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Creativity in Management
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committees decided to sack poorly performing workers. Some 500 surplus workers were retrenched. A productivity-linked pay system was introduced. Plant modernization was implemented. A suggestion scheme was introduced to get the suggestions of the staff on how to improve performance. As a result of all these actions - innovative in our public sector - capacity utilization increased dramatically, and so did sales and profits. Sales rose from Rs. 85 million in 1983-84 to Rs. 181 million in 1986-87, and the performance altered from a loss of Rs. 9.4 million in 1983-84 to a profit of Rs. 30 million in 1986-87.
But is creativity possible in large organizations ? These organizations operate in a context in which creativity is often quite difficult, because of rules and regulations, a tall hierarchy, multiple specialized departments, formal policies, and controls. On the other hand, even large organizations need to be adaptable and innovative in the face of intense competitive pressures and opportunities for growth in an emerging market economy like India. Such organizations need a distinctive kind of creativity. This is because creative ideas need to be brought to the attention of management, any innovation needs to be funded and approved, needs the cooperation of a number of subordinates, colleagues, and bosses and needs to be reviewed periodically by higher ups, who may or may not allow it to be executed for political or other reasons. Innovation also needs to be effectively implemented. A creative head helps a lot, but it is not a necessary condition. It suffices if he or she is receptive to creativity and respects its value to the organization.
Let me give the example of a German company called Siemens-Nixdorf or S-N in brief (Kennedy, 1998). This is a large information technology company that produces and markets both software and hardware. In the 1990s it had a staff of 40000. In 1993 it lost DM 350 million on sales of DM 11700 million. Gerhard Schulmeyer was brought in as the CEO in October 1994 to turnaround the company. Schulmeyer met some 9000 employees and other stakeholders even before taking over as CEO. His diagnosis was that the company needed a mindset change to thrive in the extremely dynamic and competitive IT industry. He felt that it needed a lot more entrepreneurial, customer focused and teamwork oriented culture. He wanted the mindset change in just 2 years.
Schulmeyer initially talked to 3 high potential change agents - the heads of human resource management, corporate communications, and corporate strategy. He asked them to identify several more change agents. 30 change agents were identified, who brainstormed for 3 days and developed a 19point agenda of action. Another 300 'opinion leaders' were roped into the transformation effort, and 60 consensus issues for action emerged at a workshop. Each action issue was assigned to a project leader, who recuited his/her own team for the effort.
The process of identifying and roping in change agents was continued
