With the ever-increasing digitization and brisk industrialization, the competition among businesses is getting even more furious. For a company to be able to stand out in this competition, being innovative is the key. Companies nowadays are stressing more emphasis on the R&D department for new researches and developments. Studies have shown that every dollar invested in R&D generates nearly two dollars in return, which further justifies the need for innovation. Thus, for a company to grow continuously, it needs to be updated with the changes around and implement its strategies accordingly.
The innovation factor (IQ) of a company is its ability to implement a positive change in all the facets from the operations to the product itself. A high IQ business is the one that comes up with a staggering product or service as it has an inbuilt innovation culture, which encourages employees to generate, pursue, and experiment with new ideas. High Innovation Quotient gives the company the first mover’s advantage as well as yields towering results for the company.
Significance of Innovation
All the heavyweight companies in the corporate world such as Amazon, Google, Tesla, and Apple are successful because of the high level of innovation. In these companies, change is central to everything they do. These companies apply a distinct employee policy, recruit young management team, and embrace new software programs to structure themselves to facilitate innovation. Likewise, for any company to achieve higher feats, change is mandatory. The growth of a company dampens if it does not change the way it is being run. Innovation requires constant changes in the methodology of production, marketing, or even the product itself.
The company that does not adopt the changes might slump down towards irrelevance. The path to irrelevance begins with the stagnation of growth, causing the company to fall by the wayside. Here, the role of the innovation quotient begins. Whether a company is young or old, it should monitor its innovation quotient (IQ) because constant and systematic self-evaluation is a prerequisite to adopting change. A business with low innovation quotient does not utilize its people, policy, products, and processes to its maximum advantage.
Growth Against Irrelevance
The standard business metrics such as profitability and market share cannot be used to understand the direction where a company is heading. These metrics are not always the accurate gauge to measure long-term success as there is a probability of getting misleading results. Companies often face the classic innovator’s dilemma. The innovators, on one hand have a sound market position and a financial capability to innovate and create value. However, on the other hand, they are excited by the current high revenue level, which might make them rigid towards ongoing services and strategies.
Innovation is a continuous cycle that companies must adopt. There is no business model that guarantees lifetime success. The market positions are always temporary and some companies such as Kodak, Nokia who thought otherwise, experienced success for some time before things started to worsen. The popularity of such companies has faded over the years and those companies are presently irrelevant. Furthermore, some companies are unaware of the proper way to invest in innovation. Though innovation is core to their success, they outsource it to consultants or start an innovation center. Companies tend to get into the illusion of being innovative through these techniques, which are pleasing to the eye but worthless and time-consuming in reality.
Measurement of Innovation
To examine whether a company has an environment that supports innovation is the best way to determine whether a company is on the path of growth or irrelevance. If the business builds an environment suitable for innovation, change is inevitable. The company is headed towards growth if the management and employees are empowered to innovate. Many successful companies rest the protocols of reporting a potent idea to the upper management, encouraging employees to discuss different types of change that could be implemented.
A company’s leadership should always believe that innovation is critical to its success, thereby making the employees come up with a process for testing, developing, and advancing new ideas. Companies must include innovation in the job description of all employees. The companies can also give monetary or non-monetary incentives if an employee comes up with a meaningful contribution. Thus, the leadership should believe in providing value to the customers and consider failure as a step towards a significant change.
Improving the Innovation Quotient
There are several activities that can help companies improve their innovation quotient. Some of them are as follows.
- Jam Sessions
Jam sessions are the free-flowing, open-discussion sessions about new ideas that are very similar to how musicians hold jam sessions. A facilitator can help guide the sessions to keep the conversations productive and capture the ideas for further development. This activity builds excitement and energy among the participants as each of them finds a way to contribute their unique perspectives to the session. In such an environment, innovation can amplify.
- Idea Boards
This is a large-format visual display of ideas that allows others to contribute information. Ideas that are still in need of further exploration and comment can begin to grow into actual projects. An initial idea often comes from just one individual who likely hasn’t had time to flesh it out. If that idea has some support, then broader input from others can help develop its body. This readiness piece is essential for growing ideas into reality. Staff can share their thoughts to the board after they have had time to examine them.
- Brainswarming
The motive behind Brainswarming is that participants don’t speak at all, unlike a typical brainstorming session. Instead, they write a problem they are trying to solve on a large sheet of paper and then attendees add their written ideas about ways to solve the problem. Meanwhile, others continue to build what is already been written by providing additional input. This method helps introverts feel equal in the process and uses the optimized knowledge of participants to build the best solutions.
To conclude, as more and more startups are emerging day in and day out, the competition in the future is bound to get fiercer. Thus, innovation seems to be an effective mantra that every modern-day company should emphasize.
Also read:Â Can Innovative Services be the Ultimate Guide for Business Survival?
Read full magazine:Â Innovative Companies of 2020
