Date posted: September 3, 2015

“Insanity: doing the same thing over and over again and expecting different results” – Albert Einstein. If businesses want to fast-track their growth, they need to look beyond the usual suspects. After all, cost reduction and efficiency programs only offer finite solutions at the end of the day.  The process of innovation, on the other hand, is a potential game-changer. The end result can be completely new and exciting ways of doing business as an organisation dares to disrupt itself, and others. 

The inherent benefits are compelling. Those businesses that innovate effectively have a greater opportunity to increase their profitability, productivity and develop a sustainable competitive advantage. They are more likely to employ people and export and generate new products and services. Cost reductions and improved productivity are just some of the gains to be had. There is also the opportunity to enhance the customer experience, or even to develop an entirely new business model. Innovation requires different thinking and increased risk. Every business has a plethora of untapped, brilliant ideas. However, successful innovation lies not just in generating ideas but in effectively executing them. It requires the support of a well-designed process to ensure the most salient ideas are uncovered and successfully brought to market. Often as not, it is about an organisation disrupting itself – turning business as usual on its head.  That, quite simply, takes guts.

In business, being comfortable with taking a higher level of risk and working differently is not for the faint hearted. Yet this is what innovation is all about. It is uncomfortable, a wild ride without clear rules or even the sense of having been there before. Consider the alternative, a business choosing not to innovate or adapt, may be at a greater risk of losing relevance, market share and revenue streams. Clearly innovation cannot occur without a concurrent shift in an organisation’s culture, one which promotes agility and a ‘safe to fail’ environment. Many family businesses were born out of innovation, seeing a niche in the market with little by way of resources, therefore having to innovate in order to compete. As these businesses have grown, they rightly put in place “controls and processes” which can stifle the very essence of the original innovation which created the business. Further, as businesses become larger, they often have more to lose and therefore take even less risk.

In good news, family businesses feel like they are already moving in the right direction.  In KPMG/FBA’s 2013 Family Business Survey, 70% of family businesses felt they were outperforming their competitors in the area of innovation. This change in mindset requires a more fundamental change in an organisation’s language. As Henry Doss says in The Rhetoric of Innovation, the language of innovation is not the “language of strategic plans or goals, of reports or evaluations”. Rather, it is “a language about culture, and for this reason, it must be a language of narrative, and stories and tales”. This means that instead of the traditional ‘command and control’ language and structure, innovation requires the language of nurture: surrounding ideas with love and encouragement, being humble and vulnerable, embracing and learning from failure. This is by no means easy.

Most businesses are results driven and speak in the language of action. Soft, creative story telling does not sit so comfortably in the boardroom. It is not impossible however. By harnessing the creativity and entrepreneurial thinking of people in and around the business, and providing a critical space to allow the business to disrupt itself, ideas can be brought to commercial reality. Leaders just have to believe in the uncertainty of the outcome and take risks to bring it to fruition.

  • Guidance for tackling innovation head on:
  • Develop and communicate methods of enabling taking ideas from conception to launch.  Be prepared to be agile and make changes as you evolve. 
  • Clearly define the problem you are looking to solve. 
  • Encourage risk-taking without fear of punishment for failure.
  • Provide access to tools and resources, including time.
  • Gather the right team to make the biggest impact.
  • Allocate sufficient resources to fund the idea, right through to commercial reality.


    Adapting your business to embrace new thinking and a risk taking culture can be a daunting process.  From KPMG’s experience working with clients on this journey, it often begins with an understanding of the drivers and forces that require the organisation to innovate. The process of evolving into an organisation which fosters and develops innovation does not happen overnight, but to grow and succeed, organisations need to take advantage of the latest in innovative thinking and networks.  In a world where information is a commodity and scale is less relevant, an innovative culture and leadership team may be the only true source of competitive advantage left. The 2015 KPMG/FBA Family Business Survey will be released in October, with a focus on disruption and innovation. 

    How are family businesses using innovation to respond to the ever changing and fast paced business and economic landscape, while taking the family on the journey?  To request a copy, email:

    This article was prepared by KPMG and the advice is designed to be general in nature.