Innovation, like success, comes in many forms, and the latest instalment of Bankwest’s Future of Business Series, The Innovation Report has revealed mid-sized Australian businesses are firmly focused on how they harness it to get ahead of their competition.
While a staggering 91.8% say they’ve embraced innovation as part of their culture, nearly half (46.4%) currently use it as a tool to gain a competitive advantage.
How they do it is where it gets interesting. Improvements in customer service is the top priority for nearly 70% of mid-sized businesses in the coming year, while product innovation ranks second at 62.9%, just ahead of technological innovation at 60.8%.
The Innovation Report suggests Aussie mid-sizers think they’re pretty good at it too, with almost half (47.4%) declaring their business an innovation leader, coincidentally matched by an equal number who say their business is a follower.
The remaining 5.2% labelled themselves innovation avoiders.
Sinead Taylor, Executive General Manager of Business Banking at Bankwest, said that with innovation becoming a buzzword, the report was keen to try and define what it meant to Australian firms.
“Contrary to the perception that innovation is focused solely around technology and its impact on product development, our research shows mid-size businesses are most commonly looking to improve existing services and create more efficient work processes, followed by growth and success,” she said.
Innovation is all about finding ways to set yourself apart from competitors in a crowded marketplace.
And just in case you think it’s all about the new, the surprise is that there’s a back-to-the-future aspect, with some turning to “old school” methods of innovation: think face-to-face meetings, talking to customers on the phone rather than by email and in-person customer meetings as some of the innovations planned.
Keeping costs under control remains a key driver, with nearly 60% seeking to reduce operating costs in order to keep innovating and grow.
Taylor says the mid-market’s blend of available capital and relative flexibility makes it ideally positioned to lead the way.
“Looking for opportunities to maximise both commercial and competitive advantages is crucial so it’s exciting to see the mid-market taking the lead in innovation to secure future opportunities,” she said.
Impressively, they’re walking the talk: three in 10 (30.9%) respondents already have employees dedicated to innovation efforts, while another 41% are planning to bring someone on board. On top of that, nearly two-thirds (62.9%) are planning to formally allocate resources to innovation development.
Two perennials stand in the way, however, with a little over a third of the respondents in The Innovation Report outlining insufficient human resources (37%) and financial resources (36%) as the most commonly cited barriers.
Unsurprisingly, it’s all about evolution rather than revolution, with nearly four in 10 saying their focus is on the incremental gains of continuous improvement rather than the radical disruption model favoured by startups.
Taylor says the key to success is making sure your innovation strategies are properly integrated into the overall business strategy. Creating an organisational structure that fosters and promotes idea sharing and generation is essential, and while it seems obvious, it’s worth repeating that strong leadership is critical, with nearly 93% saying it’s needed alongside a clear vision.
Taylor says Bankwest created its own way of fostering innovation via things such as “Hack Days” and “Innovation Time Out”. Ideas such as the mobile banking app, which makes banking easier and faster for customers, are the result.
“Our own experience at Bankwest has revealed the value of building agility and innovation into the DNA of our business,” Taylor said.
* The Bankwest Future of Business Series, The Innovation Report was prepared from a survey conducted with around 100 C-suite and senior managers of businesses with an annual turnover of between $7 million and $250 million in July this year.
Business Insider Emails & Alerts
Site highlights each day to your inbox.