How do I make my business more innovative?

Innovation increases the likelihood of a business succeeding, however most people don't know where to start. People often think of innovating as just invention.

Innovation does not necessary require a large budget or investment in Research and Development (R&D). It's also about new ideas and responding to new trends and market conditions, or making improvements to products and services that already exist.

Where can I get innovative ideas?

As a starting point for innovation, new ideas are needed. These ideas will form the basis for new products, services or processes which will satisfy a need, be the result of an opportunity or to solve a problem. Ideas can be sourced from any number of areas including customers or a problem you may have encountered.

When searching for new ideas, consider the following:

  • Connect with customers for ideas

  • Create a business culture for innovation

  • Select the strategy for developing innovation and update your business plan.

Connecting with customers for ideas

While there are no sure-fire way to guarantee success in creating great ideas, one of the best ways is to listen to your customers.

Connecting and listening to your customers can assist in emphasising and generating ideas on how both product and service delivery can be improved.

Connecting with customers may include:

  • conducting a market scan to better understand the environment in which your business is operating in, including an analysis of your competitors

  • understanding the importance of marketing and branding for your business

  • offering your customers channels in which to easily provide you feedback on your products and services

  • conducting market research to better understand how your customers use your products and services.

Create an innovative business culture

In order to start increasing the flow of ideas required to generate innovation in your business, there are a number of basic characteristics which can be addressed.

Developing an internal culture of innovation

Innovation requires strong leadership and a tangible vision across business. The internal culture of a business and the external culture in which it operates will influence the ability of a business to innovate.

Innovation thrives in a culture that is not afraid of risk-taking, promotes the value of experimenting, is adaptable and rewards enterprise. Innovation usually needs to be led from the top management of the business.

Be flexible and open to new ideas

Managers need to adopt a positive attitude and focus on the potential for enhancing competitiveness through innovation. Listen to new ideas and ways of doing business, even if this means you have to change your current business model.

Allocate resources for innovation

The allocation of resources for innovation including finance and personnel is dependent on management understanding the benefits of new ideas. Unfortunately, business expenditure on innovation is often characterised as expenditure rather than investment, and improvements to operational processes may not be seen as innovation at all. Resources need to be allocated to innovation, even if it's only giving employees time to come up with new ideas.

A free flow of information and ideas up, down and across the business encourages the development of new ways of performing tasks and can also lead to the development of new products. Processes which allow employees to suggest improvements and ideas, circulate these ideas and be rewarded for their entrepreneurial behaviour can be implemented.

Invest in Research & Development (R&D)

R&Dcan be used to enhance the productivity of your business. Grants, tax concessions and other funding programs are available to assist investment in R&D so you can develop your ideas.

Develop a strategy for innovation

A strategic purpose and direction is vital for business, as well as the ability to respond quickly and being flexible to change.

How do I develop a strategy for innovation?

Innovation should be tied to the company strategy and built into the core competence of the business. Whilst innovation can be a modification to products, it can also mean small, internal changes to business or management processes that alter the way things are done.

Being innovative means making the time and investment in people and resources. Often, your employee resources will be your best source for developing ideas for innovation. Remember, everyone in the business has the potential to be creative! Each employee will have a different viewpoint or may come from a different background - this will also help in the variety of ideas created. Even the smallest idea can be the cause of a productivity improvement!

In order to start increasing the flow of ideas required to generate innovation in your business, there are a number of characteristics which can be addressed in your business strategy to support an innovative business culture.

Having a responsive business strategy is important for adding value in your business. Often the most effective innovation comes from changing the way things are done.

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