According to the ADP Midsized Business Owners Study 2015, 84 percent of midsized business owners lack complete confidence that they have the tools to "keep and grow the best talent." So it is clear that a key focus for 2016 will be improving technological tools that enhance employee engagement and other aspects of human capital management (HCM).

Technology can also be the key to unlocking innovation through transparency at midsized organizations. By adopting enterprise social networks (ESNs) and other forms of communication technology, organizations can encourage teams to collaborate and solve problems together. Those technologies empower your most talented employees to contribute to organizational innovation, and they can be a powerful tool for retention and engagement efforts, as well.

Why Open Innovation Isn't a Novelty

The right technology investments can foster transparency of information in a way that's beneficial to both talent and HR teams. R&D Magazine defines open innovation as the rapid sourcing of "ideas and solutions" beyond traditional product development processes. It has become a core business model for many of the world's most innovative businesses.

Innovation Through Transparency: How It Impacts HR

HR leaders should already understand that transparency is a key priority for modern employees. Entrepreneur explains that "the biggest change at the workplace in the past 10 to 15 years is a demand from employees for transparency." Modern talent wants access to information, and they want the ability to provide feedback on processes and products. For midsized employers with aggressive growth strategies, using technology to support transparency efforts can allow for a culture of open innovation and information-sharing to scale, even if that growth happens very quickly.

In a tight talent market, improved retention could be a primary benefit of technologies that support innovation and transparency. Fast Company highlights that "a culture that values transparency and access will breed trust and loyalty." In a time when skilled employees are at a premium, technologies that foster employee relationships and information-sharing are an invaluable tool for reducing flight risks.

How to Leverage Technology to Inspire Innovation

For HR leaders who are hoping to adopt technologies to foster open communications between talent with innovative results, picking the right tools and processes is a key factor for success.

Support real-time communications

Gigaom, a technology research firm, writes that innovation is best achieved when "tools drop into the near background." If your tools are too clunky to support the real-time conversations and information exchange needed for innovation, the potential of your ESN will suffer.

Remove boundaries

Employee platforms that place barriers between employees, such as by team or job title, may not yield good results. ABB, a power and automation technology organization, allowed their employees to raise issues and questions independently and "work together in groups organized by interest or topic, without [limitations]." The result was a surprising lift in productivity, strengthened relationships and powerful knowledge-sharing.

Ensure your culture supports the initiative

A corporate culture that doesn't support independent initiatives and open innovation may struggle to achieve full-adoption of a new employee portal or ESN. ESN usage, or lack thereof, is often a reliable indicator of the strength of an organization's culture. If your HR goals include a shift toward more enterprise-wide transparency, engaging executives and managers to adopt and promote your new technology should generate a trickle-down effect and get the whole organization to buy in.

Technologies can support relationship-building between employees and a culture of open innovation, provided your team selects the right tools and has the culture to back up your efforts.

Tags: innovation HCM Strategy Employee Engagement