How does value innovation achieve sustained competitive advantage for the innovating company?
Innovation is one of the keys to growing your business and increasing its competitiveness that you can include in your strategic planning process. It can help you to improve your productivity, reduce costs and become more profitable. Because small to mid-sized companies usually aren’t as capable of benefiting from economies of scale to the same extent that big companies can, the ability to innovate becomes even more important.
Show We at Viima have learned that especially in small and medium sized organizations, innovation isn’t usually anyone’s only job. In companies where no one is solely responsible for it, innovation may not be treated as a top priority. Another reason why smaller businesses may decide not to prioritize innovation is that they often have fewer resources at their disposal compared to large corporations with separate innovation units and labs. > Watch the video below to learn about re-gaining a competitive advantage when you return to the office post-COVID: The nature of innovation is often described as uncertain because it’s difficult to tell in advance which ideas will be the most profitable. Also, these profits can take a while to be realized, which is why companies with limited resources decide to invest in initiatives that are perceived less risky and generate faster results. However, if we look at startups, we can see that ideation and execution doesn’t have to cost a fortune. In this post I’ll shed some light on how you can achieve competitive advantage through innovation without having to invest tons of money. Make innovation a part of your strategy and processes Innovation cannot and should not be outsourced. Instead, it should originate within your company. Small or mid-sized organizations often innovate by making small changes to improve their operations. It wouldn’t make much sense to use an outsourced company for the job, as transferring the project takes a lot of time and still requires support. Also, because it’s not financially feasible for smaller companies to purchase innovation through acquisitions, making it a part of everyday work is the best and the most cost-efficient option. Companies that are able to make innovation a continuous practice by integrating it into the actual ways of working have a much better chance of succeeding now and in the future. Although aligning innovation with your structure might not be the easiest of tasks, paying attention to the following aspects can help make innovation a part of your strategy and ways of working:
Create a pro-innovation culture Having strategies, processes and tools are great, but these alone won’t make innovation happen. The ability to cultivate a mindset of growth and shape your culture to support innovation is as important as the right tools and processes. Culture is the collective way in which things get done in your company. It’s a combination of implicit and explicit rules and norms that help determine people’s behaviour and responses to certain situations. In other words, it’s everything your company stands for, including how and why people do what they do. When it comes to achieving competitive advantage, culture plays a significant role. In general, a pro-innovation culture means a collective and constant ambition to become better at what you’re doing. A healthy culture enables your organization to adapt to changes. If your competitive advantage is your customer experience, make sure all of your employees are on board with your customer-centric attitudes and behaviours.
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When creating a culture conducive to innovation, you might want to consider the following aspects:
Final words Innovation is all about improving your business. It’s important because it can help your organization to become more competitive and strategic. The aforementioned aspects make a good starting point if you’re looking for ways to increase innovation within your team or entire organization. The best way to get started is by clarifying your goals and communicating them clearly to everyone who will be involved in the process. Once you know what you want to achieve with innovation, you can start executing your plan in practice. Keep in mind that integrating innovation into your ways of working is often the easy part. Cultural change, however, is what takes the most time and requires constant reinforcement and development. How value innovation can be applied to achieve competitive advantage?Innovation capability is the key productivity that creates competitive advantage by perceiving or discovering the new or better way to compete in an industry and launch them into the market. One of success factor depends on innovation's relative advantage.
How can innovation contribute to the competitive advantage of a company?Product innovation provides differentiated competitiveness in terms of quality and function, which offers incentives for customers to choose. This allows companies to win competition, secure a market-leading position, and create market performance by attracting new customers [30].
Can innovation be sustained as a competitive advantage?Innovative and competitive are able to affect competitive advantage. It needs to be taken into account that corporate ability to innovate causes competitive advantage.
Why is value important in innovation?Instead of competing for market share, value innovation is designed to create new markets. The goal of value innovation is to create new demand and change the market enough to render the competition irrelevant in that market.
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