Knowledge economy to creativity economy
From English 194 Wiki Site
By Taylor Whitmer
22:38, 9 May 2006 (PDT)
Contents |
Abstract
This research report will analyze the shift over the past century of what businesses value as most important. The importance of reaching maximum efficiency has changed to finding the most innovative ways to manage a company, the most inventive products and the most creative ways to market those products. Because much of the playing ground for companies has leveled out in terms of who has access to knowledge and who does not, technology simply is not enough to separate the “good” from the “great” companies. Creativity and innovation are currently seen as the most important aspects of a business, and a whole new industry of creativity consultants has risen out of the high demand for companies to actively compete in the market. It is ironic, however, that an industry of consultants has arisen to help companies manage their business, since creativity is often seen as only limited to things such as visual arts, music, theater, and the like.
Description
In order to examine exactly how creativity plays a role in business today, several companies will be studied, in addition to their historical contexts. The Cisco System Study will uncover what is most valued in our economy. This reveals how numerous companies view creativity as essential to surviving in the corporate world today. Furthermore, companies such as Apple and McDonald's are examples of those that have not only found ways to be the most productive, but have also found the ways that are most creative to market their products. Lastly, there is a large area of business growing in creating Creative Consultant Businesses that will further explain the importance of innovation in our society.
Analysis and Evaluation
In today’s fast-paced society, businesses are seeing vast changes with how their businesses are run. Technological advances have been pushed to the limits to provide maximum efficiency and productivity for their customers. Because of the limits that lie within businesses' attempts to provide the latter qualities, companies are currently forced to look elsewhere in order to make themselves stand out from their competition. "Creativity" and "innovation" are sources of many ways in which businesses attempt to be seen as prominent. Currently, businesses are looking to innovative strategies not only within the company (such as with management and procedures), but are also thinking of more creative products and means of advertising for those products. Because much of the playing field has been leveled out in regards to the access of knowledge, creativity has become the essential drive for successful business.
Perhaps we should start with questioning exactly what defines “creativity”. Creativity is defined by Franklin in the 3rd Edition of Human Motivation as “the ability to not only understand the other perspective, but ‘generate’ another point of view. Creativity [measures] the uniqueness of various perspectives in addition to the number of possible perspectives. [It is also] an ability to formulate ideas that would be useful in communications, entertainment as well as problem solving.” Most definitions describe creativity as stepping outside of boundaries to find a unique idea, state or product that stands out from other things that are similar. It involves imagination and going “out of the box”. For many centuries, creativity has been limited to the realm of the arts, such as music, painting, architecture, and even photography. However, creativity is now applicable to the busines world, although it is somewhat different from creativity in the humanities. Business creativity involves generating new ideas and products, while simultaneously solving problems of innovation that exist anywhere within the company. Creativity within business implies that the organization is as efficient and productive as technologically possible. Although Franklin’s definition follows what creativity in business is, many could easily argue that applying creativity to the corporate world is a completely novel idea.
In the past, technology was enough to make a company grow and become more productive. The question that was most often posed was: “How can we increase efficiency?” In many cases, the most current technology was simply enough to reach the current competitive level. For example, computers revolutionized the way that records were kept, how people communicated, and how work was done. The companies who did not utilize the new advancement started to fall short, while the ones who used the new technology reaped the benefits. In order to re-enter that competitive market, many businesses adopted the computer as a new technology. However, since much of today’s technology is becoming more readily available to the masses as prices are constantly dropping, it is fair to say that all companies can reach a sort of efficiency since technology is more accessible for them now than ever before. Therefore, there must be a new mode of thought that companies must use in order to compete with the most efficient competitors of today’s markets. Businesses need to shift the first question posed and ask instead: “How can we create a different way to operate? What is a way that we can produce a completely different way of doing business?” With this being said, creativity in business is born.
A shift has been made from the “Knowledge Economy” to the “Creativity Economy”, as the Get Creative! article in BusinessWeek Online states. Because any type of information is so readily available to practically anyone, that “being in the know” does not provide businesses with enough to rise above their competitors anymore. To further explain this shift, Cisco Systems Study sponsored an interesting study. It examined how companies spend more and more to invent new and better products or ways of doing business. In the study, 635 businesses and IT decision makers participated in explaining what was most valuable to their own company. These companies ranked innovation as more important than the following: education, lower wages, or even reductions in corporate taxes! This simple study emphasizes the significant changes that our markets are currently going through.
In general, creativity can be broken down into further specifications. There are two types of creativity: Innovation and Invention. Innovation is the act of introducing something new that is based on a previously existing idea. For example, the iPod was an innovation which originated from the CD player, which in turn originated from the tape recorder. However, an invention is somewhat different than an innovation. Invention is defined as creating something that never existed before. Therefore, the tape recorder would be an example of the original invention. Both of these types of creativity are valuable in business. However, I would argue that the companies who perfect current innovations, such as the tape player to the iPod, are the most successful in today’s world. This is because ideas or products that are completely new take a while to market, to perfect and to become a popular, commonly-used entity.
