Digitalizationinnovation management

Bottom-Up decisions support effective digitization in SME 


In our last article we explained in detail how small and medium enterprises (SME) can create suitable digitization measures by using specific success factors. The purposeful optimization of the processes and work environment secure the long-term success of the company. Even simple measures and optimizations can help you benefit from digital transformation. Today we are talking about bottom-up decisions.


No optimization without an innovation culture  

An important success factor of digital transformation is the lived innovation culture in the company. The reason? The employees in the various departments and areas of the company know best where the existing difficulties and potential for improvement lie. Whether they share these ideas with other employees or their superiors depends in large part on the company culture. 


Because innovation is a mentality. You can’t command innovation. Innovation is a culture topic and a management topic. Only when all for the company culture essential conditions are working together, can your employees unleash their innovation potential and apply it within the company. The creation of an innovation culture in companies therefore supports the discovery of problems and potential improvements as well as the finding and implementation of ideas for the optimization. 


Top-down vs. bottom-u 

In business/management planning, there are two basic kinds of planning: (1) top-down and (2) bottom-up. Top-down planning is when management decides on the most important objectives and the various corporate areas then take these goals into consideration in their own plans. Bottom-up planning is when the corporate areas determine their own goals and these goals are then combined by management and evaluated as a whole. 


As everywhere, also within IT the bottom-up approach has become more and more popular. Because of the increased use of agile project management and agile methods like SCRUM and Kanban, employees are more involved and have more and more responsibility anyways. However, a few companies go much further. For example, at the company Metro the employees themselves create the IT strategy in a bottom-up approach. You can find out more in this article by CIO [in German]. 


Innovation culture = top-down & innovations = bottom-up 

It is the responsibility of the leadership team to create the conditions for an innovation culture to develop (top-down), in which employees can work on innovations and optimizations in order to present them to management (bottom-up).  


Thanks to a lived innovation culture and bottom-up decisions, your company doesn’t only benefit by having motivated employees that move the digitization process forward, but also gains an enormous increase in dynamic behavior and recognition. 


And because the employees in the various company areas often know very well which processes can be optimized, your company also gains additional efficiencies. 


Create the right conditions for bottom-up decisions 

The following steps can help to create the right conditions for innovations to be developed and bottom-up decisions to be made: 

  • Create a simple process illustration on how you currently deal with suggestions for improvements, recommendations and ideas. 
  • Deliberately capture how you would like to deal with the topics innovation, development and optimization in the future and set goals accordingly. Our innovation consultants are happy to create a workshop for your employees. 
  • Create channels your employees can use as an official communication mechanism. 
  • Provide an environment, in which your employees can creatively and actively collaborate on and contribute to ideas/process improvements. This could take place for example in a creative room. 
  • Be transparent and allow your employees to see which criteria are used to transform ideas into projects. 
  • As a manager, you support this culture continuously in meetings and motivate others to choose this culture as well. 
  • Let everybody see your vision: Print big posters. That’s how you show that this process really exists and enable your employees to identify with it. 
  • Be patient when it comes to your expectations for instant success. Every change takes some time. 


You can find more suggestions regarding the implementation or improvement of an innovation culture in your company in our blog post A Detailed Look at Innovation Culture for SMEs”. 


Optimizing processes and the work environment by using bottom-up decisions 

The digitization of a company can (and should) include an analysis of the current processes and circumstances. That’s how companies can prevent that inefficient analogue processes continue to live on in their company as digital versions.  


A lived innovation culture and the promotion of bottom-up decisions can support the optimization of processes as part of digitizing the company – especially in SMU. And the company doesn’t just benefit from this during the initial stages of digitizing a process or a corporate area. If the corporate culture remains innovative also after the implementation is complete and employees are still asked to be a part of the company’s success by participating in bottom-up decisions, the future can continue to bring small and large optimization of processes. 


Have you experienced something similar in your company? Or the opposite? We would be happy to hear from you in the comments or on Twitter

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