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Being ordinary is no way to differentiate your company from your competitors. The drive for small business innovation is strong. So strong, the federal government is operating a $2.5 billion fund to support small businesses innovate.

Yet, according to a survey by Robert Half Management Resources, only 31% of CFOs consider their employees to be innovative. And while 59% felt their employees were somewhat innovative, they also felt there was room for improvement.

Where does your team stand? Here are six tips to help you foster a culture of innovation at your small business.

1. INNOVATION IS NOT REINVENTION

Forget about Uber. The bar for being innovative doesn’t require that you reinvent your industry. Innovation – real, impactful innovation – more often occurs in the details. Small business innovation occurs in different ways. It might be a momentary decision to change a workflow. It may get planned out after deliberate brainstorming with your team.

The point is don’t limit yourself by discarding ideas that don’t seem big enough. For instance, what’s the impact if you develop a more streamlined way to communicate with subcontractors and suppliers? Imagine if your instructions were carried out correctly the first time, or deliveries arrived on time at the right place? Higher client happiness, stronger vendor relationships, and an improved bottom line. That’s innovative!

You didn’t start your small business because the circumstances were perfect. You took the risk because your passion and entrepreneurial spirit inspired you. Use that same attitude to guide your small business innovation process. Don’t let splashy, high profile stories of radical change stifle your idea of what’s innovative.

Meaningful innovation isn’t about how radically you change things. It’s about the significant results from the change, no matter how small.

So where can you find opportunities for innovation within your company?

2. FILL IN THE GAPS

What are the little pain points everyone puts up with because they’ve always been there? Your team’s (and even your) attitude of “it’s just how it is” often cover up the gaps screaming for change.

Since you know your business so well, it can sometimes be hard to spot these gaps. You might not even see them. The first step to small business innovation is to expose and shine a spotlight on them.

Rohit Bhargava, founder of the Influential Marketing Group, wrote a great book — “Non-Obvious: How to Curate Ideas & Predict the Future.” In it, he identifies three helpful skills to finding opportunities to innovate:

  • Be curious
  • Be observant
  • Be fickle

If you already see large areas that affect your operations, start there and dig down to pinpoint all the tiny steps that combine to create that big issue. Get curious and consciously observe your standard practices. Which step could be ripe for change?

Then, be fickle about the where, what, when, and how to change. Don’t get sucked into one way of solving problems, or that a specific person (or role or title) should fix only certain things, or what time is the only time to make changes. Instead, get attached to positive outcomes, not any specific idea. If a change isn’t working, consider it another opportunity to explore for new ideas.

3. DON’T IGNORE THE OUTLIERS OR COMPLAINERS

Being observant about what you already know so well can be tough. We’ll get to ways your team can look at your business with fresh eyes in a moment. But before that, let’s talk about your most annoying customers.

They’re regulars. They’re good, valuable customers. But they make you (and your team) nuts. At this point, their complaints have become background noise for you.

Do not ignore them. Even if their communication style isn’t what it could be, or they exaggerate, or they aren’t very clear about what’s wrong. Listen to the substance of their complaints. Appreciate their perspective as an outsider and customer. Is there a nugget anywhere in their message that’s worth looking at?

Take the same approach with any outlier comments or situations. Don’t dismiss them as one-off situations. They may be the tip of the iceberg when it comes underlying issues or the forewarning of a trend that could hurt your business.

4. TRY ON ALL THE HATS

If you’ve ever seen the TV show “Undercover Boss,” you know what an educational experience it can be for bosses to experience the trenches. Now, your employees know you. So going undercover isn’t going to work. Even so, the principle applies. Find ways for you and your employees to understand what everyone at your company does.

This is easier in the early phases of a small business, where everyone seems to do a little bit of everything. Maturing as a business can make innovation more difficult. Give your employees opportunities to see and experience each other’s work. Sometimes having employees trade off jobs for part of a day or shift can work wonders in generating appreciation and respect for each other. It will also create greater empathy for their challenges, and that’s when the sparks of new ideas appear.

5. ASK YOUR EMPLOYEES

Does your team feel you’re open to their ideas? Have you asked them straight out to share their thoughts?

Don’t assume they know you want to hear their suggestions. You have to tell them. As their leader, part of your role is giving your employees the support and resources they need to shine. How many employees are sitting on ideas of better ways to do things? How many are too consumed with their current duties to test them out?

You can help open them up with innovation brainstorm sessions. You can also have the proverbial “suggestion box.” Some companies offer rewards for ideas that are adopted (e.g. vacation days, bonuses, commissions, etc.).

Others offer the employee paid time to plan out how their idea would work. Obviously their day-to-day tasks still need to get done. And a small business can’t afford to lots of people at once do this. But used smartly, innovation incentives can help catapult your firm into a whole new level.

Why not start with approval to take paid time to refine an idea? This isn’t approval of the idea, and shouldn’t need a validated concept. Give employees specific direction on how to present their ideas for “paid innovation time” approval. For example, their request should:

  • Clearly outline the issue they’re attempting to address.
  • Specify how they believe their idea can resolve the issue.
  • How they expect to use their paid innovation time to refine their idea.

Taking this approach will limit requests regarding ideas that haven’t been given some genuine thought first.

6. SHARE RISK AND REWARD

Some ideas will reap great results. Other ideas will be disasters. Yet, no one will come to you with their ideas if they fear risking their jobs. Giving people space to innovate means allowing space for ideas to fail. In fact, some have suggested “reward[ing] smart failure in addition to success.”

You want to keep everyone accountable for their responsibilities and actions, but no idea gets implemented on its own. While the suggestion may have started with one person, many people will have a hand in shaping and executing it. People feel more confident to act when they see a team is working with them on a new proposal. As employee confidence grows, you’ll see more employee creativity.

AN INVESTMENT WORTH MAKING

Investing time, money and resources is a risk for any small business. Especially in ideas you aren’t sure will provide a return. But starting your business was a risk too. You’re as successful as you are because you’ve exercised good judgment. Trust your gut to distinguish between crazy schemes or schemes for a day off, versus innovation with a purpose.

Purposeful intention to innovate will bring changes that yield bottom line results. The innovation process also strengthens your small business as a team working together. And that always improves performance and productivity.

Now what’s not to love about that? Want more tips? Check out our article on 5 Small Business Tips.

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