SME business guru Eric Wolfe-Murray offers her expert advice on how to generate innovation, which is critical to survive and thrive in the COVID-19 era
Every business in the United Kingdom should have innovation on its “action” list today, whether you’re a small- or medium-sized company. No matter your sector. Innovation should be a core part of your team’s thinking, it should be part of your board’s regular conversation and be the underlying continuum of any owner/manager’s everyday practice.
Innovation needs to be at the very heart of what you do – it is one of the key factors to help your business emerge stronger out of the pandemic. Innovation doesn’t have to be expensive or time-consuming. And everyone in your organisation is capable of innovating.
With Business Matters magazine reporting, in mid-June, that nearly half of the UK’s SMEs are launching a new product or service as a result of the pandemic, you need to be on the front foot now.
Here follows some key steps to fast-tracking innovation in your business today.
Step 1: Implement Reactive And Proactive Innovation
Reactive innovation is a response to changing circumstances making you adapt a process, product or service. It generally harnesses what you already know, do, make to what is going on in the marketplace around you. We saw countless examples of this in the spring as garment makers switched their production to protective clothing supplies. Are there ways you can respond by adapting existing commerce to the new marketplaces that are emerging?
Proactive innovation will see you developing products and services in anticipation of emerging market needs. It needs vision and courage. By using “build fast, fail fast” techniques you can trial projects quickly to see if they work, you can find an audience, and gain traction. Don’t spend a long time polishing up every aspect of a new product – develop an MVP (minimum viable product) to see if it works as anticipated. You will learn, improve it or abandon it faster with less cash wastage.
Step 2: Involve Everyone
Encouraging every team member to participate in innovation is crucial. Particularly in micro and small companies. They may have a production, supply or customer insight that triggers deeper questioning, leading to new ideas. They’re also a key resource – find out who’s looking to add new skills, techniques or methodology that could benefit business thinking or ways of working.
Step 3: Upstream And Downstream
Innovation is not just about new products or services. Review your whole value chain. Look at every step from suppliers through to end usage. Innovation might be a new procurement process, group buying in your locality, repurposing of existing assets to generate new income, selling into customers in new ways. You need to assess each aspect individually.
Step 4: Close Contact
Involve both your suppliers and your customers in the conversation around what they see changing, how they innovate or what their evolving worlds are looking like. You are in this together so make them part of your team. Keep them close, make them feel cared for, pick their brains.
Step 5: Business Model Innovation
Most companies only make money in two or three ways. They are often self-limited by legacy thinking and models. Looking to innovate with your business models should be high on your hit list. There are countless ways to do business, to sell, to generate revenues in new ways. You should be continually questioning how to add or adapt models.
Step 6: OODA Loop
“Observe, orient, decide and act” is a simple, highly effective innovation mantra to help SMEs drive innovation. And can help out-manoeuvre larger companies and corporations. In a nutshell, you observe the market(s) to see what is happening, where shifts and changes are occurring. Then you orient yourself with an opportunity, innovation, new product or service, researching thoroughly to see how you can seize a market advantage. Next, you make a decision as to whether to proceed having considered all the variables. Finally, you act – this can either be proto-typing/launching or abandoning the concept. Which brings you back to the start again: it’s a continual loop of opportunity, assessment and action.
Step 7: Switch Your Radar On
By being curious and continually looking around you at other companies, sectors, industries, you will see big and small shifts, adapted ways of trading, of engaging with suppliers and customers. New ideas can come from every quarter. But if you don’t have your radar on – you won’t spot them or see how to apply them.
Step 8: Look For Help And Funding
Innovating is great for your business, your team, and the UK. It should be at the core of what you do. To encourage innovation there are various financial sweeteners in place. HMRC offers research and development tax credits to large and small companies undertaking research and technology innovation and Innovate UK has some useful funding opportunities. If you are a member of a trade organisation, see what they are doing to support members’ innovation. Find out if there is a local accelerator you can join, or perhaps there is one specific to your industry. These offer support, mentorship and a forward-moving process to help you assess and develop new ideas.