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What is a Culture of Innovation for a Business?

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When you think about a successful company, what do you see? Visionary growth? An in-depth understanding of the industry’s market? A company with a strategy that encompasses not only the technological standpoint but also the cultural standpoint? Yes! All of these make a company great, but something else sets thriving companies apart from those who aren’t doing as well.

An innovative culture.

A company that fosters a culture of innovation is sure to have continued success for the years that they are in business. If you are looking for more information on how to create a culture of innovation, then you came to the right place! We will go over what innovative culture is and what you can do to optimize and improve your company today!

What is a Culture of Innovation?

A “culture of innovation” is a corporate environment that fosters and supports creative thinking, diverse perspective, and psychological safety. This culture cultivates new ideas and improved products by acknowledging and accepting different ways of thinking and development, both inside and outside of the organization.

Chris Hood shares insights on building a culture of innovation.

Exploratory Innovation

When people first think about innovation, they think of game-changing ideas that cause revolutions. This type of innovation is considered exploratory innovation.

Exploratory innovations are designed to meet the needs of specific industry markets or emerging customer needs. Exploratory innovation creates new products or services that create new markets or reshape those markets. Examples of exploratory innovation would be social media, smartphones, and online shopping.

Exploitative Innovations

Exploitative innovations are designed for improving business products and service the existing market and existing customers. These types of innovations improve designs and expand services and products. If you are looking into how to improve business, exploitative innovations are the best for your business.

You will see an increase in your organization’s financial performance, even in those competitive environments. The best thing about exploitative innovation is that you can access information from the operational level of your organization.

Your employees who deal with customers daily are great resources. Your employees at all levels of your organization can contribute to innovation.

How to Create a Culture of Innovation

There are many fantastic ways to create a culture of innovation in your business, such as involving your employees. As mentioned earlier, your employees who work directly with your target audience and clientele know more about day-to-day operations. These employees understand the many pain points that need fixing to innovate and upgrade your company.

When you include your employees in the conversation, they feel as if they have some autonomy to find new ways to create solutions. Great leaders ultimately make the final decision, but they should never do it alone. Successful leadership is about listening, trusting, and empowering your teams to input their opinions and ideas.

Leverage Data to increase Value

Capitalize on the value of data through developing new data-driven products and services and revenue streams for an organization’s competitiveness. It will be key that data-driven insights are leveraged for enterprise-wide collaboration and decision-making to institute a knowledge-sharing culture.

Businesses transform, and data is the essential ingredient. Your data cloud can elevate your customer experiences, so you’re able to delight customers with rich and compelling experiences that are personalized, secure, seamless, and instantly responsive, no matter where they are or on which device. And a culture of innovation and a comprehensive data strategy can accelerate your digital transformation.

Failure is Ok but Psychological Safety is Key

Many people assume that failure is an end all be all in business, but that is not true. If your company does not have moments of failure, then you probably are not innovating as much as you need to be.

You should look at failures as opportunities to innovate to make the necessary changes to be successful. Failure will happen at any level of your organization. It is essential to learn how to pivot and adjust in these moments to keep your business running and improving.

“There’s no team without trust,” says Paul Santagata, Head of Industry at Google. He knows the results of the tech giant’s massive two-year study on team performance, which revealed that the highest-performing teams have one thing in common: psychological safety, the belief that you won’t be punished when you make a mistake. Studies show that psychological safety allows for moderate risk-taking, speaking your mind, creativity, and sticking your neck out without fear of having it cut off — just the types of behavior that lead to market breakthroughs.

Take Action and get Feedback

To create a culture of innovation, you must want to encourage action. Talking and pondering on an idea does not produce results or cause any changes.

Not all ideas should go straight to prototyping, but they should have some time to research and review data to make an informed decision. Of course, to keep your enterprise running, you aren’t going to want to spend too much time idling on the idea. Once you have a good idea of whether you are going to make a decision, make it.

When you take action on an idea, you should also take action on feedback. Create feedback loops to help you understand what consumers are asking for. This is not only the opportunity to learn but to continuously improve your products and services as well.

Learn from the Past

Did you know that more than 20% of new businesses fail within their first two years due to complacency? Enterprises become comfortable and refuse to learn from their mistakes.

The market in your industry is always changing and adapting, so your business should do the same. The last thing you want is to miss opportunities to exploit certain areas or markets in your industry. That is money that you are leaving on the table!

Multi-Faceted Innovation Approach

Innovation does not need to look like an extensive brainstorming session in a breakout room with clever marketing campaigns and fresh and exciting new products. Sometimes you may need to remove the product from the equation and give a multi-faceted approach a chance.

An example of a multi-faceted approach is breaking down innovation into four components: processes, profit models, policies, and products. Breaking them down into those components makes them easier to tackle and manage.

Create a Culture of Innovation

Creating a culture of innovation in your enterprise is extremely important if you want your business to succeed. Taking in the feedback from your teams is a great way to foster an innovative environment.

Once you understand that innovation is great for your business and it is necessary, you will then be on your way to creating a path for continued success. If you want more information on creating a culture of innovation in your business, reach out now.

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