Case Study Analysis

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Case Study 1: Shutterstock’s Experimental Innovation

Question 1: Benefits and drawbacks of Shutterstock’s culture

The contemporary business climate is changing rapidly, whereby new technologies, new media platforms and novel business models are emerging at an astonishing rate. The businesses who fail to shift the gear of current business practices to experiment with new emerging method, are likely to fall behind the competitors. The key survival tip in the age of rapidly changing business climate is to take risk of adopting and testing new ideas. The consumers are becoming more empowered and skeptical, which enforces the businesses to become visionary for exploring the new methods of undertaking a specific business practice. Moreover, creating the culture of experimentation, just like Shutterstock. 

It has been mentioned in research of Uribetxebarria, Garmendia and Elorza (2020) that the most obvious benefit of adopting the culture of experimentation is that products can be improved continuously and higher amount of revenue can be generated. A/B testing of Shutterstock is the way of killing the opinions of those who are senior or have highest power. For instance, if any senior provide any idea, then it might not be effective all the time. Thus, experimentation allows to test the idea, regardless of who has provided it. The link between actions and words is clarified and better decision making is supported. 

Additionally, when all the employee receive an opportunity to get their ideas tested, they become more confident and generate greater sense of value for their work. The commitment of employees increases when each of their idea is exposed to daylight, than being killed on white board during presentations. The communication rapidly shifts from abstract value of the ideas and moves to testing and experimentation (Murillo and Kauttu, 2017). The lower-level employees feel more empowered and thus their motivation level increases to the highest reachable point. The culture of experimentation and say of lower level of employees is thus beneficial for supporting innovation capabilities and potential of Shutterstock.

On the other hand, having say of employees in strategic decision making also has some limitations.  For instance, the experimentation culture helps the organization to continually bring incremental improvements in its products, as done by Shutterstock, but the company might miss on any major and disruptive innovation opportunity. Additionally, testing mainly shows short run results which could be negative but in long run ideas are likely to be more beneficial. It can lead Shutterstock to miss on any viable strategic opportunity. Moreover, testing of each and every idea provided by employees is not viable option for Shutterstock. Not each employee has strategic understanding and waste of time and resources can be minimized by testing the ideas which have strong strategic standing. Finally, too much attention of employees on generation of new ideas can also cause performance issues, as they might lose their daily organizational responsibilities (LUO and HE, 2017). Therefore, the experimentation culture of Shutterstock is although beneficial for company, yet company needs to understand its associated risks for assuring that experimentation is practiced in effective manner. 

Question 2: Risks expected for Shutterstock

Although innovation at Shutterstock is well supported by executives’ initiative to increase say of employees in strategic thinking and decision making. Along with that it could bring some risks to the organization, which is needed to be addressed by the management.

Strategic Risk

The business might be exposed to strategic risk, which is associated with any failed strategic decision taken by the organization. Although testing is conducted rigorously by Shutterstock, it is notable that experimental innovation might sometimes show positive outcomes in short run that might not prove worthy in long run. This issue can be addressed by making reliance on many metrics. For instance, any chosen metrics might not tell the whole story and there is need to look at many metrics for viewing the real change (Cheng, Humphreys and Zhang, 2018). For instance, any one metric might shows that innovation idea is suitable for bringing positive change in organization. However, that might not be the clear picture of the story and implementation of such strategy might cause loss for business. Therefore, selection of alternative metrics and retesting of ideas prior to their implementation is needed to overcome any kind of strategic risk.

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