Apple provides a great example of how innovation works within business. In the article "The Seed of Apple's Innovation" an interview with CEO, Steve Jobs, explains why innovation has been crucial to their business. He states that Apple's goal is "to make the world's best PCs -- not to be the biggest or the richest." However, Jobs recognizes the fact that there are "tons of great engineers and smart people," or a large presence of what we might call “knowledge”. In order to achieve this goal, Jobs claims that they "hire people who want to make the best things in the world". Jobs states that Apple manages for innovation through the employees who are extremely dedicated to making the best. This example only describes innovation within the company; however, the creativity of Apple’s products can be seen through the explosion of the "iPod Generation". This generation has been filled with the obsession of colorful iMac computers and bright, slim iPod’s of the size of your choice, which will play any type of music imaginable. Although these products are not the biggest and the richest, they were the most innovately created and advertised products of their kind; this is what has made Apple stand out amongst their competitors.
Although we have now found ourselves in this so-called Creativity Economy, it may seem ironic that companies are now having to “manage” for creativity. What does this exactly mean? Well, it means that many companies are now looking for ways to be creative not only through their products, but also with their management and procedures. To manage for creativity within the organization there must be motivation and skill. The interview with Steve Jobs portrays that he hires people who really want to make a difference and have the knowledge to create the items desired. Furthermore, the processes by which a company works are an additional area where creativity can be fostered. For example, if a company creates an environment where even the lowest employees are made to feel important, perhaps through an open communication environment, it can motivate all of the employees. When the internal side of the company is made as innovation-oriented as possible, then the other aspect that the company must consider is the actual product.
However, creativity can be problematic for some companies, as innovation typically involves taking risks. Many times these risks can even threaten the very existence of a company. Some of the changes that companies attempt to make often involve high costs, which is only part of the risk factor. The other part involves the actual effectiveness of the creativity. If businesses make a change and they do not see the benefits of those changes, then the business is likely to suffer. Recieving the benefits of risk can be difficult because some companies' management will not want to make huge changes for the fear of not succeeding. This is due to the fact that not all companies that make large changes to be more creative or innovative find the same rewards as companies like Apple. Furthermore, in the end, it is all a guessing game. Even Creativity Consultants do not know the exact answers as to what will and won't work.
Because there has been a huge demand for finding or creating “creativity” within business, a whole new industry of creativity consulting agencies has formed. These companies specialize in building "creativity" or innovative ways for companies to become even more successful. But, how exactly does this line of business work? The struggling business will contact the consulting agency, and then the creativity consultants will analyze the problems that the company has, in order to see where they can fix the problems or expand their horizons. Then, the consultants will look at different ways for that company to stand out from competitors through these new “innovative” ideas. Creativity consulting agencies look to brainstorm about the strengths of that specific company that can lead to future opportunity, and they will try to help the company through presentations of what has worked for other struggling companies. These creativity consultants are typically very effective, and thus the industry has seen a boom.
However, these resources are available for companies in more places than one. One way in which a company can communicate with these particular agencies which inspire creativity is through the internet, as many of these consulting agencies exist online. Although it is possible for many of these agencies to come directly to the company, there are additional possibilities open for the companies who are struggling financially and who can only afford to take advice from the consulting services on the web. The company looking for help can access a consulting agency online. The site typically has lots of useful information about how they can increase creativyt; however, they usually charrge some sort of fee for the most valuable information. For example, Innovation Tools is one useful consulting site. They identify that "a growing number of business leaders and entrepreneurs are recognizing that innovation must be embedded into the very DNA of a company's operations and culture, a part of normal, day-to-day operations." Under their "Resource Center", there are various links that companies can use to gain better ideas for brainstorming, past innovation research, innovation and idea management, mind mapping, and problem solving. All of these various links are the type of advice that consultants who would come into a company, would give. Under the link "Enterprise Innovation", Dr. Robert Karlsberg & Dr. Jane Adler describe seven steps to sustaining innovation: (1) Establish A clear sense of direction, (2) Open communication, (3) Reduce bureaucracy, (4) Instill a sense of ownership, (5) Make sure recognition and rewards are consistent, (6) A tolerance for risk and failure, and (7) Eliminate projects and processes that do not work. Ultimately, the internet has allowed for a greater access to creative help. Again, these steps bring about the question: "Isn't it ironic that businesses are managaing for creativity?" It is as if seven simple steps can cure the creativity blues of the corporate world.
Other websites such as Ten3 Business e-Coaching are also excellent resources in aiding a company. Sites such as this one are a bit more focused on actually coaching companies in attaining creativity, than compared to Innovation Tools. This is due to the fact that Innovation Tools focuses more on articles and general topics such as brainstorming, while Ten3 Business e-Coaching lays out every step very elaborately. Both are useful in today's economy. To see more information about how a busniess such as this operates, see Fortune Smiles on the Disciplined Innovator.
Although we seem to have just entered this new Creative Economy, it appears as if companies will continue to look for more innovative ways to manage their businesses, while coming up with constantly more creative products. Companies such as Apple and McDonald's will continue to strive in constantly being a step ahead of their counterparts, and based on their performance thus far, they will do so successfully. The creativity consulting industry will also continue to grow, as creativity is continuously becoming more and more valued in the corporate world. Although creativity is in its prime, it is similar to knowledge. Once creativity is pushed to the threshold where it is accessible to everyone, something new will dominate what businesses value. Who knows what that be.
Works Cited
Edited by Brooke Birrenkott 22:20, 14 May 2006 (PDT)
