Innovation

 An organization’s long time sustenance and growth depends on `innovation`.  Innovation is the lifeline of an organization.  Innovation may mean many things – maybe, a new product, or an improved product, or a new process, or new method or procedure within the organization, or inventions.

The Business Dictionary defines innovation

“as a process by which an idea or invention is formulated into a good or service for          which people will pay.  To be an innovation, an idea must be replicable at an economical cost and must satisfy a need.  Innovation involves deliberate application of information, imagination and initiative in deriving greater or different value from resources and encompasses all processes by which new ideas are generated and converted into useful products”.

Four ingredients form an essential part of innovation:-

• Something new: Who does not want something new?  Every second advertisement claims something `new and improved` in a product or service.  But for innovation, newness is just the beginning.
• Better than what is existing. Newness alone does not add `value`.  Is it truly better and improved?  What is new and better adds `increased perceived value`.  A new method or procedure must create something better than the existing method or process.
• Viable economically? Does the improved version save money or reduce cost?  If it is not, then it should not be produced or implemented.  The improved product should bring in more sales turnover and, in turn, more profit for the company.  Then, the innovation is a profitable addition.  If a new procedure improves the efficiency and effectiveness of the work force and, therefore, saves or improves labor costs, then it makes the organization more profitable.
• Widespread Appeal. The above three element are important and are inter-related.  However, the innovation must basically appeal to everyone; otherwise it will not sell.  If it is new and of less cost, but does not appeal to everyone, the product may not sell.  There should be widespread acceptance resulting in more sales.  Then only, we can call it an innovation.  Similarly, any change in office method or procedure, if it does not appeal, is doomed to fail right in the beginning, and it is not an innovation.

Business Innovation is how a companies improve the way they do business.  Dell Computers innovated its operational procedures to become a powerhouse in selling personal computers.  Business Innovation also means how a company operates and does business through its internal structure, its marketing strategies and campaigns and its branding and its core mission objectives.  Competitive advantage comes from companies who constantly innovate along these lines.  It is vital for a company to apply innovation to do things other than products.  A company’s innovative operations impact the branding, customer satisfaction, employee satisfaction, costs, etc. If a company out-beats its competitors on these issues, it has the ultimate advantage.

Innovation is progress and growth for a business.

Questions:

• Define Innovation.
• What is business innovation?