Why It's Imperative For Startups To Keep Up With Innovation
Entrepreneur's New Year’s Guide
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For any startup to stand out of the crowd and get noticed, be it by customers, investors or just about anyone else, it is critical that they innovate. If you have nothing new to offer, it’s very easy to get lost in the crowd.
It is said that a having a culture of innovation and creativity fosters new product development. That’s not all. Once an innovation is part of a company’s DNA, it pervades all aspects of the business – it’s products, systems, processes etc. So apart from getting an obvious competitive edge in the market, there are many other ways in which the startup benefits. Here are some of them:
1. Adds entry barriers to the industry
Having little or no competition in the market is an ideal situation for any startup to flourish. So, if a startup offers a completely disruptive product or service, then it automatically has a first mover advantage, since by the time others take inspiration from the product or idea and try to catch up, you would have already made a mark and got a sizeable chunk of the market.
So, as long as you continue to innovate, you’ll remain far ahead of others in the race. Also, one you launch a product or service in the market, it automatically serves as a deterrent for many others still waiting in the queue with a similar idea, since they know that being a ‘me-too’ product, they will take longer to get noticed and cut into the market. They will, therefore, take far longer to establish their foothold in the market, as compared to the first-mover. So, the ground is cleared!
2. Helps get to the top spot and retain that position
Innovating continuously helps startups beat competition easily. 1997 was the year when Apple was close to shutting down. It was rumored that when Steve Jobs was made the interim CEO, Apple just had enough cash to pay its employees for 2 months. At that time, Apple was in the business of manufacturing and selling computer software and hardware.
Steve Jobs then reiterated Apple’s philosophy, which was to make an impact on the world by innovating, and not competing. He reminded people of things like the mouse and different fonts which he introduced. Post this, Apple introduced iconic products like the iPod, the iMac, the iBook& Power Mac G4. All these products did not have a lot of competition. They were introduced one after the other in quick succession, which left all their competitors guessing and kept Apple in the lead.
Their other innovations that shook the market, when launched, include the iPad and iPhone. The company certainly doesn’t rest on its laurels and believes in constantly reinventing its products. In fact, the only reason it’s been losing market share to its competitors of late is because experts feel that its new iPhone versions are not innovative in the real sense and are only an improved version of the initial iPhone that was a truly breakthrough product.
3. It shortens the time taken to solve a problem
If continuous innovation is a culture that is ingrained in your startup’s lifeblood, problem-solving will not be a very challenging or a time-consuming activity. As an organization pushes for continuous innovation, everyone, right from the CEO to the lowermost executive or a plant worker, gets aligned to this way of life. They can continuously think about improving the quality of work that they do.
Take the case of Toyota Motors. Many global car manufacturing companies wonder how Toyota has been able to do well in every car category that they enter? Why, or rather, how can they be so efficient in manufacturing new segments of cars with such few hiccups?
The answer lies in the close alignment of the entire production line to the company philosophy that the lowest level factory workers are the most important and efficient part of their manufacturing line. And it is here that new ideas are born! Most companies hire outsiders such as process consultants or production/ management experts to solve their problems or come up with new solutions for products. Toyota gives its lowest rung employees the training, equipment and management support to come up with innovative solutions to increase the line efficiency or to solve a problem. The results are there for everyone to see – Toyota is the No. 1 car manufacturer in the world.
4. Recycling of waste and by-products to increase efficiency!
Continuous innovation helps startups reduce, reuse and recycle the by-products or waste products that they get during production.Yes, although this may not really be the objective of a startup, it becomes a welcome by-product; and one that wins you accolades for serving the larger interest of the ecosystem you thrive in! Although the value add here may not reflect in your revenues numbers, it can certainly work wonders for your goodwill in the industry.
An unusual place to look to for innovation is the Indian Sugar Co-operative industry. The sugar manufacturers are usually located in the interiors of a state, where normal manufacturing facilities and supplies like electricity are scarce. The sugar co-operatives and farmers have come up with a brilliant solution to solve their energy problems. The dry squeezed sugarcane is converted to bagasse and used by the sugar manufacturing factories to produce electricity for their plants. Some factories are able to produce enough electricity to sell the excess power generated to the State Electricity Grid. The sugarcane waste, which had to be disposed, is now successfully used as a raw material for power generation.
Many management gurus have highlighted how a culture can eat any business strategy for breakfast. It is, therefore,very important to have a culture of innovation in every business, since that way innovation becomes part of itsDNA. With every single person in an organization thinking of bettering themselves every moment, imagine the collective power of innovative thinking! There certainly will be no way to prevent such a startup from breaking its way to the top and shaking up the competitors.