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Alla Tkachuk FRSA explores the power of creativity in business to bring change and argues that there is no innovation without creativity.

What is creativity and innovation?

'Creativity' means generating new ideas. In business, however, the novelty of ideas is not enough: they need to be practical. 'Innovation' is bringing ideas into practice. It emerges from technological and non-technological knowledge, and impacts on all realms of business. Innovation is 'creativity in business'. There is no innovation without creativity.

Innovation’s impact on growth

Leveraging creativity and innovation is at the heart of a robust economic growth and competitiveness. According to the World Economic Forum, 'around 85% of productivity gains are related to investments in innovation. Innovation is now as important as infrastructure, skills and markets'. In light of the current economic sluggishness, companies must resist the pressure to cut back on innovation spending, warns the World Economic Forum, as it is critical to the future growth.

Economic factors leading to innovation

The surge of innovation coincides with the fundamental changes in traditional manufacturing and consumption models. These changes are fuelled by the economic factors such as:

  • The rate of new technological inventions - in the 21st century, this will be 1000 times more than in the 20th century, says inventor Ray Kurzweil[1];
  • Demand for customised products and services - with the old manufacturing and trade models outmoded, companies continuously adapt to satisfy consumers with better products, quality, and prices; and,
  • Globalisation, flat-world economy, and sustainability of the environment.

What is the goal?

Profits are the goal of innovation. New services, operation models, processes, markets, and marketing methods - all impact on shareholder value.

The essence of creativity in business

The essence of creativity in business is to bring change, whether radical or gradual. Radical innovations, those that transform the way we live, lead to a long-term competitive edge; graduate modifications drive short-term sales. Companies should choose innovation that suits them best. If a company is on a tight budget, a gradual approach is more fitting, although radical change can be the way to go when resources are short. If a company needs to solve a reoccurring problem, a radical approach ought to be considered. If the problem surfaces late in a project, a smaller modification might be more productive. Not all change is innovation though; change for the sake of change should be avoided.

Relationship with consumers

Creativity in business always has consumers in mind. Successful companies understand their customers' 'unmet needs', often better than customers themselves. As Steve Jobs noted, 'customers don't know what they want can't want what they can't imagine' . Innovation, however, should not be confused with traditional market research which is primarily concerned with improving products that are already established.

Planned and managed

While creativity is a natural human activity, in the context of business it needs to be planned and managed. Yet, companies are often at a loss about the innovation know-how. According to leading business surveys[2], more than 50% of chief executives are only 'moderately successful' at planning and managing innovation, and 40% 'are not good' at it. Most innovation efforts fail, disengaging employees and costing money. Learning the innovation management mechanisms is key to companies reconciling innovation with management and making the process more timely and dependable, less risky and unpredictable.

Drivers of innovation

As well as managing mechanisms, creativity in business demands creative leaders, creative workforce, creative corporate culture, and right government policies. Creative leaders drive innovation. They are powerful champions of change. Creative workforce is the number one organisational practice of successful innovation. Companies need to learn how to recruit, train, and retain creative employees. Creative corporate culture - the work environment that encourages employees' new ideas - is the prerequisite for innovation. Government policies that strengthen education for creativity and institutional research ensure effective and sustainable innovation.

[1] Ray Kurzweil, The Singularity Is Near: When Humans Transend Biology, 2005

[2] The Business Council CEOs survey, The Conference Board, 2006; Troy, Kathryn L., Making Innovation Work: From Strategy to Practice, The Conference Board, 2004; Andrew, James P., Innovation 2005, Boston Consulting Group, 2005; Andrew, James P., Innovation 2006, Boston Consulting Group, 2006; Andrew, James P., Measuring Innovation 2006, Boston Consulting Group, 2006.

Alla Tkachuk MSc FRSA is London-based creativity and innovation consultant and facilitator, and founder of a 'creativity top-up' platform, Creativity-Gym. She can be contacted at contact@creativity-gym.com or @ATcreativitygym.

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