Innovation is the process of turning ideas into value for businesses, communities and society. This article explains what innovation is, why it matters and how you can foster it in your organisation.
Innovation sits at the heart of every successful business. Most businesses don’t have a problem generating ideas, but they may lack the time, clarity or resources to explore and nurture them. It’s often when they focus on quality over quantity that they discover real value. By challenging existing practices and embracing new technologies, you can shape solutions for both emerging and established markets.
What is innovation?
Innovation is not the opposite of tradition but the ability to influence the future by understanding the past. Successful businesses embed innovation and innovation management into their structures and practices to remain relevant and resilient.
Customers ultimately assign value to a product by the service it offers them, the need or want it fills in their lives. Innovation is about executing an idea to create value, so understanding the true value being created is vitally important.
Innovative organisations go beyond simply producing goods and services. They develop a deep understanding of customers, supply chains, routes to market, business models, and, most importantly, problems worth solving.
What's the difference between innovation and entrepreneurship?
Importantly, you can be an innovator without being entrepreneurial, and you can be an entrepreneur without being innovative. For example, if you open a coffee shop because demand is outpacing existing supply, you're an entrepreneur but not an innovator. Similarly, if you improve a process within an existing organisation, this makes you an innovator but not an entrepreneur.
Why is innovation important?
To move forward with momentum, you need to see the big picture when developing a promising new idea. As markets evolve rapidly, innovating your business model and adopting an entrepreneurial mindset gives you the competitive edge to succeed. Innovation transforms a good idea into a great reality.
Businesses that don’t innovate stagnate under the weight of tradition and market expectations. In every industry, from technology to agriculture, innovation helps you overcome new global challenges. By adopting innovative strategies, you and your business will have the ability to navigate change, even when the unexpected occurs.
What is disruptive innovation?
Newcomers to the market challenge traditional views and disrupt the status quo, often competing with well-established conglomerates. Leaders of small companies can disrupt industries and more established, resourced competitors by creatively improving their structures, practices, products and services.
However, disruption without structure or purpose doesn’t guarantee an organisation’s ability to sustain innovation. Effective innovation comes from understanding human behaviour and emerging technologies and evolving to meet changing consumer demands for improved products and services.
One of the most significant disruptive innovations in recent history is Netflix. The streaming service and production company was initially launched as a mail-based rental business in the late '90s. By 2000, founders Marc Randolph and Reed Hastings had pitched Netflix to Blockbuster for $50 million. This offer was met with instant refusal, only to see the home video rental service filing for bankruptcy 10 years later.
When Hastings reflected on this pivotal moment another decade on, time had helped clarify the importance of elevating innovation above standard control practices.
“It was not obvious at the time, even to me, but we had one thing that Blockbuster did not: a culture that valued people over process, emphasised innovation over efficiency, and had very few controls. Our culture, which focused on achieving top performance with talent density and leading employees with context, not control, has allowed us to continually grow and change as the world, and our members’ needs, have likewise morphed around us.”
– Reed Hastings, co-founder of Netflix
Netflix continued to grow and adapt with technological advancements and consumer changes in the market. Eventually the company transformed beyond streaming and began investing in original productions, making history with Roma (2018) winning 3 Academy Awards, including Best Director, despite the film’s limited theatrical release. In 2025, Netflix’s market capitalisation is A$807.81 billion, making it the 18th most valuable company in the world, by market cap (Companies Market Cap, 2025).
What is social innovation?
Social innovation aims to resolve social or environmental issues through research and applied methodology. Social innovators strive for impact, purpose fulfilment and sustainable outcomes.
For example, Nic Marchesi and Lucas Patchett transformed their passion for helping the homeless into Orange Sky Laundry, a Brisbane-based charity founded in 2014. Orange Sky provides a free mobile laundry service for people experiencing homelessness and expanded in 2016 to also offer showers.
“We stumbled on a world-first, something that connected the community, reduced the transmission of diseases, but most importantly and most simply, we were improving the lives of others.”
– Nic Marchesi, co-founder of Orange Sky Laundry
Orange Sky Laundry continues to develop innovative projects, working alongside remote communities in Queensland, Northern Territory and Western Australia to create local partnerships and employment opportunities.
Laura Stokes, UQ MBA graduate and Director of Marketing and Transformation at Orange Sky, found that people who used the service often returned for the sense of community and conversation, even after finding accommodation.
Professionally, the role is extending me in many ways but still plays to my strengths in marketing, fundraising and engagement, while giving me the opportunity to have a positive impact in the lives of those who need it.
Social and community innovation and entrepreneurship is driven by empathy, which can become a catalyst for significant advancements in communities. By actively learning about an issue and understanding the specific methodology needed to address it, social innovation empowers individuals, startups and organisations to find appropriate solutions. If you're looking for a career with purpose, social innovation can transform your desire to better the world into a reality.
Common innovation processes and frameworks
There are many frameworks and processes you can use to drive strategic growth and innovativeness. Three of the most popular are:
- Design Thinking – focuses on understanding user needs, redefining problems and creating new solutions through a series of tests and iterations
- Blue Ocean Strategy – focuses on creating new markets rather than competing in saturated ones
- Lean Startup – focuses on building a minimum viable product (MVP) and getting feedback to iterate quickly.
Common barriers to innovation
It’s normal to face some challenges when introducing new ideas in an organisation or as an entrepreneur. Here are 3 of the most common barriers to innovation you may face and how to overcome them.
1. Resistance to change
Any change in a workplace can cause fear and uncertainty, which may lead to resistance. You can build support for change by involving stakeholders and employees early, communicating the benefits of the change and fostering a culture of experimentation.
2. Lack of resources
Innovation requires an investment in resources such as time, funding and employees to be effective. This can be addressed by streamlining existing processes to free up time, sourcing additional funding and partnering with other organisations.
3. Lack of clarity and direction
This barrier can be resolved through setting clear goals, establishing a road map and consistent communication.
How can you promote innovation in your organisation?
To promote innovation, an organisation must invest in 3 vital resources: time, support and leadership.
Use these 3 strategies to get started:
- Create an environment of honesty and collaboration.
- Build a team that includes diverse perspectives to unlock unique problem-solving abilities.
- Encourage your employees to undertake specialist training, fostering new skills and ideas across your organisation.
If you're an entrepreneur, these strategies may be helpful as you scale.
Want to become more innovative?
Postgraduate degrees specialising in innovation, like UQ’s Master of Entrepreneurship and Innovation, will engage you in multidisciplinary perspectives and rejuvenate your strategic thinking. Whether you want to start your own business or lead innovation management in an existing workplace, you can develop critical thinking and innovation skills to create a high-performing business that makes a real impact.
Learn more about UQ’s Master of Entrepreneurship and Innovation
You can also uplift your innovation capabilities by completing a professional development short course on Leading Innovation for Growth or by choosing innovation as a major in these UQ programs:
