Is there anything we hear more about these days than AI and innovation in business? Companies are investing huge amounts of money into innovation to stay relevant and competitive. But when it comes to your business, do you know what to focus on? And how to start your own innovation journey?
What Is Innovation?
We often mix up innovation with creativity, but they’re not quite the same. As Harvard Business School explains, creativity is about generating unique ideas, while innovation is about turning those ideas into something useful. In business, innovation means introducing new products, services, strategies, or business models that are both unique and valuable.
What benefits does innovation in business bring for you?
More than 80% of digitally mature companies see innovation as a core strength. To help you understand why, here are some of the key ways innovation can benefit your business.
1. Stay ahead of the competition
When you do things differently, people notice. Innovation can help you stand out through smarter tools, better service, or a fresh approach your competitors haven’t thought of yet.
2. Keep up with what customers want
Companies that innovate regularly are better at keeping up. The more you listen, test, and tweak, the more likely you are to build things people actually use and love.
3. Find new ways to grow
Growth comes from trying something new. A different product, a new market, or just a smarter way of doing things. Innovation opens up paths you might not have seen before.
4. Attract people who want to make a difference
Innovation is also about how your team feels. When people get space to try new things, they feel more motivated and connected to their work. This kind of energy can help you keep great talent around.
5. Work smarter, not harder
Innovation can result in increased productivity. You can do this by finding ways to improve existing processes, streamline operations, or implement new forms of technology.
6. Be ready when things change
The world doesn’t sit still. Neither should your business. Companies that build a habit of trying new things tend to handle change better.
Different innovation models in business
Not all innovation models in business look the same. Depending on your industry, market position, and goals, there are different ways companies can approach innovation.
One common difference is between sustaining innovation and disruptive innovation:
Sustaining innovation focuses on improving existing products, services, or processes to better serve current customers. It’s the path most established businesses take to maintain their market leadership.
Disruptive innovation happens when smaller or newer companies introduce products or services that transform the market. This can open up entirely new customer segments or challenge larger competitors.
Many organizations seek to combine both types of innovation into their business strategies. Improving what already works, while at the same time exploring new opportunities.
A great example is AI transformation. Companies are using AI to enhance customer experiences, streamline operations, and create new services. Opening these kinds of possibilities is becoming a key part of many innovation models in business.
How can leaders decide what innovations in business to prioritize?
Just because an idea seems great at first doesn’t mean it’s worth turning into a full innovation initiative. The challenge for leaders is knowing which innovations will create real value for their business and customers.
A useful way to approach this is by focusing on three key questions:
- Who: Who is the customer, and what problem do they need to solve? Are there new problems arising from shifts in behavior, technology, or market trends?
- What: Is our solution both valuable and achievable? Can it solve the identified need better than current alternatives?
- How: How will the solution create value? What business model will make it sustainable?
Answering these questions helps ensure your innovation efforts are guided by real needs and clear business value.
5 Strategies to build a culture of innovation in business
If you’re serious about innovation in business, you need to start with your internal culture. Companies that lead in innovation tend to create an environment where experimentation is encouraged, employees feel supported, and ideas have room to grow. These five strategies can help you make innovation part of your company’s everyday reality.
- Define a clear innovation strategy
Successful innovation in companies starts with a plan. Define what innovation means for your business, for example, to develop new products, improve services, or streamline operations. Then, connect these goals directly to your broader business objectives. Communicate this vision clearly through meetings, documented strategies, and team KPIs.
- Empower employees
People closest to your products or customers often have the best ideas. Give your teams the freedom and support them. This could include dedicated innovation hours, access to prototyping tools, or a platform where anyone can submit and develop ideas.
- Create Psychological Safety
No one can innovate in an environment where they’re afraid to make mistakes. Create a space where all employees can speak up, challenge ideas, and share feedback. One way to get this going is to have regular “idea-sharing” sessions where any team member can introduce an idea without being judged.
