This month’s blog has been submitted by innovation expert Stuart Hartley prior to a series of free workshops Stuart will be running for the Marches Growth Hub Shropshire https://www.linkedin.com/in/hartleystuart/
Why Innovation Matters
In today’s rapidly evolving landscape, innovation is no longer a choice reserved for individual enterprises; it has become a vital source of national economic growth.
An Australian government website states that “Companies that do not invest in innovation put their future in doubt. Their business is unlikely to prosper, and they are unlikely to be able to compete if they do not seek innovative solutions to emerging problems”.
Research highlights the key traits of successful small to medium-sized enterprises (SMEs):
- Success is closely tied to innovation.
- Innovative means growth: businesses that innovate grow stronger and fare better than those that don’t.
- Capture market share: Thriving businesses innovate, gaining more market share and profit.
Developing new products or services helps maintain market share and profits.
As the environment changes, developing new products becomes vital. Shifts in people’s beliefs, desires, and laws bring opportunities and threats. Rivals may also introduce products that challenge existing market positions.
Consequently, businesses need the capability to respond through innovation.
And remember, the advantages gained through innovation are gradually eroded as others copy. To avoid falling behind, organisations must keep innovating.
Other businesses may take the lead by changing their offerings, processes, and business models, so staying innovative is the only way to keep up.
| Mechanism | Strategic Advantage | Examples |
| Novelty in product or service offering | Offering something no one else can | Introducing the first MP3 player, DVD, Digital Camera |
| Novelty in process | Offering it in ways others cannot match – faster, cheaper, higher quality | Internet banking, online book selling |
| Complexity | Offering something which others find it difficult to master | Rolls Royce and aircraft engines. Only a handful of competitors can master the complexities of machining and metallurgy |
| Legal Protection of Intellectual Property | Offering something others cannot do unless they pay a fee for it | Drugs like Prozac and Zantac. Many specific designs, eg. Dyson vacuum cleaner, Apple iphone |
| Add/extend range of competitive factors | Move basis of competition, e.g. from price of product to price and quality, or price, quality, choice | Japanese car manufacturing, which systematically moved the competitive agenda from price to quality, to flexibility and choice |
| Timing | First mover advantage
First follower advantage Sometimes being first means you encounter problems. It can make better sense to watch someone experience the problems and to move fast with a follow up product |
Amazon – others can follow but the advantage sticks to the early movers
PalmPilot and other PDAs benefitted from the failed Apple Newton which experienced technical difficulties |
| Robust platform design | Offering something which provides the platform on which other variations can be built | Intel and AMD with different variations of their processors |
| Rewriting the rules | Offering something which represents a completely new product or process concept and makes the old ones redundant | Typewriters vs computers |
| Reconfiguring parts of the process | Rethinking the way in which bits of the system work | Zara, Benetton in Clothing, Dell in computing |
| Transferring across different application contexts | Recombining established elements for different markets | Polycarbonate wheels from luggage into children’s toys |
| Others | Innovation is all about finding new ways to do things and to obtain strategic advantage | Spotify in music
Netflix in TV and film Skype in communication |
For further information on the sessions on offer in January 2024 and to book, please see :
https://www.marchesgrowthhub.co.uk/events/from-garage-to-glory-2/
For further information contact the Marches Growth Hub Shropshire :
Telephone: 01743 250526
Email: marchesgrowthhub@shropshire.gov.uk
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