Strategy

How Small Companies Can Build a Culture of Innovation

Sam Frentzel-Beyme Follow Managing Partner & Strategy Director

The Short of It

  • Employers need to help employees contribute.
  • Empowering employees to work through problems drives real problem solving.
  • Celebrating the process is as important as the outcomes.
  • Taking time to talk with customers is critical and often forgotten.

Reading through Forbes’ list of the world’s most innovative companies might be discouraging to small business owners. After all, who can compete with the vast resources that Google and Amazon enjoy? What you don’t realize is that large companies struggle to create a culture of innovation, while small businesses, those with 500 or fewer employees, actually have significant advantages over industry behemoths. With a few smart moves, the spoils of the innovation war can go to the little guy.

Be Smart… But Not Too Smart

Most small businesses were built from the ground up through the brainpower and hard labor of just one devoted founder. As client lists grow and ideas begin to bear fruit, it is tempting for leaders to keep a firm hand on the company’s plans and goals. There is nothing wrong with making the most of leaders’ business acumen, but the key to building a culture of innovation is developing employees’ abilities to contribute innovative ideas. Instead of directing the conversation, encourage creative flow throughout the organization:

Hold brainstorming sessions and take participants’ suggestions seriously. 

Instead of considering all of the reasons something won’t work, let employees show how it could work. If the idea is truly a clunker, give employees some latitude to learn for themselves.

Celebrate the process of innovation. 

That means there will be some ideas that don’t work before you strike gold. When employees can test theories and go down dead ends without fear of reprisal, they won’t be shy about coming up with something new.

Talk to Your Customers

Leave your employees back at the office to test out their new ideas and take some time to visit with your customers. Find out what problems they still can’t solve with your product or service and use these conversations as a springboard for your business-wide brainstorming sessions. These folks will tell you exactly what your company is missing, but you have to listen carefully.

Keep in mind that your customer service representatives, salespeople, and technical personnel have the most contact with your product’s end-user. Through them, you have a window into the minds of your customers, so these are the folks you should develop into innovation leaders to improve your value proposition.

Large companies are lucky when they roll out truly innovative ideas, because the extraordinary number of people that touch each project tend to muck it up. Small businesses, on the other hand, have versatility and agility on their side. A new idea can be developed and implemented right away, while it is still relevant, which gives them a leading edge.

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