- Encourage Cross-Functional Collaboration
When different departments work together, great things happen. Bring together people from tech, product, marketing, or operations to work on challenges, run workshops, or try out new business ideas.
- Celebrate Innovation Successes
It’s always great to celebrate success, whether small or big. Share stories of successful ideas through internal channels and team meetings. You can even let employees nominate each other for creative ideas. Shows that innovation in business is something everyone can be part of.
Société Générale – one of the most innovative banks of 2025
Société Générale is one of Europe’s leading financial services groups. In 2025, it was named Western Europe’s Most Innovative Bank by Global Finance as part of the Innovators 2025 awards. The bank has more than 133,000 employees in 61 countries and supports around 30 million customers every year.
Société Générale has been working on its digital transformation over the past several years. Their strategy focuses on scaling AI initiatives, automating data processes, advancing “Banking as a Platform” services, and creating highly secure and flexible digital work environments.
When the COVID-19 pandemic began, their innovation efforts proved critical. In just two weeks, the bank transitioned 100,000 employees in 61 countries to remote work and scaled its digital services to handle a sharp increase in online activity.
Innovation continues to be a core part of Société Générale’s long-term strategy. The bank continues to invest in AI, cloud technology, and customer-focused digital services with an emphasis on sustainability, security, and improving the customer experience.
How to measure innovation in your company?
Measuring innovation in business can be tricky because innovation is not a linear process. Still, it helps to think about it in stages. You can break innovation down into three main phases: exploration, experimentation, and scaling.
For each stage, it is good to track progress differently.
Exploration phase
In the exploration phase, teams focus on generating ideas. You might measure how many new concepts your teams are producing or how much you’re investing in R&D.
Experimentation phase
During the experimentation phase, teams test and validate ideas, so it makes sense to track metrics such as prototype development speed or the success rate of experiments.
Scaling phase
Finally, once ideas are ready to go to market, you can look at commercial outcomes. Valuable insights can be provided by measuring time to market, revenue from new products, or market penetration.
There is no single measuring metric that works for everyone. The key is to design metrics that fit your company’s strategy and maturity level. That way, you can stay focused on what matters to you at each stage of innovation.
Why are innovation metrics so hard to track?
You’d think that by now we’d have a simple formula for tracking innovation in companies. Not yet. Compared to areas like sales or finance, where results are easy to quantify, innovation tends to be a bit more difficult to define.
Here are five reasons why:
- Innovation means different things to different people
Ask five people in your company what “innovation” means, and you’ll likely get five different answers. For one person, it’s a new product. For someone else, it’s improving an internal process. Without a shared definition, it becomes tricky to decide what you should even be measuring in the first place.
- It’s happening all over the place
Innovation doesn’t stay neatly inside an R&D department. In many companies, great ideas pop up around departments. That’s great for creativity, but it also makes it harder to track resources and success.
- You don’t always know where it’s going
Unlike more predictable business areas, innovation work is, well, unpredictable. Sometimes projects change direction halfway through. Other times, a big breakthrough might come out of nowhere. Tracking progress in a straight line just doesn’t fit the nature of this kind of work.
- The simplest metrics aren’t always the best
It’s tempting to track what’s easy, like counting how many new products launched this year. But that doesn’t tell you whether those products were any good or whether they added long-term value. Simple metrics can sometimes give a false sense of progress.
- Too many metrics can backfire
When companies try to measure every little piece of innovation, it can bog the whole process down. Teams end up spending more time filling out reports than doing the creative work they’re supposed to be focused on.
How can you drive your own innovation?
Turning ideas into real products and services requires not only a clear strategy and the right tools, but also teams who know how to execute.
At Vacuumlabs, we work with companies at every stage of this process. Some start by using Spark, our product discovery framework, to shape new products or rethink existing ones. Others are looking to explore blockchain adoption and develop advanced solutions in wealth management, trading, or investment. All these are areas where innovation is shaping the future of financial services.
No matter where you are in your innovation journey, the right combination of strategy, technology, and trusted expertise can help you move forward faster.
