"Organisational Creativity in Japanese Pearl Industry"

“Organisational Creativity in Japanese Pearl Industry”

The Executive summary

The aim of this report is to analyse the creativity and barriers that exist in terms of increasing creativity in Taiyo Pearl Inc. (TPI) in Japan, by using the appropriate theories, concepts, and models. First of all, the context of the organisation that is related with a meaningful and workable notion of creativity will be explained. Secondly, how increased creativity might affect performance in the organisation will be evaluated. Thirdly, the barriers that affect increasing creativity in the chosen organisation will be identified. Finally, an action plan will be produced to reduce the barriers.

The context within which Taiyo Pearl operates in Japan

Since Kokichi Mikimoto finally perfected the technique of cultivating pearls in Japan in 1919, it has become a traditional custom in Japan for women to wear pearl products at formal events, such as weddings and funerals. Usually, Japanese women wear two or sometimes three of the simple pearl necklaces, earrings and rings at these formal events. Moreover, it has become another custom that a bride is usually given a set of pearl necklaces and earrings by her mother, grandmother or husband when she gets married. As a result of these customs, the demands for the formal pearl products have dramatically increased and the cultured pearl industry has become one of Japan’s most important fishery industries until the beginning of the 1990s.

Since TPI in Kobe, Japan, which deals in pearls, was established in 1957, the company had gradually been growing until the beginning of the 1990s. This was done by going into partnerships with a lot of department stores such as Daimaru, the third biggest in Japan. In 1990, its turnover had become approximately 36 million pounds. There are two main reasons for its successful business until the beginning of the 1990s. The first one is the high increase in demand, for the formal pearl products. The other is that TPI deals in quite high quality products that were sold at very competitive prices. This was because they have their own pearl farms in the Tsushima archipelago in Japan, which has received the first prize three times for the quality of cultured pearls in Japan. Its main customers are usually high-income 40 to 70 year-old people, such as doctors, managing directors, politicians and their wives. The department stores give these customers particular service as their special customers and whose needs are basically high quality products rather than low price ones. In short, the products of the company had completely corresponded with the needs of its market until the beginning of the 1990s.

However, during the 1990s, the company was faced with two changes that caused serious problems. First of all, the needs of their customers had gradually been changing, especially in the urban areas such as Tokyo and Osaka. These needs moved away from formal pearl products to fashionable ones, such as designed pearl necklaces, rings, earrings and brooches, because the market for the formal pearl products had already grown into the mature stage. On the other hand, there were great opportunities in rural markets, because the markets were still undeveloped and had the high potential for the designed products. Secondly, water pollution and virus problems in the mother-of-pearls had diminished cultured pearl production and quality since the beginning of the 1990s. Gary (2002) says that as a cultured pearl is a bead-nucleated product, the purity of water and use of high-quality mother-of-pearl beads are important to the pearl growth with the roundness and nacre consistency. Furthermore, Dana (1998) says that a mysterious virus has teamed up with disruptive weather patterns to kill more than half the oysters in the world’s busiest undersea factory in recent years and in Japan, the problem has been building for a decade, but became acute in 1996 and 1997. As a result of these problems, the production of the high quality pearls had extremely decreased in our pearl firms and the sales had gradually decreased since the beginning of the 1990s.

A meaningful and workable notion of creativity

Kao (1991) says that creativity may be defined as a human process leading to a result which is novel (new), useful (solves an existing problem or satisfies an existing need), and understandable (can be reproduced). Therefore, a meaningful and workable notion of creativity in TPI is to respond to the changes in the urban markets and not to miss the great opportunities in the rural markets. As a result the company created new and novel designed products.

