| dc.description.abstract | The research was undertaken to establish innovation processes and the perceived role of
the Chief Executive Officer in the banking industry. The thrust of the study was to find
out whether the CEO seek to encourage innovation, factors influencing innovation
processes and the main barriers to bring innovation to market.
To gain insight into this proposition, primary data was collected using survey design from
two classes of respondents in each of the 40 clearing banks; the Chief Executive Officer
(CEO) and Business Development Manager (BDM). Factors that influence innovation
such as bank objectives and strengths (both core and distinctive) were also investigated.
Fifty-five percent of the BDMs and 65 percent of CEOs responded positively. The results
were analyzed by use of descriptive statistics, while t-test was used to gauge perception.
Sixty-five percent of the CEOs and 50 percent of the BDMs perceive the CEO as a
facilitator of innovation process to realize value. Fifty-nine percent of the cases indicated
that the CEO is responsible for driving innovations, whereas in 50 percent of the cases,
the responsibility was on cross-functional committees. Thirty-nine percent of the CEOs
and 50 percent of the BDM consider innovation as the most important factor in achieving
competitive advantage, yet 36 percent of the cases indicated that they were only able to
commercialize less than 20 percent of the promising ideas. Good human resource base,
expansive network and technology capability are considered distinctive competencies
among the Banks. Innovation is encouraged within the organizational setup to the extent
that in 59 percent of the cases, innovation formed part of the employees' assessment
program.
But a number of constraints were identified as limiting efforts to bring good ideas to
market. These include budgetary constraints, resistance to change, insufficient number of
people who can be freed and unclear strategy and often conflicting priorities. Despite the
resource and capability limitations, less than 10 percent of the cases indicated that they
always used external resources to bring innovation to market.
-....•
iii
To accelerate value realization, the research recommends Disruptive Growth Engine:
First, the CEOs will have to create a strong innovation context setting a clear innovation
agenda with tangible goals and promoting an innovation culture, build performance
management and learning infrastructure to track the effectiveness of innovation
investments and diffuse them effectively through the organization. The CEOs should
restore confidence through empowerment - replacing denial with dialogue, blame with
respect, isolation with collaboration and helplessness with opportunities for initiative to
create a winner's attitude in people, even before victories.
Secondly, there is need to use external resources in general and outsourcing to augment
resources and accelerate value creation, free up management to focus on key aspects and
to tap into economies of scale from shared infrastructure and to flexibly scale operations
to add muscle to innovation execution capability.
Though high resistance was displayed by the respondents in data collection, an important
area open to further research is to evaluate the extent of outsourcing of innovations
among the banks and the level of innovations that are commercialized to value by relying
on internal resources compared to outsourcing. | en |
