According to Business Victoria, innovation embraces not only the further development of products and services but also the new technologies and their uses, improved industry methods, meeting changing customer demands or needs and better systems/processes.

Benefits:

Creating an innovative business culture will ensure everyone in the business is working towards improving business practices, efficiency, and performance.

Primary benefits of business innovation include:

• Increased competitiveness – offering higher quality products more efficiently and at a lower cost
• Improved staff retention – staff like to work in jobs that promote teamwork and problem solving
• Proactive approach to business – your business can keep up with changes in your industry
• More customers – offering new or improving existing products or services, or entering new markets
• More efficient use of all resources.

Although your ability to be innovative may be somewhat determined by variables such as business strategy, capability, market understanding and commitment levels; this process can generally add capacity to your business with little to no costs.

Creating an innovative environment:

Your employees are one of your most productive assets. You can help them become more productive by fostering a culture that encourages creative thinking and action in the workplace. In turn, creating a far more supportive and communicative work team where issues are overcome easier, and productivity is increased.

Here are some ways you can promote an innovative environment in your business:

1. Make innovation a core value
   You want everyone in your business to be under the assumption that there is no bad new idea and that being stagnant or not trying anything new is often the biggest risk!
   Knowing this, you should encourage your employees to do/be the following:
   • Be honest and open
   • Share ideas
   • Explore initiatives without fear of retribution
2. Hire people with varying perspectives
   Having employees with a different set of ideas or approach to problem-solving will easily generate an innovative approach. When hiring look for people who:
   • Understand your vision
   • Align with your culture (not necessarily the same)
   • Have a diverse background
   • Have passion and different abilities
3. Give time and space to be innovative
   Be open and approachable to new ideas and set aside spaces for employees to create and share ideas. This can be achieved through initiative such as meetings, suggestion boxes or allocated times for debriefs.
4. Encourage collaboration
   Create work practices to encourage employees to work together and openly discuss ways to improve.
   For example:
   • Allow job swaps that foster new perspectives
   • Brainstorming sessions with employees from different parts of the organisation
   • Introduce a new ideas or ‘what if?’ section to your regular meetings
5. Include a Feedback process
   Ensure there’s a process that everyone understands for assessing each new idea. Employees will be encouraged to suggest or recommend ideas if they’re confident that it will be appropriately considered.
6. Implement ideas as soon as possible
   Put employees’ ideas and suggestions into effect as quickly as possible. When employees see they’re influencing the direction of the business, they’ll be motivated to continue to share ideas and work towards the success of the idea.
7. Reward employees for their ideas
   Use rewards to encourage your employees to suggest all ideas, even if they’re not carried out. You can offer these rewards to individuals, teams, or the whole workforce.
8. Offer training
   Employees will gain experience and the business will benefit from any new ideas and approaches your employee has learned.
9. Invest in resources
   Ideas can only go so far, so make sure you set aside the resources to act on them including time, finances, employee support and leadership.

Summarised from:

• Business Victoria: Improve Employee Innovation