Innovation: Cost Burden or Returns Generator?
Published: December 22, 2016
Innovation is often an expensive and difficult exercise for business. Let’s take a look at how innovation can be simple, effective and affordable.
The Australian climate of “innovation” is experiencing a rapid, unfortunate shift towards the United States’ viewpoint. This has been fueled by programs such as the National Innovation and Science Agenda (NISA) and rhetoric from our leading politicians.
Big money and bright new ideas lead the charge. Untested, untried and unproven concepts attract all the attention and a large percentage of publicly available investment.
Is this the only innovation that matters? Should we all be chasing the next Uber, or the next SAAS product, or is there another avenue of innovation that isn’t receiving adequate attention?
Business process improvement (BPI) isn’t as exciting as the development of new products or services. However, it can have significant, lasting effects on an organisation that is open to change.
Business process improvement can take many forms. It might be a new content management system or simple adjustments to an existing one. It could be the decision to outsource certain aspects of the organisation, or remove certain aspects of the product offering.
The driving force behind business process improvement is the same as the force behind other “game changing” innovations. It adds value and eliminates that which does not. The key aspect to BPI which makes it worth so much to the Australian economy is its accessibility. Any SME, from the family-run corner store to a nationwide industrial product manufacturer, can improve some aspect of their business operations.
Xero is one of the shining examples of BPI. Its ability to provide top-tier accounting software capabilities enmeshed with CRM access, inventory management and much more has made it a staple of many small Australian businesses.
There are a host of benefits to BPI.
By taking out extraneous steps in a process, or removing unnecessary stages in management of production, a business can immensely improve its bottom line. Seeking automation where possible is a clever way of slimming down costs.
Reducing the time and effort required to bring a product to market is often a goal of small businesses. The key to automation is to grin and bear the pain of implementation. It has to be done correctly to avoid future headaches.
In many workspaces, the time taken to communicate with co-workers or external parties is excessive. Implementing simple improvements to this process can generate immense savings and improved efficiency. Something as simple as an office-wide chat program to facilitate rapid communication and reserving emails for matters of greater import, can lead to impressive time savings.
Furthermore, reducing unnecessary requests for approval, and returning autonomy to teams, can also puncture communication bloat.
When all employees are on the same page, and managers can physically view business processes, major changes can happen easily. Eliminating duplicated tasks and finding ways to facilitate more rapid results are shining examples of basic business process improvement.
Streamlined business processes allow for a greater degree of control over all operations. Being able to rapidly assess non-compliance or poorly managed aspects of operations can quickly produce great returns.
Carving out unnecessary processes and freeing up employee time can allow a business to handle greater operating capacity. If your employees are able to complete their tasks efficiently, they’ll be more capable of handling additional workload.
BPI works if the short-term costs are accepted in the face of long-term gains. New software costs money and can require training. New processes can experience pushback from those reluctant to change. However, if the change is necessary, and well implemented, it can have an immense payoff for years to come.
The key to successful BPI is careful cost/benefit analysis and dogged determination to implement changes for the better.
First published in The CEO Magazine