You need to be innovative and improve your business to stay ahead of the competition. Innovation refers to improving or creating new products or services. But, a successful innovation needs careful balance and timing.
One may claim that you need dedicated resources, talented R&D teams, and rapid prototyping to be innovative. These are some of the best practices of business innovation. But it goes beyond that. Nokia and Kodak had resources but failed to innovate fast as their rivals.
So, if the more prominent firms can fail terribly in innovation, what can happen to small businesses? The most critical pillar in your innovation pursuit should be an innovation strategy. It will outline your whole innovation process, including picking and trading-off major innovative projects. An innovation strategy will act as a guiding light on how to:
- Search for new problems, ideas, and solutions;
- Curate ideas into concepts and product designs;
- Decide which project(s) to prioritize for funding, which is the most challenging part.
But the small businesses face the most significant challenge in innovation. They may be too busy to innovate or just short of funds and insights to out-innovate their bigger rivals.
Here are 6 ways to improve your innovation in your small business.
1. Invest in Idea Creation Platform
As a small business, innovative ideas can come from your customers, suppliers, or yourself. The idea should solve a specific customer pain point with ease and simplicity. In most cases, businesses overlook their employees, suppliers, and partners in the innovation process.
Creating a platform for idea generation from your employees, customers, and partners should be prioritized. It helps you collect quality ideas ripe for innovation. There are several free and reasonably priced idea management solutions you can tap to fuel your innovation:
These online idea generation and management tools allow stakeholders to brainstorm. Such brainstorming sessions drive relevant questions and research on variables that can transform your company and its products.
2. Innovation Coaching and Consulting
Despite having a great idea generation platform, you need experts to test their viability to disrupt the market. There are challenges that your innovation team may face with the products or business models they are trying to iterate or create.
For example, curating an innovative idea into a business concept and finally to a minimum viable product is challenging. You need to research your industry’s business models and competitor products. Besides, you need to conduct rapid prototyping and ensure your products reach the market quickly. Nokia and Kodak missed the timing and lost market share.
First, you need the right mindset and innovation training for your team. The same should be reflected across the organization because changes are always met with a certain resistance level. Secondly, you’ll need accelerated market research and testing to reduce your time to market. Innovation training and consulting will come in handy to help you scale your innovative projects to fruition.
3. Develop an Innovation Strategy
It is common for businesses to develop business strategies and highlight how each function will contribute to its goals. Marketing, finance, HR, R&D, etc., are aligned to optimize the success of the business strategy.
However, developing a clear innovative strategy with relevant support structures is rare. A strategy is a collection of coherent policies designed to achieve specific competitive leverage and goals.
As mentioned earlier, innovation involves collaborating with many stakeholders. An innovation strategy will guide you to trade off certain competing aspects of the process. For example, if you have several innovative projects, you must prioritize which ones to fund. And creating a minimum viable product template can be overwhelming, let alone getting funds.
Innovation consulting firms like Kromatic can come in handy. You need all the support you can get to have a fully functioning and effective innovation strategy. It should go beyond best practices and align each relevant function and stakeholders for maximum impact.
Without an innovation strategy, you will face:
- Trade-off crises on core elements of an innovation program.
- Different business functions may pursue divergent and conflicting priorities and goals.
Designing an effective innovation strategy will make it easy to match your innovative ideas with your competitive needs. For example, you should not imitate another invention, hoping it will work for you as it did for another rival. Take the case of Apple: despite tablets flooding the market after the release of the iPad, its consistent innovation and control of its iOS software make it ahead of the rest.
Also, R&D involves curating diverse opinions and perspectives from different groups. These diverse perspectives can kill the idea without a proper innovation strategy instead of nurturing it into a disruptive product or business model. But, having a strategy in place can help resolve issues and encourage alignment with goals.
4. Have a Detailed Understanding of Your Customer Needs
“Know thy customer or perish.” One of the notable companies that perish for failing to understand consumer needs is the smartphone maker BlackBerry. It focused on the enterprise market overlooking consumer preferences.
In the end, BlackBerry had an operating system (OS) that no one was building applications (apps) on. It lost market share to Apple and Samsung in the long run. Whatever innovation you are working on, you should ensure it solves customers’ problems.
Uber solved the irritating communication problems from taxi drivers. Also, Instacart solves profitability problems for groceries and shoppers with no shopping time. These startups are worth billions of dollars. It is also worth noting that they offered a needed solution to customers’ problems. As a result, they disrupted the industry using innovative business models (also known as architectural innovation).
5. Keep the Management and Sponsor in Loop
Before creating a minimum viable product template, you must convince yourself and your management team of your value proposition. You must determine if the innovative idea will create value and the resources needed to realize it.
You may have a compelling idea, but the management fails to commit its resources. As a result, you must demonstrate that the innovative project can capture the value and not drain resources in vain. The management and sponsors must be kept in the loop to understand every stage of the project and its potential.
Despite being a core component of competitive leverage, small businesses can find innovation extremely challenging. However, you must always strive for continuous improvement to keep up with rivals.
There are ways to drive innovation despite your busy schedule or limited funding. The above tips can help you create, nurture and release innovative projects. But, do not imitate innovations because some are not one-size-fits-all. You should know your customers’ needs and preferences to ensure any creative undertaking solves their problems.