Innovation training day: Exago team updates its facilitation skills

With the aim of improving our team’s skills as innovation workshop facilitators, several Exago employees are attending a certified Workshop Facilitation Training in Lisbon, Portugal.

The session covers topics such as better communication, posture and participation promotion and is arming our teams with the latest facilitation tools and techniques. It was designed to enable them to provide our clients with informative and engaging innovation workshops that draw the most benefits throughout the innovation cycle.

How Human Resource leaders make the most of innovation management

With innovation management capturing rising interest from human resource managers and directors, Exago’s team took part in the Expo’RH2018 in Estoril, Portugal, to discuss the latest news and trends in the sector. The event organised by the International Faculty for Executives gathered hundreds of HR directors from leading companies such as Nestlé, Ageas, Pfizer, Renova and McDonald’s, under the motto “Experience is the way”, on March 14 and 15.

In the spotlight was the importance of communication for employee engagement. Effective communication not only has to be continuous, but also two-sided, said Maria do Rosário Vilhena, Human Resource Director of Nestlé Portugal. The food and drink company is using focus groups to launch internal challenges and collect insights, while searching for better ways to convey “consistent messages to everyone” across the different business units of their large organisation, “and to be understood by all”.

Ongoing communication and a close relationship with employees has also been part of Renova’s success, explained their HR Director, Paulo Santos. The family-run paper consumption goods company expanded internationally as “the sexiest paper on Earth” and is a renowned case study for incremental innovation.

To open communication channels and bring together the experience and know-how of all employees, larger, multinational companies are also using platforms that allow them to reach their people across business units and geographical locations.

Promoting change through your innovation programme
Internal communication is critical in processes of organisational change, according to Paulo Teixeira, Pfizer Portugal Country Manager. The pharmaceuticals company opened a communication channel with employees through a post box placed in each business location to get ideas and suggestions, but also their feedback. Similarly, an internal tool has supported the recent image and culture change at Montepio bank, Fátima Silva, Head of Talent & Development at Montepio bank, told the audience.

To strategically realign its workforce, the insurance company Ageas used Ding!, built on Exago innovation management software. After Ageas bought AXA’s Portuguese operations, Ding! is helping the company spread its organisational culture and communicate with all the employees from the different brands they now operate, Portugal Human Resource Director Rita Baptista said.

“Listening to our employees was the most important factor for this successful transition, since we were able to make people feel part of that change,” she added. The Ageas management was able to promote company goals and engage people in the process of transformation, bringing everyone together in a collaborative innovation platform.

The HR Director of ANA – Aeroportos de Portugal, Catarina Horta, also highlighted the importance of a company’s collective intelligence as a learning tool.

Keeping in mind the words of Ray Kroc
The quote “None of us is as good as all of us” is attributed to the founder of McDonald’s and defines the company’s DNA, says Sofia Mendonça, HR Director of McDonald’s Portugal. She explains how collaborators, franchisees and suppliers are the corporate pillars involved in the business evolution. The iconic 50-year-old Big Mac, for example, is a by-product of this approach: it was originally suggested by a Pittsburgh franchisee after several construction workers commented that the hamburgers were too small.

McDonald’s connects with those three pillars through several types of channels, both face to face and digital. Gamification and social features, along with a vivid communication tone, are particularly relevant in the digital linking to their workforce, whose average age is between 19 and 23.

Optimise your cost-cutting strategy with the right innovation management tool

When investing in a bottom-up innovation management approach, you get to call on people’s knowledge and experience to help you separate the wheat from the chaff and find concrete and innovative solutions, mainly at micro level. You can save time and money by having your employees contribute ideas for the cost-cutting strategy, as well as cost-optimisation ideas that can transform and impact the company positively. Examples from our clients show just that.

Simple ideas such as ‘set as default printing on both sides’, ‘reduce the number of floors or buildings being used during night or weekend shifts’ or ‘use more efficient watering systems in the green areas of the company’ can have significant impacts on your costs. What’s more, they can boost morale by promoting a culture of sustainability, in all corners of your company.

 

When can an innovation management software be useful?

In large multinational companies with multi-regional presence, it may however be difficult to listen to all your people on the ground. Through its capacity to engage employees across borders, an innovation management platform becomes a powerful tool.

If this is the case in your organisation, make sure you get a solution that offers multi-language features – where employees can have access to the content and strategic cost-cutting challenges presented by management in their native language and make use of their business knowledge to create ideas and help others improve theirs.

Your innovation management platform should be centralised, but allow for the creation of target and country communities to which specific challenges can be issued. Think, for instance, how remote the problem of wasting paper bags in stores in the US can seem to someone building components in Asia.

Gamification elements are also valuable, as they are designed to capture different types of participants, to develop greater loyalty and promote higher use. Participation will be more frequent when users feel their ideas and insights are valued and turn into real solutions.

