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The link between business success and organisation-wide attitudes towards innovation are becoming clearer and clearer in the current economic turbulence. Those businesses that can foster innovation at the heart of every operational function are seeing long-term profit increases, tapping into new markets, creating more efficient internal processes for cost savings – and so much more.
The benefits of innovation in the workplace
Implementing new technology systems and processes regularly and encouraging innovation at every level of the company can have a wide range of benefits:
- Increasing productivity whilst reducing costs
Creating a more efficient suite of processes or systems can help your employees complete more in less time, allowing you to decrease your costs and maximise on profitability.
- Higher-quality services or products
If you can innovate in such a way that your products or services are of a higher quality, they are more likely to meet your customers’ needs, which if combined with effective marketing will lead to better sales and profits.
- Reaching new markets
Innovation can allow you to tap into more markets, allowing your customer base to increase and your products to appeal to a broader range of people.
- Meeting new environmental, social and governance (ESG) regulatory requirements
Innovation can allow a company to meet the increasing ESG regulations in beneficial ways. An innovative way to reduce carbon emissions or waste is not only beneficial to the company and the world, it can also have a great impact on your employer branding and corporate reputation.
The possibilities offered by technology and software advancements can mean exponentially improved ways in which to communicate with and attract customers, stakeholders and employees. Having agility in mind when creating innovation teams or systems will also allow businesses to grow or shrink their innovation efforts accordingly with the economic climate. However, businesses who take a cautious approach and underinvest in innovation and research and development (R&D) will, on average, see short-term gains rather than sustained profitability and business success.
Business leaders who innovate well
According to BCG’s 2020 survey of the most innovative companies, only 46% of those surveyed say that innovation is a top priority, and they support that commitment with significant investment. However, 30% feel the reverse, seeing innovation as neither a strategic priority nor a significant target of funding.
However, of that 45% that were completely committed to innovation, almost 60% of them report generating a rising proportion of sales from products and services launched in the past three years, compared with only 30% of the more sceptical organisations.
Two notable examples of business leaders who imbed innovation into their strategies successfully include Howard Schultz, who served as the chairman and CEO of Starbucks Coffee Company from 1986 to 2000, and then again from 2008 to 2017, and Elon Musk, the early-stage investor, CEO, and product architect of Tesla.
Howard Schultz: Starbucks
In 2000, Schultz raised Starbucks’ business innovation spend by 50% which fell drastically after his departure in 2008 (to an 11% spend). When Schultz returned to leading the company in 2009, he again drove the innovation spend back up to 49%. The value in his efforts can be seen from his periods of absence from the company, both from 1986-2000 and from 2008-2017, Starbucks’ stock fell by more than 10%.
(Starbucks stock price 1996-2021, source Google)
Elon Musk: Tesla
Elon Musk’s hands-on approach to innovation investment has helped drive over $1bn in revenue for renewable energy and transport company, Tesla. Since 2012, Tesla shares have risen by 881%. With Musk’s unique confidence in start up investments and company mergers to create a full suite of services and products (from the renewable energy car you buy to how you charge and house it, and then the wider energy supply system in your home, etc., according to Toptal), it is clear that without Musk and his drive for innovation investment, Tesla would not be the successful corporate entity it is today.
How can JSS Transform support innovation within your organisation?
Innovation doesn’t just have to come from within, JSS can provide the SMEs you need at every stage of your innovation endeavours to deliver tangible change, or can facilitate the optimal working model your business needs to deliver effective and successful innovation.
JSS Transform is experienced at supporting clients as they navigate digital or technological transformation for innovation. Our Interim Solutions services ensure the rapid provision of senior executives and functional experts, deployed to help manage change, work instinctively in a crisis and support business critical projects through to delivery.