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A recent study found that 84% of leaders at large corporations believe innovation is essential for business growth. And yet, many companies do not have an innovation strategy. If you want your company to succeed, it’s crucial to align your business values and goals with a solid plan for how you will establish a sustainable and agile business in this ever-changing digital world. Here’s what you need to know about innovation and why it’s so important for businesses today.

What is Innovation?

Innovation is the application of new ideas or methods to create value.

It can be something as small as a new way of doing things or a new product or service that meets a customer’s need in a new way. Innovation is often driven by a need or opportunity to solve a problem. To be successful, your company must be strategic in innovation —it should be aligned with your company’s business goals.

There are different types of innovation, each with its own benefits.

Product Innovation

Product innovation is the development of new or improved products. This could be a new version of an existing product or an entirely new product altogether. Product innovation can help businesses meet the needs of their customers and stay ahead of the competition.

Process Innovation

Process innovation is the development of new or improved processes. This could be a new way of manufacturing a product, a new way of delivering a service, or a new way of doing business. Process innovation can help businesses increase efficiency and effectiveness.

Business Model Innovation

Business model innovation is the development of new or improved business models. This could be a new way of selling products or services, a new pricing model, or a new organizational structure. Business model innovation can help businesses succeed in today’s ever-changing marketplace. 

Why is Innovation Important?

Innovation is more critical than ever because the world is changing faster than ever before. Technology has enabled new companies to enter any market quickly and easily. Established companies must continuously innovate to stay ahead of the competition. Additionally, customers’ needs and expectations are constantly changing, so businesses must innovate to meet those needs. 

Avoid making the detrimental mistake seen in the downfall of Kodak – fear of innovation. Kodak’s scientists developed digital technology that the company refused to build into their business model out of fear of cannibalizing profits from their photographic film. The innovation persisted, but unfortunately, it was from the competition. This decades-long strategic failure ended in bankruptcy for the industry giant.

How Can You Foster Innovation in Your Company?

As the world becomes more competitive, businesses must do everything possible to foster innovation. After all, it is innovation that leads to new products, services, and processes that can give a company a competitive edge. So, how can you encourage innovation in your company? Below are a few key ways you can foster innovation in your company: 

Encourage creativity

Create an environment where employees feel comfortable sharing their ideas, even if they still aren’t fully formed. One of the best ways to encourage innovation is simply by promoting creativity. Many people believe they are not creative, but everyone can be creative. Provide employees with opportunities to brainstorm and come up with new ideas. 

Encourage risk-taking

Allow employees to experiment and take risks without fear of failure. Encourage your team to take risks. Many people are afraid of failure, but it is essential to remember that failure is often a necessary step on the road to success. Encourage employees to experiment and try new things. Support them when they fail and celebrate their accomplishments.

Support collaboration

Encourage employees to work together across departments to develop new ideas. Collaboration is key to innovation. When people work together, they can share ideas and build on each other’s strengths. Encourage employees to collaborate, both within and outside of their department. Consider setting up cross-functional teams to work on specific projects.

Reward creativity 

Recognize and reward employees who come up with new and innovative ideas. Let them know that their efforts are appreciated. You can do this through verbal praise, bonuses, or public recognition. By rewarding creativity, you’ll send a message that you value innovation and are willing to invest in it.

Nowadays, the industry doesn’t matter—the choice is the same for everyone: innovate or fail. In this ever-changing digital world, you’re bound to struggle without a solid plan outlining how to establish a sustainable and agile business and achieve your goals. By investing in innovation, you can set your company up for success now and in the future.

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