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The Management Of Innovation Business Essay


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The title of my research is The need to balance Acquisition, Organic and Geographical Growth Sources: A sustainable growth strategy for Pinnacle Technology Holdings Limited. Pinnacle Technology Holdings Limite4d is a South African Company, focussed on the assembly and distribution of ICT hardware. It focusses on the channel, small to medium corporates and the public sector. Pinnacle Technology Holdings Limited was established in 1993 and listed on the JSE in 1997.

The continually expanding product range spans the entire breadth of ICT hardware and related peripherals, including (but not limited to) high powered enterprise servers, switches and storage devices in addition to notebooks and personal computers. This range includes almost all of the top international tier -one brands , such as Hewlett Packard, Lenovo, Dell and IBM, as well as its own mainstay brand of Proline personal computers, notebooks and servers (Pinnacle Annual Report: 2010).

Pinnacle Africa has branches in Midrand, Bloemfontein, Nelspruit, Durban, Port Elizabeth, East London, and Cape Town. These branches are all in South Africa. Only three branches are outside of South Africa and these are Windhoek and Gaborone and Zambia.

I will focus on the research topic in this post module assignment.

Creative Myths

Creativity is the generation of ideas that result in the improved efficiency or effectiveness of a system. The people are the resources that determine the solution. The process remains the same. The process is goal-oriented: it is designed to attain a solution to a problem. However, the approach used by people will vary (http:notendur.hi.is/joner/eaps/cq_cr04.htm).

Creativity comes from epiphany

An epiphany (manifestation, striking appearance") is the sudden realisation or comprehension of the (larger) essence or meaning of something. The term is used in either a philosophical or literal sense to signify that the claimant has "found the last piece of the puzzle and now sees the whole picture," or has new information or experience, often insignificant by itself, that illuminates a deeper or numinous foundational frame of reference. This concept is studied by psychologists and other scholars, particularly those attempting to study the process of innovation.

Although epiphanies are only a rare occurrence, following the process of significant labour, there is a common myth that epiphanies of sudden comprehension have also made possible leaps in technology and the sciences. Though famous individuals like Archimedes and Isaac Newton might have had epiphanies, they were almost certainly the end result of a long and intensive period of study those individuals have undertaken, not a sudden, out-of-the-blue, flash of inspiration on an issue they have not thought about previously (http://en.wikipedia.org/wiki/Epiphany).

Creativity comes from creative types

The fact is, nearly all the research in this field shows that anyone with normal intelligence is capable of doing some creative work. Creativity depends on a number of things: experience, including knowledge and technical skills; talent; an ability to think in new ways; and the capacity to push through uncreative dry spells. Intrinsic motivation - people who are turned on by their work often work creatively - is especially critical.

Money is a creative motivator

Research shows that people put far more value on a work environment where creativity is supported, valued, and recognised. People want the opportunity to deeply engage in their work and make real progress. It is therefore critical for managers to match people to projects not only on the basis of their experience but also in terms of where their interests lie. People are most creative when they care about their work and they are being stretched.

Time pressure fuels creativity

People are least creative when they are racing the clock. Actually, you may find that there are 'after effects' - when people are working under great pressure, their creativity is likely to go down not only on that day but the following day or two days also. Time pressure stifles creativity because people can't deeply engage with the problem. Creativity requires an incubation period; people need time to soak in a problem and let the ideas bubble up. (http://www.associatedcontent.com/article/7736944)

"I am not creative"

The truth is we are all creative. And while some people are naturally more creative than others, we can all have very creative ideas. The problem is, as we grow older, most of us learn to inhibit our creativity for reasons relating to work, acceptable behaviour and just the notion of being a grown-up.

"That's a stupid [or daft, or silly, or ridiculous] idea"

People say this kind of thing to colleagues, family and even to themselves. Indeed, this is one reason why people believe they are not creative: they have got into such a habit of censoring their creative ideas, by telling themselves that their idea s are stupid, that they no longer feel creative. Next time you have an idea you think is stupid, don't censor it. Rather, ask yourself how you could improve the idea.

"Creative people always have great ideas"

Creative people always have ideas. Whether they like it or not they are having ideas and sharing those ideas (often with people who tell them their ideas are stupid, no less!) every waking hour of the day. Of those ideas, a precious few are great. Many are good, many are mediocre and a precious few are stupid ideas. Over time, we tend to forget creative people's weak ideas and remember the great ideas.

"Constructive criticism will help my colleague improve her idea"

Criticism whether constructive or destructive (as most criticism truly is) squelches creative thinking and teaches your colleague to keep her ideas to herself. Likewise, other colleagues will see what happens when ideas are shared and will also learn to keep their ideas to themselves. Fresh ideas are fragile. They need nurturing, not kicking. Instead of criticising a colleague's new idea, challenge her to improve the idea by asking her how she could get over the idea's weakness.

"We need some new marketing ideas for the upcoming product launch. Let's get the marketing people together and brainstorm ideas"

This is a sure recipe for coming up with the same kind of marketing ideas you have had in the past: i.e. uncreative. Brainstorming, as well as ideas campaigns and other group ideation events get the most creative results with the widest variety of participants. Want marketing ideas? Then bring in sales, accounting, human resources, financial, administrative, production, design, research, legal and other people into the brainstorming event. Such a wide range of knowledge, experience and backgrounds will encourage a wide range of ideas. And that results in more creative ideas.

