Creativity and Innovation in Business Organisations

Introduction

Over the years, scholars in the field of economics have sought to explain why some organisations perform better than others and superior performance has always been linked to innovation activities. Creative efforts of employees have also been recognised as a factor driving innovation in business organisations: according to Stojcic et al. (2018), creative efforts of employees are the central driving wheel behind the emergence of new economic structures and the destruction of the existing economic structures. Other researchers particularly those using the endogenous growth theory and the resource-based view confirm the relationship between creativity and innovations in economics (Edwards-Schachter et al. 2015). Extant literature has investigated the effect of innovations on different aspects of firm performance and the results reveal that the success of the modern companies significantly depends on the ability to innovate (Fadaee and Abd Alzahrh 2014). Research has also shown that creativity is a fundamental driver of innovation, market share, profitability, and survival of companies. Within this background, the aim of this paper is to explore how creative and innovative Tata Consultancy Services (TCS) has been and how innovation and creativity has affected its performance in the global market. If you need more insights with your business dissertation help, then feel free to reach out to us.

An overview of TCS

TCS is a global IT services, business solutions, and consulting provider that partners with the world’s largest businesses to transform their business journey (TCS 2019). The company offers a consulting-led and cognitive powered integrated portfolio of IT as well as engineering and technology solutions and services (TCS 2019). These are delivered through TCS unique Location Independent agile delivery model, which it uses to benchmark excellence in the development of software. TCS IT services are tailored to meet specific needs of each business organisation and government agency (TCS 2019). While the services are delivered by highly-qualified on-site IT program managers, they are highly reliable which creates value for the company. Since its establishment in 1968, TCS continues to develop unique ways of touching the lives of their customers through a continuing series of transformational innovations both in products and processes (TCS 2019). With revenue of US $20 billion in 2019 and over 420,000 of the world’s best-trained consultants (TCS 2019), the company has been able to transform itself through focussing on strategic innovations in the last five decades. TCS primary aim is to remain entrepreneurial, agile, innovative, and adaptive in order to continue creating value for its stakeholders. In addition, the company hopes to bring in new technologies that will provide business organisations innovative solutions that are required to thrive in the current technology-defined business environment. TCS objectives are formed around four key behaviours of successful firms in the digital era namely mass personalisation, leveraging ecosystems, embracing risks, and creating exponential value (TCS 2019).

Creativity and innovation literature

Organisational success in the current technology-defined business environment depends on the ability of firms to innovate. Previous literature on innovation has identified creativity as a key driver of innovation and the survival of organisations. The basic information from previous literature is that innovation starts from a creative idea whose concept has market potential but must receive funding in order to overcome obstacles such as competitive pressures and technological challenges (Coulson-Thomas 2017). Such ideas are conceived by creative employees or teams that are managed in a manner that encourages team members to be creative. From this information, it is evident that innovation cannot be realised without creative processes undergone by individual employees. This implies that innovation is a multi-dimensional concept, which comprises individual, team, organisational, and multi-level perspective (Matthews and Brueggemann 2015).

Recent literature suggests that the frequency, speed, and magnitude of innovations significantly depend on the creativity of individuals within and outside an organisation (Perry-Smith and Mannucci 2017). In the same vein, previous theoretical advances on creativity and its association with innovation have centred its effort on understanding the factors that influence an individual’s creative potential (Sarooghi et al. 2015). Other studies have focussed on interpersonal, organisational and environmental factors that affect an individual’s creativity and the success of the innovation process (Caniëls and Rietzschel 2015). Such studies are a clear indication that individual creativity is significantly related to organisational innovation activities, which implies that creativity and innovation are related. In this line, creative individuals are seen to make greater impact of product modifications and innovations, which creates value for stakeholders.

