Innovation in Operations Management Throughout

Innovation in Operations Management

Throughout the past recent decades, various factors emerged to force organizations to adapt along. Issues such as globalization, market liberalization or international affairs have generated mutations in the way stakeholders behave. As a result then, economic entities had to develop and implement strategies customized to the new needs and demands. In the contemporaneous era, the most useful such strategy is given by a differentiation achieved through an increased emphasis on corporate core competencies. "The most powerful way to prevail in global competition is still invisible to many companies. During the 1980s, top executives were judged on their ability to restructure, declutter, and delayer their corporations. In the 1990s, they'll be judged on their ability to identify, cultivate, and exploit the core competencies that make growth possible indeed, they'll have to rethink the concept of the corporation itself" (Prahalad and Hamel, 1990).

Today's industry and academic literature have come up with a multitude of models and suggestions for further improvement. However, since there is not secret recipe for success, each organization must identify, develop and customize those strategies which best satisfy its particular needs. These needs refer to all nature of the industry where the organization operates, the features of the market deserved and also the specific characteristics of the problem encountered.

To best understand this, one should consider a real life example; say for instance an ophthalmology practice. The demand for their products and services should theoretically never decline as they offer items necessary for numerous individuals. However, they do face difficulties as the competition in the industry significantly increases. As such, the further lines of the paper will discuss alternatives to overcoming the competition and maintaining a leading position onto the market through the offering of high quality products and services.

The outline of the paper is as follows:

1. The Phases of Industries

1.1 the Dynamics of Innovation (Abernathy) Model

1.2 Abernathy Phases and Product Life Cycles

1.3 Innovation

1.4 Dominant Design

2: Core Competencies

2.1 a Corporation: Collections of SBU's or of Competencies

2.2 Further Thoughts on the Abernathy Model

2.3 Strategy and Core Competencies

2.4 Types of Service

3: Strategy and Structure

3.1 Tools for Designing the Organization

3.2 Silos

3.3 Culture and Organizational Structure

3.4 Organizing for Innovation

3.5 Aligning the Organization with the Market

3.6 Linking Operations and Strategy

4: Assessment Tools and Backbones for Change

4.1 Opportunities and Threats

4.2 Strengths and Weaknesses

4.3 Strategies for Change

4.4 Project Management

5: Teams

5.1 Teams (General Comments)

5.2 Virtuoso Teams

5.3 Dispersed or Virtual Teams

5.4 Multicultural Issues within 6: Large Scale Change

6.1 Reengineering

6.2 ERP

6.3 Supply Chain Management

6.4 How Companies Grow

6.5 Globalization

6.6 Knowledge Management

7: Quality, Past and Present, and its Relationship to Incremental Improvement

7.1 Key Performance Indicators and the Balanced Scorecard

7.2 Quality Retrospective

7.3 Six Sigma

7.4 Putting it All Together

7.5 Competition Based on Analytics

7.6 Learning Organizations

1. The Phases of Industries

1.1 the Dynamics of Innovation (Abernathy) Model

The process of introducing the novelty element within organizations is a highly dynamic and complex one. "Innovation in industry is a process that involves an enormous amount of uncertainty, human creativity and chance. It takes place in small and large ways, and in some times and places more than in others" (Utterback, 1996). To the ophthalmology clinic, this basically means that they have to implement innovation in a complex manner that takes into account numerous forces of the micro and macro environment.

1.2 Abernathy Phases and Product Life Cycles

The Abernathy-Utterback model introduces three phases upon which innovation should be introduced. The first one is the fluid phase, when change occurs on current basis and has unknown effects. The second phase is the transitional one, during which players in the industry become accustomed with the emergent changes and implement technology in a way that appropriately responds to the changes. Finally, the third stage sees that once market equilibrium is achieved, organizations will strive to differentiate themselves (Innovation Zen, 2006). The ophthalmology industry is currently in the specific industry, with the mentioning that technological innovations still occur and all three phases are being replayed. The company currently manufactures products in all stages of life: introduction, growth, maturity and decline.

1.3 Innovation

Technological innovations constantly affect the ophthalmologic industry. Consequently then, the clinic should continually research the market for newer technologies that add more value to customer satisfaction. The innovations could refer to frames and lenses that last longer, are more flexible and easier to clean and upkeep.

