Leading Innovation and Change
When it comes to organizational change and innovation, quality and creativity are inevitable. In the wake of globalization and the dynamism of the society, industries ranging from agriculture to telecommunications have seen the need to embrace new organizational concepts and exposing themselves to alteration to confront the challenges created by markets and new rivalry. The situation has made firms struggle to fit themselves in the competitive and globalizing market, and this need for change comes in as a driving force for economic and organizational development. Managing alteration is, however, a complex task that faces companies as well as individuals, because people must adjust to business transformations, and they are the ones to implement and coordinate these processes. Change management needs systemization as there is the need to consider the conditions necessary for alterations. For instance, there must be a managerial policy that promotes dialogue and communication. Change cannot be effectively enforced from above, but instead, all workers in the firm must understand and accept the required adjustment to minimize or avoid resistance. This essay seeks to examine how business entities should manage innovation and change on the example of the Adidas Shoe Company.
Since there is turbulence in the market, especially in the wake of globalization, the companies must deal with such issues as price pressure and rivalry, because every firm does its best to fight for its existence in the market, especially through outshining others. In such a situation, a business entity can make an informed strategic and organizational decision to create a competitive edge over the others. For instance, in the 1980s, Adidas faced a hard time due to market pressure related to prices and business rivals, and this was a threat to its sales and revenue generation. In response to this problem, the management adopted the directional change management by undertaking various steps that may not necessarily require employees’ participation. The firm decided to outsource manufacturing through contracting third parties which operated in cheap labor countries to supply the products. Adidas also chose and took over small companies that had excellent performance, and examples are Reebok and Taylor Made. The above step was crucial as the corporation identified a change/problem in the market and decided to innovate through shifting its focus from predominant manufacturing to prioritized marketing as a way of reducing operating costs and increasing the awareness and sales of products. The firm, therefore, took advantage of other smaller businesses working in better conditions to have them as suppliers, and this helped it to lower the production expenditure. Business entities can borrow the concept of the Adidas directional change management strategy to address the changes necessitated by market instabilities and to make those decisions that may not require employee's contribution. The main idea here is that managers are the brains of the firm and, therefore, they must make wise decisions regarding the problems their companies may come across and alterations necessary to overcome the challenges.
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Firms have no fixed consumer segments as there might be a demand for new products related to what the company produces, and this may involve the entry of new customers. The business entities must, therefore, keep on updating their product ranges to match the needs of the clients for the purpose of achieving maximum sales and reaping high profits. For instance, when Adidas began its operations in 1949, it was solely a footwear business, and it supplied the 1952 Olympic and the 1954 FIFA World Cup with foot gear. However, the alterations in the market created demand for new products and hence forcing the company to expand the range of products and the size of the market share. Through a directive change management, the firm began producing balls and sports apparels as well as foot gear for sports such as tennis, basketball, and skiing among others. The company then realized that the fans also need the sports-related footgear, and thus it ventured into sports fashion and sports performance segments. The above information provides an example of how firms face alterations in the market, which require implementing innovations to diversify the production and boost sales of their products. The kind of change management above appears as a combination of directive and participatory management because the managers' decision to diversify the product line was influenced by customers' demand for various products, and thus clients had a stake in the decision. Other companies, therefore, can borrow this idea from Adidas so that they can adequately address the changing market demand as well as increase the revenue and profit from sales.
In the contemporary world, there is the growing demand for products at the global or international level, and thus companies must change the ways they sell their products to satisfy the demand as well as defend their market share from competitors. Adidas faced a similar situation combined with the presence of other large firms like Foot Locker, Intersport, and Decathlon among others, and thus the managers had to use their authority to steer the business to success. However, in response to the above issue, the management took a directional initiative of choosing a sales channel that fits the large market, and this made the company a leading seller of products in its segment. The managers established self-run retail stores, mono-branded franchise stores, shops-in-shops and co-branded shops with sports organizations, joint ventures, and retail partners in a bid to maximize its sales volumes. With such a variety of selling formats, Adidas has achieved a strong ground in product offering and sales, hence the firm has developed regarding sales and revenue despite the challenge of adjusting itself to cope with the alteration. In 2011, the company launched a vision to expand its controlled market space from 36% to 45% increasing the number of its retail shops and mono-branded franchise stores, and the directive change management worked perfectly for Adidas as it made the business entity have increased sales. The case, therefore, provides an example to the managers of other businesses as they can draw guidance from the Adidas case to increase sales in their respective firms as the world keeps on changing.
Firms, in modern times, operate in a dynamic world characterized with numerous changes in the way humans live and do business. The alterations have led to the reduction in cash handling, as people embrace cashless systems that are more convenient to use. In this regard, there is an increased development of information and communication technology that has caused the growth of online business. Regarding the above issue, companies need to follow Adidas' managerial directive of establishing an online selling channel that provides the customers a virtual store where they purchase goods in the comfort of their homes or offices. At first, the channel was not effective outside the United States, and thus it was pulled out of the European market in 2002, but the managers reintroduced it in 2008, and it became significant in the European as well as other markets. The e-commerce soon became the third major channel for selling Adidas shoes. The above directive style of handling change guides the managers of other firms as they can borrow this strategy from Adidas. The directive management style is, therefore, useful for enterprises in situations where managers do not have to consult the employees.
