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Innovation Management and Organizational Development

Info: 2941 words (12 pages) Example Literature Review
Published: 26th Jan 2022

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Tagged: Management

In the present day environment, there is the added pressure to be more socially and environmentally responsible and there are risks which need to be mitigated and managed before an organization can be succeeded and remain market leader in their operations. The survival of any organisation depends on the ability of such organisation to manage and build in the concept of innovations. Many firms had, in the past, done exploits but, out of their negligence to change that occurred in their environment make them existence no more.

Companies that have established themselves as technical and market leaders and shown ability to develop successful new product and properly manage change.(Oloyede,B.2009).In virtually every industry from aerospace to pharmaceutical and from banking to computer, the dominant companies had demonstrated an ability to innovate.

Even, a brief analysis of economic history, especially in Nigeria, will show that industrial technology innovation has led to substantial economic benefit for the innovating company and the innovating country. Indeed, the industrial revolution of the nineteenth century was fuelled by technology innovation. Technological innovation has also be an important component in the progress of human societies.

The ability of a firm to manage innovation and absorb change will determine the extent such firm will go in the industry and an economy. Innovation to be managed include: organisation innovation, management innovation, commercial/marketing innovation and service innovation. (Fakokunde,2009).

Any organization that will successfully manage its innovations and change, satisfy the demand of its customers, want to achieve survival and, set itself as a leader of its industry must have its management skills and horizons broadened.

In order to shed more light and proper solution to problems associate with the management of innovation and change.


There are many argument and debates in virtually all field of management, it seems that this is particular the case in innovative management. Very often these centre on semantic. Innovation itself has a broad concept that can be understood in a variety of ways.“Innovation is the management of all the activities involved in the process of idea generation, technology development, manufacturing and marketing of new (or improved) product or manufacturing process or equipment” (Trott 1998). He furthered his explanation with simple equation that shows the relationship between the two terms: Innovation = theoretical conception + technical invention + commercial exploitation

Models of innovation

Traditional argument about innovation have centered on two schools of thought. On the one hand. The social deterministic school argued that innovation were the result of a combination of external social factors and influences, such as demographic change, economic influences and cultural changes. The argument was that when the conditions were right innovations would occur. On the other hand the individualistic school argued that innovations were the result of unique individual talents and such innovators are born, closely linked to the individualistic theory is the important role, played by serendipity.

Linear Model

The recognition that innovation occurs through the interaction of the science base (dominated by industry) and the need of the market was a significant step forward. The explanation of the interaction of these activities from the basis of models of innovation today. There is a great deal of debate and disagreement about precisely what activities influence innovation and more importantly, the internal processes that affect a company’s ability to innovate.

There are two basic variations of this model for product innovation. First and most crudely, there is the technology driven model (often referred to as ‘technology push’) where it is assumed that scientists make unexpected discoveries, technologist apply them to develop product idea and engineers and designers turn them to prototype for testing. It is left for manufacturing to devise way of producing the product efficiently. And also, marketing and sales will promote the product to the potential consumer.

Simultaneous Coupling Model

Whether innovations are stimulated by technology, customer need, manufacturing or a host of other factors, including competition, misses the point. The model above concentrate on what is driving the down stream effort rather than on how innovation occur (Galbraith, 1982). The simultaneous coupling model suggests that it is the result of the knowledge within all three functions that will foster innovation.

Interaction Model

The interactive model further idea by linking together technology – push and market – pull models. It emphasizes that innovations occur as the result of the interaction of the market place, the science base and the organisation’s capabilities. Like the coupling model, there is no explicit starting point. The use of information flows is used to explain how innovation transpires and that they can arise from a wide variety of points.

This model is a more comprehensive representation of the innovation process. It can be regarded as logically sequential, though not necessary continuous, process that can be divided into a series of functionally district but interacting and inter-dependent stages according to Rothwell and Zegveld (1985).

A framework for the management of innovation

Industrial innovation and organisation development have to be taken seriously, for it determines the growth and future of an organisation. Innovation is extremely complex and involves the effective management of a variety of different activities. It is precisely how the process is managed that need to be examined.

Innovation management framework diagram

Source: Trott, P (1998) Innovation Management and new product development.


Organisational requirement Characterised by

(i) Growth orientation A commitment to long – term growth rather than short-term profit.

(ii) Vigilance The ability of the organisation to be aware of its threats and opportunities.

(iii) Commitment to technology The wiliness to invest in the long-term development of technology.

(iv) Acceptance of risks The willingness to include risky opportunity in a balanced portfolio.

(v) Gross function co-operation Mutual respect among individual and willingness to work together across functions.

(vi) Receptivity The ability to be aware of to identify of external development technology.

(vii) Slack An ability to manage the innovation dilemma and provide room for creativity.

(viii) Adaptability A readiness to accept change

(ix) Diverse range of skills A combination of specialization and diversity of knowledge and skills.


This study adopted the descriptive research design using a correlation survey method to investigate possible relationship between innovation management and organization development in banking industry.

Population for Study

The target population for this study consists of all banks in Nigeria includes micro finance banks.

Sample and Sampling technique

Due to the large population, a stratified random sampling technique was used to select few from the population as samples for the study. Guarantee Trust Bank and Unity Bank of Nigeria were selected from southwest region.


