A new report by Microsoft has revealed almost 70 per cent of the country’s small and medium-sized enterprises (SMEs) are not reaching their potential because innovation is being stifled by workplace culture.
Microsoft’s Culturing Success report highlighted the workplace obstacles standing in the way of SMEs embracing innovation and increasing revenue, finding that only 33 per cent of Australia’s SMEs were considered innovation ‘Leaders’. The report classified a ‘Leader’ as a business that is adept at responding to change, threats and opportunities in their markets.
43 per cent of SMEs were found to be innovation ‘Cruisers’, classified as a business that has an interest in innovation but doesn’t match it in practice, while 24 per cent fell under the innovation ‘Laggards’ banner, pointing to those businesses who simply have little or no desire for innovation.
“Innovation is vital to the success of any business, no matter how big or small,” Managing Director of Microsoft Australia Pip Marlow said.
“However, our research reveals that many businesses find it difficult to develop a culture of innovation because of barriers including working in silos, fear of failure, employee distrust and poor collaboration.”
39 per cent of Leaders claimed they were seeing a rate of revenue growth that was higher than their industry standard, while only 24 per cent of Cruisers and 23 per cent of Laggards could report the same.
Small Business Minister Bruce Billson said the report highlighted the need for businesses to tackle a better workplace culture.
“We know small business people are time poor, but innovation within business processes can drive efficiencies. As the Culturing Success report shows, improving workplace culture drives innovation so it is a good investment to make.
“Innovative businesses are generally successful businesses, constantly looking at ways to improve and to grow their business,” Mr Billson said.
“As the Intergenerational Report released by the Government demonstrates, we need to improve our productivity as a nation and get more small businesses to become leaders of innovation.”
The Culturing Success report revealed the six cultural traits common to Leaders:
– Strong customer focus.
– Awareness and drive for innovation.
– Supportive working environment.
– Business leaders being both visible and involved.
– Engaged employees.
– Engaging and detailed internal dialogues.