The role that increased creativity might play in improving organisational performance

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A meaningful and workable notion of creativity

The role that increased creativity might play in improving organisational performance

Larry and Thomas (2004) say there are five steps in the creative process: Preparation, Concentration, Incubation, Illumination and Verification. The first step requires a thorough investigation to ensure that all parts of a problem are understood fully. In this stage, the executives at TPI investigated to ensure their problems inside and outside thoroughly, such as the changes of their pearl firms and customers’ needs. The next step requires that personal or organizational energies and resources are focused on solving the problem. In this stage, they focused on the quantity of the high quality pearl and the number of their creative designers. During the third step, there is internalization and a subconscious ordering of gathered information. They were thinking about some changes and organizational energies and resources to create something new. Illumination is the moment of discovery. In this stage, they decided to create new and novel products by hiring many creative designers. The last step involves testing the solution or idea. In the last stage, they introduced these products into their small projects first. After checking and analysing the outcome, they introduced them into their core projects.

Since TPI started to create many new and novel designed pearl products in 1995, it had been able to improve various things. Firstly, it had succeeded to cultivate its new image in our markets. TPI hired many creative designers of pearl products, some of whom received prizes in International Pearl Design Contest as designers for TPI, before it started to create new products. Some of their customers bought the products from the International Pearl Design Contest, which were worth tens of thousands though to hundreds of thousands pounds. Consequently, the prizes played an essential role in enhancing the status of the pearl design products in their markets. Secondly, it had succeeded to make stable sales every month. One of some reasons is that the sales representatives could avoid missing out on a lot of opportunities to sell their products, because they could have various kinds of pearl products suitable for the broad needs of their customers. This was done by adding the variety of the new and novel designed products into their bags. More specifically, the sales representatives basically had approximately five hundred thousand pound pearl products in our bags. After the company created the new and novel designed products, they reorganised the designed products from approximately 20 % to more than 50 % of the five hundred thousand pound products. The other reason is that they could develop their customers’ needs especially in the rural areas by showing these new and novel products. As a result of these reasons, they have been able to develop their existent markets and obtain new markets, such as fashion-conscious 20 to 40 year-old women. Considering all of the above factors, it is obvious that the increased creativity, that is to say, creating new and novel products, had played the important role to the improving performance of the company.

The barriers that exist with regard to increasing creativity

There were three barriers that exist with regard to increasing new and novel designed pearl products.

First of all, with regard to the quality of necklaces, it was not difficult for the sales representatives to sell them to their customers. This was because they could explain the high quality and competitive price they have by using evidence, such as the first prize for their quality. However, with regard to the designed products, it was much more difficult to sell them, because they had to make their customers understand why these designed products were useful and practical for them and how these ones differentiated from other competitors in terms of their design. From my experience, it was the difficult for me to sell designed brooches; because I had to explain to my customers and make them satisfied with what type of brooch suited which colour, what kind of clothes and which kind of situation, for example, going shopping, business, parties or weddings. One of reasons was that most of our customers especially in rural areas didn’t know how to use the brooches in correct ways. The other reason was that they felt brooches were more expensive than the other products, such as necklaces and rings, even if the prices of them are cheaper than ones of the other products.

Secondly, a few elder sales representatives, managers and directors were suspicious about the reason that the company created and depended on the new and novel designed pearl products rather than the high quality pearl ones. This was because they knew how much profit had been brought into the company by the high quality pearl products. Furthermore, it was much more difficult for them to interpret and sell the designed pearl products than the younger sales representatives. An obvious reason was that as all sales representatives in the company were men in spite that almost our customers were women, most of the elder sales representatives weren’t familiar with women’s up-to-date fashion.

Finally, the more designed pearl products the company creates, the more excessive, unsold old-fashioned stocks it has to keep afterwards, because the needs of customers are always changing and designed products definitely become old-fashioned sooner or later. In TPI’s case, there were a lot of old-fashioned products that were produced over three years ago. Moreover, we could sometimes find the gap between the new and novel products and the needs of our customers in terms of the design, because basically, the design department had taken the initiative for creating the new and novel pearl products without the feedback from the sales representatives who know the needs of their customers.

