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Learning from workplace innovation in Scottish SMEs Dissemination event for the Innovating Works… pilot project Technology & Innovation Centre, University.

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Presentation on theme: "Learning from workplace innovation in Scottish SMEs Dissemination event for the Innovating Works… pilot project Technology & Innovation Centre, University."— Presentation transcript:

1 Learning from workplace innovation in Scottish SMEs Dissemination event for the Innovating Works… pilot project Technology & Innovation Centre, University of Strathclyde, Glasgow 17 March 2015

2 Sir Peter Housden Permanent Secretary to the Scottish Government

3 Learning from workplace innovation in Scottish SMEs Professor Patricia Findlay

4 A response to economic, social, labour market and workplaces challenges Low relative productivity Smaller proportion of UK firms innovate around new products and services Low pay, in-work poverty, income inequality Labour market exclusion Poor skills utilisation Low levels of problem-solving, discretionary space and ‘learning’ Absence of effective voice mechanisms and participation An effort to draw on untapped potential in Scotland’s workplaces A response to economic, social, labour market and workplaces challenges Low relative productivity Smaller proportion of UK firms innovate around new products and services Low pay, in-work poverty, income inequality Labour market exclusion Poor skills utilisation Low levels of problem-solving, discretionary space and ‘learning’ Absence of effective voice mechanisms and participation An effort to draw on untapped potential in Scotland’s workplaces Why Innovating Works…?

5 Organisational Benefits Societal Benefits Workplace Stakeholders Economic Development Networks Process People Individual Benefits Organisational Benefits Societal Benefits Employers Employees Workplace Stakeholders Economic Development Skills & Learning Governance Industry Policy Research Scottish Centre for Employment Research Hunter Centre for Entrepreneurship Strathclyde Institute for Operations Management Individual Benefits Employers Employees Skills & Learning Governance Industry Policy Research Scottish Centre for Employment Research Hunter Centre for Entrepreneurship Strathclyde Institute for Operations Management People Process Networks

6 The Innovation Challenge Innovation is change that creates value “In one way or another, all of the definitions equate innovation to changes in existing products or production and/or organizational processes that make those products and processes more commercially valuable.” (Globerman 2014) People make innovation, but are often the residual in innovation research and policy. Innovation is change that creates value “In one way or another, all of the definitions equate innovation to changes in existing products or production and/or organizational processes that make those products and processes more commercially valuable.” (Globerman 2014) People make innovation, but are often the residual in innovation research and policy. Innovation is change that creates value “In one way or another, all of the definitions equate innovation to changes in existing products or production and/or organizational processes that make those products and processes more commercially valuable.” (Globerman 2014) People make innovation, but are often the residual in innovation research and policy.

7 The European Commission defines workplaces innovation as innovations in the way enterprises: are structured; manage their human resources; devise internal decision-making and innovation processes; organise relationships with clients or suppliers; and/or design the work environment and internal support systems. Improving workplaces & work: sharing the gains of innovation The Innovation Challenge The European Commission defines workplaces innovation as innovations in the way enterprises: are structured; manage their human resources; devise internal decision-making and innovation processes; organise relationships with clients or suppliers; and/or design the work environment and internal support systems. Improving workplaces & work: sharing the gains of innovation

8 SMEs and Innovation? Innovative Potential Scarce bureaucracy and clannish structures Greater operational expertise and customer knowledge Ability to create astute alliances Ability to utilise external networks Innovation Challenges Limited resources and capabilities for conducting in-house R&D Less risk diversification Underdeveloped education and training Reluctance to delegate authority or decision making to others Over-involvement in operational level decisions Weak external contacts Innovative Potential Scarce bureaucracy and clannish structures Greater operational expertise and customer knowledge Ability to create astute alliances Ability to utilise external networks Innovation Challenges Limited resources and capabilities for conducting in-house R&D Less risk diversification Underdeveloped education and training Reluctance to delegate authority or decision making to others Over-involvement in operational level decisions Weak external contacts

