INNOVATION, MANAGMENT AND BUSINESS SUCCESS

Slavka Draskovic
English School of Business, slavkadraskovic@yahoo.com

Abstract:New global world has developed new paradigm of sucess that includes need for constant change,
knowledge based society and a paradigm of innovation as a part of it. The paper focuses on innovation
paradigm and analyzes possible connection of inovation and business success. It is based on the research
done among US business leaders of Serbian descent followed by structural and qualitative analysis of their
th
life stories and biographies and autobiographies of more than fifty American business leaders of the 20 and
st
21 century. As a result of a search for the structure and sucess patterns in gathered material, the Scheme
of Success is developed. The Scheme defines success as a process and gives the patterns/elements of that
process one should follow in order to be successful. Innovation, any form of pioneering undertaking, is
shown to be one of those defined, inevitable elements of any process of big business success.

By analyzing business leaders narratives and biographies, the paper deals with the topic of leadership and
innovation using newest leadership study methodology flows which include more qualitative methodology in
leadership studies.

Key words: innovation, business leaders, leadership, elements of success, scheme of success.

1. INTRODUCTION
Success is a concept that attracts attention and is desired by most people, although the meaning of this term
is relative. While the term success is often identified with wealth and prosperity, its meaning can be different
for different people and connected with achieving a certain goal. Wealth and prosperity usually come as a
result of achieving a set of professional and personal goals. In this paper success is understood in the same
way as it is used in the American myth of success that is, gaining wealth and climbing the social ladder from
the lower to the highest social level.

How to be successful in achieving an objective has always been concern of human societies. Most of the
research related to business success was conducted as a part of management and leadership in
organization studies, having effectiveness of a manager in its focus. Global market and tecnology and
continulous education led to need for innovation as the key success factor. And vice-versa, an ever-growing
need for innovation and diversification led to the creation of a new kind of global competition and the need of
continuous education of workforce in order to track the constant changes that this kind of technological
environment and competition brings. A new paradigm of sucess has been developed that includes need for
constant change and development of organizations and of people meaning knowledge based society and a
paradigm of innovation as a part of it.
The author gathered and analyzed autobiographical stories of six American business leaders of Serbian
origin and more than fifty other US business leaders’ autobiographies and biographies. The autobiographies
and biographies gave the corpus of facts which was then structurally analyzed for patterns and themes that
are repeating.

The themes that were repeatedly present in every narrative were: 1. Hard work, long working hours 2)
Personality traits that helped them succeed 3) Other people and institutions help that leaders had during
their business career and how it was beneficial to their success. 4) Innovation, pioneering endeavor and
novelties that leader introduced, 5) Crisis and risk, critical situations in which leaders found themselves in
during their career 6) Circumstances and taking the opportunities. (Draskovic, 2010)

2. THE SCHEME OF SUCCESS

By grouping together the themes in the narratives one more theme was also recognized: Unacceptance of
the existing situation and decision to act. All of these themes make elements of the Success Scheme.
(Draskovic, 2010, 2011) We will describe briefly each of the Success Scheme elements and the Scheme

159
itself before we focus on one of success elements – Innovation - and analyze its place at the Scheme and it’s
relation to success.

(1) Unacceptance of the situation they found themselves, decision to change that, and action is the
starting point of business leader’s narratives of their business success. Determination to confront the
situation and eventually leave their home is starting point for both Serbian Americans and other American
leaders. They are not satisfied with conditions of their life, even revolt against it and very often leave their
homes in search of better future.

(2) Hard work is the main element of the success scheme of US business leaders. Serbian Americans start
to work very early, practically from their childhood. They work from dusk to dawn, work hard and sacrifice
personal and family life. The same was found in the US business leaders biographies like Clarence Vulu,
DeBartolo and others who started working when they were ten, twelve, fifteen, just like their poor ancestors
in 19th century.

(3) Innovation and pioneering undertaking is another common element of the US business leaders
success stories. Each and every one of them, including US business leaders of Serbian descent was an
innovator and a pioneer in their fields of business. This element of success will be discussed more in the
next chapter.

