Businesses work fastidiously to generate thousands of ideas. In exploring a range of possibilities, innovation is often born from one good idea that can be nurtured into a successful enterprise. The theory and practice behind innovation value quality over quantity. As new ideas and technologies emerge, innovators can produce greater output by going against existing practices and creating something for a new market or something new for an existing market.
What is innovation?
Innovation is not the opposite of tradition, but the ability to influence the future by understanding the past. Innovation is the foundation of all successful businesses and should be rooted in an organisation’s internal structures and practices.
“Customers ultimately assign value to a product by the service it offers them, the need or want it fills in their lives. Innovation is about executing an idea to create value, so understanding the true value being created is vitally important.” – Associate Professor Tim Kastelle, Director, Andrew N. Liveris Academy for Innovation and Leadership
Beyond the production of products and services, an innovative enterprise engages a deep understanding of supply chains, routes to market and business models.
Why is innovation important?
To move forward with momentum, innovations need to capture the big
picture when working with a promising idea. With increasing pressure from
a rapidly changing market, innovating your business model and adopting an
entrepreneurial mindset gives you the competitive edge required to succeed.
Innovation is the way to transform a good idea into a great reality.
Businesses without innovation stagnate under the weight of tradition and
market expectations. In every industry, from technology to agriculture,
innovation influences how businesses overcome new global challenges.
Innovative strategies adapt across a variety of circumstances, keeping
entrepreneurs and businesses equipped with purpose and unique skills
when the unexpected occurs.
What is disruptive innovation?
Market newcomers have the potential to challenge traditional views, often working against well-established conglomerates and rupturing the status quo. The theory of disruptive innovation proposes that leaders of small companies can do this with less resources than more established competitors by creatively improving their structures, practices, products and services.
But disruption itself doesn’t guarantee an organisation’s ability to sustain innovation. Evolving to meet ongoing consumer demands for improved product or service performance is essential, but innovation comes from understanding human behaviour and emerging technologies.
One of the most significant disruptive innovations in recent history is Netflix. The streaming service and production company was initially launched as a mail-based rental business in the late nineties. By 2000, founders Marc Randolph and Reed Hastings had pitched Netflix to Blockbuster for $50 million. This offer was met with instant refusal, only to see the home video rental service filing for bankruptcy ten years later.
When Hastings reflected on this pivotal moment another decade on, time had helped clarify the importance of elevating innovation above standard control practices.
“It was not obvious at the time, even to me, but we had one thing that Blockbuster did not: a culture that valued people over process, emphasized innovation over efficiency, and had very few controls. Our culture, which focused on achieving top performance with talent density and leading employees with context, not control, has allowed us to continually grow and change as the world, and our members’ needs, have likewise morphed around us.”
– Reed Hastings, co-founder of Netflix
Netflix continued to grow and adapt with technological advancements and consumer changes in the market. Eventually the company transformed beyond streaming and began investing in original productions, making history with Roma (2018) winning three Academy Awards, including Best Director, despite the film’s limited theatrical release.
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What is social innovation?
Entrepreneurs can use their knowledge of business and economics to create meaningful change in the world. Social innovation aims to resolve social or environmental issues through research and understanding methodology. Social entrepreneurs need to strive for impact to successfully fulfill their purpose and create sustainable social outcomes.
Young entrepreneurs, Nic Marchesi and Lucas Patchett, transformed their years of volunteering and passion for helping the homeless into creating the Brisbane-based charity Orange Sky Laundry in 2014. Recognised as a truly game-changing innovation, Orange Sky provides a free mobile laundry service for homeless people, with the charity expanding in 2016 to also offer showers.
“We stumbled on a world-first, something that connected the community, reduced the transmission of diseases, but most importantly and most simply, we were improving the lives of others.” – Nic Marchesi, co-founder of Orange Sky Laundry
Orange Sky Laundry has continued to develop innovative projects during their continued growth, exploring new ways to positively impact communities. Working alongside remote communities in Queensland, Northern Territory and Western Australia, Orange Sky has helped build local employment and local partnerships.
Laura Stokes, the Chief Marketing Officer of Orange Sky, found that those who had previously used the service continued coming back to Orange Sky for the people and conversation, even after they had found temporary accommodation.
"Professionally, the role is extending me in many ways, but still plays to my strengths in marketing, fundraising, and engagement, while giving me the opportunity to have a positive impact in the lives of those who need it." – Laura Stokes, Chief Marketing Officer, Orange Sky Laundry
Social and community entrepreneurship is driven by innovation and elevated by empathy. These two factors inspire enterprises’ social mission, becoming catalysts for significant advancements in communities. By actively learning about an issue and understanding the specific methodology needed to address it, social innovation empowers individuals, startups and organisations to find appropriate solutions. When looking for a career with purpose, social entrepreneurship transforms the intrinsic need to better the world into a reality.
Now you know the differences between social innovation and disruptive innovation and why innovation is so important for businesses and the global community, here’s how to develop innovative practices.
How can you promote innovation in an organisation?
With the economy emerging from a global pandemic, the pressure felt by business owners and entrepreneurs may cause an instinctive resistance to change. Rather than avoid risks, incorporating innovative principles into your business culture can boost your performance.
To promote innovation, an organisation must invest in 3 vital resources:
- time
- support
- leadership.
Use these 3 strategies to get started:
1. Promote innovation in your business by creating an environment where honesty is valued. Open collaboration is a necessary tool in creatively exploring new initiatives and engaging dynamic momentum.
2. Ensure your team includes individuals with different perspectives to offer unique problem-solving abilities.
3. Encourage your employees to undertake specialist training to enhance your organisation by fostering new skills and ideas across the team.
Want to become more innovative?
Postgraduate degrees specialised in innovative theories and practices like UQ’s Master of Entrepreneurship and Innovation engage multi-disciplinary perspectives to rejuvenate strategic thinking. Whether you’re an organisation or future leader, developing critical-thinking and innovation skills can foster high-performing teams aligned with a shared purpose.