Creating space for innovation

Traditionally, Australian businesses have received a lower-than-average innovation score compared to leaders on the global stage. A study of Australian Leadership reports only 18% of private sector organisations received high levels of ‘radical innovation’ (think: creating products beyond expectation, experimenting in new markets, new ways of delivery of products and services). Especially as Australia is an island nation and heavily dependent on Asia and China for exports, there is a need for better informed decision-making for leaders to be less reactive to global issues and to create space for future innovation.

Many Australian leaders have been hampered by the lack of visibility across their organisations and reluctantly operating as lone wolves, especially over the past couple of years due to pandemic-induced challenges like lack of face time with peers. In today’s business landscape, this is dangerous. So how can organisations take a more holistic approach and create transformational leaders? It starts with gathering input from across the business, and not being afraid to go beyond borders to make the right decisions.

Proactively prepare your workforce

With border closures, the remaining skills shortage and demanding market competition, technical talent has become increasingly scarce. In fact, one in five Australian businesses report being underemployed during the last few months, with 84% of these organisations attributing it to the inability to find suitable staff to employ. While business leaders are experts at managing costs, staff shortages can have astronomical impacts with many organisations reporting they are unable to operate at full capacity.

When businesses are expected to deliver the same results while operating at a lower capacity, cracks in the system become unavoidable. This leaves business leaders not only vulnerable to internal and external disruption, but also unable to effectively identify and act on emerging opportunities. To combat workforce shortages, more robust forecasting is needed to empower transformational leadership to address these ongoing challenges. This starts by having access to richer data, deeper insights and planning to address issues three to five years in advance.

Utilise data to manage your supply chain

With 41% of Australian businesses currently experiencing supply chain disruptions, leaders must act fast to get ahead of future disruptions. Supply chain planning is highly complex and involves many moving parts across the business ranging from suppliers, channels, customers and pricing schemes. With decisions having a ripple effect on the wider business and so many variables within supply chain management, leaders need to take a birds-eye-view approach.

For example, if finance heads focus on revenue, costs and projected growth, or supply chain heads are solely preoccupied with moving product, leaders across departments are left with a very siloed view of the impact of their decisions. On the other hand, leaders who embrace connected planning and take a more holistic approach can better synchronise execution, enhance forecasting and be better equipped to identify potential risks and opportunities.

I work with a regional steel manufacturer that is a great example of a company that has streamlined data across the supply chain. The company sells premium made-to-order steel products, which means it is crucial for them to accurately forecast demand and raw material availability. Supply chain planning meant that they could meet urgent customer lead times whilst ensuring product quality was up to standard. The results were a $500K annual recurring SG&A cost savings and 50% planning time improvement.

Futureproof your organisation

Actively planning for change is a crucial part of any successful business. Over the last few years, we’ve seen businesses dramatically shift from outdated technology and lone wolf-style management to embracing a connected workplace model. However, organisations are still reluctant to embrace this change, with just under half (45%) of Australian businesses stating they don’t intend on implementing connected planning anytime soon.

A siloed approach may have worked in the past, but with organisations currently facing increasing customer expectations, waning loyalty, rising inflation and supply chain disruptions, these critical business decisions open organisations up to massive vulnerabilities. To limit the margin for error and streamline decision-making, organisations must employ a connected approach to planning for the future. Business leaders need to make sure they’re asking the right questions and taking the steps necessary to build resilience and agility when inevitable future disruptions arise.

The old way of managing a business through outdated planning processes is no longer a way to be competitive in today’s constantly evolving workforce. To remain ahead of the pack and be a trailblazer in transformational leadership, it is critical to focus on your future workforce, enhance forecasting abilities and implement connected planning. This will make way for innovation and allow leaders to confidently identify risks and emerging opportunities for years to come.

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