(4) Personality that is required according to both Serbian American leaders narratives and their US colleges
biographies is the following: High ambitions and a need to prove oneself combined with perseverance,
diligence and strong will. Hard and disciplined work is as important as good communication, honesty, team
work, partnership, and respect for others and the community. It is also important to have vision and creativity
and a strong moral code.

(5) Circumstances are recognized to have role in success stories in contemporary America. Even since
1939, in biographies of the American business leaders one can find the idea that it was not only hard work
that contributed to success but also luck or circumstances. It was Henry Ford who said that he succeeded
because he was in the right place at the right time. (Mayo, Nohria 2005.) But it is up to an individual to
recognize opportunities. The circumstances that affect success are shown by the following diagram (Przulj,
Draskovic, 2012):

Figure 1: Impact of circumstances on success (Draskovic, 2012)

(6) Crises are not only part of the circumstances, but have their own impact on success. The individual
narratives show several crises during the career, with at least one major crisis. Successful people are
motivated by crisis, the crisis represents a challenge that influences change and helps them to advance in
their career.

(7) No one has succeeded alone. All successful people have received help of some sort. An important
principle to gain help is that it must have been deserved, with business leaders previous records, previous
behavior that develops trust and respect, etc. The following diagram shows usual sources of help.

160
 Figure 2: Sources of Help (Przulj, Draskovic, 2012)

Finally, there is a change of situation at some point resulting from all of the previous: hard work, loans, crisis,
not giving up i.e. persistence, several attempts, help from others. Elements of success are graphically shown
in the scheme on Figure 3:

Figure 3: Success Scheme (Draskovic, 2010)

The scheme shows starting position as unfavorable in relation to later status. This position represents the
lack of something, situation that needs to be changed. An action is connected with innovation of some sort
(pioneer undertaking), inevitable crisis and risks. They initiate change, but for the change to happen two
more elements are needed: hard work and help from others. Finally, the whole process is followed by
circumstances needed to climb to the next level. These are social-economic system that supports success
(American democracy), new areas of business, new environment, but also of the person and her readiness
to recognize and take chances. Not until all of these elements are combined together can a higher level
change occur.

161
3. INOVATION, MANAGEMENT AND SUCCESS
The environment is increasingly dynamic and competitive. There is a need to have people at every level who
are oriented toward learning and continuous improvement. Organizational learning involves acquiring and
using new knowledge. Learning Organization is the term for organizations that learn rapidly and use
knowledge to become more effective. (Chawla, 1995) This kind of organization has embedded values of
learning, innovation, experimentation, flexibility and initiative. Knowledge is diffused through the organization
as they nurture ideas and support changes initiated by people at lower levels. Concept of learning
organization is connected with the experimenting, risk acceptance and right to make mistakes.

Among different types of organizational change there is the organizational approach: organization can
change and develop as it improves human capability, commitment, and creativity by increasing individual
and organizational learning, strenghtening cultural values that support flexibility and inovation. (Yukl, 2010)
This type of development eencourage appreciation for flexibility and innovation, set innovation goals,
encourage and facilitate learning by individuals and teams, help people improve their mental models,
leverage learning from surprises and failures, encourage and facilitate sharing of knowledge and ideas and
Reward entrepreneurial behavior.

How leaders influence organizational performance (effectiveness) is one of the most important questions in
strategic leadership. It is seen as dependant of three types of performance determinants: Efficiency and
process reliability, Innovation and adaptation and Human resources and relations. (Yukl, 2010) The focus of
this paper is on Innovation as the performance determinant.

Global environment changes the character and the essence of the innovation process. Innovations become
inseparable part of business success and of competitiveness. Too many commodities and services at the
global market and too many information urge need for new and different. There for the innovations get critical
importance.

