How Can An Organisation Be Innovative?

How Innovative Is Your Organisation?

How innovative is your organisation? It’s a simple, yet extremely telling question that can shine a light on whether or not your organisation can afford to be complacent when moving through difficult times like these. An innovative organisational culture can help your company navigate through challenges in which you need to be quick to adapt. So let’s explore how to create an innovative environment/culture. 

Firstly, it’s important to ask yourself what is organisational innovation? What does innovation look like in an organisation and how can you create an innovative culture within your organisation? These are all questions that you need to ask before establishing an organisational structure that encourages innovative ideas within your business.

Innovation and organisational success often go hand-in-hand. Observing long term technological innovation and the effects of innovation on your industry is a vital element of being able to take advantage of new opportunities and use them to grow your business. Brainstorming innovative ideas and adopting new technologies early can give your organisation a variety of competitive advantages. 

Creating an innovative organisation and increasing your innovation capability starts with establishing an innovative culture within your organisation. Creating a culture that promotes incremental innovation ensures that your business gives itself the best chance at being a market leader and dominating your market. 

If the pandemic has taught us one thing – aside from the importance of hygiene and of course, social distancing – it’s that innovation is an absolute necessity when it comes to navigating through a tricky business environment. It’s one of the few prerequisites to success during a profoundly distressing time like a pandemic, where it’s essential to inspire current and future customers with the quality of your products and services and your commitment to innovation management as you move into the future. 


While browsing the web recently, I was scoping out the Australian Bureau of Statistics (ABS) website, where I found an extremely interesting report called the “characteristics of Australian business.” While this report pre-dates the COVID-19 pandemic, it remains one of the most telling indicators as to whether or not an organisation can stand the test of time, and the test of something like the dynamic nature of business during a time of uncertainty and crisis. 

The report took things like business finance, performance indicators, markets, skills, use of IT into account, but most significantly, it mapped out what it called ‘business innovation,’ and ranked sectors within the Australian economy in terms of how ‘innovative-active’ they were. 

The results are extremely interesting. 

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How Innovative Is Your Organisation?

First of all, the ABS defined ‘innovation-active’ businesses as “one which has undertaken any activity during the reference period including: introduction of any type of innovation; and/or development or introduction either still in progress or abandoned.” 

The ABS found that 44% of Australian businesses were innovation-active, with wholesale trade and manufacturing taking out first and second-place with innovation-active scores of 61% and 59% respectively. 

Overall, 37% of Australian businesses “introduced an innovation, with 17% of businesses introducing a good and/or service innovation and 32% of businesses introducing a process innovation.” 

The ABS also mapped out ‘process innovation’ for the first time, which wholesale trade, information media and telecommunications, as well as manufacturing taking out the podium with 44% and 40% respectively. The ABS adds that “nearly one in four businesses (24%) had an innovation in development, while one in eleven businesses (9%) abandoned innovation.”

How Innovative Is Your Organisation?
Graphic Courtesy of the ABS

The ABS also wanted to understand why 9% of Australian organisations were abandoning innovation, with the results showing that it came down to one simple thing: money. “Lower profit margins to remain competitive” was the most common barrier to innovation for around 21% of businesses. 

The ABS adds that “nearly a quarter of innovation-active businesses (24%) reported a lack of access to additional funds as a barrier to business performance and activities compared to 9% of non-innovative active businesses.” 

“15% of businesses with 0-4 employees reported a lack of access to additional funds as a barrier to general business activities or performance, compared to 8% of businesses with 200 or more employees,” the ABS concluded in its report. This is to be expected as smaller businesses with fewer employees don’t traditionally have the funds to spend on a large scale innovation.

The ABS reveals that organisations are sacrificing innovation in order to remain competitive within their industries. However, if they were to prioritise innovation, they might be able to not just remain competitive within their industries, but dominate them. 

I also stumbled upon an old volume from the National Center for Science and Engineering Statistics, who mapped out rates of innovation across 1.3 million non-profit organisations in the US. Authors Audrey E. Kindlon and John E Jankowski write that “fifteen percent of an estimated 1.3 million non-profit companies introduced one or more product or process innovations” across the span of two years. 

They go on to explain that rates were higher in the manufacturing sector, signifying the need to innovate in the more competitive space. “Thirty-two percent of companies classified as manufacturing reported one or more product or process innovations… these innovation rates are more than double those for the full 1.3 million population of companies.” 

These reports highlighted the importance of innovation management within an organisation, underlining the effects of innovation and how innovative companies ultimately benefit from becoming early adopters of new technologies. So have a look at your organisation and the industry in which you operate, and constantly be observing new trends, technologies and innovations that you could harness to expand your business. 

Auditing your knowledge management to include the continual observation for innovation opportunities can be extremely beneficial to your business. An example of some currently emerging technologies/trends/innovation opportunities might include, The Metaverse, Non-fungible Tokens (NFTs), Web 3.0, Augmented Reality and Virtual Reality. Try to consider how these technologies could be utilised by your organisation to improve the products or services that you offer. 

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