"In order for our innovation strategy to be a success, we need a system of review processes for screening ideas and determining which ideas to implement"

In fact, the review process is very often about eroding creativity by removing risk from ideas. The most important component for corporate innovation is a method of soliciting and capturing focussed business ideas. The ideas campaign approach - where you challenge employees to submit ideas on specific business issues, such as "in what ways might we improve product X?" is the best way to focus innovation. A transparent tool that allows employees to submit, read and collaborate on ideas is the best way to focus creative thinking. And, framing your challenges effectively is arguably one of the most important aspects of successful corporate innovation. Yes, reviewing ideas is important. But first you need to be generating the creative ideas so that they may be reviewed.

"That's a good idea. Let's run with it"

When we are looking for ideas, we have a tendency to stop looking and start implementing with the first good idea that comes to mind. Unfortunately, that means that any great ideas you might have had, had you spent more time thinking, are lost. Moreover, good ideas can often be developed into significantly better ideas with a little creative thought. So, don't think of a good idea as an end - rather think of it as a beginning of the second stage of creative thought.

"Drugs will help me be more creative"

The 1960s drug culture and glamour of musicians and artists getting high and being creative led to this myth. And, possibly a little bit of drugs or alcohol will loosen you inhibitions to the extent that you do not criticise your ideas as much as you might had your inhibitions not been loosened. A lot of drugs or alcohol, however, will alter your mind and may very likely make you believe you are being more creative. But to people watching you, you will just seem like someone who is very high.

"If it ain't broke, don't fix it"

Just the other day I was at a workshop where some people were complaining about a colleague who always had ideas. Worse, he wanted to use those ideas to change processes that were working perfectly well. Sadly, too many of us (but not you, of course) are like the complainers. If something works well as it is, whether it is a machine or a process, we often feel there is no need to change the way it works. Fortunately, Dr. Hans von Ohain and Sir Frank Whittle didn't think like that - or we'd still be flying in propeller airplanes. Bear in mind that propeller airplanes were working perfectly fine when the two gentlemen in question individually invented the jet engine.

"I don't need a notebook. I always remember my ideas"

Maybe. But I doubt it. When we are inspired by an idea, that idea is very often out of context with what we are doing. Perhaps a dream we had upon waking inspires us with the solution to a problem. But, then we wake up, get the children up, have breakfast, run through in our minds an important presentation we'll be giving in the morning, panic that the kids will miss their bus, run for the train, flirt with an attractive young thing on the train etc. - until late afternoon when you finally have time to think about the problem. How likely are you really to remember the idea you had upon wakening? (http://innovationexcellence.com/blog/2010/11/26/10

2.15 Fear Forces Breakthroughs

There's this widespread notion that fear and sadness somehow spur creativity. There's even some psychological literature suggesting that the incidence of depression is higher in creative writers and artists - the de-pressed geniuses who are incredibly original in their thinking. But we don't see it in the population that we studied.

We coded all 12,000 journal entries for the degree of fear, anxiety, sadness, anger, joy, and love that people were experiencing on a given day. And we found that creativity is positively associated with joy and love and negatively associated with anger, fear, and anxiety. The entries show that people are happiest when they come up with a creative idea, but they're more likely to have a breath through if they were happy the day before. There's a kind of virtuous cycle. When people are excited about their work, there's a better chance that they'll make a cognitive association that incubates overnight and shows up as a creative idea the next day. One day's happiness often predicts the next day's creativity.

Competition Beats Collaboration

There's a widespread belief, particularly in the finance and high-tech industries, that internal competition fosters innovation. In our surveys, we found that creativity takes a hit when people in a work group compete instead of collaborate. The most creative teams are those that have the confidence to share and debate ideas. But when people compete for recognition, they stop sharing information. And that's destructive because nobody in an organisation has all of the information required to put all the pieces of the puzzle together.

A Streamlined Organisation is a Creative Organisation

Maybe it's only the public-relations departments that believe downsizing and restructuring actually foster creativity. Unfortunately, I've seen too many examples of this kind of spin. One of my favourite is a 1994 letter to shareholders from a major US software company: "A downsizing such as this one is always difficult for employees, but out of tough times can come strength, creativity, and teamwork."

Of course, the opposite is true: Creativity suffers greatly during a downsizing. But it's even worse than many of us realised. We studied a 6,000-person division in a global electronics company during the entire course of a 25% downsizing, which took an incredibly agonizing 18 months. Every single one of the stimulants to creativity in the work environment went down significantly. Anticipation of the downsizing was even worse than the downsizing itself - people's fear of the unknown led them to basically disengage from the work. More troubling was the fact that even five months after the downsizing, creativity was still down significantly.

Unfortunately, downsizing will remain a fact of life, which means that leaders need to focus on things that get hit. Communication and collaboration decline significantly. So too does people's sense of freedom and autonomy. Leaders will have to work hard and fast to stabilise the work environment so ideas can flourish.

Taken together, these operating principles for fostering creativity in the workplace might lead you to think that I'm advocating a soft management style. Not true. I'm pushing for a smart management style. My 30 years of research and these 12,0000 journal entries suggest that when people are doing work that they love and they're allowed to deeply engage in it - and when the work itself is valued and recognised - then creativity will flourish. Even in tough times. (http://www.fastcompany.com/magazine/89/creativity.html)

2.18 Other Myths

The following are other myths:

Being creative is a waste of time,

Creativity is not for adults or people with serious careers,

Creativity is the result of a lone innovator,

There is always a clear path to creativity,

Creativity always results in greatness.

2.19 Myths surrounding business creativity into Africa.

These are myths which have prevented many South African companies into expanding operations into Africa.

We do not understand Africa

This is a myth as Africa is easy to understand. Those who have ventured into Africa did so by researching exactly how to do business in Africa. Apart from the research there are many published articles on how to do business in Africa,

You may not get paid

There are many arrangements which can be made to ensure payments. Letters of credit confirmed by foreign banks being one.

