Good Innovation Management Is Key to the Success of a Small Business

No matter what size your business is, you must focus on innovation. Yet, too many still think that innovation is just about applying research and development or new technologies. In fact, however, it is about far more than that. It is about thinking outside of the box, being more cost efficient and really staying ahead of the competition.

Businessman sketching on a glass a success graph

Businessman sketching on a glass a success graph

A Definition of Innovation

Innovation for business was first defined in 1985 by Drucker. It was stated then that it was a method for entrepreneurs to find new resources for the production of wealth, or for changing the way existing resources are used in order to create more wealth. This basically means that a business, through innovation process management, implements various changes in order for them to become more competitive in the market, rivaling their competition. Furthermore, the goal is for these innovations to increase their profitability and/or efficiency. Before starting on the process of innovation, however, businesses need to be able to access new information and understand how this can be turned into knowledge. They must also be able to create resources and procedures that allow them to actually apply this new found knowledge.

As such, innovation is actually a process that can be felt throughout every element of the organization. It is not possible to change one element and simply hope that nothing else changes. Thanks to innovation, an entire organization will go through changes. This includes operations, human resources, sales, accounts and every other element of the business itself. It is for this reason that so many struggle with the implementation of innovative practice, as it requires a new company culture that is open to creativity and communication.

Six Stages of Innovation

Innovation goes through six clear stages:

  1. The definition of the strategic intent.
  2. Looking for pathways and ideas.
  3. Mapping the process of development.
  4. Applying the various decision-making processes.
  5. Implementing the actual decision.
  6. Reviewing the process in order to learn and continue.

In most cases, innovation is limited to the commitment of the business manager. In many cases, innovation is something that accidentally happens. However, if it is actually done formally, the success a business can have as a result can be phenomenal.

Implementing Innovation

So how can you make sure innovation becomes part of your strategy? It should start by making sure everybody knows what innovation is and why it is so important to the future success of the organization itself. This can be done by bringing in an external consultant, or by offering innovation training. Others improve their networking contacts by speaking to businesses that already are innovative and learning from them. Networking in itself is already a highly innovative idea, particularly because many businesses still feel that speaking with the competition is like sharing trade secrets. Implementing a culture of innovation can be hard work, but if there is a commitment from leadership and management, the results can be tremendous.