Recent literature focuses on strategic innovation, which is defined as the blend of creative exploration with growth strategies in order to discover new product categories, new market segments, and new services and business models, which change operations within an industry while enhancing value creation (Briones Peñalver et al. 2018). As a result, businesses are increasingly adopting the strategic innovation framework in revitalising their business processes and portfolios in order to remain competitive. The strategic innovation framework uses traditional and non-traditional approaches to business strategy while deploying other dimensions of customer insight, industry foresight, core competencies, strategic alignment, visionary thinking, and organisational readiness in order to drive growth (Agarwal 2016). Regardless of the dimensions of the strategic innovation approach that a company adopts, strategic innovation has been positively associated with organisational performance.

Analysis of TCS’s innovative activities

TCS has adopted a customer-centric organisation structure, which implies that its actions are informed by the needs of its customers. In all its activities, TCS seeks to build differentiated capabilities for its customers, helping them gain a competitive advantage (TCS 2019). The company has set up innovation centres in different industries and markets and strategically placed researchers in these centres that collaborate with domain experts to build innovative solutions of customers in specific industries. For example, the company is working together with Total and Newcrest to set up dedicated innovation hubs that will harness the combinatorial power of IoT, machine learning, analytics, and AI in order to improve the experiences of customers, boost profitability and productivity, and establish competitive differentiation for customers that will use the combined service(TCS 2019). By working together with its customers, TCS seeks to ensure that customers are able to digitally reimagine the principal elements of their business, reduce risk, and gain speed to the market thus outperforming their competitors.

TCS has made six major strategic innovations and the six have significantly created a sustained competitive advantage for the company. The six innovations are innovation forum, innovation labs, co-innovation network, global strategic partnerships, digital software solutions, and business process innovation (TCS 2019). TCS has hosted various innovation forums whereby businesses come together and identify technological innovations that would drive value to stakeholders. The company with the help of its employees who are experts analyses how the proposed innovations would meet customers’ specific requirements and the most beneficial innovations in terms of better operational effectiveness, business transformation, cloud business models, and simplification are adopted resulting in increased value for the businesses and their stakeholders (TCS 2019). TCS has a 4E innovation framework: the 4 Es are Explore, Enable, Evangelise, and Exploit teams. The innovation labs come handy in Explore where research concepts are tested by engineering the applications. Applications that are most attractive to customers and the business are then upgraded by an Exploit team before they are made available to customers. TCS has innovation labs across India, UK and the US and the labs are continuously undergoing evolution resulting in new technologies, businesses, and domain innovations. Through the Co-Innovation network, TCS has been able to partner with different countries to develop different ideas, which have then been transformed into ideas and business solutions. Through this innovation, TCS has been able to deliver disruptive innovations that are globally sources and customised to requirements of different customer segments. Through global strategic partnerships, TCS has been able to work with other IT companies across the world to provide led digital transformation and rapid development of applications. Through such partnerships, the company has also been able to co-own applications and combine their best features to deliver even greater value to customers. The digital software solutions group is a strategic growth business unit in TCS, which was formed with an aim of helping customers to undergo critical digital transformations through tailor-made software and solutions. Lastly, business process innovation, simulation, and visualisation as a service commonly known as VAAS is TCS strategic partnership with iRise which was formed with an aim of helping organisations achieve business agility through integration of visualisation and simulation capability into TCS software development processes. Through this integration, TCS is able to meet the needs of its customers faster.

Impact of TCS’s innovative approach and practices

The information in the above section shows that TCS could promote its unique capabilities by innovating strategically, which in turn will help it gain excellence in all spheres of the business. TCS has been attaining heights of excellence and maximising value creation for its stakeholders through practicing strategic innovation. TCS believes that stakeholders such as academic institutions, clients, peers, and other technology companies have a critical role to play in the innovation process as a result the company has actively engaged these stakeholders in the innovation process (TCS 2019). This has resulted in development of software and business solutions that better meet the needs of clients helping TCS better serve its customers. TCS has also continued to encourage innovative thinking among its employees and its clients and this has resulted in mass processing of ideas and creation of channels through which the customers can be engaged (TCS 2019). This has resulted in TCS been able to engage its stakeholders even better and as such has been able to gain a deeper understanding of their requirements promoting uptake of the developed solutions and software. Therefore, innovation can be said to be the wheel driving TCS success in the current hypercompetitive business environment.

