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The Link Between Productivity and Innovation

The Link Between Productivity and Innovation

Optimising productivity is critical for SME success. Read on to see how small innovations can lead to big gains.

Small businesses need to maximise their resources in order to reach their potential and be the best version of themselves. But how can small businesses drive productivity to grow bigger, better, and faster in a time of uncertainty? The answer is simple: innovation.

Let’s have a look at some ways that innovation can help small businesses drive productivity and get the most out of their technologies and workforces.

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Innovation starts when a problem arises

In a time when anyone can create an app simply by dragging and dropping components, innovation has been democratised. Everyone in the workforce now has the potential to be their own IT department. If a problem arises, it no longer takes a highly trained team to tackle it – it only takes a single person with a creative idea for a solution. And solutions are where true innovation starts.

‘Innovation’ has become something of a catch-all term in an age of blue-sky thinkers and bespoke technologies, being used to describe anything new. But innovation is most effective when it’s directed at solving a problem.

After all, it doesn’t take a Steve Jobs or Thomas Edison to innovate, it only takes someone on the customer service team who sees a way to leverage a technology or processes to remove a bottleneck and deliver better service. Or a sales rep who realises that new sales tools can be more effective than in-person meetings, enabling them to book twice as many face-to-face. Or a retailer that responds to store closures by imagining a virtual changing-room app that allows customers to try on looks from home; and then just click-and-collect what they want, contact-free and worry-free.

Anyone can be a problem-solver, which is why it’s so important for small businesses to create a culture of innovation to boost productivity. But innovation can be ephemeral, hard to define and even harder to measure. So how can small businesses successfully build a foundation for innovation and productivity in the digital age?

The importance of innovation is clear, but execution is lacking

We’re in a unique moment. A McKinsey report shows that:

  • 80% of executives think that their current business models are at risk
  • 84% state that innovation is important to growth strategy
  • Only 6% are satisfied with their innovation performance

These statistics reveal a conundrum. Many business leaders realise that the landscape is changing and that they need to innovate to keep up, but very few are successfully doing it. Interestingly, one of the reasons they’re not acting may be the exact reason they need to: uncertainty.

The key to navigating change is to innovate and get ahead of it, but the fear of getting burned by failed innovation initiatives can lead to an abundance of caution. For small business CEOs, this is an important consideration in a time of budget squeezes. It’s also important to consider that big R&D budgets don’t necessarily make for a more innovative company.

Innovation doesn’t have to be driven by expensive, large-scale initiatives. Small businesses can start by tackling one problem at a time and driving productivity in the process.

SMEs don’t have to start with a grand idea, they can start with a little list

When addressing rapidly changing customer behaviour, the increasing speed of business cycles and the race to be first to market, larger R&D initiatives may help. But when it comes to improving productivity, small changes can go a long way.

Here are five ways that innovation can lead to small business solutions with a big impact.

  1. Update legacy IT infrastructure with new cloud-based platforms. These platforms are easier and cheaper to maintain, enable better connections among the workforce, and provide more flexibility for developing apps and new services. Increased efficiency leads to better productivity.
  2. Leverage AI to automate processes and drive productivity. AI can be used in everything from marketing and sales to customer service. Automating laborious tasks and productivity killers can free up the workforce to focus on higher-value work. Additionally, businesses can deploy chatbots to provide self-service options and lower the burden on their reps.
  3. Use intelligent platforms like Sales Cloud, Service Cloud and Marketing Cloud, to surface need-to-know info and provide more personalised experiences, leading to big improvements in productivity. Streamlining the workload of sales reps and service agents is one of the best ways to increase their productivity. Better still, their customers will also benefit from faster service.
  4. Get the team together. Businesses can tap their collective brainpower to find solutions to recurring problems and business ‘weaknesses’. Gather team members from different departments and functions and ask them to list any productivity bottlenecks they regularly encounter. You may be surprised at their response.
  5. Set up a virtual campus. Use on-demand training platforms that empower your workforce to learn new skills – quickly, easily and from wherever they may be. Trailhead, an ‘anytime, anyplace’ digital training platform makes it easy to transform the office into an always-open university, where team members can increase productivity by skilling up across functions.

For small businesses, innovation and productivity go hand in hand

There’s a wonderful symbiosis between innovation and productivity. The more innovative a company is, the more it can drive productivity. In turn, this increased productivity allows the workforce to be more creative and innovative. On and on the cycle goes as the company grows.

Innovation is crucial for SMEs who need to do more with less. Improving decision velocity, creating better-equipped workforces and driving productivity are just some of the benefits of innovation. SMEs will also find that innovation enables them to better serve their stakeholders, and better prepare for the challenges of a post-pandemic world.

SMEs looking to drive productivity can start by driving innovation. And creating a more innovative workplace can start with creating a simple strategy. SMEs can get started on their strategy by viewing our demo for small businesses here.

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