Modern businesses increasingly see innovation as a key ingredient for success, given the need to keep up with ever-changing trends. Recently released figures from the Australian Bureau of Statistics (ABS) appear to back up this view, finding that innovative businesses tend to perform better on the whole.
The Selected Characteristics of Australian Business dataset from the ABS will generally make for pleasant reading for most small business owners in Australia. According to the statistics, more than a third (34.6 per cent) of Australian companies recorded growth in in sales income between 2011-12 and 2012-13.
Positive results were also reported in a variety of other measures - for example, 16.5 per cent of business said they managed to expand the range of products or services they offered over this time period. A quarter (25.8 per cent) said their profitability increased, while a similar proportion (22.1 per cent) saw improvements in productivity.
The ABS's Sue-Ellen Luke pointed out that there was a vital common factor among the businesses that reported the best results.
"Against each of the measures ... businesses that had innovative activity during the year were more likely to report increases against the measures than non innovation-active businesses," she said.
The ABS lists examples of innovative activity as "new or significantly improved" goods or services, operational processes, managerial processes and marketing methods.
Small businesses wanting to foster growth and success may therefore want to look at ramping their innovative efforts. The internet and the digital world are always good places to start - for example, the ABS found that innovative companies were more than twice as likely than others to be active on the web and social media. More than two-thirds said they have a web presence, while over 40 per cent had a presence on social media.
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