BENEFITS OF INNOVATION

Innovation takes place when a change is introduced that improves what is already in existence

Innovation takes place when a change is introduced that improves what is already in existence. 

Innovation in business, as elsewhere, can take a wide range of specific forms. Many of the changes ultimately concern the physical products of an organisation or its processes. For example, a modification in manufacturing plant can lead to an improvement in some characteristic of a good or alteration of the manner in which it is made, or both. A shift in management structure or philosophy can also eventually impact the product or the way certain tasks are performed.

Pursuing a creative path in business comes with a number of important possible gains.

Gaining more control over price. Innovation is one way to reduce price-reduction competition that eats away at the profit margins. New features in a product, that competing brands do not have, mean less direct comparison by customers. In other words, a newly-innovated product is effectively differentiated: it is often seen in its own light and as deserving its own price. In fact, a really revolutionary product improvement is a good passport to top-of-the-range kind of pricing and can therefore bring enormous profits.

Improving efficiency.  Higher efficiency simply means achieving the same result with less resource. Inevitably, then, improved efficiency represents cost savings. These come in such shapes as reduced raw material, waste or time. Indeed, savings in costs are rises in profit.    

Efficiency is not just about the actual process of producing goods and services. It also concerns the general way in which an organisation and its various departments or sections are administered.

Re-designing the plant or machinery used to produce; tasks and responsibilities; procedures and processes, are all examples of innovations that can lead to greater efficiency.   

Creating new consumers. It happened when double cab pick-ups were introduced. The innovation transformed purely utility vehicles to family ones as well, which meant likelihood of more users.

Extending life cycle. By continually making improvements to goods and services, marketing techniques, human skills and other relevant aspects, the life of both the products – and hence the enterprise itself – can be prolonged.

Raising profile. Strong credentials as a creative firm could bring probability to more easily attract additional capital when needed; good talent in search of an environment in which they are able to freely showcase their individual resourcefulness; and even make customers more ready to prefer their products over those of businesses less firmly associated with dynamic offerings.                 

CONCLUSION

Innovation must be part of the central business culture of an enterprise. Many big organisations that have over the years grown more and more lethargic have fallen by the wayside and their place has been taken by newer firms directing more energies toward product and operational modifications.    

Rupert Chimfwembe  30                          January 2017