Difficult to repatriate profits

There are investment guidelines dealing with all African countries. Some may be more difficult than others but this does not mean that all countries in Africa should be painted with the same brush. MTN is doing roaring business in Nigeria and there has been no problem in profit repatriation.

Myths of Nationalisation

Again, here there have been very few if any private companies which have been nationalised. The investment guidelines will prescribe certain criteria to be observed but this does not amount to nationalisation.

Myths of being killed kidnapped etc.

African countries are poor markets. This is also not true as we mentioned in the case of MTN. Again here it does not mean doing business with the entire continent of Africa, but only few selected countries.

Creative Roles

There are four distinct roles to be performed for the creative process to be as effective as possible. Each one requires that you play different characters, with different mind-sets and skills.

The roles are: Explorer, Artist, Judge and Warrior.

Learn how they help unleash your creativity and how to master the skills each one requires.

The Explorer

Ideas do not come out of the blue. In order to build them you first need to gather the raw materials: facts, concepts, experiences, knowledge, feelings - that's what ideas are made of. To get all of that, you need an attitude of on-going curiosity and exploration.

The Explorer is always in search of new things. He is relentlessly curious and never limits himself to a particular area of experience and knowledge. To have ideas is to connect dots. First and foremost you need lots of dots to connect - you need fuel for the formation of new ideas.

The Artist

The Artist has ideas. He takes the raw materials from the Explorer and combines them in novel ways.

When people say someone's "creative", they're usually referring to the Artist. The Artist has ideas mostly by trying new things. He applies his imagination by rearranging, turning things upside down, stirring things up. He pursues different approaches and finds unexpected connections. He's playful; he doesn't care about what people expect from him.

The Judge

The Judge is all about "getting real". His job is to analyse the Artist's wild ideas and assess if they're practical - in the real world.

The Judge questions assumptions; he compares and analyses. He checks how feasible ideas are. No matter how much the Artist loves an idea, the Judge looks for counterarguments, checks evidence, and makes hard decisions. Combining gut feeling and analytical tools, the Judge must only let through feasible ideas.

The Judge gets a bad reputation - but only because people usually invoke him too early. Killing an idea before the Artist can play with it is a pity; killing it later is oftentimes a necessity.

The Warrior

As soon as you have an idea ready to be executed you'll realise the world isn't set up to accommodate every new idea that comes along. The enemies can be external: competition may be fierce, or people maybe just don't "get" your beautiful ideas. Even harder than those, there are more than enough enemies already within you: think resistance, excuses and fear of failure.

The Warrior's job is to make ideas happen. For that, you'll need not only a strategy and plan of action but to put in the hours - fight the daily fight.

That means remaining productive, developing the resilience and courage to overcome obstacles and, of course, being able to sell your ideas - whatever's necessary to materialise them. (http://litemind.com/creativity-roles)

Innovative Archetypes

An archetype is an original model of a person, ideal example, or a prototype after which others are copied, patterned, or emulated; a symbol universally recognised by all. Archetypes put context to a situation. We use archetypes, for example, in marketing. We create brand archetypes to assign a personality to the brand.

The innovation Archetypes are:

Innovation Doer: These are the practitioners of innovation…people who innovate on a regular basis. The Innovation Doer is on the front lines and feels both accountable and motivated to come up with new and useful ideas. They approach situations with a natural inclination to change the status quo rather than preserve it.

Innovation Watcher: These are people with a strong interest or obsession with innovation created by other people. They are fascinated by novelty. They consume it, read about it, and report on it. They marvel at what others create but stop short of serious innovation themselves. They report useful insights about innovation and innovators. They add value by commenting on trends and milestones in the world of innovation. Entire websites such as Gizmodo and Engadget fit this archetype.

Innovation Preacher: These are the voices that inspire others of the need to innovate. They make the case for innovation and change. They relate innovation to our everyday lives as well as to the global economy. They create both hope and fear…hope in terms of what can be created through innovation, and fear from the consequences of not innovating…from being "disrupted."

Innovation Teacher: These are the people who teach methods and processes of innovation. They infect others with tools to create new ideas. Teachers are interventionalists. Their students become Doers (if they have taught them well). A number of university professors and innovation consultant fit this archetype.

Marketplace of ideas. In the marketplace archetype, employees are charged with creating new ideas, shopping them around to gain support and implementing them rapidly to test feasibility and market acceptance. It is an environment that is somewhat chaotic by design. Google, 3M, Best Buy typify this model.

Visionary leader. The visionary leader model revolves around a senior executive who understands the future better than customers, motivates employees to zealously pursue that vision and keeps generating ideas that are unexpected and profound. Steve Jobs of Apple is citied as the paragon. Other examples are Akio Morita of Sony and Henry Ford.

Systematic Innovation. These are firms that succeed through a mix of executive prioritization and team processes. Samsung, Proctor & Gamble and Goldman Sachs are cited as examples.

Collaborative Innovation. This archetype is more externally oriented, featuring companies that team with outside partners to evaluate a wide range of opportunities, rapidly select the ones to trial and often implement the ideas through these partners. Collaboration organisations gather "innovation intelligence" by building formal relationships with other firms that can help them not only shape the innovative concept but also actively implement the solution. For example, most movie studios are collaboration organisations, partnering with independent producers to generate ideas, with technology companies to create special effects, and with advertising agencies to promote new releases. Another recent example is social networking site Facebook. (http://innovate.typepad.com/innovation/2009/04/four-kinds-of-innovation-dna.html)

Innovation through Rigor

An involved leadership oversees the development of many products and services by problem-solving, cross-functional teams who work systematically on internally generated ideas using formal vetting processes. Typical of large enterprises with diffuse product lines; often with a culture of "perpetual crisis." Samsung's large product catalogue is overseen by senior executive prioritisation and team processes that focus on the design aspect of innovation.

