Abstract:
The word innovation comes from the Latin word "Innovate" which means to "make new". Innovations involve new methods of doing things and are associated with risks, failure, new ways of management thinking and unlearning of old ways {3}. Innovation is the process of doing new things. It is important to recognize that innovation implies action, not just conceiving of new ideas. According to Drucker {4} "Innovation is the means by which the entrepreneur either creates new wealth producing resources or endows existing resources with enhanced potential for creating wealth. Arthur D. Little {5} has classified innovation further as: - Product Innovation - Process Innovation - Organizational innovation Product innovation is defined, as the creative development and commercialization of radically new products or services, using new technology and linked to unmet customer requirements. Process Innovation is defined, as the development of new ways of producing or delivering services that lead to cost efficiencies or speedier deliveries. Today organizations are knowledge based and their success and survival depend on creativity, innovation, discovery and inventiveness. An effective reaction to these demands lead to innovative change in the organization, to ensure their existence. The rate of changes is learn and imbibe the process of innovation, in their day to day working, to remain competitive. Instead of looking for support from other agencies, they have to find their own ways of overcoming barriers. Despite all the barriers and gaps which have stated before, Indian SMEs have continued on their path of progress. In fact, their rate of growth is higher than the rate of growth of the industry sector as a whole, their contribution to our GDP is almost 7%. In the past also, our SMEs have shown enough strength, vigour and resilience and in current situation they will not only survive but win also. We have our examples of Hero Honda, Ranbaxy, Infosys, WIPRO, Bharti Telecom and many more SMEs who have shown to the world the path of success accelerating rapidly, as new knowledge idea generation and global diffusion are increasing. Creativity and innovation have a bigger role in this change process for survival. SMEs have to show to the world the path of success.