9 Identify and build a network of workplace innovation enthusiasts Develop a measure that would: Capture practices associated with workplace innovation Examine the relationship between workplace innovation practices and workplace and employee outcomes Stimulate discussion within businesses and organisations about workplace innovation Examine case studies of innovative practice and challenges/barriers to workplace innovation Innovating Works… Pilot: Core Objectives

10 The design of work and support systems How the business makes decisions and approaches new ideas Attitudes within the business The way people are managed How the organisation manages external relationships The design and structure of the organisation Better workInnovative workplaces The Workplace Innovation Tool

11

12 Romanes Pharmacy HealthCo.* AgriCo.*

13 Time – More so than resources Idea implementation more challenging than idea generation Sharing knowledge Ownership … and succession? Cementing learning into practice Getting the balance between formal and informal approaches and solutions, especially with increasing size Accessing external support Challenges, Lessons and Potential:

14 “Well, where we are actually is… we don’t have enough money but we innovate despite it. Do we have sufficient financial resources to try new things? Well, we’re trying new things regardless… because we can’t not try new things. If we don’t try new things, things are not going to get any better either” But despite the challenges…

15 Can’t usefully discuss innovation without discussing business purpose - innovation only works when aligned to purpose Firms need to perform and innovate simultaneously – finding the balance between the two isn’t straightforward Technology/automation is a facilitator, but rarely a complete solution. Keep in mind…

16 “We are happy with lesser margins – we’re playing a long game. We’re not solely driven by profit maximisation. Our competitors are constantly talking about percentages, market share and metrics. They can be ruthless. But we have an intimacy here that ‘proper’ businesses couldn’t attain. We reinvest in the business, train apprentices, and treat people like people.”

17 Keep in mind… Can’t usefully discuss innovation without discussing business purpose - innovation only works when aligned to purpose Firms need to perform and innovate simultaneously – finding the balance between the two isn’t straightforward Technology/automation is a facilitator, but rarely a complete solution. Can’t usefully discuss innovation without discussing business purpose - innovation only works when aligned to purpose Firms need to perform and innovate simultaneously – finding the balance between the two isn’t straightforward Technology/automation is a facilitator, but rarely a complete solution.

18 Exploring Innovative Potential Structure & Design of Work Professor Jill MacBryde

19 Formal and informal interactions between management and employees can encourage new ideas Sharing and communicating of information between management and employees and across business functions Sharing of new ideas and good practices can support innovative behaviours This can be challenging in larger organisations and across multiple sites Structure, Design of Work & Innovation

20 “I totally feel that we’re at that point where we need to formalise things. However, the obvious thing would be for us to have staff reviews and all these very traditional ways of doing it. […] But it’s thinking what we do need and what we don’t need – because if we introduce too many systems and too many things, it slows us down. We need to look at both options and then equally, we’ll dismiss the formal thing if it doesn’t work for us. We need to evaluate what we currently do.” Formalising systems & growth

21 “It’s still very much a work in process […] I’ve got to start [mentoring] with my guys and getting them to do it with team leaders […] I was trying to get people to think about delegation as a development tool. So it’s… starting to get them thinking that way, and then gradually we’ll try to formalise that and try to bring in systems and procedures. We’re trying to win the hearts and minds first. ” Delegating as a development process

22 “The more relaxed we were, the more unhappy [staff] were. They’d come in a bit late. We’d be communicating at 9pm. There’s a fine line between relaxed and open and unorganised chaos, which I think a lot of start-ups have. They say it’s a cool environment, but really it’s a mess.” Liberating (but not abandoning) staff

23 “There’s quite a lot of preparatory work and I think that’s what puts most people off… when I talk about workflows and the fact that the robot has to fit into your pharmacy properly. You don’t just fit your pharmacy around the robot. You have to look at the whole picture. It’s not like a laptop or a computer or anything. It changes the way you think and your workflows and how your staff interact. It just changes everything you do on a day-to-day basis.” Technology & Workflow

