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Businesses are keen to grow and get ahead of competition, but a new study finds they are doing it in their own unique ways
Medium-sized businesses around the country are planning to take the lead when it comes to innovation – but they’re doing it slowly, and not necessarily in traditional areas.
According to a new report from Bankwest, 91.8% of mid-sized businesses are embracing innovation as a way to deliver commercial and competitive benefits, and 46.4% are using innovation to gain a competitive advantage against larger businesses.
The Innovation Report, the third instalment of the Bankwest Future of Business Series, also shows innovation in SMEs is most likely to be incremental, rather than large, radical advances happening at once – and not necessarily focused on technology.
Curiously, this innovation is occurring in non-traditional areas. Customer service, for instance, is cited by 69.1% of the survey’s respondents as being a key priority, followed by product innovation, and technological innovation.
Three in five businesses plan to allocate specific resources to innovation development.
“The term ‘innovation’ is increasingly becoming a buzzword, so it was important for us to define what innovation means to mid-sized Australian businesses,” says Sinead Taylor, Executive General Manager of Business Banking at Bankwest.
“Contrary to the perception that innovation is focused solely around technology and its impact on product and product development, our research shows mid-sized businesses are most commonly looking to improve existing services and create more efficient work processes, followed by growth and success, and better productivity and performance.”
The Innovation Report also found that traditional methods of inspiring innovation were often the most effective. Face to face meetings, (72.2%), phone conversations, (66%), and in-person customer meetings, (64.9%) were identified as key development opportunities.
The report found mid-sized businesses take a ‘slow and steady’ approach to innovation – 37.1% prefer incremental, continuous improvement, as opposed to 20% who opt for more radical advances.
However, finding a good balance can be difficult. Bankwest client, StayWell Hospitality Group’s managing director and chief executive officer Simon Wan, says the changing pace of technology can often demand a quicker pace of innovation.
“Companies need to come up to speed with new technology, but the problem is this process takes time. By the time you understand it, the technology has moved on.”
The Bankwest report also found strategy is a key factor, with 38.1% of respondents saying aligning different innovation strategies to the business strategy is crucial for success, along with creating an organisational atmosphere that prioritises the sharing of ideas.
This echoes the findings of a previous Bankwest report, the Bankwest Future of Business report, which found 61.2% of leaders believed creating a common vision and goals is a crucial leadership strategy.
However, finance can be a key hindrance to innovation. Almost three in five businesses want to reduce operating costs in order to keep innovation, and 48.5% have or are set to develop plans to access finance more effectively to develop innovation.
Bankwest’s Sinead Taylor says the company’s banking App was designed with this problem specifically in mind.
“Bankwest is committed to being an innovative organisation and we have introduced ‘Hack Days’ and ‘Innovation Time Out’ to actively foster innovation and develop creative solutions within our teams,” she says.
“Our own experience at Bankwest has revealed the value of building agility and innovation into the DNA of our business. We are pleased to see mid-sized businesses are also placing strong importance on innovation and are taking steps to secure funding and talent to support their innovation agendas.
“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.”
To read the Bankwest Future of Business Series: Innovation Report visit: https://www.bankwest.com.au/connect/insights-information/bankwest-future-of-business-report-innovation
At Bankwest, we know that Business Banking is about more than just financial solutions. Explore our tools, information and products to help you start, manage and grow your business. bankwest.com.au/business/guides-and-tools
