Organizational Changes

Innovation and organizational change play an important role in the business landscape. Whether it is the formulation of a new product, the introduction of a new service, a technological invention that changes business processes or a new administrative practice, innovation and organizational change helps to shape a companies strategy and structure. Some industries spend a higher percentage of their budget on innovation strategy than others. This can depend on the structural factors that influence the industry and the degree of influence changing consumer preferences and tastes can have on a company.

Industries and companies allocate funds for innovation and organizational change in response to competitive pressures and the likely duration of the product life cycle. The software, health and pharmaceutical industry typically invest a higher percentage into research and development for new product creation. Competitive pressures to develop new solutions to meet the needs of changing consumer preferences and the intense nature of the competition forces companies to stay highly response to market needs or risk losing market share to competitors who differentiate their products or offer superior solutions.

The automobile and airline industry are two industries that spend heavily on organizational innovation research. This is to facilitate product and process improvement. Technological advancements that contribute to product development also play an important part in innovation and organizational change within a companies manufacturing division. Changes to companies production processes to increase productivity are a prime example of this. As automation replaces manually skilled workers, companies respond by reducing the workforce or retraining existing employees.

The challenge companies face with innovation and organizational change lies in the implementation and workplace response to new initiatives. When new technology enters the scene, companies are forced to evaluate and plan how to best implement it. This often involves a high degree of anticipatory style planning because a lack of comparison studies exists. Operating in 'unchartered waters' requires careful consideration of the likely effects on an organizations strategy, structure and corresponding workplace implications.

Mandating, communicating and effectively managing innovative organizational change requires strong leadership to embrace and implement the initiatives. This is best achieved by unifying company resources and involving personnel who are most affected by the change. A consultative approach encourages participation in the process and minimizes the chance that alienation, anxiety and resistance will occur within company ranks. Having the vision to implement and responding to practical real life feedback are important factors for the success of organizational change and innovation.

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