24 “That’s just the nature of the beast for us… treating the [in-house] agency slightly differently and trying to be fairer and trying to share hours around to try to keep people in the business. But, it does sometimes annoy the full time staff.” Restructuring resourcing to maintain skills

25 Exploring Innovative Potential People Management & Decision-Making Dr Colin Lindsay

26 Employee-driven innovation: “embedded in daily work activities and social processes” (Hoyrup 2012) and…. “critical and reflective experiences and work practices triggered by social interaction and exchange” (Kesting and Ulhoi 2010) People management can: Design jobs facilitating collaborative problem-solving Create spaces and cultures to encourage collaboration Encourage boundary-spanning Provide time and resources for reflection and learning (Beugelsdijk 2008; Marrone 2010; Aasen 2014) People Management & Innovation Employee-driven innovation: “embedded in daily work activities and social processes” (Hoyrup 2012) and…. “critical and reflective experiences and work practices triggered by social interaction and exchange” (Kesting and Ulhoi 2010) People management can: Design jobs facilitating collaborative problem-solving Create spaces and cultures to encourage collaboration Encourage boundary-spanning Provide time and resources for reflection and learning (Beugelsdijk 2008; Marrone 2010; Aasen 2014)

27 Supporting employees to innovate Enabling employee-driven innovation: Learning Academies driven by employees’ skill needs Bonuses for problem-solving Employees informing ‘time-off’ bonus strategies SMEs supporting opportunities for learning and reflection: Enabling employees to ‘pitch’ for learning resources Redesigning training to fit employee and business needs Sharing facilities with partners in return for learning Enabling employee-driven innovation: Learning Academies driven by employees’ skill needs Bonuses for problem-solving Employees informing ‘time-off’ bonus strategies SMEs supporting opportunities for learning and reflection: Enabling employees to ‘pitch’ for learning resources Redesigning training to fit employee and business needs Sharing facilities with partners in return for learning

28 Creating innovative spaces and cultures Designing jobs and spaces for collaboration: Involving employees in work space redesign And designing work space to encourage collaboration Designing jobs with time to learn and ‘do other stuff’ Promoting a culture of innovation: Values that support collaboration and innovation Visibility of management support for employee innovation (even in ‘traditional’ sectors) Designing jobs and spaces for collaboration: Involving employees in work space redesign And designing work space to encourage collaboration Designing jobs with time to learn and ‘do other stuff’ Promoting a culture of innovation: Values that support collaboration and innovation Visibility of management support for employee innovation (even in ‘traditional’ sectors)

29 “Collaborative learning is central to work at MAKLab… Jobs are designed to provide staff with the time and resources to experiment with technologies and processes. Material costs are absorbed by earmarking portions of workshop revenues for the development of future work. Staff report having time and space to reflect on their work and opportunities to contribute to decision- making…” Innovating Works… Improving Work and Workplaces report, MAKLab Integrating development

30 External Relationships & Attitudes within the Business Exploring Innovative Potential Dominic Chalmers

31 External EnvironmentInternal Processes TRANSLATING Applying External Resources to Business Needs Building Internal Capacity SCANNING Industry best practice Tech/Software Applications Customer Trends Strategic Partnerships Key Resources/Finance

32 “We’re always looking at how clients do things. We’ve integrated some of their ideas into our developments. What we do is to try to steal [ideas] from the best. We’re always looking at ‘how do they do that’, ‘how do they do it better than us’ and ‘how can we do it better?’” External knowledge: Learning from clients

33 Patients, staff, suppliers and professional networks have constituted an important asset in growing and developing the business. A commitment to a high quality service alongside taking advantage of internal and external networks provides the backdrop to the generation and implementation of new ideas. Innovating Works… Improving Work and Workplaces report, Romanes Pharmacy Collaborating with the Supply Chain

34 External EnvironmentInternal Processes TRANSLATING Applying External Resources to Business Needs Building Internal Capacity SCANNING Industry best practice Tech/Software Applications Customer Trends Strategic Partnerships Key Resources/Finance

