Why an Innovation Strategy is Essential for Your Business
Photo by Kindel Media
Innovation has been defining the market forever. Smart businesses know that to stay relevant and grow, they need to be searching for the next big thing. But constant innovation is impossible if you don’t have a plan.
Studies show that 82% of companies are approaching innovation in the same way they approach incremental growth. The problem with that is simple: game-changing ideas don’t come from everyday processes. To truly reap the benefits of innovation, businesses need to have a well-defined innovation-specific strategy in place.
What is an Innovation Strategy?
To create value for customers, employees, and investors, you have to be proactive about new ideas. Knowing exactly how your business will achieve innovation is essential to keeping up with an ever-changing market. That’s where a clearly defined innovation strategy comes in.
An innovation strategy is a comprehensive plan that sets out how your business will generate and implement new ideas. It should include tools, processes, and techniques for taking an idea from concept to fruition, as well as ways to forecast the success of an idea.
The best way to develop an effective innovation strategy is by taking a systematic approach. This means setting measurable goals, allocating resources, and building feedback loops to track progress. This way you’ll be able to continue to innovate again and again.
Benefits of an Innovation Strategy
So many companies that start with huge growth find their trajectory slowing over time. It seems inevitable in hindsight, but it can take a business off-guard if they aren’t planning ahead.
There are so many benefits to focusing on innovation at all stages of your company’s development. Growth and sustainability are only the beginning.
Product Development
A strong innovation strategy will both improve your existing products (and/or services) and help to develop new ones. When you are constantly improving in this way, your customer satisfaction will skyrocket, and you’ll find your market share continuing to increase.
Businesses with a solid innovation strategy can do this with way less risk involved because they have a tried and true process.
Optimization of Revenue and Costs
An innovation strategy also allows you to optimize both revenue and costs. With the right tools in place, you can save money on research and development while still increasing your top-line growth.
Whether your innovations lead to lower production costs (such as using cloud storage or chatbots) or a growing customer base, it’s sure to increase your bottom line.
Provide a Clear Vision and Focus
Another major benefit is a better decision-making process with a framework to follow. You can avoid making decisions that are based on a gut feeling by sticking to the strategy. Instead, all of your decisions will be driven by data and analytics.
You’ll also be able to ensure that every department is on the same page as they know exactly what the plan and process will be going forward. Your employees will get excited about innovation because they can see that you are committed to investing in their skills and development.
This leads to improved morale and motivation, which in turn leads to better performance.
How to Develop and Implement an Innovation Strategy
Creating an innovation strategy may seem like a daunting task, but it doesn't have to be. By following a few simple steps, you can develop a strategy that will help your business stay ahead of the curve and continue to grow.
*Stormboard is an innovation-driving tool with templates that can help organizations develop and implement an innovation strategy at every stage.
1. Know What You Want
Before you figure out how you’re going to innovate, you need to know what you are hoping to achieve. This will keep all your decisions on track and prevent you from spending time and money doing something that will not move your company forward.
Take a look at the long-term goals for your business and determine how innovation can help drive them.
Do you want to be the most used brand in your field? Do you want to create the next household staple? Is your customer satisfaction at the top of your mind?
These core values will determine how your strategy ultimately takes shape.
*Stormboard has various high-level corporate and team strategy templates to help businesses define goals and weigh different approaches.
2. Understand the Market
To innovate, you need to understand what your target market is looking for. This means keeping up with the latest trends and having a finger on the pulse of what your customers want.
Your market research should include your competition as well. See what they are doing and figure out how you can do it better. It’s important to always be aware of what’s happening in your industry so that you can adjust your strategy accordingly.
*Try starting out with exercises such as customer journey mapping, buying motivations, or market perception mapping.
3. Know How You Will Create Value
Innovation should always be focused on creating value for your customers. This value proposition could be a new product or service, a better user experience, or a more efficient process. This is how you will seize a competitive advantage.
You should focus on making your competition irrelevant to your growth by making your business model challenging to emulate. Don’t just increase market share, decrease costs to make it impossible for others to follow in your wake.
*Conducting a value differentiation evaluation can be an insightful exercise for this step.
4. Find your Fundamental Capabilities
Your company’s capabilities are the foundation for your innovation strategy. You need to know what you do better than anyone else and use that to inform your decisions. What processes or technologies can you leverage? How can you create a competitive advantage?
Consider your company culture, values, and knowledge. All of these things and more will be a part of your unique strategy.
*The popular Strengths, Weaknesses, Opportunities, and Threats (SWOT) analysis can help you gain a deeper understanding of your organization, product, or approach.
5. Put in Place Your Innovation Techniques and Systems
Now that you know what you’re working towards and what tools are at your disposal, it’s time to start designing your strategy with techniques and systems for success. This will include the organizational structures, processes, and resources necessary to support innovation.
It’s important that everyone in the company understands the importance of innovation and is on board with the strategy. This means creating a culture of innovation and giving employees the freedom to experiment.
*Making sure there is an easy way for every team to reference the strategy, share ideas, and stay up to date on progress will be vital. Invest in innovative office solutions like Stormboard to promote a more collaborative workforce.
6. Continue to Evaluate Your Innovation
Some innovations will change the landscape of the marketplace right away, but others will simply secure your company's place within it. This is why it’s so important to track your business innovation.
You should keep an eye on some essential aspects of innovation. This could be your ability to develop and launch innovations before your competition, your team’s motivation, or the scalability of your profit sources. Knowing which areas need work will help you continue to innovate in the right direction.
Conclusion
Many companies mistakenly believe that innovation is something you do after everything else is taken care of — that it’s a luxury to be pursued only when the core business is strong and there’s extra cash on hand.
But in today’s hyper-competitive, global economy, that approach is no longer enough. To succeed, companies must prioritize innovation and treat it as a discipline that requires deliberate effort and attention.
If you take the time to make a plan for how your business will innovate going forward, you can gain a competitive advantage and stay on top.
Keeping your ultimate goals in mind, staying aware of market trends, knowing your strengths, and investing in innovative office solutions will ultimately pay off in less risky, more profitable innovation.
Don’t let your competition take you by surprise. Start working on a strategy for continued growth now. Ultimately, finding your company’s strengths and planning how you’ll use them to your advantage is the easiest recipe for innovative success.
Stormboard is a data-rich collaboration space — perfect for jumpstarting innovation strategy planning and following through every step.
Speak with one of our enterprise experts today to learn how global leaders in innovative products and solutions are using Stormboard to drive better outcomes.
About the author:
A programmer by trade, Nick Saraev is a freelance writer and entrepreneur with a penchant for helping people excel in their careers. He's been featured on Popular Mechanics & Apple News, and has founded several successful companies in e-commerce, marketing, and artificial intelligence. When he's not working on his latest project, you can find him hiking or painting.
