Application Assignment Week 2 - Adaptation through Innovation and Strategy

Yeirang Lee

Academic Article: Application Assignment Week 2

Business as Organisms: Adaptation through Innovation and Strategy

                  Through the readings and from the purpose of this course, we are always trying to penetrate the fact that management is the key to an organization’s success. From our last week’s reading, we read management as a mechanistic tool used to increase an organization’s efficiency and this week, we realize that organizations are all very different and as the metaphor goes, “organizations, like organisms, are open to their environment and must achieve an appropriate relation with that environment if they are to survive” (Morgan, 1998). Thus, we begin to see that organizations hold mechanistic as well as social, psychological, physiological characteristics that change according to internal and external influences. As we have approached many models and theories in this week’s readings, I will approach case studies looking at diversity. We all know that diversity in gender, race, ethnicity, and religion is a growing and critical part of our globalizing world, but more importantly, diversity is a key enforcer of innovation and strategy. In their study, Forbes stated that “among companies with more than $10 billion in annual revenues, 56% strongly agreed that diversity helps drive innovation” (Forbes, 2012). In this essay, we will look at the importance of diversity when we accept that diversity is a key factor in innovation and strategy.

                  Many CEOs and business leaders agree that the best way to ensure innovation, creativity, and good business strategy is through a diverse and inclusive workforce. The theory and case studies behind this is that various ideas and opinions encourage out-of-the-box thinking, creating new products, and attracting new clients. The current globalization of businesses has created a complex and competitive environment in which companies need to continually create new products and services in order to be successful. The case studies outlined in the following show that innovation is a critical component of success for businesses to adapt and survive in their environments.

A simple case study I will analyze is Reebok, which embraced diversity in its leadership translating into a diversity of perspectives along the communication line. One of the most powerful successes of Reebok was when women in the company complained about the lack of aerobic shoes in the 1980s, and reacting to this complaint, Reebok became one of the first companies to make marketable aerobic shoes. Within ten years, the company went from a $12 million company to a $3 billion powerhouse (Gandz, 2001). Reebok shaped its industry by diversifying its policy directions and leadership, which not only allowed the company to recognize issues, but also increase research and development, create new products, and open itself to a whole new market.

                  The second case study is given by Jay Galbraith, a baking company A that struggled in the 1908s because of new competitors, but was able to rise because of its innovative management of a new found product (2002, Chapt. 6). At the time, competitors came up with lower priced and healthier products than company A, which significantly cut companies sales and revenues. Then, company A came up with a new low-fat ingredient that allowed it to produce new products, and Company A was able to partner with new companies, creating also grouped products. Moreover, it used the new product into a different market (breakfast foods), creating new channels and customer relationships. The new market was the Hispanic community. By partnering with Spanish baking companies and the Spanish media, the company gained significant sales in the market. The company works to survive by implementing the strategies it previously did: innovation by focusing on Research and Development as well as searching for new customers, channels, categories, etc.

                  The third case study is Mattel, one of the largest toy companies in the world. The company utilized a diverse workforce to bring in unique insights that are important to assessing culturally sensitive toys. Before they launched a new line of dolls called “So in Style” in the African-American market, Mattel formed the Mattel’s African-American Employee Resource Group (MAAERG) to advise Mattel’s marketing team in creating culturally sensitive dolls. The MAAERG included Mattel diverse racial employees and high-profile black women like Cookie Johnson, the wife of former basketball star Magic Johnson. The MAAERG analyzed the overall concept and look of the dolls as well as their names. Mattel does not release sales figures; however, the dolls are continued products of Mattel and the CEO of Mattel claims that they are resonating with girls of all colors and ages (Zimmerman, 2012).

                 The case studies highlight the importance of adaptation through innovation and strategy. Many businesses and organizations are trying to fulfill this gap by employing a diverse and inclusive workforce. As I accepted that diversity is a sufficient condition for innovation and strategy, diversity becomes critical for businesses because globalization has increased the need for new products, segments, channels, partners, and so on. By looking at the different management cases and theories, we understand that organizations can to “adapt” to the changing environments, but with the right tools and skills. Although the readings highlighted many management systems and theories such as the contingency theory, star model, systems theory, and population ecology theory, I believe the central theme of the week that in order to adjust and adapt to internal and external influences, innovation and strategy is critical, and one way to do this is through diversity policies and programs.

Citation

Morgan, G. (1998) Images of Organizations: Executive Edition, pp. 35-67

Galbraith, J.R. (2002) Designing Organizations, pp. 73-90 (Chapter 6)

Galbraith., J.R.. (2002) Designing Organizations, pp. 1-8 (Chapter 1)

Gandz, J. (2001). Paths to Equal Opportunity: A Business Case for Diversity. Ontario, 1. Retrieved September 21, 2012, from http://www.hrsdc.gc.ca/eng/labour/equality/racism/docs/BusinessCase-e.pdf

Forbes Insights (2012). Innovation through Diversity. Retrieved September 21, 2012, from www.forbesmedia.com/files/Innovation_Through_Diversity.pdf

Zimmerman, A. (2010). Are Mattel's New Dolls Black . The Wall Street Journal. Retrieved September 21, 2012, from http://online.wsj.com/article/SB10001424052748704533904574544442926160228.html