35 The collaborative nature of work design is such that there is a high degree of informal one-to-one communication between employees and managers. This is supported by regular team meetings. Collaborative work design also ensures that staff roles are not restricted to narrow specialisms and, as a result, there appears to be a strong degree of crossover learning. Innovating Works… Improving Work and Workplaces report, Greenhill Translating Knowledge

36 External EnvironmentInternal Processes TRANSLATING Applying External Resources to Business Needs Building Internal Capacity SCANNING Industry best practice Tech/Software Applications Customer Trends Strategic Partnerships Key Resources/Finance

37 Having a bespoke training centre with on-site staff will allow the company to deliver skills accreditation to their apprentices and training to their staff in ways that align with operational realities. Significantly, the training centre will, over time, be open to other local businesses and tradespeople to support training of their apprentices and the updating of trade skills, enhancing skills formation for the industry as a whole. Innovating Works… Improving Work and Workplaces report, GMG Contractors Ltd. Overcoming External Constraints

38 AgriCo explore the possibility of collaborating with ‘competitors’ in order to secure supply for customers and to even out seasonal demand across different producers. The company see this as a potential form of collaboration which will be crucial to future success. Innovating Works… Improving Work and Workplaces report, AgriCo. From Competition to Collaboration

39 Collaborative Resourcing in practice

40 Shared Values, Shared Success Better Work & Innovative Workplaces Professor Patricia Findlay

41 High better work scores & reported low turnover Few formalised channels for voice, but importance of climate Many living wage employers, but not accredited Genuine concern for opportunities to make a decent living doing a decent job Equality/diversity/inclusion is the right thing to do – even if operationally challenging Clear examples of benefits to individuals and to the business of investing in skills and careers Importance of having a stake in the business Better Work

42 “The building trade is a safety net in every country for non- academic young boys. We want to see our staff well paid, all moving forward together … I want to see the boys becoming architects and surveyors where they can earn a good living. There is a big emphasis on the dignity of everyone here – everyone here is as good as everyone out there.” Sharing in success

43 All successful businesses Lots of examples of innovation – but rarely seen as such Innovators and non-innovators – no clear or easy distinction More process oriented innovation than product/service oriented innovation Synergy between different aspects of workplace innovation – no one best way, and ‘one off’ practices don’t work. Importance of virtuous circles – willingness to try new things, and to learn from new things that don’t work Innovative Workplaces

44 “There are a lot of areas where people get responsibilities and they get to make their own mistakes. There are a lot of cases where people have to hold their hands up and say ‘listen, I made a rip roaring …. of that and there’s nothing I can do about it’. And it will get sorted and people will work around that. It’s not a finger pointing exercise, it’s ‘can we make sure it doesn’t happen again?’” Learning from Trial & Error

45 “There’s very little that can be a bad idea in terms of what we do, apart from spending a ton of money on stuff that we don’t need. But very rarely is it a bad idea. So normally somebody comes in and says, ‘there’s a gap here’. And as long as the team’s nimble enough to identify that as avenue that they want to explore, then we’ll do it. [Our staff] may have a small pot of money that will allow [them] to innovate in certain ways. And equally to be high risk… to make mistakes and to go out and try stuff that isn’t part of our core activities, because that might be our core activities in five years.” Trying better things, trying new things

46 Learning Collaborating Trust Risk Rewarding Stake Ideas Ownership Knowledge Interacting Sharing Communicating Reflecting Boundary-Spanning Delegating Including Scanning Learning Collaborating Trust Risk Rewarding Stake Ideas Ownership Knowledge Interacting Sharing Communicating Reflecting Boundary-Spanning Delegating Including Scanning Trial & Error Shared Gains Improvement Trial & Error Shared Gains Improvement Questions & Discussion

47 Linda Murray Head of Strategy Services Scottish Enterprise

48 Marion Beattie Head of Employer Services Skills Development Scotland

49 To stay in touch with Innovating Works…


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