The instruments used for data collection two sets of researcher’s self-designed questionnaire titled `Innovation Management Assessment Scale“ (IMAS) and “ Organisation growth Scale Rate“ (OGSR). These scales are described below:

This instrument was used to collect information in respect of innovation management level of these organisations. It consists of two sections; A and B. Section A is structured to elicit information that relate to respondent bio data in respect to the industry .Section B contains 20 structured questionnaires to evaluate the nexus between innovation management and organization development. These items are measured on a four-point Likert scale namely: Strongly Agree (SA), Agree (A), Disagree (D) and Strongly Disagree (SD). It focused precisely on innovation management variables

Organisation growth Scale Rate (OGSR)

This scale, which can be described as both process and end-result assessment is designed to assess the effect, impact and contribution of strategic innovation management and the end-result of the strategy (the level of organization development).

Validation of the Instrument

This has to do with the degree to which an instrument measure what it has been design to measure. The instruments were distributed to experts in questionnaire construction. The experts` suggestions and corrections were incorporated in to the final draft of the questionnaire.

However, in order to ensure that the instruments for this study are reliable in terms of consistency and stability of scores or answers from one administration of the instruments to another and one set of items to another.A co-efficient alpha method was used to estimate the extent to which items of IMAS and OGRS correlate with the total score. Using the pilot tests, Cronbach reliability co-efficient of 0.87 and 0.89 were obtained respectively which were considered very high. Thus, the IMAS and OGRS were consequently accepted as reliable instrument for the study.

Administration of the Instruments

Prior to the administration of research instruments, the questionnaires were explained to the respondents by the researcher. The researcher guaranteed the anonymity of the respondents and the confidentiality of their responses.The researcher with the assistance of two trained research assistants administered the questionnaires within four weeks duration. Out of 300 copies of the questionnaire administered, the 224 duly completed and returned.

Method of Data Analysis

The Pearson Product Moment Correlation Statistics was used to test research questions two; while the t test statistics was utilized to test research question three and. All the research questions were tested at 0.05 level of significance.


In this section, the results and findings of the research were presented on basis of the research questions generated for the study.

Research questions 1: Does the strategic innovation management bring about market growth and organization development?

Table 1: Innovation management as Predictors of organization development

R = 0.453

R square = 0.205

Adjusted R square = 0.202

Standard Error = 8.728

Sum of Squares Df Mean Square F Sig. Remarks


57.275 .000a *

Source: Analysis data. * Significant (P<0.05)

The result in this table indicates that, innovation management predicts organization development among Nigeria banking industry. Innovation managerial accounts for 57.2% of the total variance of organization development therefore 43.725% account for other possible variance.

Research Question 2: Does the Organisation that is able to introduce new innovation and manage change will increase their market growth and gain customers’ trust?

Table 2: Innovation management as Predictors of market growth and customer’s trust

  Introduction of new innovation Market growth
New innovation management 1.000 0.453
Perceived market growth and customer’s trust 0.453 1.000

Source: Analysis data. Significant (P<0.05)

In table 2 above, there is a moderately positive significant relationship between introduction of new innovation and market growth in banking industry. (r = 0.453, P<0.05)

Research Question 3: Is there any significant difference between the level of response to innovation management in Nigeria banking industry.

Table 3: Comparison of Guarantee trust Bank and Unity bank of Nigeria.

  Banks N Mean Std.Deviation Std.Error Mean df T P Remarks
Rapid response to innovation management GTB 119 70.2269 9.49080 .87002 222 2.177 0.031 Sig
Unity 105 67.3524 10.26287 1.00155

Source: Analysis data Significant (P<0.05)

Table 3 shows that there is a significant difference in the level of banking innovation management between the two banking industries. The level of innovation management in Guarantee trust Bank is Different from the Unity Bank.


The finding revealed that innovation management has significant role to play and contribute to rapid organization development in Nigeria banking industry. This shows that the more the organisation strategically response to new innovation the higher the rate of organization development . From the research conducted, it was found out that innovation management predicts organization development among Nigeria banking industry. Innovation managerial accounts for 57.2% of the total variance of organization development therefore 43.725% account for other possible variance.

The finding of the study revealed that there is a positive significant relationship between new innovation management and market growth. The finding of the study also revealed that there is a significant difference in the the level of banking innovation management between the two bank industries. The level of innovation management in Guarantee trust Bank is different from the Unity Bank. This could be as a result of the fact that some of the new products package introduce for the consumption of customers such as debit master card.


The findings of the study established that the innovation management has significantly contributed to organization development in Nigeria Banking industry. This implies that the banking organization should consider it as reliable strategy that can survive them in the face of strong competition and economic crisis. Also, It is true that acquisition of modern technology will help an organisation to boost its market growth and hence, increase their market share. Any organisations that desire to mount of maintain leadership position in the industry must be able to respond and adapt to change that occur in the industry and the market environment.


Based on the findings of the study, the following recommendations were made:

Organisation should maintain a continuous and effective research and development, and allow all its staff to act as agents of change by giving them equal and free hands to operate. This will increase the level of innovativeness and organization growth.

Organisation should be strictly adherence to innovation management policy to achieve their vision. Since it has been revealed that a company’s market growth is a measure of its innovativeness.

Organisation should create conducive environment and social responsibilities as one their objectives.

The researcher recommends that all firms in the industry should give acquisition of modern technology a priority so as to improve their operation. It is revealed that an average customer will like to bank with innovative banks. If any company want to achieve the purpose of its establishment it must be updated on technology and innovation.

The researcher recommends that all firms in the industry should form alliance and embark on Research and Development project that will help improve and widen their operation in the industry.

Finally, government should provide conducive and enabling environment for these organizations by providing them with basic amenities and infrastructure that will support their operation and enhance high productivity.

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