1.4 Dominant Design

The dominant design generically occurs in the transitional phase and it refers to an improved version of a previous product. "The dominant design product has features that competitors and innovators must adhere if they hope to command significant market share following" (Utterback, 2006). The ophthalmologic clinic could develop a dominant design by integrating the latest technological advancements to redesign an already existent product. The item would be re-launched onto the market and sustained through strategies according to the product introduction stage.

2: Core Competencies

2.1 a Corporation: Collections of SBU's or of Competencies

The strategic business unit is built on a series of core competencies, which deliver core products, which in turn sustain the company in gaining a competitive and leading position within its industry (Forbes, 2005). The ophthalmologic clinic can built its SBU on several core competencies, such as sufficient financial resources which allow it increased access to technologies, vast expertise in the field of eye care products and services or the highly trained, skilled and committed staff members.

2.2 Further Thoughts on the Abernathy Model

Given that, according to the Abernathy model, the ophthalmologic clinic finds itself at the border of the transitional and the specific phases, they could consider implementing the following courses of action:

creation of the dominant design in an attempt to gain increased market share development of strategies to consolidate product positioning increase product innovation increase production capacities concentrate on serving specific clients achieve cost and operational efficiencies (Innovation Zen, 2006)

2.3 Strategy and Core Competencies

As previously mentioned, the ophthalmologic practice possesses the organizational strengths, or core competencies, of easy access to resources (including capital, labor force and technologies), vast expertise and product offering, combined with highly skilled and committed personnel. From the standpoint of these competencies then, the implemented organizational strategy should focus on further enhancing the quality of the products and services in a way that better addresses and serves the needs of the customers. They could for instance use their personnel, resources and expertise to search the market for new trends and demands and integrate these emergent requirements into newly developed products.

2.4 Types of Services

In order to succeed in the highly competitive environment, the ophthalmologic clinic should offer their customers a wide array of complementary products and services. The most relevant of these could include the offering of special lotions and cloths for cleaning the lenses. Also, the customers could be given the possibility of returning every six months for special treatments of their glasses. Foremost, each customer should be offered a free general ophthalmologic consult.

3: Strategy and Structure

3.1 Tools for Designing the Organization

Just like with the strategies that organizations have to implement in order to retrieve a successful outcome, the tools to be used in designing the organizations are also uncertain and must be adapted to the unique requirements and features of each economic entity. The ophthalmologic clinic for instance should implement a strong corporate culture promoting the full satisfaction of their customers' needs and wants. They should also integrate the latest technological advancements and introduce them to the staff members through training programs.

3.2 Silos

The organizational strategy and structure could be assimilated to a silo. In this line of thoughts then, just like the silo, the organization is the recipient containing a mixture of thoughts, ideas, desires, beliefs, wants and strategies. Then, just like the items in the silo, the components of the organization are all aimed to serve the same purpose and are arranged in a manner that will help the achievement of the established goal. The R&D department will for instance integrate the new technologies in eye care; the marketing team will promote the new products and research the market for unsatisfied needs and the medical team will serve the patients and customers.

3.3 Culture and Organizational Structure

The organizational culture and structure are directly linked to ensure overall corporate success. In this order of ideas then, the ophthalmologic practice should implement a culture based on collaboration, friendship and respect, all under the umbrella of a pleasant working environment. This could only be achieved through the implementation of a horizontal structure, in which employees are seen as equals and hierarchy is not used to create power.

3.4 Organizing for Innovation

Innovation at the ophthalmologic clinic has to commence from within the organization and has to be achieved at three stages: culture, process and structure. The culture feature refers to the "the mindset and norms that allow individuals and teams to think imaginatively, to take prudent risks, and to seek out, create and introduce innovative solutions." The process feature revolves around "the general business process and practices that enable functional groups to operate effectively and collaborate toward a common goal - as well as a robust set of innovation methodologies and tools." Finally, the structure component has refers to the "organizational structures and supporting technologies that enable collaboration across functional lines" (Innovation Point, 2004). Otherwise put, the ophthalmologic clinic has to focus on implementing a culture, a process and a structure in support of innovation.

3.5 Aligning the Organization with the Market

Another crucial issue in ensuring sustained organizational success is that of aligning the company to the market. This basically means that the company must delegate marketing specialists to analyse the market in order to identify new demands, requirements, needs and trends. In other words, the alignment to the market must be achieved on two grounds: customer demands and strategic approaches implemented by the competitors in the ophthalmologic industry.

