First National Bank in South Africa has created strong innovation programs to nurture ideas from its staff, and last month won an innovation award from the Bank Administration Institute.

But trying to pin down the person who runs these programs, Paul Steenkamp, head of employment branding and FNB Innovators, about how he does it isn't easy.

"Innovations are quite a magical process I think. They're elusive. … They have a life of their own," Steenkamp says.

"The notion of entrepreneurialism and innovation are inexorably linked," he says.

His definition of the term "innovation" includes an idea, plus an implementation of that idea, plus a benefit to the business. And First National, a division of FirstRand Ltd., has given birth to plenty of them.

Since starting its Innovation Program in 2004, FNB says it has implemented 5,585 new ideas. The program encourages employees to pitch suggestions, after they are documented in a website and vetted through a number of stages, to management. FNB celebrates the best ideas with an annual awards event.

Steenkamp credits FNB's ability to execute innovations to three primary factors: its decentralized structure, its strong leadership and an entrepreneurial-minded culture.

One of Steenkamp's personal favorite product launches from First National Bank is its fuel-rewards program that lets customers receive up to a 15% return on their fuel purchases made with an FNB card.

"The secret to moving accounts is innovations like fuel rewards," Steenkamp says. "They get great benefits and rewards for banking with us. … It's almost like becoming a club. "

And it's a club people want to join: within a 12-month period, 1.3 million South Africans became FNB customers, drawn in by product offerings like fuel rewards.

Steenkamp wants to clear up two common innovation misnomers about FNB: its bank-related innovations aren't just meant for the unbanked nor are they always customer facing.

"A lot of innovations are for existing customers and for improving cost-to-income ratios," he says.

First National Bank took home the Most Innovative Bank of the Year Award at the BAI Retail Delivery Conference in October. The BAI-Finacle Global Banking Innovation Awards evaluated more than 150 entries from more than 30 countries and chose the South African bank as the winner on the strength of its "top-down approach to innovation, which is literally baked into the culture."

The organizers of the competition cited the bank's annual companywide innovation contest for awarding employees for big ideas, like e-wallets and mobile phone offerings, with up to $120,000 in real money and its "Minivation" program that presents back-office employees with eBucks, the bank's rewards program, when they suggest day-to-day incremental improvement ideas, as evidence of First National doing just that.

Don't expect FNB to rest on its laurels.

"We have a position to defend," Steenkamp says. "We can't become complacent."