In addition, we are arguing that innovation was alwaus important for business success. Looking into the way
US business leaders earned their fortune, there is one pattern striking for our attention: repeting in each and
every bigoraphy that each of leders has been inovator in his field of work, and has given something new to
the business and the community. Whenever we find a wealthy and succesfujll manager, we can find
pioneering business undertaking including new ideas, new products or new vays of seling, new way of
advertising etc. From Carnegie in steel industry and Ford in the authomobil industry to new Silicon Valley
richmen, all has built their empire on a new and innovative businesses. The same is with the Serbian
Diaspora US business leaders. In every narrative we found the story of a pionneering undertaking of a
particular business leader. (Draskovic, 2010, 2011) Each of them has been pioneer in his fields of work:
Michael Djordjevic has made a Capital Guaranty corporation that has for the first time connected banking
and insurance business; Mandaric and Selak intrudiuced new technologies, one in ICT industry in Silicon
Valley, the other in offset print in Chicago Ilinnois; Mijušković has introduced at the time new multilevel sale
model into Avon, US corporation etc. I have always been promoted on the basis of innovations I was
introducing, says Mijuskovic. (Draskovic, 2010).

Alex Machaskee introduced new way of dealing with workers unions as well as new way of commbatting with
the competition; (Draskovic, 2010) Martin Selak, another US business leader of Serbian descent, has been
pioneer in one of the sectors that emerged in late 60is – offset printing. He has today fourteen patents for the
offset machine which made him and his company wealthy; Milan Mandaric was one of the pioneers in Silicon
Valley inventing new technology use for the electronics of the developing PC industry; Vukovic has been one
of the first to recognize the potential of the mobile home business becoming the King of the Mobile Parks in
the US, etc. (Draskovic 2010)

Innovation is part of every US leader’s business success. We have already mentioned pioneers undertaking
at automobile industry which helped Henry Ford to become an icon of a self-made man. He began life as a
farmer's son and quickly became rich and famous. His main innovation is the design of the Model T for the
masses, but he also installed first mechanized assembly line to make production cheaper and faster.
In steel industry Carnegie made his fortune with his innovations. One of his two great innovations was in the
cheap and efficient mass production of steel by adopting and adapting the Bessemer process. The steel
price dropped as a direct result. Carnegie’s second invention was in his vertical integration of all suppliers of
raw materials. Every other leader has in one way or another being part of some new and pioneering
business. We will mention just few more examples: Famous Ball Brothers made a fortune within a few years

162
after added glass production to the business and, in 1884, produced their first fruit jar made of glass
replacing wood jars; Frank Phillips, petroleum magnat was a pioneer in natural gas production and fuel for
emerging avioindustry; Clarence Saunders has developed the first modern retail sales model of self service.
His ideas have had a massive influence on the development of the modern supermarket. He was introducing
innovations for most of his life trying to develop a truly automated store, developing Piggly Wiggly,
Keedoozle, and Foodelectric store concepts; Juan Trippe has been the first to offer aircraft service to distant
regions in US and also first to offer international air flights by his Pan Am company. He was also first to
introduced three motor aircrafts which were able to exercise post as well as passenger service. (Mejo, Noria
2010)

Margaret Ratkin was first to produce what is today known as an organic food and Edward DeBartolo
developed shopping malls, and was first to invent what will become shopping boulevards and consumption
transformed into a social experience, place for not only clots buying but meeting friend, relaxing, going out
with kinds, have a meal etc.

The same importance and connection of innovative management and success can be found in IT
businesses. One example can be Dell Corporation. Dell started an informal business putting together and
selling upgrade kits for personal computers. He made a fortune introducing innovation of selling PCs directly
to customers which had enormous advantages over the conventional indirect retail channel. Dell Corporation
introduced other innovations to industry first offering one month refund guarantee and was also first to offer
industrial service at the buyer location. And everybody knows software interface that Bill Gates invented
which revolutionized computer usage, etc.

These men and women have changed the way we work and live. Great successes are rarely won by playing
safe. On the contrary, the biggest fortunes have been won by those willing to step outside the box and
change the way the game is played. They are business innovators. For example, Jack Welch is perhaps
most famous for streamlining GE, reducing management from 29 levels to only six, Steve Jobs, co-founder
of Apple and chairman of Pixar is responsible for changing the way the world works and plays, and at the
end of his autobiography, Sam Walton wrote that the most important rule in business is to break all the rules,
which he did by his innovative and daring approach to business.

