INTRODUCTION:

Organizations have to constantly reinvent themselves and upgrade their products and services every now and then. Incremental innovation ensures that companies come up with something better time and again, rather than something radically new which might create apprehension in the minds of its stakeholders-suppliers, employees, consumers, Government etc. Innovation is a way of life for most organizations and those which fail to innovate end up in the loser’s path.

CREATIVITY AND INNOVATION :

The term “creativity” refers to the ability and power to develop new ideas. Innovation refers to the use of ideas. In an organization, this can mean creation of a new product, a new service or a new way of doing things. Innovation is any product, service or idea that is perceived as new. Organizations have to constantly reinvent themselves and upgrade their products and services. Innovation, in a manufacturing or service organization, can be seen across such diverse field as product or service innovation, technological change and manufacturing process innovation, finance and its department innovation, innovation in HR and marketing innovation.

Most companies limit their innovation efforts to only search for new product ideas or new disruptive technologies. However, it does not end at new products or technology. Companies need to steer clear of this myopia, and try to widen the front end of their innovation pipeline so that they become open to a different set of innovation opportunities. Hence, companies started to innovate various things in various department as it is rightly said that “drops of water makes an ocean” so as little efforts to innovate the various departments an organization have will make it a markrt leader or in simple terms a successful company.

Let us start studying innovation in various departments of a company: To begin with----

I . FINANCE DEPARTMENT :

Generally when we connect the world of innovation with the world of finance, we think of phrases like creative accounting. This term has come to be a euphemism for the misrepresentation of a corporation's financial position.

Now there is a distinct trend toward the finance function emerging as an enabler, and even a driver, of business innovation. The results of a survey conducted by CFO Research Services and Microsoft, an EDS Agility Alliance Partner, first aired on March 18^th in a webcast entitled, "How the Finance Function Is Emerging as an Enabler of Innovation." This study among senior finance executives examined the contribution finance makes toward enabling business managers to develop business innovations and make well-informed decisions.

Surprisingly, respondents said that their company would benefit the most from a greater collaboration with the finance team in crafting, tuning, and optimizing business models to bring visibility to business complexity and to meet improved performance expectations. That is, companies felt the finance teams should exert more effort working with business managers to find and validate opportunities to improve operating performance; comprehend the revenue, cost, and profit implications of their decisions, and understand competitive dynamics. Overwhelmingly, respondents also indicated that the highest value business innovation came from cross-functional teams.

In management theory, one way of structuring organizations is to divide departments and divisions between line and staff functions. Those directly related to the organization's primary mission are line functions and those that enable the line functions to accomplish their objectives are staff functions.

Staff functions play an essential role in overall operations. The finance department, for example, is responsible for preparing and administering the budget, collecting revenues, issuing checks to the vendors and employees, borrowing funds when necessary, and issuing financial reports to meet legal and managerial requirements. These responsibilities often are accomplished in collaboration with other staff departments, including the chief executive's office, the management information systems group, and the human resource management department.

Payroll Services. The single largest internal customer group served by the finance department is the employees. The primary service that finance provides is high-quality payroll services. In an organization, payroll services are provided through a collaborative effort among the departments of finance, human resource management (HRM), and information technology.

The most important function of payroll services is to provide an accurate and timely payroll check to all employees. Less obvious but essential payroll services include:

* ensuring accurate transmission and reporting of payroll withholdings to the proper entities,

* ensuring accurate and timely end-of-year tax forms,

* ensuring that the company’s Payroll Account always has sufficient funds on deposit to cover the payroll checks issued so that employees' earnings are immediately available to them,

* ensuring accurate and timely transmission of non-tax payroll withholdings to ensure employees' legal compliance,

* allowing for direct bank deposit of employees' net pay,

* using payroll software to enable the company to offer a variety of employee benefit programs by payroll deduction, and;

* providing up-to-date, accurate vacation and sick leave balance information with employees' paychecks.

