• Business leaders must loosen their reins on employees and encourage a comprehensive culture of experimentation as lockdowns end
  • 48% of new ideas created by European businesses are never explored by senior management
  • Businesses which engage the full organisation in innovation implement 28% more new business ideas than those who rely on a centralised team

Europe’s middle market businesses must empower employees, at all levels, in order to adapt to the new normal, according to RSM International, the leading middle market audit, tax and consulting network.

A survey, conducted for RSM by the European Business Awards, found that businesses which place an emphasis on a bottom-up culture of innovation successfully implement 28% more new ideas than those which rely on centralised innovation teams. They are also more likely to let go of legacy ways of working (44% compared to 27%) and to see innovation drive their growth (53% compared to 37%).

This disconnect increases as businesses grow, with 70% agreeing that the top-down structures of larger companies limit the creativity of employees.

Paul Herring, Global Chief Innovation Officer, RSM International, commented:

“Coronavirus has already reshaped the business environment beyond recognition and there likely won’t be a ‘return to normal’. Across Europe and beyond, businesses must learn to adapt their business models to a world with more unpredictable supply chains, changing consumer habits and greater state intervention. Innovation, and a willingness to leave the old way of doing things behind, will be vital for business survival let alone growth.

“Our data shows that this cannot be done through a top-down command-and-control mentality. At a time of drastic change, it is more important than ever that all employees are driving innovation. In the race to adapt post-lockdown, the businesses which empower employees to experiment with their own solutions will have a significant competitive advantage over those which try to control creativity from the top."

With innovation now more crucial than ever to business success, European organisations must improve the rate at which they create, test and implement new ideas. The survey, was conducted in Q1 2020, just ahead of the COVID-19 lockdowns across Europe and show that even before the crisis, 48% of the new ideas created within European businesses were never even considered by senior management, with 37% saying that resistance to change from senior leadership was the greatest barrier to innovation.

Herring explains:

“The Covid-19 crisis has forced a step change in thinking to address the immediate challenges the virus has created. But if businesses are genuinely going to remain relevant in this new normal, they will need to change the way they foster and embrace innovative ideas and doing that effectively means empowering employees across the whole organisation to continually ideate. It also means creating a culture of continual feedback, with employees and clients alike, which our research suggests is another major driver of successful innovation.”