An actual plan designed to reduce the barriers

1. Actual Plan 1

Gilbert (1998) says that a theoretical framework how managers can foster and sustain creativity in their organizations identifies three types of interventions, namely, cultural, organization and design, team-building, and training development, which can help develop the ingredients of creativity. In my company’ case, executives had created the new designed pearl products to adapt to the fast-changing environment and to develop our existent culture of high depending on the quality of the pearls, but hadn’t created team-building, and training development. Therefore, some barriers existed after the company created new products. Paul (1996) says that the goal of Japanese creativity is not only to create new products and ideas but also to build teamwork and a sense of harmony. We should

The first step – The executives or sales managers should train the sales representatives regularly to improve their selling techniques with the new and novel products, for example, group trainings and workshops for the latest trend and fashion.

The second step – They reorganize all sales project teams in terms of the balance of their abilities and ages to minimize missing the opportunities.

2. Actual Plan 2

James (2004) says that the more satisfied your clients are, the more business you’ll have in the future. Since you are the catalyst providing the solution to their problem, you are accountable for fulfilling their needs. Whenever the company had made new designed products, design department had taken the initiative before, but sales department that actually has to sell the products should have the initiative more for final making-decision on new and novel products, because sales representatives know what actually the needs of our customers are and should take more responsibility of selling them. As a result, the company would be able to make the new products more efficiently, enhance the sales and control the stocks more effectively.

The first step – Design and marketing departments make the design list of various kinds of new products designed by researching the market and getting some feedback from the sales department to show sales representatives. They check over which ones are suitable for our customers, pick them up. Finally, the managers of sales, design, marketing, production and financial departments make the decision in the meetings.

The second step – Design and production department make all kinds of the new products to make sales representatives check them and get some feedback about them.

The final step – the company introduces them into the sales projects.

References

Dana, C. (1998) “Mysterious virus plagues Japanese Akoya industry” The New York

Times NATIONAL, Sunday, 24 May, 1998.

First International Pearl Summit, Convention News, (November 1, 1994)

Gary, R. (2002) “Jewel of the Month”12

Gilbert, T. (1998) “Managing Creativity in Organizations: a Total System Approach”

James, F. (2004) “Instilling Innovation and Creativity”

Kao, J. (1991), “Managing Creativity”, Prentice Hall, Englewood Cliffs, NJ.

Larry, K. Boone. and A. Thomas Hollingsworth. (2004) “CREATIVE THINKING IN BUSINESS ORGANIZATIONS”

Paul, H, and Laurence, J. (1996) “Creative problem-solving styles in the USA and Japan” International Marketing Review, Volume 13, Number 2, 1996, pp. 63-71.

Bibliography

Constantine, A. (2001) “Determinants of organisational creativity: a literature review”

Dana, C. (1998) “Mysterious virus plagues Japanese Akoya industry” The New York

Day, J. D., Lawson, E. and Leslie, K. (2003) “When reorganization works”

Dianne, G. (2000) “BARRIERS TO THE IMPLEMENTATION OF MANAGEMENT SYSTEMS: LESSONS FROM THE PAST”

Times NATIONAL, Sunday, 24 May, 1998.

Elspeth, M. (1998) “Enhancing creative thinking within organisations”

First International Pearl Summit, Convention News, (November 1, 1994)

Gary, R. (2002) “Jewel of the Month”12

Gilbert, T. (1998) “Managing Creativity in Organizations: a Total System Approach”

James, F. (2004) “Instilling Innovation and Creativity”

Kao, J. (1991), “Managing Creativity”, Prentice Hall, Englewood Cliffs, NJ.

Larry, K. Boone. and A. Thomas Hollingsworth. (2004) “CREATIVE THINKING IN

Lawson, E. and Price, C. (2003) “The psychology of change management”

BUSINESS ORGANIZATIONS”

Paul, H, and Laurence, J. (1996) “Creative problem-solving styles in the USA and Japan” International Marketing Review, Volume 13, Number 2, 1996, pp. 63-71.

Gary, R. (2002) “Jewel of the Month”

First International Pearl Summit, Convention News, (November 1, 1994) http://www.convention-news.co.jp/fips.htm

"Organisational Creativity in Japanese Pearl Industry"

The Executive summary

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