There are several schools of thought about the connection of “innovation” and “small business.” Hit your search tool and type in “innovation and small business.” What you will find is a plethora of ranking articles about “how” to innovate, “5 steps”, or my favorite “promoting innovation.” What I’ve noticed to be missing are ways to generate ideas for innovation. Let’s explore what innovation really is and how to integrate it into your success!!
Level set on Creativity vs. Innovation
Over the years there has been a competition of sorts between the term’s “creativity” and “innovation.” Alan Weiss and Michel Robert in their sage work on innovation; The Innovation Formula have a fantastic clarifying description of the two words. They say, “innovating is the systematic anticipation, recognition, and exploitation of creativity and change.” I think this is one of the best summaries I have ever heard. Not only does this encompass the idea that innovation is a system, it also identifies that it is reliant on creativity and change. So how do you build a system around innovation that you can drive culture and propel your business to new heights…you must know where to look for opportunities!!
What happens if…
Blockbuster to Netflix, Myspace to Facebook, Walkman to iPod, the list goes on. There are just too many examples to list, many very sad, that failed or endured their businesses fundamentally changing because of their inability to innovate. Many of these companies were at the top of their industry/niche. It’s certainly reasonable that they were busy “doing” their business and not “anticipating” their business. As a result, they were negatively impacted by a competitor who exploited creativity and anticipated what was next.
Size Doesn’t Matter
What size company is the right “size” to focus on innovation? Well, the answer to that question should be obvious! We should certainly all agree that every company needs to be focused on innovation. If you are a part of a multi-national company, innovation is important. If you own a local landscaping company, innovation is important. If you provide a service, if you provide a product, innovation is important. No matter what the position or stage or niche of your business, innovation should be recognized as the DNA of growth!!
The Search for Opportunity
So, if innovation is of such importance, then what are some of the ways to identify and evaluate innovation opportunities? One way is to look in areas of your business that might be inconspicuous. Areas of change, growth, and creativity can be great places to look for ideas. Below are just a few of the areas that could generate some real possibilities:
|Places to look…||An example of a question might be…|
|Unexpected Successes||What unexpected product successes have you or your company had recently?|
|Unexpected Failures||What customer segments have proven to be unexpected failures recently?|
|Unexpected Events||Have any expected external and internal events combined in an unexpected way?|
|Process Weakness||What bottlenecks do your processes create?|
|Changes in Industry or Market Structure||What changes are occurring at your competitors?|
|High Growth Business Areas||What areas of your business are growing faster than the industry?|
|Converging Technologies||What would be the ideal convergence of technology in your business?|
|Demographic Changes||How is your mix of customers changing?|
|Changes in Perception||What new purposes have customers purchased your products and services for recently?|
|New Knowledge||What new knowledge has recently become known about your business or to you from another business?|
|Value Authority||What value are you delivering that your customers recognize?|
These questions and others are great starting points for identifying areas that can create opportunities for innovation. It is important however to recognize that once ideas are generated, they must be assessed, developed, and implemented. So to be clear, developing ideas is really the first step. But what really matters is that the first step is the one that most small businesses miss. Building a process and culture for generating innovation is a strong competitive advantage for any small business. Innovation is the pathway to Blue Ocean markets
Develop a “Blue Ocean” Future In their book Blue Ocean Strategy, W. Kim and R. Mauborgne refer to “value innovation” as the cornerstone of creating a blue ocean strategy. The idea of a blue ocean strategy is to invest in non-competitive marketspaces as a way to remove the dynamic of status quo competition and focus on creating value in uncontested places. It is a natural connection between innovation and blue ocean market opportunities. Every small business can benefit by looking at their business through the lens of where the competition is not.