It is likely there are more innovation archetypes than these four. Other could be defined around some of the brand archetypes displayed in the model above. Certainly there are people who display multiple archetypes, perhaps all four.

In the corporate domain, we need all four archetypes. Those that preach create the mandate for change. They mobilise the leadership and staff to focus on innovation as a source of organic growth. The Doers and Teachers tend to put things into motion. Watchers are the "sense makers". They are trend spotters. They have a unique perspective on external innovation to give useful context to internal innovation. A lot of corporate mergers and acquisition departments fall into this category. They are "hunters" of opportunity.

The Knowledge Economy

Introduction: The Knowledge Economy

The paradigm of the knowledge economy originally appeared as a consequence of new trends in the economy and of new categories of statistical data on economic activity (Machlup, 1962). In the mid-1990s, the concept evolved to refer to two presumed characteristics of the new economy: the increased relevance of abstract knowledge, both quantitatively and qualitatively, and the prevalence of applications of information and communication technologies as economic drivers (David and Foray, 1995). The OECD (1996) defines knowledge-based economies as "economies, which are directly based on the production, distribution and use of knowledge and information." Thus, the knowledge economy is based on an efficient system of knowledge access and distribution, as a sine qua non condition for increasing the amount of innovative opportunities (Godin, 2003).

This increasing importance of knowledge is changing the way firms compete as well as the sources of competitive advantage between countries. For the leading countries in the world economy, the balance between knowledge and resources has shifted so much towards the former that knowledge has become one of the most important determinants of the standard of living (World Bank, 1998). Today's most technologically advanced economies are knowledge-based in the sense that knowledge is increasingly considered to be a commodity (Boulding, 1996), that advances in ICTs (Information and Communication Technologies) have reduced the cost of many aspects of knowledge activity (Howells, 2000), and the degree of connectivity between knowledge agents has increased dramatically (Aridor et al., 2000).

Knowledge workers in today's workforce are individuals who are valued for their ability to act and communicate with knowledge within a specific subject area. They will often advance the overall understanding of that subject through focused analysis, design and/or development. They use research skills to define problems and to identify alternatives. Fuelled by their expertise and insight, they work to solve those problems, in an effort to influence company decisions, priorities and strategies. With differentiates knowledge work from other forms of work is its primary task of "non-routine" problem solving that requires a combination of convergent, divergent, and creative thinking (Reinhart et al., 2011). Also, despite the amount of research and literature on knowledge work there is yet to be succinct definition of the term (Pyöriä, 2005).

Knowledge Worker Roles

Knowledge workers bring benefits to organisations in a variety of important ways. These include:

Analysing data to establish relationships

Assessing input in order to evaluate complex or conflicting priorities

Identifying and understanding trends

Making connections

Understanding cause and effect

Ability to brainstorm, thinking broadly (divergent thinking)

Producing a new capability

Creating or modifying a strategy

These knowledge worker contributions are in contrast with activities that they would typically not be asked to perform, including:

Transaction processing

Routine tasks

Simple prioritisation of work

There is a set of transitional tasks includes roles that are seemingly routine, but that require deep technology, product, or customer knowledge to fulfil the function. These include:

Providing technical or customer support

Handling unique customer issues

Addressing open-ended inquiries

Generally, if the knowledge can be retained, knowledge worker contributions will serve to expand the knowledge assets of a company. While it can be difficult to measure, this increases the overall value of its intellectual capital. In cases where the knowledge assets have commercial or monetary value, companies may create patents around their assets, at which point the material becomes restricted intellectual property. In these knowledge-intensive situations, knowledge workers play a direct, vital role in increasing the financial value of a company. They can do this by finding solutions on how they can find new ways to make profits this can also be related with market and research. Davenport, (2005) says that even if knowledge workers are not a majority of all workers, they do have the most influence on their economies. He adds that companies with a high volume of knowledge workers are the most successful and fastest growing in leading economies including the United States.

Reinhart et al.'s (2011) review of current literature shows that the roles of knowledge workers across the workforce are incredibly diverse. In two empirical studies conducted by Reinhardt et al. (2011) they have "proposed a new way of classifying the roles of knowledge workers and the knowledge actions they perform during their daily work" (Reinhardt et al., p. 150). The typology of knowledge worker roles suggested by Reinhardt et al. are "controller, helper, learner, linker, networker, organiser, retriever, sharer, solver, and tracker (2011, p. 160).

Typology of knowledge worker roles



Typical knowledge actions (expected)

Existence of the role in literature


People who monitor the organisational performance based on raw information.

Analyse, dissemination, information organisation, monitoring.

(Moore and Rugullies, 2005)(Geisler, 2007)


People who transfers information to teach others, once they passed a problem.

Authoring, analyse, dissemination, feedback, information search, learning, and networking.

(Davenport and Prusak, 1998)


People use information and practices to improve skills and competence.

Acquisition, analyse, expert search, information search, learning, service search.


People who associate and mash up information from different sources to generate new information.

Analyse, dissemination, information search, information organisation, and networking.

(Davenport and Prusak, 1998)(Nonaka and Takeushi, 1995)(Geisler, 2007)


People who create personal or project related connections with people involved in the same kind of work, to share information and support each other.

Analyse, dissemination, expert search, monitoring, networking, service search.

(davenport and Prusak, 1998)(Nonaka and Takeushi, 1995)(Geisler, 2007)


People who are involved in personal or organisational planning of activities, e.g. to-do lists and scheduling.

Analyse, information organisation, monitoring, and networking.

(Moore and Rugullies, 2005)


People who search and collect information on a given topic.

