustain it.
Professor Kecheng Liu
Director of Strategic Initiatives
Henley Business School