Research shows that innovative firms are on average two times more profitable than other companies. But that is certainly not the only reason which justifies the need to innovate.
By innovating, you can:
- Distinguish yourself from the competition and build brand value
- Respond to the increasingly shorter product life cycles
- Increase labour productivity
It is important to remember the following: the customer will ultimately decide on the success or failure of your innovation effort. Therefore, it is imperative that the needs and wishes of the client are taken into consideration during the entire innovation project!
Innovation is not only about coming up with new services and products, but also about improving what you already have or what you are already doing. For example, are there new markets that you can tap into, or can you improve your service to customers? Give customers a reason to purchase your products and/or services. Offer them something new that adds value to their lives or their work.
Innovation does not assume the following...
You have to be very creative. There is a distinction between creativity and innovation. Innovation is the process whereby the application of ideas leads to 'new' products/services. Creativity is merely one of the many ways to generate new ideas.
You come up with ideas that will cause a revolution. The most innovative companies still improve their products/services/processes with small steps. More importantly, innovation is an ongoing task that is planned and managed, just like the finances or production line of a company.
You must have your own R&D department. Innovation is also about small improvements to existing products, services and processes. It is not merely the task of R&D personnel or developers, but instead applies to all employees in every division or department.
Innovation is not a one-man-show. Even geniuses need other people to achieve innovation.
Innovation does require the following
Vision and strategy
Innovation does not fall from the sky. Do not assume that your colleague will come up with the most amazing ideas. Without a clear vision, nothing will happen. Innovation is to be embedded in the normal business process and managed just like the finances or the production line of a company.
An innovation mission and goal
The vision and strategy must be converted into a goal. The innovation strategy should be effectively communicated to, and understood by, the entire organization. Every employee in the organization must be reached, and not just the managers of the company. And do not forget: the manager still sets the example when it comes to innovation.
Within a culture of innovation, employees participate in the thinking process and come up with new ideas. New ideas should not be seen as a threat. Bad ideas have just as much right to exist as good ideas. Somewhere in that mountain of bad ideas, there is a good idea that makes the trial and error worth the effort. Reward those who come up with good ideas.
Please note that innovation can go awry. Do not concentrate on one sole innovation, but spread the risk across multiple projects.
Realize that many innovations are simply the result of a curious attitude. How can we improve this? Why is something not working? Can we create it? People who can innovate typically ask more questions, and good questions. And even if the answer is not within their expectations, they explore it further. The capacity to innovate can be learned by encouraging curiosity and creativity.
The culture of sharing
Innovation is stimulated in a natural way when a given organizational culture prevails wherein the sharing of information is a given, and where there is an openness between the various departments and with the environment. There are indeed several sources that can contribute to your innovation: your customers, your suppliers, innovation networks, academics, etc. Working with others, setting up a platform, launching a competition, setting up formal and informal networks ... allow you to collect a lot of innovative ideas.