Just 25 percent of Australian business leaders believe innovation is core to their business

Only a quarter of Australian business leaders believe innovation is core to their business, a new report has found.

The Innovate for Change report, commissioned by Ricoh Australia, saw StollzNow Research survey 304 C-suite executives, business unit managers, and middle managers in companies with 100 or more staff on their organisation’s approach to and capacity for innovation.

Participants were asked to judge the performance of their organisation on factors including the value it places on collaboration tools, its attitude to innovation, its process of evaluating the needs and perspectives of staff, the importance of the quality of life of its staff, and how it caters for different modes of working by age generation.

According to the survey, while 40 percent of leaders believe they must innovate for survival, 24 percent stated they lack budget and resources, while 22 percent cited aversion to risk by staff and management as a barrier.

Twenty-seven percent of respondents also believe they don’t have the right people in their business to address the need to innovate.

While Australia’s tech skills shortage is a significant concern, it’s worthwhile examining how businesses are building a culture of innovation and enabling their staff to innovate through their processes and procedures and ways of working.

If looking at streamlined processes and procedures and collaborative ways of working as enablers of innovation, the report found a disconnect between management and front-line staff: just 33 percent of leaders stated they always involve staff in the rollout of new tech, while 51 percent sometimes include staff. Twelve percent rarely involve staff.

Meanwhile, just 17 percent of respondents have reorganised their internal systems and processes, 33 percent are in the process of doing so, and 32 percent have plans to do so. The report also found that just 52 percent of organisations value collaboration and support it with appropriate tools.

Furthermore, the report found that while 74 percent believe it’s important to cater for different generations’ modes of work, 20 percent don’t believe it’s important.

Andy Berry, CEO of Ricoh Australia, believes that, no matter the business case, large organisations cannot shift their culture unless their people are willing to change; this, in turn, requires taking staff on the journey.

“The best thing we can do as leaders is answer the big question: why? The clearer we can explain why we are changing where we are heading, or how we will get there, the more our people will trust us to lead them there,” he said.

The findings echo those in previous reports.

A 2018 report commissioned by DXC Technology surveyed 403 business and tech decision makers across organisations with 20 or more employees to find that 60 percent are keeping an eye on digital trends and will react if and when it impacts their organisation. However, almost 50 percent of Australian businesses believe either their industry or products and services are not being disrupted.

Defining a ‘digital strategy’ as defining the existing capability of IT and how it plans to apply technology for business outcomes, the report found nine percent of Australian organisations have no digital strategy at all, while 25 percent are ‘investigating’ the creation of one; these organisations are interested in partnering with others that can help them overtake more developed competitors.

Meanwhile, 34 percent of organisations have digital strategies across varied business units, where innovation is about the smaller steps, such as introducing new digital services, mobile apps, and projects, as opposed to structural or cultural change within an organisation; they are typically less concerned about disruption.

Image: City of Melbourne/That Startup Show/Photographer Wren Steiner