Sociological and technological changes also affect the customers' taste in the contemporary world, and this causes demand for customized products as opposed to the general manufactured goods. People tend to have personal feelings or an affiliation with a group or organization, and thus they may want to brand their shoes with the name of the organization. The demand for customization compels the firms to diversify their products in small quantities with varying characteristics to satisfy the needs of every customer. However, small amounts of goods causes some challenges, as it makes planning/forecasting hard and increases the risk of out-of-stock or overstock situations. Nevertheless, due to the competition from other firms, the step is inevitable. To respond to the demand, the managers of Adidas adopted a directive change management initiative to create the MiAdidas as a mass customization program that led to the introduction of customizable foot gear in response to the customers’ needs, as strong competitors like Nike and other rivals have done. In 2000, Adidas selected test markets that included major sports events, and the positive results made the management to venture in investing in customization at a deeper scale providing thus customized products in the shops. By adopting the test market strategy, the firm used participatory change management, as it sought customers' views by bringing a small number of customized shoes on the market, and when consumers expressed satisfaction, the management increased the supply of the same. The employees also participated in the process, because they sold the customized products in the test market and, therefore, their views about sales contributed to the managerial decision as well. Regarding the above issues, Adidas combined both directive and participatory change management styles and thus paved a way that other firms can follow to increase their sales.
Change is never entirely fulfilled, and thus companies have to keep on changing/improving or diversifying over a period as tastes and technology change. The launch of a new service or product in a firm is thus subject to evolve over time. In the Adidas case, the MiAdidas customization initiative was offering only the predator football shoes as a single brand for customization. However, the positive response by customers made the management diversify customization options covering various models as well as shoe types including the running, tennis and indoor shoes among others in response to the market demand for the same. By 2007, the MiAdidas offered 14 distinct models of shoes from different sports categories such as tennis, basketball, football, and athletics among others, and by 2008, there appeared sneakers as a MiAdidas shoe model. By 2012, the product range varied by seasons and by now, there are over 30 types of shoes available, and there is still much potential for growth. Regarding the above information, the decision on the models and sports varieties came as a result of demand and customers' positive response, and thus clients are essential participants of this particular decision. The managers of other organizations, therefore, can use the described approach and handle their change management following the participatory style that accommodates consumers’ views and response.
The increased competition from rival firms producing the same products combined with the customers’ urge for high-quality goods forces companies to take actions so that they can maintain their market share. Business entities, therefore, need to encourage creativity and innovation as well as adopt quality standards and checks to make sure that they produce the desirable quality or beat the rivals. Regarding the above issues, Adidas has taken a participatory change management style by encouraging the employees to participate in the change process through innovation and creativity aimed at producing unique goods that are of high quality. The move enabled personnel to initiate, implement and own alterations in the organization and thus make them acceptable. The firm has succeeded in adding remarkable features to its shoes and examples are ventilation system/Clima cool and a3 technology for managing energy and guiding the athletes’ foot. The above achievement depicts a participatory change management, as Adidas engaged the employees by encouraging and allowing them to be creative and innovative making the staff contribute towards product improvement. Concerning the above information, other firms have an example of this strategy’s effectiveness, thus they should follow the footsteps of Adidas.
The increased customer autonomy and choice of products are issues facing many enterprises in the modern world. It is the obligation of the management to give consumers what they need, and thus managers must make sure that they manufacture products as per the clientele specification. Making decisions on the above foundation implies that the client is crucial to every firm. Concerning the customer satisfaction, the management of Adidas came up with the strategy of the order-to-delivery process, whereby a consumer customizes a product or gives instructions on the way he or she wants the good to look like. The instructions are given to the suppliers, and upon completion of the product, the supplier may deliver the same to the Adidas retail outlet or ship it to the client's home. Such kind of change management is desirable, as it allows the Adidas customers to decide what exactly they want from the firm. Through the above initiative, the Adidas managers use the participatory approach in change management, since it encourages views from the clients who are the target purchasers and hence making an alteration an acceptable event. Regarding the above achievement, other firms have a great instance from where to draw guidance.
In conclusion, change, innovation, creativity, and quality are useful elements of a business that embraces change. Globalization and competition have made firms consider altering their ways of operation to maintain their market shares as well as increase sales and profitability. Adidas faced the problem of price pressure and rivalry, and thus the managers used their authority to undertake several initiatives such as outsourcing supplies and taking over smaller businesses. The increasing demand for goods is causing the companies' market to change. For instance, Adidas concentrated on shoes and provided with them the Olympics and the FIFA World Cup in the early 1950s. However, soon the company took a managerial directive based on customers’ demand to produce shoes for other games. In the wake of increased competition, firms need to change their sales strategies, and thus Adidas management took the initiative of opening many self-run stores as well as a partnership with other potentially beneficial enterprises to increase sales. The rising usage of the Internet also necessitates alterations in the company’s operations and thus the managers of Adidas introduced an online sales platform to boost sales. Sociological and technological changes affect the way customers perceive products. The consumers’ demand for customized products made the managers of Adidas introduce the MiAdidas as a customization initiative, and this change management approach included an element of participation, because clients influenced the managerial decision. The MiAdidas offered soccer shoes as the only customized product but soon demand for the products made the management consider customizing other sports shoes providing a variety of models in different sports. The competition for market shares prompts firms to produce high-quality goods. In response to the issue, Adidas adopted a participatory change management style that encourages employees to be creative and innovative to promote quality development. Market changes are increasing customers' autonomy prompting organizations to alter their operation methods. For instance, Adidas management exercised authority to adopt a style of allowing its clients to customize the shoes and then have them made for them. However, the decision also entails an element of participation, since customers’ views are the priority in customization of products. Concerning the above information, Adidas uses participatory as well as directional styles of management, because, in some instances, the managers make decisions by themselves while in other cases they allow clients and employees to participate in decision-making.
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