What is innovation and why is it important?

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What is the driving force of successful companies, you would ask? I would answer, innovation!

The importance of innovation is highlighted in your company’s competitiveness, ability to reach its vision, getting the perfect product/market fit, and finally, hitting your revenue goals to accelerate your growth.

As an innovative company, you firstly need to have a clear understanding of what is innovation. Let us untangle this Gordian Knot which never comes down to a single definition.

1. What is innovation?

Innovation does not come on its own,  but it has some peripheral attributes that we need to discuss first.

Creativity is the source of all the buzz created around innovation and entrepreneurship. It is defined as deviation from what is normal, in other words, the shift from the status quo and an ability to do/see things in a new light.

Carrying these mind-blowing ideas in your mind can be a bit heavy for you, therefore, you would rather bring them to life. When you apply your creativity and get something tangible that can be measured or evaluated, you innovate.

It includes:

• Understanding and responding to the market need/demand,
• Evaluating and using available resources,
• Recognizing and using opportunities,
• Envisioning the social well-being as a result,
• Making profit.

According to Prof. Mary-Hrachoohi Boghosian, innovation can be seen as (see next image):

• Thinking + Creating + Making Change
• Lifeblood of the company
• Having a vision and be proactive
• Prospective (jump the curve), futuristic
• Understanding customer’s pain & need
• Elegance, comfort, simple, unique, valuable, flexible, against the norm, profound, clear & obvious, and more.

2. What Are the Types of Innovation?

There are 4 types of innovation that I will discuss next:

2.1 Product Innovation

This is a type of innovation when you offer new things to your customers based on the need they have. This new product that you introduce, will lead to an incremental change in the market and will ultimately affect the market.

2.2 Process Innovation

This innovation is way to improve your business operations by making those more efficient and effective. This can be achieved through new technology, new methodology, digital design and more.

2.3 Service Innovation

Service innovation is similar to Product innovation, however, in this case, you provide a new service, can be intangible, instead of a product. The core principles hold the same – you encounter customer needs and demands.

2.4 Business Model Innovation

The business model innovation assumes coming up with a new way of serving the society, running your business, and making money. This type of innovation shakes up the industry and vastly affects entrepreneurial creativity.

3. Why is It Important to Innovate?

In the introduction I introduced the main reasons why companies should innovate.

Let’s dive deeper now.

Inc.com mentions 4 reasons why companies should innovate:

3.1 Your Business Will Grow

Innovative companies manage to scale up easier since they recognize the opportunities and know how to leverage them.

Finding creative and innovative solutions to old problems, the businesses manage to irrupt to the growth stage of their lifecycle or even further depending on their current status.

3.2 You will Stand out from Competition

Imagine a straight road that takes everyone toward the same destination. Then suddenly, someone sees a shorter or faster way taking to the same place that is hidden from everybody else. The person breaks through from the conventional path and reaches the final spot first.

This is the next chapter of your story if you decide to innovate.

3.3 Your Customers Will Be More Satisfied

The needs of customers are evolving, so do the solutions. Being reactive and merely responding to buyer needs is not the way of winning the market anymore.

Innovation is the tool of proactivity. Your business needs to meet the unrecognized needs of the customers, create new ones and provide the best solutions.

This is how the world works.

3.4 You will Develop the Best Team

The best talent wants to work for the best companies, and the best companies are the ones that innovate.

The best talent, aka innovators, like to learn, explore new opportunities, analyze the past and challenge the status-quo. Isn’t this someone you are looking for to join your team?

You need to revolutionize your image today. They are waiting for you.

Having learnt about innovation, I would like to challenge you and ask, “Are you truly an innovative company?”

If you want to become one, then you should contact us and get at the top of your success.

Why would you innovate?

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