Leverage human capital to drive innovation
In the prevailing technology-driven economy, many companies are choosing to invest substantially in the development and implementation of systems and platforms as a means to drive innovation and compete in an increasingly cluttered marketplace.
However, by focusing predominantly on technology as its key competitive differentiator, these businesses are failing to tap into their greatest potential for innovation – its human resources.
Human capital, as it’s commonly referred to, is often a company’s greatest asset, explains Bruce Arnold, co-founder of Pivotal , the holding company for a range of innovative tech businesses.
“When the inherent skills and collective knowledge that staff possess are allowed to flourish in an environment that promotes creativity and collaboration, achieved through an organisation’s processes and supported by technology, then human capital becomes the main driver of innovation.”
According to Arnold, it is this combination of people, processes and technology that ultimately drives business growth and sustainability, either by improving efficiencies through step-change innovation to remain competitive and grow market share, finding innovative ways to disrupt existing markets, or even create entirely new segments with game-changing innovation.
“Innovation is ultimately about continual improvement, and creating solutions for customers that ensure return on investment. Innovation challenges existing paradigms and forces businesses to become more relevant by continually exploring opportunities to grow and improve their competitiveness,” continues Arnold.
To achieve this, Arnold states that companies need to foster a culture of innovation, where idea generation thrives and teams of staff are allowed to develop concepts that can be successfully converted into profitable, value-adding solutions or products.
This culture of innovation also creates value within an organisation that attracts high quality people to the business, he adds. “By building a bigger pool of knowledgeable people, an organisation can create disparate groups that all network and collaborate to deliver their unique skill-sets, be it strategic conceptualisation, lateral thinking, the ability to understand and test the business viability of an innovative concept, or implementers who can convert innovative products and solutions into commercially-viable business offerings,” explains Arnold.
“Often, the key to unlocking the creative potential that drives this innovation within an organisation is about more than brainstorming; it’s about bringing the right people with the right context around the table,” he continues. “There is sufficient evidence to support the notion that people who have greater content knowledge are more likely to innovate in a specific area. And when this is combined with diverse thinking from other groups within the organisation, skill sets overlap which augments the creative process and accelerates the rate of innovation.”
The processes needed to orchestrate this culture of innovation requires that companies have a documented, communicated strategic intent for the business, with the capabilities to evaluate creative ideas against practical implementation and customer needs, along with the budgets needed to support research and development.
However, Arnold states that companies should never seek to innovate for the sake of it. “Innovation should address market pain-points, either to exploit a gap in the market or solve a problem. If the strategic intent of innovation fails to meet these parameters, then it’s often not worth the investment. However, once a market need has been established, the business can start to invest in and leverage its human capital to deliver new revenue opportunities,” he concludes.