Andreia Agostinho Dias, Sales Executive
Diana Neves de Carvalho, Exago’s CEO

You can access the full paper here

 

What are the good and the bad costs in your innovation agenda?

When introducing a cost-cutting strategy in your innovation agenda, you should first have a clear view of your company’s strategy and map out good and bad costs for programme intervention, at macro and micro levels. Both macro- and micro-level-oriented strategies have value and they often make more sense combined.

At a more tactical level, and in line with your strategy, you need to look at your whole organisation and differentiate between the critical ‘good costs’ and the non-essential ‘bad costs’:

  • Bad costs are those not aligned with the overall growth strategy of the company;
  • Good costs support the business capabilities needed to achieve the overall growth goals.

In an online article in Forbes, PWC’s strategist Rodger Howell says that ‘once a company’s costs are classified, strategic cost-cutting and improvement become a process of minimising exposure to bad costs and maximising investment in the best ones’. He adds that this practice helps to ‘create a more resilient growth model’, which is ‘particularly important during times of uncertainty’.

These bad and good costs can happen at both micro and macro level, as the figure below shows. It is key that you keep this matrix is mind when defining your strategic cost-cutting and its goals, and how to address each quadrant.

Strategic cost-cutting matrix

Overall, the bad costs are waste and an outcome of inefficiencies, which can and should be reduced. Do not underestimate them. Even micro-level bad cost-cutting, such as reducing power and resources use, can have tremendous impact on your balance account. Not only are these costs easily identifiable by your employees, but they can also be incorporated into your incremental innovation agenda in ongoing challenges, so that you are always capturing and addressing new and existing inefficiencies.

Measures to cut bad costs at a macro level (such as closing units or laying off people) may, however, have a stronger, higher and more immediate impact on your financial balance. But is it the way for your growth? We are not saying it isn’t part of it, but there are other ways you should always consider as well. These costs are better leveraged by external teams carrying out a strategic analysis to understand which costs are no longer aligned with the organisation’s strategy and can therefore be eliminated without negatively impacting core business.

On the other hand, good costs are those that support business capabilities to achieve growth goals. They may be, in consequence, worthy of more investment, so that in the mid to long term you end up saving more or increasing return.

At a more macro level, they will likely imply some investment and a more disruptive transformation, but can also have a larger financial impact. For instance, if you decide to redesign a profitable business area, you can open doors to new clients and markets and to higher returns.

At a more micro level, for example, by changing a product material or a method of doing things, you can also pave the way for an unexpected internal revolution. Here again your internal workforce can provide useful insights to redefine current products, services and processes. There is always space for improvement, and including this quest in your innovation agenda will help you structure and centralise the process, thus reducing investment in external advisory services and bringing interesting and relevant inputs for your business aligned with your needs.

There is no magic formula and no equation to tell you how and where to cut exactly.

The main message is: remember to look at the bigger picture and understand which methods are more efficient in which situation, so as to develop an effective strategic cost-cutting and improvement strategy.

This process of employee engagement and empowerment will also make your organisation more future-fit and will create a cost-conscious culture, essential to creating a sustainable cost-cutting and improvement strategy.

Andreia Agostinho Dias, Sales Executive
Diana Neves de Carvalho, Exago’s CEO

You can access the full paper here

 

How strategic cost-cutting helps you shift from survival to growth

In a weak growth environment, with low investments and rising risks, companies gamble on cost-cutting to ensure that they are prepared and equipped to grow stronger, as they wait for better times to come. Yet, cost-cutting is more and more seen as a way to drive growth, rather than as way to survive or avoid insolvency.

With recession, macroeconomic concerns, digital disruption and commodity price fluctuations fueling uncertainty, Deloitte’s 2016 data illustrates this shift from survival to growth. Its fourth biennial cost survey shows that the ‘save to grow’ strategy of ‘using cost reduction to fund growth initiatives’ remains prominent today.

However, in 2016, many US companies were ‘simultaneously pursuing seemingly conflicting goals of aggressive growth and aggressive cost improvement’. Deloitte calls this the ‘thriving in uncertainty’ paradox.

Then, whatever the future holds, the key to cost programme success lies in ‘choosing a cost management strategy that aligns with your company’s needs and is capable of delivering the required level of savings’. In this context, tactical initiatives to pursue aggressive cost targets will not be enough, and are likely to be ‘a recipe for failure’, the report adds.

The change has to go deeper then, beyond tactics, reaching a strategic level. This means that a company’s most valuable assets, people and their talents, become top priorities, ‘consistent with a growth mindset, since having qualified workers and deploying them effectively is key to successful growth’, writes Deloitte.

Andreia Agostinho Dias, Sales Executive
Diana Neves de Carvalho, Exago’s CEO

You can access the full paper here