In many firms, idea generation is a haphazard process. However, entrepre- neurial ventures can take certain concrete steps to build an organization that encourages and protects new ideas. Let’s see what these steps are.
1. Establishing a Focal point for ideas
Some firms meet the challenge of encouraging, collecting, and evaluating ideas by designating a specific person to screen and track them—for if it’s everybody’s job, it may be no one’s responsibility.32 Another approach is to establish an idea bank (or vault), which is a physical or digital repository for storing ideas. An example of an idea bank would be a password-protected location on a firm’s intranet that is available only to qualified employees. It may have a file for ideas that are being actively contemplated and a file for inactive ideas. Other firms do not have idea banks, but instead encourage employees to keep jour- nals of their ideas.
2. Encouraging creativity at the Firm level
There is an important distinction between creativity and innovation. As indicated in Chapter 1, innovation refers to the successful introduction of new outcomes by a firm. In contrast, creativity is the process of generating a novel or useful idea; however, creativity does not require implementation of an idea. In other words, creativity is the raw material that goes into innovation. A team of employees may come up with a hundred legitimate creative ideas for a new product or service, but only one may eventually be implemented. Of course, it may take a hundred creative ideas to discover the one that ideally satisfies an opportunity.
An employee may exhibit creativity in a number of ways, including solving a problem or taking an opportunity and using it to develop a new product or service idea. Although creativity is typically thought of as an individual attri- bute, it can be encouraged or discouraged at the firm level. The extent to which an organization encourages and rewards creativity affects the creative output of its employees.33 Table 2.5 provides a list of actions and behaviors that en- courage and discourage creativity at both the organizational level and the indi- vidual supervisor level.
Source: Barringer Bruce R, Ireland R Duane (2015), Entrepreneurship: successfully launching new ventures, Pearson; 5th edition.