How To Reward Innovation In The Workplace
Rewarding staff for their innovative efforts goes a long way in making research and development part of the company’s fabric. Here we look at what business owners and managers can do to encourage innovative thinking within in their own organisations.
Cultivate an appetite for research
A great place to start is in encouraging your employees to carry out their own research in solving a problem. Allow their own passions and personal interests to play a part as they explore new technologies and strategies which they share with the team.
Make sure no-one is left out
Placing the responsibility for R&D entirely on one R&D department can mean limiting creative ideas more than necessary. It can often be counter-productive and things can soon fizzle out if you’re relying on just a few individuals for all the ideas.
A good way of doing things instead is to give all employees the chance to voice their thoughts and ideas, and get them involved in their development. Traditionally there was the trusty ‘suggestion box’ (and yes, that can still work!) but there are also social networking and online options where ideas can be shared too. Many companies have some kind of wiki or intranet for this purpose.
The idea is that the more everyone feels they can speak freely about their ideas, the more they will do so. It’s excellent for bringing the company together and brainstorming.
Offer more staff perks
There are far more ways of offering perks for the most innovative staff members, besides pay. Employee benefits can be a good way to incentivise people to innovate, and may include things like bonuses, a company car, private health insurance, discounted travel fares, gym memberships, gift vouchers etc.
This sounds like an odd one - surely that’s not the way to boost performance?
Well actually it can be!
Essentially, if your team isn’t encouraged to risk failure and feel confident in taking on more daring challenges, then an innovative culture generally won’t thrive. When you reward people for tackling R&D head on, regardless of whether their ideas are a success or not, you’ll build an environment of trust, where all creativity is good creativity. Think of it as rewarding the innovative process itself, not the outcome of it.
Many companies now realise that micromanaging people doesn’t work. It can leave staff feeling mistrusted and frustrated, totally stifling innovation and creativity. If free-thinking in the workplace isn’t encouraged enough, managers need to consider taking a step back and allowing staff to form their own ideas.
It’s natural to want to jump in and fix problems for people as they arise. But it’s also important that managers curb that temptation and inspire their staff to think outside the box in finding their own innovative solutions.
Offer flexible working solutions
If there’s one thing the coronavirus pandemic has shown us it’s how to work from home! But even in ‘normal’ times, flexible working has become a highly prized commodity.
Flexible working practices can build trust and respect between employer and employee, making staff feel more valued. They also have more chance to build a work schedule that fits in with their needs and priorities, which in turn makes for a more dynamic workplace. There are also of course practical, lifestyle and financial benefits to flexible working too, such as improved productivity, more creativity, a better work/life balance and reduced absenteeism.
Why is innovation so important?
Innovation is when something fresh is created through research and development. Without it, nothing new would come along, there would be no change and no progress. Businesses that don’t progress will become less and less relevant, so losing their competitive edge and their market share.
But of course, innovating solutions to business challenges doesn’t just benefit the company but society as a whole. It brings about scientific and technical discoveries which in turn benefit the broader economy.
How R&D Tax Credits can support innovative companies
To reward innovative Irish companies, the government offers R&D Tax Credits on projects which make a particular technological or scientific advancement. The project has to not just be of benefit to the individual company but to the wider industry in some way. It’s offered in respect of a huge range of R&D costs, from staff salaries, wages and overtime to employers NICs, pension contributions, materials, overheads and more.
Projects don’t even have to be successful - it’s about the research and development that’s taken place rather than the ‘destination’.
The credit works by offering companies up to 25% of their R&D expenditure, either as a cash sum or as a reduction in their Corporation Tax bill. It’s also provided over and above the standard rate of 12.5%, which means the relief is actually worth a very lucrative 37.5% altogether.
The reality is that although the R&D Tax Credits scheme is open to any business in any sector, it’s all too easy to make a mistake in applying. When the Revenue detects an error it will raise questions that will hold up your claim - they may even launch an investigation into the wider tax affairs of your company. Obviously this can have serious and unpredictable consequences which are best avoided.
Discover all about the scheme on our R&D Tax Credits page.
Don’t risk it - use the Tax Cloud portal today
With the application process for R&D Tax Credits being notoriously complex, the team of R&D experts and accountants at Myriad Associates developed our Tax Cloud portal. Simply enter in your own company figures and follow the steps in creating an effective, accurate, completely optimised claim. Fully supported by Myriad, you can speak to us at any point along the way too.
Not only is the portal excellent value for money, you’ll also benefit from our 100% success rate. So why take the risk?
- Submitting R&D tax claims since 2017
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Meet some of the team behind Tax Cloud