Summary
The article focuses on how innovation is beneficial during the financial crisis. Mary Sullivan asserts that smaller financial organizations stand to benefit from larger financial organizations in such crisis (Sullivan 2009, p. 30). During such occurrences, banks are required to implement innovative ideas to maintain future earnings’ growth. For instance, they should look beyond capitalizing on customer attrition from weakened competitors (Sullivan 2009, p. 31). Because innovation is paramount, banks should move with haste to embrace it. The author asserts that organizations with conservative management histories will find it hard to adopt innovation. As such, the article alleges that the measures and processes put in place by banks to enhance safety suppress innovation processes. To overcome this challenge, banks should acknowledge the significance of innovation and come up with a means of synchronizing it with controls in a bank’s culture (Sullivan 2009, p. 30). Organizations stand to benefit if they analyze how successful companies make innovation possible.
In the last part of the article, the author focuses on the most innovative organizations in the world. The organizations are Team Obama, Google, Hulu, Apple, and Cisco Systems. For instance, the author asserts that Team Obama made tremendous achievements during the year 2009 (Sullivan 2009, p. 31). The article attributes this success with the team’s ability to integrate social media into their campaigns. In this regard, the author advises bank managers to adopt social media as a marketing tool.
Key learning points
I agree with a number of key messages presented in the article. Based on the messages, it is apparent that the success of the top successful organizations is attributed to their innovations (Sullivan 2009, p. 30). During a financial crisis, organizations must implement several changes to cushion them from its adverse effects. Because changes have always affected the manner in which organizations offer their services or products, innovation will be evidenced by how they will use their knowledge to tackle the challenges. During such times, the affected companies should either choose to augment their competencies using the existing knowledge or adopt radical technologies that make the existing knowledge outdated.
By adopting innovation, organizations may acquire new market shares, come up with new services and products, gain a competitive advantage over their rivals, and gain more profits. In the article, the author has highlighted the top five innovative companies during the year 2009 (Sullivan 2009, p. 30). Notably, during the same year, the global economy was undergoing a financial crisis. The five companies managed to succeed, unlike their rivals, because they embrace innovation. The author points out that Google has been successful in the past few years due to its innovative abilities. The article alleges that the company’s lab has over 60 innovative ideas at a time (Sullivan 2009, p. 31). The other company that has thrived due to innovation is Apple. With its innovative products, the company has been able to dominate the American mobile phone market for several years.
Relevant statements to the session
I feel that the points made in the article are relevant to the Middle East and in particular the UAE. For the last few decades, socioeconomic and political developments in the UAE have made the country to be one of the most successful nations in the Gulf region (Khondker 2009, p. 45). The developments have been made possible by the boom in the oil industry. Expansion in the oil and service industries has resulted in huge infrastructure developments and attracted multinational companies in the region. Given that the country’s economy is largely depended on oil, the country will face enormous financial challenges once the resource is depleted in the near future.
Therefore, the government and the companies operating within the region must be innovative to thwart such possible challenges. The government is informed of the impending challenges and has put in place innovative measures to overcome them. As such, the UAE’s government has heavily invested the returns from the oil industry in the hospitality industry (Khondker 2009, p. 45). Once the oil resources are depleted, the tourism industry will take over to be the leading source of revenue for the country. Equally, corporations operating within the region must be ready for such times. For instance, companies that have invested in the oil industry should be innovative and invest in renewable sources of energy. Through this, they will be able to secure their future.
Just like Qatar and Oman, the country is currently faced with numerous human resource challenges (Khondker 2009, p. 45). To secure its future’s stability and solve the ever-increasing human resource challenges, I believe the country must embrace innovation. Through this, the country must enhance the skills of its citizens, promote their employment opportunities, and retain its expatriates. To ensure that the country increases its job opportunities and at the same time, retain its expatriates, innovative ideas must be put in place. Based on these illustrations, it is apparent that the points illustrated in the article have many benefits to the UAE and the Middle East.
Critical analysis
The lessons of the article are relevant in my organization. In this regard, they should be adopted. If adopted, my organization will lessen its operation cost, enhance new ideas leading to improved services, reward employees with outstanding achievements, and provide continuous training and development to staff.
Despite its effectiveness, the implementation of the lessons will experience numerous challenges. More often, innovation initiatives in my organization are viewed with suspicion. Notably, the adoption and use of new technologies without appropriate evidence to support the technologies are viewed as a problem rather than a solution. Unlike in other organizations, innovation in our organization is not fully supported. Therefore, my organization must tackle these challenges to spur innovation. As such, its stakeholders should develop a culture of innovation, focus on the culture, provide incentives, and let the managers guide innovation. The organization must advocate for innovation starting from its top positions. Department leaders must put in place appropriate and effective structures to encourage innovation among their staff members.
Practical implications
I would recommend new firms to adopt the lessons because they will be of benefit to them. When recruiting their employees, firms should give priority to innovative applicants. Equally, firms should appoint innovative leaders. Thereafter, the leaders should be provided with suitable training for them to manage their fellow employees and ensure that suitable leadership styles are implemented. Similarly, the firms should appoint chief innovation officers to supervise day-to-day tasks. By doing so, the firms will be in a position to prompt and integrate innovation (Gault 2010, p. 67).
While new firms can spur innovation through innovative leadership, they should also ensure that they develop a favourable environment for innovation to thrive. It is a fact that most people resist change, so every organization should strive to create an environment that promotes change. Contrary to the past organizational cultures that allowed workers to work under minimum supervision, the developed environment should allow employees to uphold the culture of innovation.
In addition, new firms can resort to the use of financial incentives to encourage innovation among their employees. Contrary to the common belief, these approaches will eventually encourage innovation, reduce costs, and improve on the quality of services (Roessl & Kessler 2010, p. 203). Therefore, managers should use incentives to alter the organizational environment. According to human resource experts, innovations are triggered through rewards (Barge-Gil 2013, pp. 590). Through incentives, people can be encouraged to think and come up with solutions to complex challenges in their daily tasks. In this essence, new firms and established firms should come up with appropriate compensation methods. For instance, innovative employees can be rewarded through bonuses and job promotions. Above all, all firms should acknowledge the significance of innovation.
Learning reflections
By a great extent, this exercise has been very useful. The exercise has taught me how the ability to innovate is paramount in all organizations. Through the article, I have learned how organizations can manage to be successful in times of crisis. Based on the exercise, I noted that no financial institution made it to the top 50 list of successful organizations in the year 2009. By adopting innovation, banks may acquire new market shares, come up with new services and products, gain a competitive advantage over their rivals, and gain more profits.
References
Barge-Gil, A 2013, Open Strategies and Innovation Performance. Industry & Innovation, vol. 20. No. 7. pp. 585-610.
Gault, F 2010, Innovation strategies for a global economy: development, implementation, measurement and management, Edward Elgar, Cheltenham, UK.
Khondker, H 2009. Social change in the United Arab Emirates challenges of migration and Emiratisation. Middle East Institute. Singapore.
Roessl, D., & Kessler, A 2010, The role of research and technology organizations in innovation processes of small and medium-sized enterprises. The International Journal of Entrepreneurship and Innovation, vol. 11. no. 3, pp. 199-207.
Sullivan, M 2009, Post Crisis Innovation Will Rule. ABA Banking Journal, vol.101. no. 4. pp. 30-31.