Acquisition, analyse, expert search, information search, information organisation, monitoring.

(Snyder-Halpern et al., 2001)


People who disseminate information in a community.

Authoring, co-authoring, dissemination, networking.

(Davenport and Prusak, 1998)(Brown et al., 2002)(Geisler, 2007)


People who find or provide a way to deal with a problem.

Acquisition, analyse, dissemination, information search, learning, service search.

(Davenport and Prusak, 1998)(Nonaka and Takeushi, 1995)(Moore and Rugullies, 2005)


People who monitor and react on personal and organisational actions that may become problems.

Analyse, information search, monitoring, and networking.

(Moore and Rugullies, 2005)

Note: From "Knowledge Worker Roles and Actions - Results of Two Empirical Studies," by W. Reinhardt, B. Schmidt, P. Sloep, and H. Drachsler, 2011, Knowledge and Process Management, 18.3, p. 160. Copyright by John Wiley & Sons, Ltd. Reprinted with permission.

5.3 Knowledge Worker Roles

The following seven roles within which innovative managers apply their individual knowledge contribute significantly towards creating a sustainable competitive advantage for organisations:

Adventurers: managers contribute unusual solutions to resolve customer and operational problems as they use practical applications of knowledge gained through personal experience.

Navigators: navigators adapt what other managers have already established. They have the ability to evaluate and analyse problems, and find the most profitable solution.

Explorers: these have the ability to recognise external patterns, trends and relationships. They initiate new business ventures and ideas which they communicate through inspiring ingenuity.

Visionaries: being a visionary suggests proactive questioning that challenges groups to find profound and unusual solutions to existing problems by working backwards from a desired outcome.

Pilots: these individuals excel in clarifying goals and responsibilities regarding knowledge projects and change initiatives.

Inventors: these managers use unconventional theories and models for analysis and synthesis of factual information which is transformed into knowledge.

Harmonisers: harmonisers are highly energetic and results-driven. They search continuously for new solutions within team leadership structures.

5.4 Individual Ratings of Leadership Dimensions

A framework for the knowledge manager is given as a foundation for the creation of a knowledge organisation. Once the information becomes actionable it is transformed into knowledge. When knowledge is then learned and embedded into individual and organisational processes, the value of knowledge to the individual and the organisation increases in value. The environmental factors affecting this cycle relate to domain context, organisational culture and individual value system, management initiatives and benchmarking standards.

Knowledge must have a contextual framework if it is to be useful to an organisation. In addition the promotion of knowledge will be affected by the organisational culture, as well as the individual's knowledge base. How knowledge is internalised and then again externalised is related to the organisation's strategic intent. Management initiatives and standards will also affect the creation of knowledge within the organisation. The project innovation manager as innovation manager acts on all mind information through the critical testing of information needed to resolve specific problems or to innovate new systematic solutions. At this precise point the information is transformed into useable knowledge and is shared through individual and team exchange which creates the enablement of knowledge for working processes to be used by future project teams and to add to the intellectual capital vault.

Figure 1.1: Conceptual view of the knowledge management framework for innovation



Individual & organisational processes


Domain context

Management activities

Organisational culture & individual value system



Source: Liebowitz, J. (2005) Conceptualizing and implementing knowledge management, from Management of Knowledge in Project Environments. P.3. (Love, Fong and Irani (eds.))

It is important for the innovation manager to realise that knowledge is often gained through experience and on-the-job innovation as knowledge without context is futile. Knowledge can be distilled from successes as well as from failures especially as project management creates intellectual property when lessons are learned and best practices are established.

The leadership dimension usually concerns senior people's role in developing the organisational processes where innovation is made an ordinary, recognised and accepted activity (although leadership need not be restricted to senior executives only). In fact, a key responsibility of leaders is to enable as many people as possible to lead positive change at all levels in the workplace. The leadership dimension includes the symbolic gesturing of leaders and the role models, artefacts and symbols they create, articulate and "hold up" as desired behaviours to others in the organisation and elsewhere. Leadership is a resource if it helps people see the direction and purpose of innovation; it is a resource only when it makes innovation a generally accepted agenda in the organisation.

Even if a new idea sees the light of day, it still has to gain wide acceptance and become spread to the many in the organisation that have to change for it to become real. Leadership is thus not only about creating an organisation conducive to innovation; it is also to champion innovation and single out those ideas that to be implemented require cooperation from many within the organisation and often also beyond from suppliers and possibly customers.

Leadership involves mediating the different assets that have to work in concert to make the innovation real.

Innovation is often a strategic option for increasing organisational competitiveness, and it is in this context, Llorens-Montez et al. (2005) through their empirical study, demonstrate the importance of leaders supporting innovation through teamwork cohesion, organisational learning, and technical and administrative innovation. A leader's role is to develop a suitable management style and to inculcate a workplace environment that enables, allows and encourages innovation to take place.

Effective leaders at all levels - executives, managers and entrepreneurs - want to optimize their personal performance and their team's performance to achieve business success.

Intense competition and new technologies have resulted in flatter organisations emphasising new ways to deliver the winning customer experience.

Also impacting company objectives are employee expectations around quality of work, personal growth and professional recognition.

Today's leaders are challenged to deliver business results while nurturing, inspiring and retaining company talent.

The key element in effective leadership is the ability to recognise business situations for what they are and employ the right leadership style to move towards the desired objective:

Commanding. Take charge to gain team commitment for the crisis at hand.

Visioning. Point the way to the future and engage your team in developing direction.

Enrolling. Get buy-in through eliciting and incorporating team input.

Relating. Connect with the individual contributors, mediate conflict and lead team building.

Coaching. Commit to developing your people through skills enhancement and providing stretch goals compatible with company objectives and personnel development.

