What is workplace innovation?

Organisations of every size and sector report higher performance, better places to work and an enhanced culture of innovation.

Workplace Innovation

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“Comparing like with like, organisations that introduce workplace innovation practices systematically gain 20-60% improvements across a wide range of business indicators, from productivity to employee health, engagement and well-being.”

Totterdill, P., Closing the Gap: ‘The Fifth Element’ and Workplace Innovation. European Journal of Workplace Innovation, 1,1, January 2015

We co-created the workplace innovation approach to help employers improve productivity, create better products, and improve the health and well-being of their workforces.

Our approach is helping companies to compete more successfully in challenging markets and public bodies to deliver improved services at lower cost. Its importance is recognised by the EU and by governments across Europe and Asia.

‘Workplace Innovation’ defines evidence-based organisational practices that enable employees at every level to use and develop their skills, knowledge, experience and creativity to the fullest possible extent, simultaneously enhancing business performance, engagement and well-being.

Totterdill, P., Dhondt, S., Milsome, S., Partners at Work? A Report to Europe’s Social Partners and Policy Makers, European Commission, 2002.

Workplace Innovation, what’s it all about?

Companies face unprecedented challenges in an economy dominated by globalisation, rapid technological advances, demographic change and fast-shifting consumer demands. The ability to reinvent products, services and processes continually is becoming essential for survival and success.

Tackling these challenges can’t be done by senior teams alone: they need to harness the creativity, insights and engagement of the entire workforce. Leaders need to empower others to take the initiative, coaching and supporting them towards successful outcomes. They must become the champions of employee empowerment, participation and voice.

Innovation, productivity and engagement are being discussed everywhere. So why are they so difficult to achieve?

The challenge for leaders is to take a systemic view of their own organisational structures and practices. Creating the culture of innovation and enterprise needed for twenty-first century challenges requires tenacity. It means confronting deeply embedded attitudes and behaviours, asking difficult questions, and being open to experiences from a diverse range of other organisations.

So what does the high performing, innovative and engaging organisation look like?

In 2001, the European Commission requested a study designed to analyse evidence both from existing literature and from an international sample of more than one hundred private and public sector organisations, each characterised by high performance and high quality of working life. The Hi-Res study involved collaboration across eight EU countries and more than a hundred public and private sector enterprises across all sizes and sectors. Its aim was to discover the workplace practices that could create high performance, enhanced capacity for innovation and great places to work simultaneously.

The key concept here is workplace innovation. It describes workplace practices and cultures which enable employees at all levels to use their knowledge, competences and creativity to the full. It builds workplaces in which people come to work to undertake their functional tasks in the most effective way possible and to improve the organisation. Evidence shows that workplace innovation leads to significant and sustainable improvements in both organisational performance and employee engagement and well-being.

Drawing on the findings of the Hi-Res report and those of many subsequent studies, workplace innovation’s claim to be considered as a distinctive, robust yet practically-focused approach to organisational transformation can be summarised in ten propositions:

It is part of a strategic choice, running through the organisation’s entire business model and underpinned by a long-term vision and perspectives, sustainability and ethics.
It’s strongly associated with the simultaneous achievement of high performance and high quality of working life – and contributing to wider society.
Workplace innovation is separate from – but builds on – ‘fair work’ principles such as job security, living wage, equality & diversity, and opportunities for training and education.
Leadership styles, culture, engagement and job satisfaction are not independent but are largely determined by work organisation and the structure of management and control.
Workplace innovation is focused on workplace practices grounded in substantial research and case study evidence.
It’s based on high levels of employee involvement and empowerment, combining direct and representative participation.

It is a systemic approach, recognising the interdependence of job autonomy, self-managed teamworking principles, skills-enhancing technologies, employee-driven innovation, flexible organisational structures, empowering systems, employee voice and co-created leadership.
It is not a blueprint but comprises generic principles and practices to inspire fresh innovation in each organisation through inclusive dialogue, experimentation and learning.
Workplace innovation is not a one-off. It introduces workplace practices and cultures that continually inspire and engage everyone to explore and discover better ways of doing things, harnessing creativity and talent from across the organisation.
Workplace innovation doesn’t just change organisations – it changes the people who work in them, not least senior team members and managers. It is strongly associated with trust, accountability, curiosity, creativity, coaching behaviours and emotional intelligence, all of which grow with the workplace innovation journey.

