Back Issues 11-20

ORGANISATIONAL INNOVATION SUCCESS FACTORS THAT SUPPORTED SURVIVAL AND GROWTH OF BUSINESSES DESPITE VOLATILITY IN THE GLOBAL ENVIRONMENT

Dzingai Katsamba*

Innovation and Technology, Davinci institute of Technology

*Corresponding author: This email address is being protected from spambots. You need JavaScript enabled to view it.

René Pellissier

Extraordinary Professor, University of the Western Cape

Professor Emeritus, University of South Africa,

Faculty Associate, The Albert Luthuli Centre for Responsible Leadership, UP

This email address is being protected from spambots. You need JavaScript enabled to view it.; This email address is being protected from spambots. You need JavaScript enabled to view it., This email address is being protected from spambots. You need JavaScript enabled to view it.

Abstract

Background: In turbulent environments like the Covid-19 global pandemic organizations have to implement novel process innovations and new management practices in order to survive and grow. Literature confirms that innovative organizations increase their chances of survival and growth. Although literature reveals benefits of leadership, organizational innovation and business model innovation strategies, there seems to be a gap in understanding how they can impact effective implementation and whether such implementation can assist businesses to achieve success during a global crisis.

Purpose: The purpose of this paper was to produce a framework which helps in the understanding of the extent to which innovation can be used to capacitate  multinationals in South Africa to grow and survive in a volatile environment. The outcomes of this provide a tool to ensure survival and growth in subsequent volatility. 

Results: Models generated show that an organization will have an increase in revenue, an increase in profit, a return on investment, a return on equity, a return on assets and positive bottom-line if organization innovation is implemented. Survival and growth will be possible through process and product innovation, flexibility, creativity, combining and mutually adapting technological knowledge. The recognition of organizational innovation as a necessary activity for business will also ensure sustainability. If the organization does not align its strategies and activities to organizational innovation, then failure is imminent.  This stagnation or reduction of revenue may lead to the closure of the business if it fails to cover fixed costs for a protracted period. 

Methods: Financial indicators were used as predictors of survival and growth if leadership, OI and BMI are used with their associated factors. To evaluate the relationship between the constructs OI, leadership, and BMI toward survival and growth, a series of discriminant analysis models were estimated. The constructs survival and growth consist of different financial indicators, including revenue, profit margin, return on investment (ROI), return on assets  (ROA) and earnings before interest, tax, depreciation and amortization (EBITDA). Models were run to optimise model fit. The standardised canonical discriminant functions which were used were significant and the correlation coefficients were high. 

Conclusions: The findings from the literature, the qualitative and quantitative outcomes, lend credence to the effect that organizational innovation will help companies to survive and grow despite volatility in the environment.

Key words: Organizational-innovation, leadership, business-model-innovation, crisis, volatility, survival, growth.

Attachments:

1165 Final.pdf

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570 kB