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By 29 August 2023 | Categories: news

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By Gadijah Dolan, Head of HR at Payfast 

Technology has radically transformed how we work and engage and the rate of change can feel overwhelming. Now, the prospect of an AI-driven future is adding to the anxiety felt by workers at every level. Despite this, companies understand that they will need to embrace new technologies and use them to innovate if they hope to keep pace with agile, born-digital startups. Finding ways to nurture innovation in the AI age requires a careful and deliberate approach.  

The first step to staying relevant is to be constantly innovating. Most companies are naturally focused on growing revenue and generating profit, but they should also be institutionalising innovation within their organisations to ensure they remain competitive. 

Making innovation count 

The benefits of embracing new technologies are quantifiable. According to McKinsey, companies that are digital leaders enjoy faster revenue growth and better productivity than their less-digitised competitors. What’s more, they grow profit margins three times faster than average and are often seen as the fastest innovators and disruptors of their sectors. This clearly shows that technological innovation can make a very meaningful difference to companies. 

The same report uncovers an additional challenge. The research company points out that larger companies are capturing more revenue as a result of their innovation. McKinsey highlights that the world’s 58 largest economic-value-creating companies account for six percent of all economic profit. They also have 20 times more sales, four times more profit, and five times more R&D investment than median companies with annual sales above $1 billion. 

With this amount of R&D clout, it becomes vital for smaller companies to use everything at their disposal to make their innovation efforts count. It also impresses the need for rapid innovation that can impact the bottom line. 

Understanding a new generation of workers 

So much of our innovation now relies on technologies like big data and AI. But this can cause a good deal of anxiety for many workers. When ChatGPT hit the headlines, it caused some panic, especially amongst the older generations, that they would become redundant and be replaced by machines. With careful engagement and allowing the staff to actually work with the technology, they realised that, while some administrative aspects of their job could be done faster and more efficiently by AI programmes, it also freed them up to focus on the roles which required the insight, experience and personal touch that only a human can provide. 

As with all workplace issues, ensuring that everyone is seen, heard and understood is key. This includes a whole new generation that will soon be joining the workforce. Generation Alpha are those born between 2010 and 2024. They are referring to themselves as Gen.AI and are hyper connected and have had AI, like ChatGPT, as part of their lives since they were in school. 

This generation is totally reliant on AI and will struggle without it. This will mean original and creative thought will have to be nurtured in a workplace setting. This generational disconnect will be an important aspect for HR leaders to consider when setting up and formalising innovation workgroups. 

Three steps to ensure innovation delivers

1. Start at the very top. Innovation needs to start at the executive level with buy-in from all leaders and then needs to be handed over to a dedicated innovation team. It’s also important that the team must be cross functional and representative of all levels within the organisation. While leaders must facilitate the initiative, when you are working on a new product or offering that will affect everyone in the organisation, it makes sense to get all the relevant stakeholders to participate. This also keeps everyone accountable, which significantly improves the chances of success in the allotted time. 

2. Ensure cross-functional viewpoints. A cross-functional team not only improves the chances of success, but the benefits of stepping outside of everyday work can be hugely beneficial to staff. We are all guilty of becoming tunnel-visioned when it comes to our daily niches, but breaking down silos can also uncover new talents and keep team members engaged and motivated. Setting up teams that have good generational representation also ensures a variety of ways of approaching problems and gives a good picture of what the customer is looking for when it comes to finding solutions. 

3. Pursue an agile, iterative approach. The most important aspect of rapid innovation is to take an agile, iterative approach. Just like how we design software, taking a fail fast approach to innovation means new ideas can be tried, tested and, if they don’t meet requirements, the innovation team can quickly move on without wasting any further time and resources. 

One thing that born-digital companies can teach more traditional organisations is that innovation must be fast, flexible, and take advantage of every available technological opportunity. Today’s leaders must show that tech is a tool and human creativity still holds the biggest chance to solve our problems. 

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