Why better work and workplaces matter for everyone

Rachelle Pascoe-Deslauriers and Professor Patricia Findlay, Research Associate and Lead Investigator on the ‘Innovating Works…’ project, discuss the importance of workplace innovation for sustainable, fair and productive growth with shared benefits for employers and employees.

Scotland’s Economic Strategy (March 2015) sets out a vision for Scotland based on creating fair and sustainable economic growth by boosting competitiveness and tackling inequalities. These two goals – economic and social prosperity – do not operate in isolation from each other. High levels of income inequality are bad for growth and impose huge social costs on the public. Effective and prosperous societies need agile, high performing businesses providing high quality, inclusive and fairly rewarded work.

So good jobs matter – to employers, employees and society. For individuals, poor quality jobs can impact negatively on physical and mental health in addition to their well-being. Bad jobs contribute not only to in-work poverty but also to lifelong poverty beyond working-life. Bad jobs increase costs on employers through ill health-related absence (or unproductive presenteeism), staff turnover and the opportunity cost of what might be delivered by engaged employees with a genuine stake in their workplace. For society, poor quality jobs affect health spending, welfare spending and tax spend on subsidising poor work, as well as the opportunity cost of lost tax revenue.

Better work and better workplaces go together. Simply put: high quality work, in a positive and collaborative organisational climate where success is shared between the business and its staff, encourages employees to engage in solving business challenges and creates the spaces where they can do so. This, in turn, can build a fertile environment to support new ideas and change.

Enter what we call ‘Workplace innovation’. This refers to innovations in the way organisations are structured, how they manage their human resources, the way internal decision-making and innovative processes are devised, the way relationships with clients and suppliers are organised and the way the work environments and internal support systems are designed.

Workplace innovation includes doing things better, and doing better things (i.e. those that create more value). At the heart of workplace innovation this includes learning, collaboration and shared benefit. Learning requires time and space for reflection about current and potential future practice. Collaboration requires scope for employee voice and influence along with an organisational climate where voice and influence are supported and encouraged. Shared benefit gives everyone a stake in improved business practice. All these factors can lead to beneficial outcomes such as new products/services, processes, policies, ways of organising as well as more conventional business outcomes, for example, increased productivity, profitability and growth. Crucially, workplace innovation can deliver positive employee outcomes – more rewarding work in every sense.

So innovation matters and it works – but only in the right circumstances. None of this is easy and challenging competitive conditions often encourage short term cost-minimising strategies, rather than investment in employees who can learn, problem-solve and drive forward new ideas.  Yet we know that this simply creates new problems – poor relative productivity, low levels of business improvement and low pay.

To put it starkly, many firms have few assets other than the people they employ.  Creating the conditions for employees to make the best contribution via high quality work can benefit everyone.  Innovation is important to all stakeholders in businesses, not just employers/organisational decision makers. Employees, suppliers, customers/clients, policy makers and society have a role to play. Scotland’s Economic Strategy now recognises this, and the ‘Innovating Works…’ project has investigated how this can be done in SMEs in Scotland. Check our website next week for a summary of our findings.  Or join us for a discussion of our findings.

Event: Workplace Innovation in Scottish SMEs, chaired by Sir Peter Housden, Permanent Secretary to the Scottish Government with closing remarks from Marion Beattie, Head of Employer Services at Skills Development Scotland and Linda Murray, Head of Strategy Service at Scottish Enterprise – Tuesday, 17^th of March from 16:00 in TIC level 1. Registration required, please email:

sbs-workplaceinnovation@strath.ac.uk.

‘Innovating Works…’ is a pilot project funded by the European Regional Development Fund, the Scottish Funding Council, the University of Strathclyde and Scottish Enterprise, supported by Skills Development Scotland and the STUC, and involving staff from the Scottish Centre for Employment Research, the Hunter Centre for Entrepreneurship and the Strathclyde Institute for Operations Management.