Characteristics and Pre-requisites for Effective Project Innovation Management in the Knowledge Economy

The characteristics of the knowledge and innovation manager poses an attitude spectrum that an effective project innovation manager should acquire through management development and self-development. These three attributes are knowledge, skills and attitudes.

The knowledge requirements of a project manager are organisational, structure and level as well as industry orientated. Knowledge is important to demonstrate project innovation managerial effectiveness while the inventory of knowledge must encapsulate the organisation's core competencies.

The skills of the project manager are transferable from management to tactical and operational levels. Once acquired, these skills represent an integral part of the personal armoury of the project innovation manager. The main skills of an effective project innovation manager should convey creativity into innovation and process it into practical implication.

These skills include, inter alia, observing, reflecting, fact-finding, analysing, diagnosing and the formulation of solutions. These skills are supported by the following additional elements of management, viz. valuable decision making with innovation in mind, communicating ideas, and motivating human capital through delegation and organising.

The creative manager has distinct attributes and characteristics by which he/she is identified as it significantly differentiates him/her form those who are less creative. The kind and degree of creativity varies from person to person and it is unlikely that any individual could possess all of the characteristics to a uniformly high degree. The description therefore should be a composite profile of the ideal creative person. The following attributes are suggested to describe this particular profile for the ideal knowledge and innovation manager: sensitivity to problems, curiosity, motivation, persistence and concentration, ability to analyse and synthesise, discernment and selectivity, ability to tolerate isolation and creative memory.

The knowledge manager values his/her creativity as "real" creativity, which must bring into existence ideas and forms that are unexpected, new in the sense that no one else has created them and have a lasting impact on the world.

Both a competence component and a self-determination component are highlighted, as the knowledge manager is intrinsically motivated and would seek situations that interest him/her and will require the use of heightened creativity and resourcefulness. The following characteristics are distinguished between effective and less effective project innovation managers:

Embracing change. Less effective project innovation managers dislike changes and prefer predictability, order and stability.

Attending to external realities. Less effective project innovation managers focus their time and attention on the routines of the internal organisation.

Creating power. Less effective project innovation managers consider their power to get things done severely limited, since they believe that real power resides with top management.

Promoting a coaching style. Less effective project innovation managers spend relatively little time coaching their people, and they see coaching in terms of delegation: assigning well-defined tasks and carefully following up.

Expanding job responsibilities. Less effective project innovation managers see their primary responsibility as meeting the demand of bosses, job descriptions and annual goals.

Creating expertise. Less effective project innovation managers recognise the importance of expertise but are "too busy" to grow (or hire) it; often they see developing expertise as someone else's job.

Driving out fear. Less effective project innovation managers work from a primitive philosophy of fear. They think fear is (with the possible exception of greed) the best motivator in business.

Exhibiting readiness for an entrepreneurial environment. Less effective and highly effective project managers alike want initiative and creativity from their work associates and they guard the processes for allocating resources.

The Eight Prerequisites for Innovation Managers

According to the three-facet model of creativity of Sternberg, the innovation manager possesses the following eight key strengths to facilitate enhanced creativity in the workplace in terms of his/her intellectual abilities, knowledge acquisition components and their ability to integrate:


The project innovation manager is fresh and child-like at times. They are willing to take risks and uses the creative thought process to analyse and differentiate between alternatives before making final decisions. He/she is curious, has a sense of humour and shares information through effective communication channels.


This project innovation manager operates independently and is determined to find the most profitable solution. He/she is energetic and courageous and will use many different avenues to demarcate and analyse a problem. His/her administrative style is assertive and deals with information by systematically seeking intelligent options.


This management style is very comfortable with ambiguity. He/she enjoys challenges and involves the entire team through proactive team dynamics. He/she looks at problems from various angles and implements a solution through different strategies. Although sceptical at times, he/she uses a large information base to form new visions and creative solutions, using immense knowledge frameworks.


This management style thrives on participative decision making and is willing to share credit with all team members. Personal satisfaction, peer recognition as well as team rewards are valued much higher than remuneration. He/she is actively involved in educating and a shared vision with all team members, and recognises individual effort and diversity within the team.

Inner openness

This management style has the ability to switch from logical argumentation to fantasy, is open to emotional behaviour patterns, can think innovatively in different modes and levels of sophistication, and is intuitive and highly expressive, integrating all segments of the implied forum.


This management style can see problematic situations realistically as they occur, and can project different options and solutions simultaneously, chooses growth over fear and is confident that the team effort can add value to the organisation's growth.


This management style uses evaluation discernment and is discriminating of conventional problem solving and decision-making methods, is judgemental at appropriate times and handles conflict well.


This management style values and respects human capital as the most important asset within organisations and seeks stimulation from a variety of people and promotes the highest benefits for all concerned.

Kelley (2002) is a great advocate of the problem solving process as a theoretical basis for creative management and describes problem solving as opening up the self to the fullest possible awareness of the storehouse of energy and resources within, and the ability to lead to innovation.

The process of idea generation leads to incubation and analysis, which bears on the tentative ideas and leads them to the eventual acceptance or rejection. Creative work is as much a process of problem finding or forming as of problem solving. To raise new questions, new possibilities, to regard old questions from a new angle, requires creative imagination.

The following motivational principles are suggested to achieve greater flexibility of ideation and produce a larger number of original ideas:

Making the objective more visible to all members of the group

Rearranging all facets of the problem

Combining different components


Looking at different aspects of the environment

Giving motion and activation to the situation

The knowledge and innovation project manager needs to evaluate him/herself firstly according to the abovementioned criteria and, secondly, promote the organisation's interest in terms of the same paradigm to discover the optimum practice of inherent creativity within individuals and organisations.

