As competition in global business increases, so too does the need for innovation. This is not a new concept, as innovation has been a primary catalyst for growth, success and overall survival of organisations for many centuries. Innovation is a particular, highly coveted type of change. It is a fundamental aspect of business and product strategy, and a source of competitive advantage. Innovation is remarkable in the sense that it is, by its very nature, change, but it is also the source or wellspring of further value-creating changes.
Innovation is not, however, an end in itself – change for change's sake. Unlike other forms of change, innovation has the inherent quality of novelty or meaningful difference. For this reason change may be described as innovative if it involves a new way of thinking and acting that achieves positive outcomes and provides advantage. Without positive strategic outcomes, including better outcomes for stakeholders, innovation is merely failed experimentation. This chapter looks at how innovation acts as both a trigger and a tool for change. In increasingly competitive and globalised markets, change, innovation, quality, expertise and creativity are concepts that are becoming ever more critical to organisational change. The sections that follow show how change management is a systematic approach involving people and processes, rather than a single, isolated concept.
□Perspectives on innovation and change
Innovation in business is a complex issue and has become a way of increasing functionality, profitability and flexibility within organisations (Strambach, 2001). Innovation is a social, spatially embedded, interactive and dynamic knowledge transfer that is drawn in the context of culture (Braczyk, Cooke & Heidenreich, 1998; Lundvall, 1992; Freeman, 1998). Given the close relationship between knowledge and innovation, it is interesting to note that there is very little literature on the dependence of innovation on knowledge created in the organisation. As Hoffman (1999) argues, continual innovation is the only way a business can beat the competition, and to continually innovate, organisations need to create new markets, products, services and systems which are each contingent upon knowledge. This fundamentally means that orientation to innovation mediates the relationship between organisational knowledge, commitment and innovation. To address the changing landscape of business, leaders must find innovative ways of addressing problems, such as major changes in how the workplace is constructed and operated.