Tibor Dőry

Innovation and excellence

Management methods for innovation transformation

The role of organisational culture in the success of innovation activities

It is not a new observation that companies have an organisational culture, which we often use as a synonym for the corporate or organisational atmosphere. In English-speaking practice, it became an increasingly popular area of research in management sciences from the 1960s and then the 1970s onwards. Following the bestseller In Search of Excellence by Peters and Waterman (1982), mentioned earlier in this volume, more and more people became interested in this field. It turned out that a key factor in the success of all outstanding companies is their unique organisational culture. Culture is nothing more than the system of shared values, norms, beliefs, expectations and assumptions held by the members of an organisation, which distinguishes one organisation from another. Leaving aside the scientific terminology, we could also say that every company is a cult, with its own leaders, heroes, language, rewards and rituals.

Research has shown that the stronger a company's culture is and the more it is geared towards market demands, the less need there is for various guidelines, detailed process descriptions, rules, procedures and instructions. If company employees know what to do and what they can do in different situations, i.e. what they are authorised to do, the company will operate much more efficiently and effectively. An extreme example of this is the handbook for employees of Nordstrom, an American chain of premium clothing stores, which is a single grey 5x8-inch card with a single rule: "Use your good judgement in all situations." The company has an additional piece of good advice to go with this: "Ask your department manager, store manager or division manager any question at any time."

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Figure 17. Handbook of Nordstrom

Source: https://www.businessinsider.com/nordstroms-employee-handbook-2014-10 (Date of access: 15 December 2022).

Of course, we do not want to overestimate or underestimate the above special example, which is a good reflection of a unique organisational culture. It can be seen as a kind of inspiration of what can be achieved through years of persistent work. Every great mission statement contains clear goals and a timeline. At Nordstrom, the mission of the employees is to provide outstanding customer service and customer experience. The handbook tells employees not to set high goals simply because they have to, because that is what management expects of them, but because they can achieve them. For years, new employees joining the company were greeted on their first day of work with a 5x8-inch card containing the above message. The "handbook" suggests that Nordstrom hires people who are wonderful professionals. The other key concept is trust. Underlying every sentence is the belief that we trust our employees to do the right thing for our company and our customers.

Hofstede, an outstanding researcher on the subject who works for IBM, summarised his many years of extensive research in his book Cultures and Organisations: Software of the Mind describing the characteristics of organisational culture as follows (Hofstede–Hofstede, 2008, p. 345):

holistic (refers to the whole, which is more than the sum of its parts);
historically determined (reflects the history of the organisation);
related to things studied by anthropologists (such as rituals and symbols);
socially structured (created and maintained by a group of people who together form an organisation);
soft (although Peters and Waterman reassured their readers that this "soft is really hard");
difficult to change (although the authors disagree on how difficult). "

From the perspective of our topic, it is important to understand how the innovation cultures of different companies differ, what tensions arise from this, and how management can contribute to the coordination of different areas of innovation. Based on our corporate research and expert experience to date, I can say that the success of the transformation into an ambidextrous organisation strongly depends on the ability of senior management to encourage the transformation of the organisation's employees through consistent transparency and continuous involvement. In this context, two principles can be highlighted:

From control to leadership

Organisational ambidexterity can only be successfully achieved if senior management and key positions in innovation areas are filled by leaders who prioritise a comprehensive vision for the future and recognise the psychological impact of innovation-driven transformation on corporate operations. In this context, it is crucial that leadership is understood as a shared task that transcends hierarchies and individual departments.

From silo thinking to transparency

In many companies, the innovation department is a black box. Others have no innovation team yet, thus their inventors, trailblazers and innovators are seen by others as lone wolves or oddballs who remain with the organisation as long as their proposals receive adequate support and their innovative solutions to the frustrations they encounter in their work are implemented. Simply put, the majority do not understand the motivations and actions of innovators. Among employees and managers working in production and other areas of the company, this lack of knowledge is accompanied by fear of the future, cynicism and a lack of understanding of senior management decisions.

Consistently creating transparent operations can fundamentally contribute to increasing a company's innovation potential. It is advisable to focus on offering employees and developers continuous, targeted, cross-departmental opportunities for participation in order to promote innovation. Transparency must be reflected in a comprehensive vision that emotionally reinforces employees and stakeholders in the realisation of a common vision. It is also important that it encourages innovation and collaboration within the company and with key players and stakeholders.

Tartalomjegyzék

Kiadó: Akadémiai Kiadó

Online megjelenés éve: 2026

ISBN: 978 963 664 182 5

Menedzsment

The aim of the book "Innovation and Excellence" is to inspire and encourage company leaders, managers, and experts to initiate and implement innovation transformations with the help of professional literature and corporate case studies. Another important goal is to help develop the innovation capabilities of small and medium-sized enterprises in particular by sharing simple, proven management methods that can be tested in practice.

The first part of the volume reviews the factors of corporate excellence and success, then highlights the possible sources of innovation, with a focus on the role of users and employees. The empirical section presents a detailed description of the supportive role of the workplace environment and creative working conditions based on corporate case studies (AUDI, BOSCH, MELECS). The volume concludes with a description of selected tested practical methods and management techniques that readers can try out in their own businesses.

Hivatkozás: https://mersz.hu/dory-innovation-and-excellence//

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