Because there are staff departments involved in delivering this critical service, the payroll quality circle can be formed and staffed with a QC facilitator. After receiving training from the facilitator, the QC members brainstorm a list of problems to be addressed. This initial list is prioritized and analyzed, giving the group an immediate sense of how useful the QC process could be. To enable the payroll QC to identify customers' needs and establish goals, the QC should meet with the other department heads and administrative staff members involved in the payroll process.

The payroll QC members may come across countless payroll issues. They can develop suggestions for policy revisions that have been implemented by the manager and can obtain software training and provide input to the software vendor about desired changes to the payroll software. They reassess and revise plans as new information became available, drafted written procedures for payroll related tasks, and provides cross-training on critical tasks. There have been numerous instances in which payroll QC actions have improved the accuracy of individual payroll checks.

A significant project that the payroll QC and the departments of finance and information technology currently are working on is to provide training to line-department staff members in obtaining certain payroll, expenditure, and budget information from the company’s accounting, human resources, and payroll software. Providing training on how to use this software will enable the line departments to retrieve useful financial and human resource data more quickly as well as streamline the workflow. Furthermore, training will reduce the time that finance, human resources, and information technology staff members devote to information retrieval so that employees can focus on other tasks.

Customer training is another very effective technique the accounts payable QC uses for maintaining customer focus and resolving customers' problems. This QC can present seminars to the staff about the general accounts payable procedures as well as procedures specifically relating to different contracts, such as those for building construction projects. A notable result of providing the will improve understanding of the accounts payable process on the part of departmental staff, reducing the amount of time needed to pay an invoice.

Budget Preparation: Another customer-oriented finance innovation is an improved process for preparation of the departments' budget requests. To assist the internal customers in preparing their budget requests, the finance staff creates templates for calculating the amounts needed for each employee's salary and benefits and calculating the totals of the projected costs. These templates can be provided on computer disks to the departments that expressed the desire to use the software in preparing their budget requests. Using these templates enabled the departments to assemble their budget requests more quickly and more accurately, since the calculations were built into the templates.

II. PRODUCTION AND OPERATIONS DEPARTMENT:

An important innovation in operations that made mass production possible was the system of standardised and interchangeable parts known as the ‘American system of manufacture’ which developed in the United States and spread to the United Kingdom and other countries. Instead of being produced for a specific machine or piece of equipment, parts were made to a standard design that could be used in different models. This greatly reduced the amount of work required in cutting, filing and fitting individual parts, and meant that people or companies could specialize in particular parts of the production process.

A second innovation was the development by Frederick Taylor of the system of 'scientific management’, which sought to redesign jobs using similar principles to those used in designing machines. Taylor argued that the role of management was to analyse jobs in order to find the ‘one best way’ of performing any task or sequence of tasks, rather than allowing workers to determine how to perform their jobs. By breaking down activities into tasks that were sequential, logical and easy to understand, each worker would have narrowly defined and repetitious tasks to perform, at high speed and therefore with low costs.

A third innovation was the development of the moving assembly line by Henry Ford. Instead of workers bringing all the parts and tools to a fixed location where one car was put together at a time, the assembly line brought the cars to the workers. Ford thus extended the ideas of scientific management, with the assembly line controlling the pace of production. This completed the development of a system through which large volumes of standardized products could be assembled by unskilled workers at constantly decreasing costs – the apogee of mass production.

New Japanese production techniques, such as total quality management (TQM), just-in-time (JIT) and employee involvement were emulated elsewhere in the developed world, with mixed results.

More recently, the mass production paradigm has been replaced, but there is as yet no single approach to managing operations that has become similarly dominant. The different approaches for managing operations that are currently popular include:

Flexible specialisation in which firms (especially small firms) focus on separate parts of the value-adding process and collaborate within networks to produce whole products. Such an approach requires highly developed networks, effective processes for collaboration and the development of long-term relationships between firms.
Lean production which developed from the highly successful Toyota Production System. It focuses on the elimination of all forms of waste from a production system. A focus on driving inventory levels down also exposes inefficiencies, reduces costs and cuts lead times.
Mass customization which seeks to combine high volume, as in mass production, with adapting products to meet the requirements of individual customers. Mass customization is becoming increasingly feasible with the advent of new technology and automated processes.

