|Inspiration, influence, and originality – these are the values required to create something new, especially in our modern era of changing demographics, technological advancements and increasingly globalized markets.
To adapt in the world of 2020, designing and building newer, better things is the way to attract consumers. If there’s three things the buyer of the current era expects, it’s more change, more brilliance and more modification.
In short, consumers expect innovation. This makes it immensely critical for any business or organization to focus increasingly on strategic innovation – to get rid of the old and stale and bring in the fresh and new. Of course, change for the sake of change is never the correct path. But inaction for the sake of inaction can also have catastrophic implications.
Nolan Bushnell, the renowned businessman and electrical engineer made famous as the founder of Atari Inc. and Chuck E. Cheese’s Pizza Time Theatre, believes not enough business people value the importance of innovation.
“Innovation is hard,” says Bushnell. “It really is. Because most people don’t get it. Remember, the automobile, the airplane, the telephone, these were all considered toys at their introduction because they had no constituency. They were too new.”
Whether your business is known for its products, services, or more abstract factors like iron-clad brand loyalty or captivating, Mad Men advertising campaigns, your next success is only as great as your next innovation in those areas that make you successful.
While cliché, “adapt or die” does serve as a powerful reminder – in the face of market changes and unforeseen consumer demographic shifts, stagnation is a recipe for disaster.
In fact, nearly half of Americans believe that growth in technology has been the biggest improvement to life in the past 50 years, which means that companies and non-profits have increasingly been forced to embrace innovation in order to separate themselves from competition and ensure their relevance moving forward.
Simply put, companies cannot afford to stay afloat if they do not embrace innovation and change. Here are three critical factors on the importance of innovation in business.
Innovation Helps Companies Grow
If you want to grow your business, whether in size or profit, you have a couple options. You can either choose a slow, incremental strategy by perfecting your existing products, services and models, or you might choose a more rapid approach, growing through mergers and acquisitions – a faster strategy, but certainly more expensive.
Depending on your business, a better strategy could be rethinking and revamping your product or service model from the ground up, leading to rapid expansion and an ability to quickly scale your organization.
In a recent survey conducted by The Boston Consulting Group, 79 percent of surveyed executives claimed innovation ranked among their top three business initiatives. Furthermore, the BCG notes that organizations consistently earning high rankings in the annual “top 50 most innovative companies” all have a common focus on science, technology, and development. These companies continue to grow while staying one step ahead of the competition because they value the positive impact of innovation on the success and evolution of their businesses.
Innovation Keeps Organizations Relevant
The world around us is constantly changing – between a global pandemic, technologies evolving at warp speed, and the sociopolitical changes associated with the two — businesses need to adapt to these new realities.
Technology continually proves to be a driving factor in the need for change. To quantify the recent impact, look at the facts:
· 90 percent of the world’s data has been created in the last couple of years.
· More than 570 new websites are created every minute.
· 8 billion devices will be connected to the Internet by 2020.
These changes have resulted in an unparalleled new age of innovation across business models and industries, allowing new businesses to enter the market and disrupt incumbents in serious ways. In fact, executives today believe 40 percent of Fortune 500 companies will be wiped out in the coming decade due to this level of digital disruption. Just as a fresh, millennial-led start-up innovates in order to break into an industry, established organizations need to do the same in order to fend off their nouveau-riche competitors and remain relevant in this changing environment.
Innovation Helps Organizations Differentiate Themselves
At the core, innovation is about doing something differently from everyone else existing in your vertical or space. If your organization is innovating its products, for example, then the goal is to develop or update the products until there is nothing else on the market like it. If your organization is innovating its processes, it’s because doing so will save you time, money, and other key resources, providing the competitive advantage necessary to beat out stagnant rivals.
The status quo is effective for a time, and any good owner or CEO knows there’s a time and a place for change. But just as Rome fell in 395 AD, so too does every organization crumble when it doesn’t recognize the threats at its metaphorical gates.
While delivering value to your customers should always be a company’s main focus, doing so in a way that is memorable and different from competitors can become a standout element of your brand identity and business strategy.
In conclusion, business leaders must think creatively and innovatively in order to drive business growth, stay relevant in changing times, and differentiate their businesses from the competition. This doesn’t mean that a willingness to innovate is the only ingredient for success, however: leaders must also have a solid understanding of how to go about bringing that innovation to life.
No matter your industry, no matter the economic climate and no matter the size of your organization, strategic, intelligent innovation is one of the key ingredients to success and growth.
This article was inspired by concepts developed in The Lean Startup by Eric Ries as well as the The Innovator’s Guide to Growth by Scott D. Anthony, Mark Johnson, Joseph V. Sinfield and Elizabeth J. Altman.