Everybody (including me :)) is talking about the fact that we have to innovate. In this post I would like to tackle the question WHY you should innovate at all and not just rely on your cash cows or try to maintain the status quo.
As an intro: Change is the new constant
The business world is getting more and more uncertain, volatile, complex and ambiguous.
All industries are changing rapidly and are being disrupted by digitalization and new technologies. Even market leaders are forced to adapt and evolve their business.
Since 2000, 52 percent of companies in the Fortune 500 have either gone bankrupt, been acquired, or ceased to exist as a result of digital disruption.
In these days, traditional management is becoming obsolete as it based on historical data and prediction, but change is the new constant and therefore we have to find new ways to be prepared for the things to come. Either than trying to constantly find valid historical data, companies have to learn how to evolve and adapt, get comfortable with change and continuously run iterative processes of improvement and evolution.
Today innovation is a survival skill and should be treated as a core discipline!
So here we go with my 4 main whys:
1. Unlock new growth:
Everybody is talking about growth, but industries are maturing. Products are maturing. Innovation is the creation and transformation of new knowledge into new products, processes, or services that meet market needs. As a consequence innovation creates new businesses and is the fundamental source of growth in business and industry.
Sixty-six percent of respondents in The Deloitte Innovation Survey 2015 stated innovation is important for growth. The value of the digital economy continues to grow in size and importance in every company in every industry.
2. Stand out from Competitors:
Competitors are getting smarter, faster, and hitting the market with new and exciting products more rapidly. Innovation cycles are becoming shorter and everything new seems to be exciting these days. You have to find your new niches, be unique and aim beyond the competition.
As a company, your competitive edge lies in your ability to acquire, absorb and apply new information on changes in the needs and frustrations of your customers.
The right innovation approach will allow you to offer something unique to your customers, stand out and as a consequence create additional revenue.
3. Meet increasing and ever changing customer expectations
More personalised, more design, more convenience and a seamless user experience. Customer expectation is increasing, customer needs are constantly changing and customers are more informed than ever and options seems endless. Taking the introduction of this blog post into account concerning the rapidly changing environment, it is a tough job to stay relevant.
The right innovation approach predicts changes before they hit the market or finds unmet customer needs. If you want to have the staying power you have to find a way to constantly adapt your portfolio or products and services in a structured and repeatable way.
4. Attract the Best Talent
The workforce demographics are changing. New generations are looking for work-life blending and are seeking to get to the highest level of the Maslow pyramid: self-actualisation. Innovators are looking for new challenges and want to create something meaningful. They want to have an impact.
Companies who can attract, engage, and maintain diversity can leverage their workforce for a broader exchange of ideas and knowledge and therefore assure long-term success.