Australian Innovation

Foster Innovation in your Organisation

Innovation has been identified as the last competitive advantage available to organisations in a turbulent and hyper-competitive global market. Therefore, a number of key drivers are needed to encourage and foster innovation in organisations.

1. Strategy for Innovation

A clear and articulated strategy for innovation must be developed and accepted to encourage innovation across the organisation. Strategy development first requires an understanding of the business and its environment, and should involve stakeholder input to ensure buy-in across the organisation. Innovative companies have a clear vision and core values that encourage the pursuit of organisational objectives, including innovation initiatives.

2. Innovation Leadership throughout the Organisation

Commitment and support from top management is the cornerstone of successful innovation. Management influence is necessary to overcome the barriers to successful change, which innovators often encounter. Identifying “champions” in the organisation to drive the innovation agenda can make a significant difference to innovation diffusion and adoption. Innovation champions can also provide the leadership required to stimulate innovation throughout the organisation. Effective change management will ensure that improvements will be easily implemented. When top management is pro-active and becomes a catalyst for change, the organisation has a better opportunity to adopt an innovative culture.

3. Culture and People


Establishing a culture that is conducive to innovation requires building a work environment where trust, open communication and teamwork are the norm. A team is capable of significant achievements because individual abilities can be pooled towards achieving a common objective. The use of cross-functional teams helps break down the barriers by transcending the existing organisational structure. An environment that encourages participation, learning and fun allows new ideas to be generated and improvements implemented. Harnessing the creativity of the workforce forms a critical component of an innovative culture. Therefore, professional development of employees should include skills development in creativity tools and techniques. Other characteristics of an innovative culture include, tolerance of ambiguity, challenging the status quo, asking “Why?” and not being afraid to speak your mind.

4. Tolerance of Risk

The innovation process generally has an element of risk since any change involves uncertainty. Some organisations are risk averse and usually struggle to become innovative. Organisations that incorporate a higher level of risk tolerance in their business processes are more successful in adopting an innovative climate. The downside of risk is failure. However, “failure is not built on success: success is built on failure”. Sagacious or calculated risk taking is therefore the preferred option, because this implies that outcomes, consequences and contingencies have been considered in advance.

5. Open Communication

The existence of free and open communication channels is favourable to innovation because it provides the opportunity for ideas and information to be relayed throughout the organisation. It is also important that, in addition to vertical communication, an organisation maintains lateral relationships between functional areas to break down any silos. Collaborative information technology solutions, such as Microsoft Sharepoint or Lotus Notes, encourage information sharing throughout the organisation and provide a repository for knowledge and ideas.

6. Flexible Operating Structures

Establishing adaptive organisational structures, which are characterized as flat, organic and cross-functional, is a key characteristic of innovative organisations. For example, 3M is a large global company that operates small autonomous cross-functional business units to encourage innovation and participation. In an organic structure job definitions are flexible, and both vertical and lateral communication flows exist. Power and authority are generally shared across team members.

7. New Ideas and Opportunities

The continuous flow and capture of new ideas provides organisations with a source of new products and services, product improvements, and novel processes that contribute to the organisation’s survival and growth. Creativity is therefore an important key driver of innovation by providing new ideas and new ways to solve organisational problems. Organisations also need to adopt a formal ideas management process to capture, develop, evaluate, protect and implement ideas and suggestions, which form the foundation of new opportunities that satisfy needs and wants in the market.

If organisations and their leaders readily embrace the concepts of innovation and successfully implement innovation strategies and processes, they would have made the first steps towards achieving growth and sustainability in the hyper-competitive global arena. Creativity is a skillset that, despite popular belief, can actually be learnt and nurtured within an organisation. Senior managers and leaders need to take responsibility to foster an internal culture that recognizes and supports creativity and innovation to ensure they sustain their competitive advantage in the marketplace.

Author: Dr John Kapeleris, Deputy CEO, Australian Institute for Commercialisation. This is an entry from Dr John Kapeleris’ blog which can be viewed here. To read more AIC-authored articles please click here.

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