Agile emphasizes the need for an organization to be able to switch frequently from one market-driven objective to another. Again, agile manufacturing has only become feasible on a large scale with the advent of enabling technology.

The research department should continually strive hard to provide with best Quality and Design. The processes should be continuously improved based on the measures and the feedback from customers. The production department should work on the Size, shape, material and finishes of the product. Appropriate machines be used to produce the Quality and Cost effectiveness. Every product so produced is to be Quality-Tested to check its Quality, Strength, Aesthetics and Packing.

III HR DEPARTMENT:

Innovation is a front burner issue in the boardroom these days. Strangely, there are many who opine that HR has no role in innovation. This is definitely not the case. The human resources within a company are the single most important ingredient in the innovation success formula. It follows quite naturally that the HR function must have an impact on the company’s innovation capacity. The only real question is how HR can ensure that this impact is a positive one.

The role of HR in innovation is a supporting role. HR should not try and insert itself into the realm of defining or managing innovation activity (with the obvious exception of looking inwardly at HR function innovation.) Rather HR, can best support the innovation agenda by sticking to its knitting and focusing on three key theme.

RECRUITMENT

It begins with hiring the best people. HR must work diligently to make sure that right systems are in place to attract, identify, and capture the best talent to drive innovation. This doesn’t mean going out and recruiting an innovation guru. This means that every person hired into the organization from the low level to the executive staff must be the top talent available to the organization.

This is harder than it may sound. Most managers have no clue about how to find and select the right people to hire. HR must provide assistance in this area. The HR team should work with other parts of the organization to create the best message and delivery to fill the candidate pipeline with the best people. HR must train managers on the best practices for creating employee and job profiles that can be used to properly screen candidates. Managers need help in constructing the process of interviewing and vetting candidates. Most managers lack interview skills. HR should provide coach to hiring managers in the basics of situation-based interview techniques and candidate evaluation around the metrics of aptitude, attitude, and achievement.

REWARDS

Everyone likes to be recognized. This is true in all aspects of life. In the office, it has specific meaning and value. The right rewards system provides a powerful for reinforcing commitment, directing employee professional growth, and shaping the corporate culture.

HR departments must look at the reward mechanisms in place and ask if they are doing the right things to develop the employees and culture of the company. This should include compensation strategies, performance management tools, and other targeted recognition and reward programs. Few companies are measuring the right things when it comes to promoting the development of innovation workers. HR managers should take a hard look at how they are trying to develop these critical resources.

RETENTION

The cost of losing a key employee is very high. So, it must be a primary objective to retain the top performers in the organization. This of course suggests that HR needs to work with managers to have a system that identifies who are the key people in the organization and where are the risks. With that information, the company can then consider what tools and actions are needed to mitigate these personnel risks proactively. Remember, it is always easier and less costly to enfranchise someone before they have made a decision to leave.

While all this might sound like the meat and potatoes of HR, it truly is where the HR function has the biggest impact on an organization’s innovation (and thus value creation) potential. Sometimes blocking and tackling is what’s needed to win.

IV. MARKETING DEPARTMENT:

The ability of a company to innovate for attaining superior efficiency, quality and customer responsiveness will determine if its product is differentiated from that of rivals and if it has low cost structure. Companies that can increase the utility that customers can get from their products thoug differentiation, while simultaneously lowring their cost structure create more value than their competitors. This leads to competitive advantage and superior profitability and product growth.

When firms are successful in introducing new ways to market their products, they trigger grater buyer interest, widen industry demand, increase product differentiation, and lower unit costs. Any or all of these can alter the competitive positions of rival firms and force strategy revisions. In today’s world, Internet marketing is shaking up competition in industries such as electronics retailing, stock brokerage, retailing of books and office supplies.

PRICING : Pricing should be designed so as to make it easy and affordable for a first time buyer to try the company’s product or service. They should find ways to reduce their operational costs. The success in achieving a low cost edge over rivals comes from exploring all possible avenues for cost reduction and pressing for continuous cost control across all stages in the company’s value chain year after year.

