How to grow like the world’s most innovative companies

innovative

All of us have heard about businesses that experienced a “pivot” during COVID-19 restrictions. For example, face to face experiences became online (including education and retail), and new products were manufactured (like distilleries producing hand sanitiser). There are still plenty of opportunities to identify new and innovative ways to provide value to your customers, find new markets, and improve business operations.

Recent research and an article written by two professors from one of the USA’s most prestigious business schools identified three things that the most innovative global companies do that make their performance stand out from other organisations. The research found that doing these three things gives businesses an advantage when it comes to what they do, how they do it, how long it takes for competitors to catch up, and importantly, the growth experienced.

The three things are investing in innovation talent, adopting an outside-in approach to innovation, and encouraging prudent risk-taking. Just because the research was based on large, global business doesn’t mean that smaller organisations can’t take a similar approach to achieve growth. Here’s how you can interpret and use these three drivers in your small and medium enterprise.

Innovation talent

Investing in innovation talent doesn’t have to mean hiring expensive innovation-focused experts or resources. It can mean investing in your existing high potential staff, or indeed yourself through education in, exposure to, and use of innovative tools and techniques. Another option is for you to hire the right talent to look into opportunities for your business, which might involve short-term contracts, consultants, or university interns or student projects that look at business innovation. There are plenty of ways to access free or inexpensive talent.

An outside-in approach

You don’t need a massive customer experience program to capture the voice and sentiment of your customers. A conversation or a simple online survey can give you great insights to understand the issues your customers (or other consumers) currently have that you can address in your business. The questions might focus on your current products/experience or on areas you don’t yet service. The insights that you learn are valuable intelligence for identifying opportunities for growth.

Prudent risk-taking

Doing new things involves both risk and reward; you can’t avoid risk and get a good return. What you can do, however, is be clear on the risks you are prepared to bear and put controls in place to make sure that they don’t go beyond the limits you have set. For example, promote a culture of ‘low-fi’ experiments in the organisation with an emphasis on failing fast and cheap, while absorbing learnings. “Low-fi” means tests should involve the minimal amount of investment in time and materials possible, using “cardboard, paperclips and string” to build your prototype. You could establish and agree on these limits in advance.

If something doesn’t work, don’t put it in a dark cupboard and never speak of it again, instead, share risks and learnings with others and explore ways to improve the offering.

With Australia starting to re-open for business, now is the time to start looking around corners for new opportunities. You can get great results from small investments in talent, insights from your customers or the market and finally, from taking measured risks. These things work for the big end of town, and they can also help your business identify and take advantages of new areas for growth.

Samantha Rush, Principal Consultant, Legion Consulting Group