Disruption and how it could affect the structure of TCS

Disruptive innovations have always led to industrial revolutions and the fourth industrial revolution is underway which will be powered by the emergence of internet and digitalisation. In the fourth industrial revolution, internet and digitalisation will blur the relationships between digital, physical, and biological spheres thus disrupting industries all over the world (Majumdar et al. 2018). In order to handle the changes that will arise with the fourth industrial revolution, companies all over the world will have to re-skill their employees and lay off a significant percentage of employees since most aspects of work will be automated (Majumdar et al. 2018). This implies that TCS as a service and business solutions provider will have to massively re-skill its employees so that they will be able to offer competent services and viable business solutions in the fourth industrial revolution. In addition, the fourth industrial revolution will lower barriers between inventors and markets (Majumdar etal. 2018) which implies the IT industry will be more competitive than ever. For TCS to survive in the fourth industrial revolution, it will have to ensure its employees are competent to handle the new business challenges and have an increased role in artificial intelligence. TCS will also have to work in partnership with more IT firms in order to understand the fusion of technologies in the fourth industrial revolution and how to respond to them in order to create value for stakeholders. In the current industrial revolution, TCS has developed its brand and it is known providing business solutions and software that help businesses gain a competitive advantage. With the confidence that customers have on the company, TCS has to ensure it has the right knowledge to orient these businesses in the fourth industrial revolution. In order to attain this, it is time that TCS invested in training and developing its employees and partnering with other firms in the industry in order to extend its knowledge base.

Impact of creativity on organisational culture, processes and outcomes

In the wave of globalisation, creativity is fundamental for firms to acquire and maintain competitive advantage. According to Imran et al. (2018), employee creativity is one of the processes that facilitate the formation of knowledge-intensive culture whereby before any task is completed, employees are encouraged to share knowledge and apply it in the task at hand resulting in better outcomes. In TCS, the creativity of individual employees is valued and this has resulted in the formation of a culture where employees are given autonomy to work directly with clients and solve problems for the clients. In TCS knowledge intensive culture, employees are known to be competent thus they receive minimal or no supervision in their work. On the other hand, Khalili (2016) states that employee creativity significantly and positively affects organisational outcomes including innovation, effectiveness, reputation, competitive advantage, and performance. TCS hires the world’s best trained IT consultants and encourages them to be creative, which has enhanced the company’s organisational outcomes such as innovation (TCS is among the most competitive IT firms in the world), performance (TCS is among the most competitive firms in India, UK and the US) and reputation. Further, Choi et al. (2015) assert that employee creativity affects leadership, intelligence and motivation to generate job outcomes. These effects are evident in TCS: following the creativity of individual employees, the company embraces transformational leadership so that employees and leaders empower each other for better performance. The company also uses creativity to motivate employees for better job outcomes: for example, a leader assigns an employee or a team to a client and the team is supposed to listen to the needs of the client and develop a business solution or software that provide value for the customer.

Conclusion

This report shows that TCS uses creativity and strategic innovation to promote excellence and maximise value creation, which has resulted in the company gaining a competitive advantage it the IT industry. The report also shows that TCS adopts strategic innovation in developing new products, processes, and even in innovation of the organisation. TCS works together with its clients, peers, academic institutions, and other technology firms in order to better understand the business environment and offer solutions and services that respond to these needs. Therefore, it can be said that innovation at TCS is informed by market demands, which has been vital to enhancing TCS performance.

References

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Briones Peñalver, A.J., Bernal Conesa, J.A. and de Nieves Nieto, C., 2018. Analysis of corporate social responsibility in Spanish agribusiness and its influence on innovation and performance. Corporate Social Responsibility and Environmental Management, 25(2), pp.182-193.

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