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Running a business

Common Characteristics of Innovative Companies

Innovation increases your small business’s productivity by developing new processes that add customer value. New products developed through innovation help differentiate your company and give it a competitive advantage. The Government of Canada provides helpful information about business innovation support options, such as research infrastructure funding and research and development tax incentives.

Empowerment and Trust

Innovative businesses provide their employees with the freedom to express groundbreaking ideas. Set broad goals, and give your staff the resources and autonomy they need to achieve them. For example, if you own a software company, you could set a goal for the project’s completion date, but give your developers the freedom to design the product how they see fit. Giving your staff autonomy and encouraging them to take risks may result in mistakes and inefficiencies as they push boundaries. Trust your employees to use these mistakes as learning experiences to help discover new improved processes that drive innovation.

Team Collaboration

Innovative companies encourage collaboration between employees and across divisions. For innovation to prosper, help your team members share ideas and work together. Consider organizing a weekly brainstorming session where you ask each employee to share an innovative idea. Facilitate collaboration in your business by introducing incentives that reward teamwork. For instance, you might offer a team bonus for the successful completion of a new project. Establish an office environment that fosters collaboration. For example, you could have a communal lounge area with a ping pong table and bean bags for your team to casually discuss ideas.

Lead by Example

Companies renowned for innovation set the standard in their respective industries for developing new technologies and ideas that enable them to offer cutting-edge products that improve consumers lives. For instance, Tesla leads innovation in the electric car market by revolutionizing battery and charging technologies. The company empowers its employees to find innovative solutions that separate it from traditional car manufacturers. Try to find an area where your small business can gain a competitive advantage by leading through innovation. For example, if you own a small bookkeeping business, you could lead your competitors by offering innovative accounting solutions, such as cloud-based software.

Customer Centred

Businesses that place an emphasis on innovation have a strong customer focus. Analyze your clients’ needs and develop new products that offer novel solutions. Stay customer-centred by listening to problems that your consumers regularly encounter. To help determine what challenges your customers discuss, read and participate in blogs and forums that they visit. For example, if you own a housing construction business, a blog post may inspire a new idea for an extension. Ask customers for feedback about your existing products; they may offer insight that results in new complementary products that you could sell. Fostering innovation in your small business creates benefits that can help it grow. Innovative companies share common characteristics that include empowerment and trust, team collaboration, leading by example, and listening to customers.

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