3.6 Linking Operations and Strategy

The actual operations conducted within the ophthalmologic clinic sometimes vary from those promoted by the overall strategy. For instance, however the strategy promotes high quality of the services delivered, the management desires to reduce costs and the medical personnel is understaffed. As a result then, the pressure is increased and the quality is decreased at times.

4: Assessment Tools and Backbones for Change

4.1 Opportunities and Threats

The main opportunity presented to the ophthalmologic industry is given by the multitude of technological advancements that can be integrated. Then, a social opportunity is that more and more individuals work in front of the computer, needing as such special eye protection products. In terms of threats, the most eloquent one is the fierce competition and the increasing consumer demands. Technology can be looked at from a dual standpoint, meaning that the innovations can occur rapidly and their replacement could generate additional expenditures for the ophthalmologic clinic.

4.2 Strengths and Weaknesses

The internal strengths of the ophthalmologic practice have been previously identified in the form of the core competencies, and they basically refer to highly capable and dedicated staff members, easy access to resources (capital, labor force and technologies), a vast product and service offering and a vast expertise in the ophthalmologic industry. Relative to their internal weaknesses, one could point out the understaffed medical personnel and the current usage of outdated technologies.

4.3 Strategies for Change

The clinic should focus on the following strategies:

research the market to identify new requirements relative to both customers, patients and competitors allocate extensive budgets to the R&D and marketing departments in order to ensure product development and differentiation focus more on employees' needs and resolve the understaffing issues integrate the latest technological advancements; these would require additional efforts but would retrieve long-term benefits, materialized in an increased operational and cost efficiency, culminating with higher profits

4.4 Project Management

The medical staff is seldom focused on projects; therefore, project management is most common within the R&D and the marketing departments. The innovative project leader within the ophthalmologic clinic will have to teach his subordinates how to think outside the box, how to take risks and how be creative and confident about their decisions. Innovative project management is based on the idea that the focus is on the organization as a whole and on the increased value to stakeholders. Foremost, it also emphasizes on transformation and change (Kotelnikov, 2008).

5: Teams

5.1 Teams (General Comments)

Organizations often use teams as internal structures. Within teams, the employees have the ability to learn from one another and improve their knowledge and performances. All this is useful for the organization as it creates a core competency. Teams are often homogenous constructions (internally) and highly different from one another. The teams within the ophthalmologic practice are driven by the same goal and share similar interests and aptitudes. They also play a significant part in enhancing employee morale and creating a pleasant, yet competitive work environment.

5.2 Virtuoso Teams

The ophthalmologic clinic does not currently possess a virtuoso team, but they could construct one to deal with the most important tasks. Virtuoso teams are different from the common teams as they are formed solely from experts and elites in their field of expertise. The characteristics of these teams include a frenetic rhythm of work, a discernible energy, constant fights and disagreements, high levels of collaboration and creativity, an understanding of the customer in terms of highly sophisticated and demanding and finally, a uniqueness of ambitions, spirits and results (Fischer and Boynton, 2005).

5.3 Dispersed or Virtual Teams

The innovations in communications and telecommunications have led to mutations in the way teams are being constructed. The direct implication of this contemporaneous feature was the formation of virtual teams. This basically means that employees do not physically come to work, but they can choose to work on a remote location and communicate with other team members or the employer through various means, such as the internet, telephones or teleconferences. The ophthalmologic center has used virtual teams but retrieved limited benefits. They accordingly concluded that the type of operations they run cannot be handled remotely.

5.4 Multicultural Issues within Teams

However teams are formed from individuals sharing similar goals, they are often divided by various individual differences. An example of these differences would reside in the cultural background of each employee. However the clinic promotes cultural equality, there still are some employees who frown upon minorities and different ethnicities. Any discriminatory practices or inappropriate behavior should be severely sanctioned.

6: Large Scale Change

6.1 Reengineering

The ophthalmologic clinic has yet to implement a reengineering process. This would be based on an organizational restructuring that would imply that a process is handled by a single team, rather than more departments.

6.2 ERP

Enterprise resource planning is paid increased attention by the management at the ophthalmologic clinic. Operations are clearly analyzed at all organizational levels including human resource, management, operations, finance or marketing. A specification that must be made however refers to the fact that the ERP is only limitedly focused on customer and patient satisfaction. As a consequence of this then, the practice should structure all resources in accordance with the needs of its patients and clients.