Regardless if you are running a small or large company you need innovation to keep your business running. More importantly, if you want your business to boom innovation has to be at a forefront of your business strategy.
Primes example is Blockbuster video store. While they survived switch from VHS to DVD they failed to innovate which left them in the dust closing hundreds of stores and paying off huge debts. Now they are struggling to survive instead of being at a forefront of their industry. Blockbuster is not the only company that had this issues — many others had or are still having the same issue — companies like Microsoft, Dell, Yahoo, Sears, Sony, Kodak, and remember Netscape??? Yeah, most people don’t…..
When it’s so obvious what needs to be done, why do so many companies make seemingly same mistake? These aren’t your small mom and pop stores that had no capital to work with — Blockbuster had contracts, capital and connections to become Netflix before Netflix even had a name!
The reason is — fear of loosing control. When you are running a profitable business, even with little profit, you are reluctant to make any changes in order not to destroy what you have. You have systems and processes in place and each quarter becomes predictable. Adding innovation requires change to that process, culture and brining in fresh blood — this is a very risky proposition because it can cost you everything. The only problem is that not innovating and evolving can cost you everything too it’s just that we don’t see this threat because it’s not on the horizon until it’s too late and Netflix has already taken over your customer base.
The key to successful innovation is to be prepared to risk certain amount and embrace it knowing that sometimes risk won’t pay off, but most of the time it will. Like Microsoft’s Web TV was a big flop — or Coors decided to move from making beer to selling bottled water — no, that didn’t go over well, but it wasn’t as bas as Colgate trying to make frozen meal entrées…Yup they are all attempts of innovation that failed. And failure is a big part of being innovative.
In order to stay in control of your business but, at the same time, stay innovative and on the front lines of your industry, you have to segregate resources and build in innovation as a vital part of your business strategy. Steve Jobs is known as the master of balancing great ideas while keeping control of the business processes and systems assuring steady growth. Take a lesson from Steve — think outside the box and let the creatives be creative!