In recent years the concept of workplace innovation has been adopted by the European Commission, which launched the European Workplace Innovation Network (EUWIN) in 2013. A growing number of national and regional governments embrace workplace innovation as part of their policy platforms for productivity, innovation, skills and mental health and well-being. Trade unions in countries including Belgium, Denmark, Germany, Ireland and The Netherlands are becoming active proponents of workplace innovation as a means of improving the working lives of their members.

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The Fifth Element

The task set by EU policymakers following the inauguration of EUWIN in 2013 was to create a coherent and accessible roadmap for the adoption of workplace innovation by companies and public sector organisations. ‘The Fifth Element’ was developed by Workplace Innovation Limited as co-leader of EUWIN to guide practitioners through workplace innovation and provide guidance on its implementation.

Expanding the original Hi-Res framework, The Fifth Element is grounded in an extensive analysis of articles and case studies. The analysis identified four bundles (or ‘Elements’) of working practices with a strong association between high performance and high quality of working life (see table below). Alignment between these Elements creates a synergy in the form of the ‘Fifth Element’, a system of mutually interdependent parts which leads to a sustainable culture of innovation and empowerment embedded throughout the organisation.

Element	Indicative Practices	Associated Outcomes
Jobs, Teams & Technology	Individual discretion Job variety Constructive challenges Self-managed teams Collaboration within the team Reflective team practices People-centred technologies	Improved workflow Enhanced quality Better productivity Cost reduction Engagement and retention Improved workforce health
Employee-Driven Innovation & Improvement	Productive reflection in teams Cross-team improvement groups Permission to experiment Company-wide innovation events	Enhanced capacity for innovation & improvement Enterprising behaviour Enhanced quality & performance Learning & development Engagement & retention Intrinsic job satisfaction
Organisational Structures, Management and Procedures	Reduced hierarchies and silos Strengths-based career structure Coaching style line management Appraisals focused on learning and innovation Simplified procedures	Improved workflow Cost reduction Better productivity Engagement & retention Improved workforce health
Co-Created Leadership & Employee Voice	Openness and transparency Emotionally intelligent behaviours Visible leadership Delegated decision-making Representative participation	Strategic alignment Better decision-making Engagement and retention
The Fifth Element	Creating synergy through alignment between the four elements – a system of mutually reinforcing practices A culture of empowerment and innovation	Win-win outcomes for the organisation and its employees

The Essential Fifth Element

The Essential Fifth Element is our practical approach to workplace innovation and organisational change, grounded in extensive evidence and experience.

It has helped growing numbers of multinational companies, SMEs, third sector bodies and the public sector achieve tangible performance gains as well as improved working lives for employees.

Workplace Innovation for you

The Workplace Innovation Diagnostic®

Our employee survey is designed to give you an in-depth understanding of where change is needed and how to deliver it.

Unlike traditional engagement surveys, the Diagnostic focuses on evidence-based workplace practices associated with high performance, engagement and workforce health, and its results indicate specific actions at team, department, site and organisational levels.

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Discover Our Programmes

Our accredited Workplace Innovation Leadership Development and Change Management Programmes, together with our Short Courses, provide you with the knowledge, skills and practical resources to inspire and engage your people, and transform your team, department or entire organisation.

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Join Fresh Thinking Labs

Fresh Thinking Labs is the international open-source network for workplace innovation. Connect with leading experts and practitioners online, access a unique range of resources, and take part in practically focused workshops and webinars.

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We offer an abundance of free resources to help you discover more

FREE GUIDE

How do you build a high-performing organisation that is also a great place to work?

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FREE TASTER DIAGNOSTIC

Assess your organisation against twelve evidence-based workplace practices.

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We have published several articles and chapters on workplace innovation

click here for references

Book a free no obligation 30 minute consultation call with one of our experts to explore how Workplace Innovation can support you.

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Action Research for Workplace Innovation: Cogenerated Methodology/Method to Develop the Meaning of Work in Firms

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Friday 31st January 2025 - Action Research for Workplace Innovation: Cogenerated Methodology/Method to Develop the Meaning of Work in Firms - Unai Elorza (Mondragon University) and Miren Larrea (Orkestra-Basque Institute of Competitiveness, University of Deusto)

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Action Research for Workplace Innovation: Cogenerated Methodology/Method to Develop the Meaning of Work in Firms

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