Organizational Impact
Innovation, design, and creativity are necesaary functions for organizations that wish to stay competitive. These three functions have a direct impact on how successful an organization is at fulfilling its mission, vision, and goals. Corporate leaders and managers looking to maximize their profits should include innovative practices as well as design and creativity as important elements of their company strategy. This paper will discuss innovation creativity, and design and the impact it has on a service company, and a manufacturing company. The companies selected for this paper are Southwest Airlines and Samsung.
In 1971 two gentlemen with less than $150.00 in the bank and debt in excess of $100,000 founded Southwest Airlines. With a fleet of 3 Boeing 737-200 planes, Southwest Airlines begin offering flights within the state of Texas. The founders of Southwest knew that in order to be competitive, and earn a profit they had to find ways to separate themselves from their competitors. In the early seventies, Southwest airlines became competitive by offering $10 fares on the last flight of the day. When other airlines followed suit Southwest began offering a bottle of Scotch, or Vodka as an incentive to attract the frequent business travelers. Although Southwest was exclusive to the state of Texas, they were able to turn a profit in their first quarter of operations.
Innovation, creativity, and, design have helped Southwest establish themselves as one of the top competitors in the airline industry. Currently, Southwest flies between more than 4,041 city - pairs and offers service to more than 650 round trip destinations (Southwest, 2014). Southwest remains innovative by offering the lowest fares, maintaining an excellent safety record, implementing the use of technology at their airport locations, and being the only airline that does not charge a fee to check a bag, or change a reservation. Southwest has adopted a more modern look by purchasing new planes and changing the color of the planes and painting a heart on the belly of the aircraft to symbolize that the employees are the heart of the company. Southwest can minimize costs in the training of its pilots because they only have to learn to fly the Boeing 737 series airplane. Southwest is dedicated to providing quality service at a discount, maintaining a work environment that is both productive and employee friendly and earning a profit for the stakeholders.
Samsung is a global manufacturing company that makes everything from cell phones to semiconductors. Samsung utilizes a process called “open innovation” as a company strategy. Chesbrough (as cited by the Industrial Research Institute, 2014) defined open innovation as “the use of purposive inflows and outflows of knowledge to accelerate internal innovation and expand the external use of innovation”. The four components of open innovation are global consortiums, which helps Samsung remain knowledgeable of new technologies and industry standards. The second is cooperation between industry and academia, which means that they maintain relationships with Universities and offer training programs to students and current employees. They believe that by providing this opportunity it gives their company the advantage of discovering cutting edge technology. The next process is synergy with equipment