Three postgraduate students studying in Business School South

July 8, 2013, by Kelly Cookson

How to encourage innovation

By Simon Mosey, Director of the Haydn Green Institute for Innovation and Entrepreneurship.

Cost-cutting might solve cash flow problems in the short-term, but it does nothing to encourage sustainable growth. To achieve this, companies need to encourage new ideas and develop them into successful innovations and this requires a willingness to do something differently.

It’s important to remember that innovation is a process rather than the result of a “eureka” moment. It starts with the identification of the problem or opportunity and continues all the way through to the innovation or idea being implemented.

In the current climate, many people are too busy fire-fighting or just servicing current customers to take the time to step back and think about problems or opportunities in a new way. New things can be perceived as a distraction – and they demand resources if they are going to come to fruition.

This is a false economy in a business environment where innovation can mean the difference between growth or no growth at all.

At the same time, the reluctance of larger companies to take risks with “the new” presents smaller, more agile companies with a great opportunity to capture the niches or launch disruptive propositions.

Six tips to encourage innovation:


Idea capture schemes or suggestion boxes can be useful. But while there is often a flurry of ideas to start with, they will quickly dry up if nothing happens to the ideas or there’s no feedback or follow-up. So ensure the necessary systems and processes are in place.


Innovation starts with great ideas, so it’s crucial that if you’re investing in just one or two, they are the right ones – those that are clearly aligned with the company’s long-term goals. That’s why health-checking the sanity of ideas is crucial and worth spending some time over.


Start by setting the goal that your business will react to new opportunities before anyone else. It’s the businesses that are most able to adapt and respond to external changes in the environment that are the most innovative.

There’s nothing wrong with mistakes

Fear of failure is a barrier to innovation. If an idea fails it doesn’t matter, and people should be encouraged to come back with another. It’s better to have lots of ideas as opposed to just one good idea. Foster a culture of enquiry – one where questions are asked and people are encouraged to challenge.

Reward innovation

Ideas need to be recognised and to be rewarded if they are going to keep flowing. Make it explicit that the people who innovate will be rewarded for their ideas and ensure that everyone within the business can contribute. If it’s not practical for the originator of an idea to be involved in its implementation, ensure that they are still fully acknowledged for their initial contribution.

Attract innovation

Organisations which encourage innovation will in turn attract ideas and people from outside. So incorporate innovation as part of your employer brand and leverage the fact that creativity and free thinking are core to your culture and values.

Posted in Business growthInnovation