DISTRIBUTION: Innovation in distribution is a driving and unifying force in the rapid developments now taking place in the distribution of many products .It has to be developed for the entire distribution value chain, from the time the customer orders a product, until it is delivered. The Minda Group, India's foremost auto component manufacturer, took a major initiative to aggressively target the After Sales market for its range of products. The Group, in the first of its kind initiative in the auto component space, announced the roll out of its FMCG model for the after market (replacement market). Minda Group will roll out the model across the state of Tamil Nadu initially, before taking it across the country. The FMCG model envisages the division of the state into seven different territories identified on the basis of their vehicle population and sales potential. Each of these territories will be serviced by a representative called the Missionary Service Representative (MSR). These representatives will be locally placed and will be responsible for the sales, marketing and servicing within the territory which would range to about a radius of 100 Km from the base. The Minda MSR’s will be provided with Motorcycles carrying appropriate Minda Branding – such constant presence and visibility in the market, coupled with a strong distribution network will ensure that consumers throughout the State will have access to genuine spare parts as well as quality service backup. The product and value offering to consumers will get further enhanced over time, as more and more products get added to the Minda range.

PRODUCT: While advertising and promotion costs are high, companies have to frequently launch new products to expand their market share. Leading FMCG players have a vast portfolio of products and brands that keeps growing by the day.The number of Bio and natural products keeps growing at most of the categories as the perception of artificial ingredients is considered unhealthy and some times evil. NATURAL, BIO and GREEN are most common words included at the brand / sub-brand / taglines of Soft drinks products. LIGHT is no longer a trendy word for fitness & calorie control product ranges. Today’s word for these products is ZERO. Portions control (i.e. Calorie Packs) and 1/X FAT claims are growing. Natural functional benefits are up! The most common innovation benefits targeted are beauty, energy, health, anti-aging and relax. The natural ingredient most of the times becomes the essence of the product personality and communication. Lean trend is growing within new consumer goods launches.Packaging, conservation, transportation / storage, regeneration, usage, consumption, dosing and bundled benefits are the major trends. In the household and personal care categories, pencil type packaging / dosifiers are growing in popularity. Recession and a growing popularity of private label products, are triggering. Value-for-Money product launches. Some companies revamp their brands (i.e. Henkel’s Dixan), others truly launch new concepts / brands (i.e. Coca-Cola’s Menos es Más), while the rest communicate price rebates at their packaging. Some products as Unilever’s Magnum Temptation have become an attainable luxury and pleasure ritual for many families. Recent innovations such as Illyisimo, Lay’s Sensations and Trident Senses, all aim for a similar hedonist consumption that drives to similar success results. Most of the times, limited edition products are variants of a regular product with a different flavor (in the case of Foods & Beverages), which are offered through impulse channels. In essence, the question is that a claim such as “limited edition” should trigger an impulsive behavior from the customers. Exotic and stylish product designs target emotional buying. Wrigley’s Five chewing gum is an excellent example of an exotic + stylish design product, whose launch has been reinforced with a communications image in the line of Apple’s iPhone. Young people and youngsters’ wannabes are the target segment for these products, such as Pringles Xtreme. Online cultural elements are generally integrated into the packaging visuals to reinforce this youth and fresh image (i.e. Perrier’s Conversations packaging). Brands with a large heritage can always be re launched with variants recovering its old image but adapted to new times (i.e. Pepsi’s Pepsi-Cola throwback). Some other times, a product can be recovered and commercialized again with its same image and communication as n years ago (i.e. Legrain’s Moussel). Fair trade, ethics and solidarity are a strong concern amongst Gens X and Y. Some brands promote charity actions and communicate them through trade-marketing material. Some others place logos of fair-trade or NGOs certifications. Just a few of NPDs are exclusively oriented to Fair Trade and Solidarity Eco-friendship product development trend grows due to the emphasis placed on ecological concerns by global opinion leaders and the massive media. Ecological food, sustainable packaging and greener cleaning products are part of this trend.

