How SMEs can build a culture of innovation

A carefully cultivated innovation culture is an essential ingredient for businesses looking to stay current. In part two of his series on innovation, Andrew Klapka GAICD explores key considerations for SMEs looking to innovate.

Many executives and boards will be all too familiar with the phrase: ‘culture eats strategy for breakfast’. The best laid plans can falter if a business’s culture does not support or align with the business’ direction or ambition. Innovation is particularly susceptible to a weak cultural foundation. But it is also the most responsive when the culture is calibrated correctly.

Innovation is a word with a powerful emotional pull that has the potential to inspire teams. Yet how well it is understood by an individual or a function within a business can vary considerably. Even the largest organisations, with sophisticated communications and marketing departments, can be challenged when messaging and setting up an innovative culture. For the SME that may not have a communications function, let alone research or innovation capabilities, the challenge can seem immense.

So what are some of the ways that an SME can build a culture of innovation that captures the hearts and minds of staff and stakeholders?

Create quick wins and tell the stories

There are many steps to embarking on a program of innovation. Executive committees will debate the possible paths of innovation and how these align with core strategy. CEOs will be highly visible in communicating the innovation mission and the key objectives to staff and external stakeholders. Stage-gate review frameworks will be chosen. Management will consider how progress should be measured.

All of these preliminary steps are valid and necessary. But will they inspire enthusiasm alone? Will they give rise to a sense of true innovative ambition throughout the company? Remember that innovation is both an activity of great motivation and one that is often treated with scepticism.

So it is important to capture attention, motivate stakeholders and build business-wide credibility and commitment at an early stage.

This can be best achieved by expeditiously implementing proven practices that will:

1. engage people in practical innovation events across the business; and


2. have a high chance of delivering early, interesting and visible results.

News about these activities and results can then be shared by way of ‘success stories’ which describe innovation techniques and milestones from within the business. These messages should be used to engage the collective mindset, resonate with all levels of staff and be talked about in company corridors.

Examples of activities that engage the hearts and minds can include:

• cross-functional workshops to define ideas;


• exploratory ‘discovery events’ with customer groups to understand possible opportunities for innovation;


• engagement sessions between user-groups and design and production staff; and


• experiential tours ‘in-the-customer’s-shoes’ for senior executives.

All of these activities will generate preliminary findings which are immensely useful. They will help define key innovation directions. Most importantly, they will capture attention and motivate enthusiasm by demonstrating the power and insights of innovation-in-action. Credible practices and outcomes should be publicised across the business to seed and feed the reflection about innovative possibilities.

Get everyone involved - cross-functional engagement

To ensure an enterprise-wide commitment to innovation, it is important to engage people from all corners and functions of the business. Active participants in a healthy innovation culture will not only come from the business’ commercial functions, such as sales and customer service, but also from internally-focused functions like HR and finance.

Management should seek to select innovation ‘champions’ from within each function. This serves as an excellent cultural-enabler since it ensures the inclusion of staff views on innovation for each function.

‘Champions’ can be made responsible for reinforcing the success stories and progress updates. They can unpack the logic behind particular techniques being applied and the findings that are uncovered. The best innovation champions are often those who volunteer; ‘true believers’ who have a keen interest in developing new products and services.

From small steps to embedded culture

Innovation can be a little like writing. Sometimes you need to get your thoughts on paper so you can see what you want to say. With innovation it helps to jump in and start your innovative processes in order to better understand where you need to focus.

Starting with small and symbolic milestones and then sharing their success with staff is a great first step. It allows you to engage with everyone in the business, gauge appetite and bring the whole team with you. By doing this, the right culture becomes embedded and the chances of success in locating and developing valuable innovative opportunities are greatly improved.

Andrew Klapka GAICD is CEO of Trans Chem, an importer and distributor of raw materials. Previously he spent 10 years in Paris managing global innovation for Lafarge France, a leading European multinational.