4. CONCLUSION
Invention as an element of success is not only part of the biographies and autobiographies of business
leaders of this and previous century, but also a part of other contemporary narratives of success like popular
literature which has made the success one of its subjects. But, in addition to that, innovation is also,
nowadays, inevitable part of academic management literature. New trends in management recognize
innovation to be not only element of successful management and managers, but of the organization
effectiveness. As discussed earlier, in the world of globalization and constant change, innovation is not only
seen as an element of success and effectiveness, but as a key element of effective management. At the
beginning of the 21st century, we are witnessing the rule of innovation paradigm that puts innovation and new
knowledge in a center of development of individuals, organizations and communities as a whole.

Although innovation as an element of success is underlined by modern global world demands and today’s
management practice and theories, its importance for achieving success has already been known for
centuries. In traditional narrative forms, like fairy tales and myths, we can find pioneering undertaking and
necessity of new in order to achieve goals. These traditional stories describe the ways in which a hero
reaches the objectives and achieves set goals. Heroes’ actions are usually something that he is doing for the
first time, and he will be the one to do it for the first time in his community, thus setting a new standard of
behavior. Opposing an enemy for the first time, or in a new way, never before being imposed to such a
challenges and obstacles, all can be found in traditional stories. (Draskovic,2010) So, by seeing innovation
as a part of the organizational development in a new and different perspective today is in a way reinventing
innovation as an element of success. Successful Americans, including ones of Serbian origin, confirm that
and teach us, based on their own experience, that innovation is inevitable part of any effective management
and of any big business success.

5. REFERENCES
Ajakoka, L. 1996. Autobiografija. Beograd, Grmeč.
Catano, J. V. 2001. Ragged Dicks: Masculinity, Steel, and the Rhetoric of the Self-Made Man. Southern

163
 Illinois University Press Carbondale and Edwardsville.
Carnegie, Andrew, 1920. „Autobiography of Andrew Carnegie“. Boston, Houghton Mifflin Company.
www.wordowner.com/carnegie/
Cawelti, J., 1965. The Apostoles of the Self Made Man. University of Chicago Press. Chicago.
Chawia S, John Renesch, Ed. 1995. Learning Organizations: Developing Cultures for Tomorrow's
Workplace. New York. Productivity press.
Del, Majkl, K. Fridman. 2006. „Direktno iz Dela“. Beograd. Finesa.
Dorfman, P.W., and J.P.Howell. 1988. “Dimensions of National Culture and Effective Leadership Patterns:
Hofstede Revisited“. Advances in Internacional Comparative Management 3: 127-150.
Draskovic, S. 2010. Narativi o uspehu poslovnih lidera srpske dijaspore u Americi. Doktorska disertacija,
Beograd. Filozofski fakultet.
Draskovic, S. 2011. Kljuc uspeha. Beograd. Zaduzbina Andrejevic.
Ehrenreich, B. 2001. Nickel and Dimed: On (Not) Getting By in America. New York. H.H.Metropolitan Books.
Ford, H., 1995. “Moj život i rad“. Kragujevac.
Fukuyama, Fransis: 1995. Trust. The Social Virtues and the Creation of Prosperity. London. Hamisch
Hamilton.
Hofstede, G. 1980. Motivation, Leadership, and Organization: Do American Theories Apply Abroad?
Organizational Dynamics 9.1: 42-63.
Hofstede G.1994 Culture’s Consequennces, SAGE Publications,
Hofstede, G., G.J.Hofstede. 2005. Cultures and Organizations. USA. McGraw Hill.
Huber, R. 1971. The American Idea of Success. New York. McGrow Hill.
McCraw, K.Thomas. 2000. American Business, 1920-2000. Wheelinh, Illinois. Harlan Davison, Inc.
www.questia.com
Mejo, E., N. Noria. 2005. Njihovo vreme: Najveći lideri biznisa dvadesetog veka. Novi Sad. Adižes.
Przulj, Z., Draskovic, S. 2102. Myths, Culture and Success in Business: A case of US and Serbian cultures.
African Journal of Business Management. www.academicjournals.org/AJBM
Witzel, Morgen. 2003. Fifty Key Figures in Management. New York, Routledge. www.questia.com
Yukl, Gary. 2010. Leadership in Organizations. Global Edition. Pearson.

164