Many organisations already have considerable experience using strategic management to identify, select and execute choices for their business scope, competitive differentiation and market place goals. As an important addition to the strategic management technology scenario learning helps managers explore the true range of available choices involved in preparing for the future, to test how well those choices will succeed in various possible scenarios and to prepare a rough time table for future events. For those organisations committed to creating their own future scenario learning is an invaluable tool as this preparation process assists managers to cope and design a variety of future scenarios and to outlive unexpected crises.

Scenario learning occurs mainly when organisations employ creativity and innovation by creating a learning culture where knowledge is shared, harvested and traded. Organisations who used scenarios to identify opportunities should also test their strategies in multiple scenarios in order to create the best practice. When an innovative organisation refines its strategy based on its new understanding of what knowledge is required to succeed in a variety of possible futures it takes heed to monitor the results of the strategy implementation and execution. This is precisely where you should familiarise yourself with the entire course content and assume the role of reconnoitre as they scan changes in the environment continuously to determine where the future strategic changes or adaptions are required.

Scenario learning involves four elements for constructing or developing scenarios and integrating the content of scenarios into decision making and innovative implementation. Both elements are central to the actual process of scenario learning and a prerequisite is the generating and acquiring of explicit knowledge which is acted upon to create the essential outcome. Secondly scenarios challenge the mindset of modern managers by developing plausible alternatives. To take decision makers into new substantive terrain and require them to be willing to suspend their judgement and traditional belief system, their assumptions and preconceptions of what should be done compel them to grapple and elaborate on questions that previously were not raised or briefly considered and quickly shunted aside. Scenario learning therefore does not only emphasise the role of scenarios as a generator of thought and reflection, but also explicitly challenges conventional wisdom, historic ways of thinking and operating and long held assumptions about important issues.

Thirdly learning implies discussion and dialogue which in the knowledge economy should include innovation and creative methods of thinking. Managers and their counterparts within the organisation as well as outside should engage each other in free ranging exchange of ideas, perceptions, concerns and new discoveries. Such exchanges will invariably provoke some degree of tension between individuals, between functions holding opposing ideas, and between corporate and business unit perspectives. Such tension is the essence of collective learning and the suspension of premature closure as individual exchange between managers enhances reflection upon the new novel solution and challenges their own mind sets.

Fourthly innovative learning suggests that scenarios are a continual input to decision making and that actions and decisions in return spawn further reflection and new knowledge creation. Rightfully scenarios provide views of the future against which managers can monitor and assess the world as it unfolds around them as each distinct view of the future becomes a new focus for shared learning.

The creative learning perspective suggests that the various tools and techniques involved in scenario development aids the understanding of how knowledge might unfold and how innovation can critically be incorporated into decision making. If this overall objective is to be achieved scenario methodologies should not be the pivotal point but should be intended only to serve the purpose of augmenting understanding and to inform creative decision making.

Current world of knowledge.

Plot or Story

What must happen in order for the scenario end state to arise?

End State

The conditions and circumstances that prevail at the end of the scenario period.


The explanation or rationale for the content of the plot.

New sustainable competitive advantage through best practice.

Driving forces.

Organisational knowledge.

Key Scenario Elements in the Knowledge Economy

(Source: Fahey 2000)

The elements of future scenario planning are identified as the driving forces for competitive advantage, logistics, scenario plots and end stated and how they pertain to the competitive advantage. Although businesses, governmental and consulting organisations have developed particular approaches to crafting and using scenarios the methodologies should incorporate all these elements to be successful.

The Innovation Funnelling Process

8.1 Introduction

Funnelling Ideas

The Funnel Mechanism is a well-known structure for dealing with innovation.

Innovation, ideas and conceived features for a product

Need to be sifted and vetted in a structured manner

In order to create a manageable development environment

For producing a successful product that will be taken up by the market

The key is to subject ideas to a series of appropriate tests as they mature. Innovation ideas are managed through a series of gates from whence they can move to different stages.

"Innovation and ideas are funnelled to maturity"

Blue sky

Business analysis

Real world validation

Pilot product




8.2 Registration

The first stage where projects are entered into the process

Must pass common sense hurdles

Innovations and ideas start here and may jump to subsequent stages

8.3 Blue Sky

No limits, mad brainstorming

Certain common sense questions must be passed concerning feasibility and the defined market.

8.4 Business Analysis

Comprehensive market study and competitive analysis

Certain assumptions are made which will be tested in subsequent stages

Conceptual development

8.5 Real World Validation

Primary learning stage

Economic and technical feasibility accepted

Agile processes used to test assumptions with a prototype in the field

Results used to update market knowledge and refine the product

8.6 Pilot Production

Limited field trials with production units in the market

Agile processes used to test concept and value proposition further with the market

Result fed back to refine product

8.7 Production

Exit from development process

Full-scale production with prepared product

Further innovation fed into the business analysis stage


The Five Dimensions of Creativity for the Innovation Funnelling Process

This is the funnelling process used for searching new value propositions and is important for the group and individual innovation process.

The five dimensions of creativity according to Torrance (1984) are viz. fluency, originality, highlighting the essence, elaboration and resistance to premature closure. It is important for students to familiarise themselves with the five dimensions of creativity as these form the foundation for understanding the application of creativity and innovation as drivers in the new innovation economy and to create the new sustainable competitive advantage.


The production of fluency includes newness of ideas as a criterion and maintains that an act is creative if the thinker reaches the solution in a sudden closure that necessarily implies some novelty to the thinker. The idea might be artistic, mechanical, theoretical or administrative, particularly in its function of solving organisational problems or in decision making. The brainstorming processes may occur even though the idea may have been produced by someone else at an earlier time. By this definition, creative thinking may take place in the mind of the humblest person or the most distinguished statesman, artist or scientist.


