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How to Create a Culture of Innovation

04 November 2018 by National Bank
How to Create a Culture of Innovation

With market globalization and competition growing increasingly fierce, companies seeking to remain competitive have no choice but to prove they are creative. So how do you introduce a culture of innovation at your small and medium-sized business SME?

We all know that growth and competitiveness go hand in hand with innovation. Here is some advice for applying it to every facet of your business.

Innovation 101

We often talk about the culture of innovation, but what does it mean? Denis J. Garand, professor of entrepreneurship and SME management in Université Laval’s Faculty of Business Administration, has a definition.

“Generally speaking, we could say it is instigating and encouraging the development of innovation by fostering attitudes and behaviors that promote originality, creativity, and measured initiative within a company to regularly bring about new ideas and solutions tailored to the organization and its customers’ needs.”

Innovation is not about technology alone; it can also apply to products, procedures, equipment, and services. It is found at the production level, but also at the organizational, commercial, and marketing levels. “For example, teleworking is a form of organizational innovation made possible by technological advancements,” Professor Garand says. In other words, innovation culture appears to be an overall process and management philosophy in its own right, enabling productivity and efficiency gains.

Why innovate?

As soon as a small and medium-sized business stops innovating, it risks falling behind the competition. It is by innovating that a company distinguishes itself from competitors—a key part of this strategic approach.

“The organizations that succeed are those that best meet their customers’ expectations,” Professor Garand adds. “For example, take Apple, which not only anticipates consumers’ needs, but sometimes creates them as well.”

In short, the more a company is able to differentiate itself from others and satisfy customers’ needs, the more sustained and constant growth it will see. Its success will attract talented, creative people, triggering a snowball effect and fostering innovation culture even more.

Optimal conditions

To establish the conditions needed for a culture of innovation to flourish, it is essential to look to the entrepreneur and their vision. After all, this person had the idea for the company and created it! It is this shared vision that will let employees be creative and innovative in keeping with the entrepreneur’s goals.

“However, some entrepreneurs are very centralist by nature and have difficulty letting other people’s ideas emerge. Such people have to work on being flexible and give more creative employees or those closest to creative environments more autonomy," Professor Garand says.

Another essential condition is the ability to delegate, for instance, to small groups of employees, who will develop ideas and then present the fruit of their labor to management.

Company leadership will also learn to spot “intrapreneurs” within their organization, and give them more leeway. “Intrapreneurs are salaried employees who have almost all the skills of an entrepreneur. They’re creative people who can contribute to the culture of innovation when given the chance,” Professor Garand explains.

The organization has a big part to play in creating conditions conducive to innovation. It has a responsibility to recruit candidates that are more open to innovative processes. When good ideas emerge from in-house resources, the company has a duty to praise them through recognition programs—bonuses, for example—or by communicating employees’ good deeds.

Another aspect to remember is accepting and even encouraging mistakes so as not to impede the creative process. Professor Garand says, “Many people think making mistakes is a bad thing. It’s actually the opposite: those who succeed have made mistakes but they have also learned from them. Those slip-ups have helped them improve and do better the next time.” On that subject, he mentions that there are “Fail Camps” in the United States—a trend that is beginning to appear in Quebec—where company heads share their failures and how they overcame them.

Getting the ball rolling

How do you go about giving your organization’s innovation culture that initial push? First, remember that any company can embark on this path, regardless of its size. “In fact,” Professor Garand says, “small businesses actually have an advantage over big ones. They’re more innovative because they’re more flexible, with flatter structures.”

Being able to innovate also requires being open and connected to innovative environments. A number of public and private players, including consultants, experts, and research centers, can help companies establish innovation culture. Likewise, there are university or college research centers and organizations such as the National Research Council Canada.

Once the process has begun, it is better to focus on a regularly updated innovation portfolio to meet current, emerging, or latent needs. According to Professor Garand,

“a small and medium-sized business cannot innovate one thing at a time. Instead, it should have three, four, or five projects on the go, in various stages of development.”


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