rationale for the Organizational creativity orientation is that it has the potential to create markets and
customers. It is not that the Organizational creativity orientation completely ignores customers; it is
just that firms following this course believe that existing (and potential) customers may not know
what they need and want. Hence, Organizational creativity is focused on exploration, with an
(internal) organization focus.
According to Mumford et al. (2002), organizational climate and culture represent collective social
constructions, over which leaders have substantial control and influence. In turn, several empirical
studies have provided evidence that an orJDQL]DWLRQ¶V RU JURXS¶V FOLPDWH IRU LQQRYDWLRQ LV DQ
important determinant of innovation. For example, Bain et al. (2001) studied a group of research
scientists and technologists in four Australian companies with substantial R&D operations. They
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At the organizational level, Scott and Bruce (1994) found that a climate that strongly supported
innovation increased innovative behavior among research scientists and engineers in a large U.S.
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5.4.4 ORGANIZATION- EXPLOITATION = OPERATIONAL EFFICIENCY
Many business leaders seem to believe that, instead of thinking about reliability and efficiency, they
should spend all their time formulating an exciting vision, negotiating acquisitions, or reinventing the
company. Maintaining reliable, efficient processes that minimize costs and ensure high quality of
products or services has increasingly been viewed as a responsibility that can be delegated to lower-
level managers. Yet cost leadership has always been a crucial element in strategy definitions. In 1980,
Porter defined the generic VWUDWHJLFW\SHV³FRVWOHDGHUVKLS ́DQG³SURGXFWGLIIHUHQWLDWLRQ ́7UHDF\DQG
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similarities (Campbell-Hunt, 2000). While there is less convergence on the key attributes of the other
dimensions of strategy (i.e. product leadership, customer intimacy and differentiation), all include cost
and efficiency as a key strategy.
Operational efficiency is characterized by an emphasis on controlling costs and standardization of
procedures. The operational efficiency perspective draws heavily on the economics discipline. Due to
scarcity of resources and time, organizations need to allocate resources efficiently and maximize the
output received from those inputs. The process of routinization and repetition promotes efficiencies
(Day & Montgomery, 1983; Levitt & March, 1988). These, in turn, lead to higher profits (Porter,