The possibility of higher productivity in project management is the result of the expertise of innovation managers who can respond to leadership and new behaviours where leadership exemplifies openness to influence, commitment to the success of others, willingness to acknowledge their own contributions to problems, personal accountability, originality and trust. Originality is seen as creative potential versus conformity.

In general, creativity has been seen as contributing original ideas, different points of view and new ways of looking at problems. Conformity is seen as doing what is expected, not disturbing or changing the status quo.

Highlighting the Essence

Although high quality ideas are produced, the dividing line in the creative thinker is the fact an unorthodox solution is reached by reacting impulsively to ideas as it triggers the inner imagination and fantasy. It is difficult to observe this process as patterns of behaviour and thoughts are unconventional and the impulse acceptance enriches the quality of creative activities by aligning these thoughts with the problem and simultaneously analysing the best proposition. Spanning an immense amount of information, a rudimentary diagnostic skill is used and flexibility on automatic pilot that shifts the mental gears, to span through a huge amount of information and diverge problems, highlighting the three qualities: discovery, adventurous thinking and congruence. The creative environment provides for freedom to respond truthfully in highlighting the essence of the problem.


The assumption that the knowledge and innovation manager identifies the solution to the problem through careful observation, understanding of the wider insight into the environment as it is reflected in the analytical process through the elimination of non-important information. Continuous idea forming and elaboration of those ideas are transformed into a fully-fledged product, which adds value to the organisation's full embodiment of inventions, designs and scientific theories. The project innovation manager emphasises the capacity of thinking by analogy as the essential fundamental element to continue finding alternative responses and solutions and creating new innovations.

Resistance to Premature Closure

Ideas generated through the suspension of judgement are intuitive and look at different angles that can save each idea from premature rejection. Project innovation managers who can suspend judgement are more valuable during idea generation exercises, such as brainstorming or creativity workshops, as they enhance the quality and quantity of the team's output, achieved by sensible selection of albeit unusual ideas and spontaneous commenting in group discussions. The group decides which ideas should be implemented and where suspended judgement should be practiced.

The Creative Process Includes the Person, the Product, the Process and the Situation

The most important common belief is that creativity in its essence is an indication of a particular type of person. In this context it is the knowledge manager.

Occasionally there is a product of result in question, but a creative person, in reality, is observed in isolation. A logical synergy between the person, the process, the product and the environment is used to explain the implication of this theory in business practice.

The Person

Creativity relies implicitly on personality traits that are inherent to the individual and expressed through individual potential, ambition, emulating individual creativity as the full human potential, including creative solution finding and the ability to exercise power and judgement in the creative process by incorporating the ability to invent by respecting he irrational and seeing the promising source of novelty as an invention of own thought. The person's ability for original thinking and innovation optimises his/her ideas through observational and mental distribution of thoughts and is expressed to optimally self-actualise the innovation manager.

The creative manager's capacity to think fluently, flexibly and originally is profoundly linked to his/her imaginative ability. To live without answers, to question the unquestionable, means that the creative person will touch perplexing darkness but will also dream undreamable dreams. The ability to imagine is identical with the ability to detach from actual situations, and envisage situations that are non-actual - an ability to detach from the world in order to think of certain objects in the world in a new way, as signifying something else.

The creative innovation manager is an original thinker who possesses in a high degree the powers of constructive imagination, and that the truly creative have more contact than most people do with the life of the unconscious, with fantasy and with the world of imagination. Creative people do more than simply break away from old patterns, finding alternatives within the old ways. Creative managers diverge from familiar patterns but they converge on new solutions, breaking laws to remake them and make hard decisions about what to include and what to eliminate. Creative managers continuously innovate using their knowledge resources.

The Process

This process theory implies that products, achievements and discoveries are regarded as creative and can be traced back to prior actions that can be seen as procedural and that there are deeper introspective processes interwoven in the "creative journey". This process is regarded as having seven recognisable phases. Throughout every phase the relationship between the manager and the creative phenomenon changes, and the experience of the innovation manager in every phase has a definite effect on the end result. The seven phases are identified as (a) identification and formulation, (b) investigation, (c) exploration, (d) revelation, (e) confirmation, (f) reformulation and (g) realisation. He regarded creativity as a process that leads to meaningful learning, insightful experience and the discovery of something new.

The different phases of the creative process never happen in isolation, but in interaction and facilitation with one another. These processes do not necessarily always happen in the same sequence because the scientist's work is not always systematic, logical or orderly. If the theory of creativity is regarded from a process approach in the wider area of creativity, it becomes clear that the focus falls mostly on essential elements and ideas or thoughts which are discovered, connected and transformed during the creative process. Forming associations and the formulation of analogical connections are also often mentioned.

The Product

The creative product, as the innovations explored and implemented by the knowledge team, relies on the assumption that the presence or absence of creativity can be determined by measuring the resultant product or achievement according to certain criteria: To create is to bring forth an entity that is both new and valuable intelligibility comes into being. Most product definitions focus on the qualities of the product itself and incorporate qualities of uniqueness, novelty, value and appropriateness.

Amabile (2004) refers to creativity as the generation of new applicable responses to daily challenges and is basic to personal growth, personality integration and effective coping. Creativity is regarded as a product where the individual enjoys attention only in the sense that he/she is the facilitator leading to creation of the product. In essence, the individual is secondary to the creative product as the process enjoys very little attention and is mostly focused on the ability to create the new product.

The Creative Situation

Creative problem solving requires a nurturing climate and a facilitative attitude on the part of the organisation and the respective project innovation manager. The disposition for creativity is often facilitated expe

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