What is innovation?

In its broadest sense innovation is the development and application of ideas that improve the way you do things and what you achieve. Innovation can produce changes in many areas such as the environment, society, technology, education and community health.

In a business sense, innovation focuses on creating positive outcomes from new products, services, operational and managerial processes, markets, market segments and organisations.

Why is it important?

Innovation is fundamental to growing and improving your business. It's about making changes that will improve the efficiency, profitability and ultimately, the viability of your business.

All aspects of your business can benefit from innovation whether it is finance, human resources, research and development, sales and marketing or logistics. The innovation does not have to be totally new or revolutionary; it may be a small but incremental improvement that results in a positive outcome.

Your business competitiveness and survival is directly linked to your ability to innovate.

How can I foster innovation in my business?

Build an environment in every part of your business that fosters innovative thinking and action. By doing this, you will harness and apply the collective knowledge, experience, skills and energy of everyone in the organisation and focus this powerful collective wisdom on improving the way things are done.

You can foster innovation in your business by:

  • developing a creative culture that encourages and rewards employees for their innovative contributions;
  • investing time and money on innovation to create resources (financial and human) to devote to the process of innovation;
  • seeking customer feedback on how you are performing; and
  • using your networks to generate new ideas, learn from others and access new business.

Being innovative is about taking calculated risks which will require you to be positive, imaginative, fearless and undeterred by negativity, cynicism and resistance to change.

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Main types of innovation

Broadly speaking, innovation in business can fall into three broad categories.

Product innovation

Developing and introducing new products, services or technologies. eg. researching, developing and commercialising a new product to capitalise on an identified market need.

Product improvement innovation

Implementing improvements to current products or services. For example, increasing the performance capabilities, durability or appearance of an existing product.

Process innovation

Streamlining and improving business processes to increase efficiency, productivity and profitability. For example, financial systems, manufacturing processes, internal and external communications.

Remember that innovation is not something only practiced by large or high-tech businesses. Even minor innovations in your small business can lead to improvements in your efficiency, profitability, competitive advantage and ultimately, your viability.

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Is there a simple process I can follow?

To better understand the process involved in developing, producing and launching a new product or service, view a copy of the Business Guide Commercialising your Innovation.

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How can I protect my innovation?

An important element in the commercialisation process is how to protect the intellectual property inherent in your idea, innovation or invention.

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My product or service is ready for market ...what next?

The final step in the commercialisation process is getting your product or service to market. For more information go to Marketing.

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Where else can I get help in commercialising my innovation?

  • Grant Finder
    provides information on Australian Government grants
    Grant Finder
  • IP Australia
    Patent, trade mark and design information
    IP Australia

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What's next...

  • Speak to an SBDC adviser about implementing innovation in your business.
  • Get started with protecting the intellectual property of your innovation.
  • Need help protecting your innovation? Find out what you need to do to hire a lawyer

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Related Information

Business Guide to view:
Commercialising your Innovation


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