Resources » What does innovation look like for small businesses?

What does innovation look like for small businesses?

The word “innovation” can conjure up images of lofty, world-changing thinkers like Thomas Edison and Steve Jobs. But you don’t have to be a once-in-a-generation inventor to find ways to innovate within your small business.

Whether you’re a one-man operation designing a better thermos or an insurance office just looking to streamline paperwork processes, innovation is a valuable core principle that benefits your bottom line.

In large businesses like Perdue Farms, innovation meant attaching RFID tags to their inventory of free-range chickens to better understand their behavior and improve well-being. But for small businesses just getting started in local marketplaces, innovation might be as simple as designing braille-embossed labels to make products more accessible for vision-impaired consumers.

Innovative moves at multinational corporations like Apple and Ford garner big headlines, but there’s room for small businesses, too. In fact, their size often allows them to actually out-maneuver large businesses because there aren’t hurdles like shareholders.

With innovation possible at any size company, the next step is finding ways to foster it. But what exactly does small business innovation look like?

Here are 6 practices to consider:

Not ready to incorporate these? That’s okay. The point is to kickstart brainstorming about the innovative policies and practices that can strengthen your business.

1.  Resource availability

To empower innovation among your teams, they need the right tools. This doesn’t have to mean a bookstack of biographies about humanity’s greatest innovators. While books are never a bad idea, you might also try:

  • Diverse hiring practices — People are the most important resource at your small business. Diversifying your team means building a more dynamic workforce, once rich with opportunities for innovation.
  • Innovation-oriented software — Everything has an app these days, even innovation. From Brightidea to Aha!, there’s something for everyone.
  • Supplying reliable equipment — Apps are fun and easy, but there’s no point in investing in them if you can’t provide the platforms employees need to access them. Whether it’s software like computers or hardware like printing presses, you can’t expect employees to be innovators if physical resources are scarce.

Whether you choose one or all of these, the important thing is just striving to give employees the resources needed to ideate innovations and make them a reality.

2.  Reward systems

Participation trophies get a bad rap, but innovative efforts deserve to be rewarded in the workplace — even if some attempts fall flat. Examples of innovation in small business may be as concrete as proposing new sustainability initiatives for your product’s packaging or more ambitious, thought leadership proposals like eliminating hierarchical titles.

There are two basic approaches to reward systems. Ideally, you’ll find a way to incorporate elements of both.

  • Positive feedback —You might be surprised by how just much praise lifts employee morale, productivity and good behavior. Research consistently shows that companies that praise their employees are more profitable, too.
  • Structured rewards — Promotions, profit-sharing, bonuses and extra vacation time are excellent incentives for performance and innovation. But make sure their value matches the value of the innovation. Otherwise these rewards won’t properly incentivize employees.

Empowering employees to pursue a wild idea can be scary. But small business innovation and entrepreneurship is about striving for more than mediocrity — and that’s a good thing.

3.  Focus on career development

Careers stall when people only do the bare minimum. Those who think outside of the box are far more likely to see their careers blossom. This kind of advancement is a powerful motivator for employees when it comes to innovation.

These efforts might look like:

  • Networking opportunities — Regularly invite industry thought leaders to speak to your teams and help employees build professional relationships across your field.
  • Personal development — Encourage employees to pursue innovation coursework from online platforms like the Harvard Extension School or IdeoU.

Classes take time and sometimes money. Go-getters might not mind attending school or networking events during off-hours but fostering resource availability in the workplace is best practiced in the workplace and by the workplace. Compensate employees for their time and call it an expense toward your own small business innovation management ethics.

4.  Mentorships

Just as diverse hiring practices can nurture innovative thinking within a business, mentorship can, too. Mentors challenge long-held views, offer outside perspectives, share experiences from their own lives and much more.

From Oprah Winfrey to Bill Gates, many high-profile entrepreneurs credit their mentors for their own personal growth and success. In fact, Winfrey called her mentor Maya Angelou “one of the greatest influences” of her life.

Sourcing acclaimed poets to mentor your employees may be difficult, but there are still plenty of ways to provide this type of relationship:

  • Peer-on-peer — While onboarding a new hire, pair them up with a “buddy.” This colleague will help your new employee learn about your company, culture and hardware in a safe and friendly way.
  • Group mentoring — Sometimes a single employee offers deep expertise in industry knowledge worth passing on to your team. Consider charging them to lead regularly scheduled presentations or educational workshops to share their skills.
  • Reverse mentoring — You might be the boss, but your subordinates have wisdom worth hearing, too.

Many organizations also enact even more specificity to their mentorship, such as developing women in business initiatives, or diversity and inclusion programs.

5.  Emphasize company values

Whether you’re focused on kindness and self-improvement or delivering results and accessibility, being transparent about your small business values will help you draw the right kind of innovators to execute your vision. This kind of thought leadership is clear for corporations like Netflix and Nike, but what about small businesses of less than 100 people?

Let’s say your company values blue-collar workers and storytelling, and that you specialize in making hand balms for laborers in rigorous fields like commercial fishing and cattle farming. Your website and social media would reflect these values in action — from mission statements to profiles of the employees and customers who embody them. You could also go a step further and include this storytelling on your product packaging through options like extended content labels, which expand to reveal more information than the label face allows.

This kind of transparency isn’t just good marketing that reinforces your brand to consumers. It also builds a loyal team that shares your same values and strives to find innovative ways to keep building on the values-based messaging.

6.  Close-knit company culture

Employers who facilitate a sense of community are much more likely to see happy employers who bring good ideas to the table. By the nature of its size, community is much more likely to happen, but here are some popular ways to help it along:

  • Praise and recognition — As discussed above, rewarding hard work is a great morale-booster. By leading the charge, you set an example for employees to also lift each other up, too.
  • Team outings — From happy hours to annual retreats, team outings reinforce the crucial social bonds that build empathy and connection.
  • Philanthropy — This is an especially good practice if your company is purpose-driven. Volunteering as a team at local schools, urban gardens and more has the added bonus of raising your own company’s visibility, too.

Innovation in small businesses can’t happen without employees who feel a sense of belonging and pride in their workplace. Positive company culture must be a priority if you want your business to succeed.

7.  Community collaboration

Great ideas can come from both within your company and from the community. Many companies develop in response to the values and needs of their local community. This starts with just getting your name out there. Brainstorm with your team for ways to increase your visibility. Innovative marketing ideas for small businesses might include clever social media campaigns on TikTok, Instagram and Twitter. These platforms make engaging with your audience easy, and you can calibrate your services to meet their needs.

This kind of collaboration taps into your community as a vital resource that can help your business thrive. In thanks for their participation and engagement, compensate them! Think free company hats, water bottles or lip balms with branded shrink sleeves, and even gift baskets of gourmet foods donning pressure sensitive labels emblazoned with your company name.

Get out there and innovate!

Whether you’re just starting out or have built a workforce of 100, there are many ways to foster innovation within your small business. Build a positive workplace loaded with incentives for trying new things. Help employees develop personally and professionally with mentorship. Give your teams the tools they need to be successful. Raise your company’s visibility by listening to your community’s needs. Whatever your business size, innovation can start today.