PROMOTION : Many companies have also introduced innovative strategies that have rewritten the rules of marketing. One such strategy is the introduction of small sachet packs of shampoos, conditioners and detergents for as low as Re. 1 or Rs. 2, which has helped FMCG majors popularise their branded products even among price and value onscious customers. International cereal-maker Kelloggs too has introduced a single-serve cereal pack as a low-price entry point for new customers.

A properly executed internal marketing campaign is essential to maintaining momentum in the innovation program and fostering champions of innovation across the enterprise. There are many forms of internal promotion. The successful architect of the high performance innovation culture uses all of them.

It begins with selling up. Have you ever noticed how a good salesman always compliments your judgment when you decide to buy? As you build the organizations innovation capability, never forget that establishing a strong innovation capability require significant, on-going investment. Naturally, such investments are subject to review as are any investments the organization makes. This means that clear and measurable return on the innovation investment must be shown to ensure the long term health of the program. Soft ROI metrics are useful, but you also need to identify hard metrics to really cement the commitment to the path of innovation But, metrics alone are not enough. You need to make sure that the achievements and ROI of the innovation have strong visibility at the C-exec level. Arm your C-level innovation champion with the anecdotes and data to represent the program in executive forums. Conduct periodic Innovation Program Reviews for the benefit of the executive team.

Selling outward is just as important. As much as innovation workers need to have visibility to the corporate goals, they also need feedback to know when their efforts have hit the mark. Information about innovation success needs to be promulgated throughout the innovation community so that innovation workers can see the impact that they and other innovation teammates have had on the organization. This sort of information sharing is a very powerful tool of enfranchisement for people. When employees can see the value of their work, they feel more valuable themselves, they feel a part of something more important, and they feel inspired to reach higher.

Don’t forget to make it personal. Give individuals and teams that have made a special contribution public recognition. This reinforces the message that the company values innovation in a very tangible way. When appropriate, recognition systems should also integrate into the compensation system.

Internal promotion is critical to building the lasting, sustainable innovation program corporations want.

CONCLUSION:

Innovation thus spreads across the entire gamut from conceiving the product to its final delivery and also in each department of a business entity. Businesses that failed to innovate and which clung to an earlier successful business model have often been forced to bow out of the market. Some of the following points will help business to be successful by hugging innovation at every nook and corner of the company.

• Lead innovation strategy and projects implementation from market insights to go-live and post-launch results

• Bring focus to new potential brands and new product opportunities, ensuring right re sourcing for innovation

• Overcome obstacles to ensure projects are delivered in time, and within budget

• Track ongoing results and fine-tune the organization’s efforts to improve them

• Lead all consumer and shopper research projects in a cost and time efficient manner

• Develop an area and provide ongoing consultation on shopper and consumer issues throughout the organization

• Build short and long term insight plans to support product innovation and general brand management

• Assess organization’s innovation capabilities and identify growth opportunities

• Build the business innovation strategy to develop innovation capabilities throughout the organization

• Deliver a portfolio of innovation initiatives to crowd the whole innovation pipeline in different time horizons

• Prepare food for thought and run Creativity / Innovation workshops with key stakeholders and / or cros functional teams (Marketing, Sales, R&D, Manufacturing, Logistics, Customer Service, Financial, Legal, …)

• Lead and provide support to market research efforts, bringing coherency throughout briefing development, agency services deployment and results interpretation

• Analyze current innovation pipeline and plan for New Product Development (NPD)

• Identify new potential innovation leads and their gap with current innovation capabilities

• Develop models to prioritize initiatives, optimize resource allocation and to help project management

• Balance initiatives across the innovation pipeline to increase success probabilities in the short, mid and long term

• Analyze the organization and processes involved with innovation and NPD and advise opportunity gaps

• Determine the ideal organization and processes to accelerate innovation and its fit with current organization

• Create an Innovation Acceleration Strategy and deliver roll-out recommendations

• Assess fine-tuning opportunities and alternatives

• Define feasible options, run market research and fine-tune the product

• Prepare product launch (Marketing communication activities, sales training, logistics, system entries, price policies, field-marketers scheduling, …)

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