Effective innovation will help you improve products and find more efficient ways to produce them. It fuels discoveries. All of which give you a competitive advantage and higher profitability.
The innovation award winners in this study saw a 32% increase in return on assets and a 34% return on sales over companies who didn’t innovate proficiently.
Sticking to a “top-down” mentality is a roadblock to setting up an effective innovation program. By not looking past your leadership team for ideas, you’re restricting your profitability pipeline.
The winners are organizations that open up the innovation suggestion box to employees outside of the leadership team. They set up a culture that encourages innovation. Keeping their pipeline full of ideas that increase profitability.
Employees, your greatest resource, are the ones who’ll make innovation a daily activity.
Case in point is the large healthcare company in this study. Their employee suggestion program generated 500 winning ideas per 1000 participators. The company also experienced a net profit growth of 6% over two years.
What an Executive Secretary Taught Business Leaders About Innovation
Remember Liquid Paper correction fluid? The product that originally saved typists millions of retyping hours is now used to cover up handwriting mistakes.
It was invented by Bette Graham, an executive secretary. The correction fluid eliminated the difficulty she had erasing typing mistakes.
When Bette tested her product, her bosses prohibited her from using it. But her coworkers frequently sought her “paint out,” so Bette kept developing the product. That turned out to be a smart move. Her company prospered, and she sold it for $47.5 million.
By setting up an innovation culture, you can prevent million-dollar product ideas from walking out your door.
Reduce Employee Turnover and Retain Talent Longer
These are two other reasons to invest in an innovation culture. When more employees are involved with innovation, your company will experience better teamwork, increased engagement, higher morale, and better productivity. This work environment makes employees stick around longer and invest more of themselves into your company.
So now you know why it’s important to create a culture of innovation within your organization. Let’s investigate how to do this.
Start by looking at your current performance improvement initiatives. They should already include High Performance Work Teams (employees dedicated to continuous improvements) and Kaizen events (fast-paced improvements). Both are useful and play a role in bringing about a culture of innovation.
Set Up a Winning Innovation Culture with High Performance Work Teams
High Performance Work Teams are made up of employees dedicated to continuous improvement and aligning organizational goals. The teams consist of highly participatory employees. They aren’t satisfied with the status quo, so they continually challenge themselves to reach the next level.
This team-based approach results in accountable, responsible, and highly engaged employees.
In addition to achieving their goals and generating great results, these employees also play a starring role in defining the culture. Remember, your employees are your front line. And because High Performance Work Teams want to push past the status quo, they drive a culture of innovation.
Engaged teams deliver better innovation results. And not only do High Performance Work Teams strive towards better products, services, and processes — they also work to better themselves — and the improvement cycle continues.
Innovate Faster and Better with Kaizen
Another way to achieve better results with innovation is through Kaizen events. Kaizens are fast-paced improvements with specific goals (usually just taking 3-5 days). With a Kaizen, you can innovate rapidly: get everyone on board, break down a process, and figure out what’s muddying it. Then put the process back together in a new and improved way.
These events help solve particular problems and contribute to continuous improvement, just as High Performance Work Teams do. In fact, Kaizen events are best when partnered with High Performance Teams. In this two-for-one bonus, both innovation and improvement are achieved.
Working Together for a Competitive Advantage
Engaging your employees (your greatest resource!) — through High Performance Work Teams and Kaizens — will help you stay ahead of the pack with a host of improvement methodologies.
Remember, your competitors are also innovating. By harnessing resources and approaching innovation through different vantage points, you will maintain a competitive edge.
For more information on unlocking your team’s potential through innovation, High Performance Work Teams, and Kaizens, contact us at TheDorseyGroup.org or (954) 629-5774.