An innovative strategy is a plan used by businesses to make sure they will stay relevant over time and drive growth. A business that does not have an innovative strategy as part of its core culture and baked into its running will struggle. Developing and implementing innovations can be pushed to the back burner and mean a business doesn’t keep up with the changing markets.
We at Next Studios know how much work you already put into your business, and that adding one more thing to your to-do list presents a challenge. That’s why we offer our business innovation consulting services to walk you through every step of the process in coming up with your innovation strategy in business without taking time away from everything else you need to do in a day!
What Are Examples of Innovation Strategy?
The best way to answer the question “what is innovation strategy?” is to just go through an example of one that works well.
Let’s say a large car manufacturer makes innovation in product development one of their top priorities, because they recognize the changing landscape of what customers want in a car. They want to stay ahead of their competition. Part of their innovation strategy, then, is to incentivize their engineers to come up with new design ideas by giving large cash bonuses for each patent they develop. The company offers workshops for developing and submitting patents for their engineers to attend. After some success, they even put on quarterly awards ceremonies to present employees who have been awarded patents with plaques and bonuses. The result? This car manufacturer receives more patents than any others in the automotive industry, and offers a more diverse range of vehicles. It’s all due to the innovation strategy.
This innovation strategy example shows that innovation can be baked into the daily operations and culture of a company. A business saying they “value innovation” without doing anything to prioritize this value is much less likely to truly create innovations. A business that consistently provides support to its employees and a clear process for using innovative ideas will succeed much more often.
Creating a company culture around innovation will normally include 3 elements:
- Providing paid company time to employees to develop innovative ideas – like hosting patent development workshops in our above example.
- Having a clear process in place for innovative ideas to be used – if employees come up with great innovations, but the company doesn’t ever do anything with them, no innovation happens.
- Celebrating employee successes – recognizing and rewarding employees that come up with great innovative ideas makes it truly a part of the ongoing company culture.
What Are the 3 Innovation Strategies?
There are virtually an unlimited number of ways for businesses to innovate, but they all fall into one (or more) of three different categories.
A product based innovation strategy focuses on making changes to existing products, or adding new products altogether. The car manufacturer we talk about above is a product innovation strategy example, because it was encouraging the engineers to develop new parts or components for improving how cars work.
Product innovations are often driven by changes in customer expectations or ways of doing things. Looking forward to what your business’s customers may want from your product in the future is a good way to direct product innovation.
Process focused innovation strategies focus on how a product is made or distributed, rather than the product itself. A frequently cited example of process innovation is the creation of moving assembly line manufacturing by Henry Ford in 1913. This innovation was groundbreaking. It wasn’t about the product itself, but about the way the product was made.
A more current example is Amazon’s focus on fast delivery in the last few years. Same day or next day delivery by mail was not something that was available for most products until recently. Amazon saw that customers waiting a long time to receive their goods in the mail was discouraging many people from buying products online. So they prioritized faster delivery by introducing things like drone deliveries and made big changes to shopping experiences with checkout-free stores.
The last of the three innovation strategy categories is innovations in business models. This is typically a more sweeping difference to a company than innovations in products or processes. Business model innovation involves implementing a whole new way to do business, rather than just a change to a product you make or the way you make and deliver it.
A business model innovation might look like fundamentally changing the type of service you offer, such as when Netflix changed from only offering DVD’s through the mail to offering streaming services.
Many times business model innovations take the form of brand new companies, or new branches of existing companies. These startups or spin ups offer a whole new category of services that has never been available before. For example, Airbnb mainstreamed the idea of individuals offering their own homes to rent instead of hotels. Creating a platform making it easy to arrange was a whole new type of business that didn’t exist before.
Innovation Strategy Framework
We’ve been looking at types of innovation strategy with examples, which can provide a lot of inspiration for what huge effects a good innovation strategy can achieve for a company. Finally, let’s look at the ways in which all of these different types can actually be achieved by a business. There are three main stages in the framework of innovation strategy:
- Objective – Set a clear mission and how you will approach it.
- Strategy – Lay out the exact steps and timeline needed to achieve your objective.
- Implementation – Follow your strategy to actually make it happen.
NextStudios: We Make Business Innovation Easy
We at NextStudios know that being a truly innovative business can be incredibly challenging, but the rewards it brings make it well worth the effort. Our business innovation consulting services are set up to streamline this process for your business and make sure you stay at the forefront of your industry. Visit NextUniversity, our online resource to help existing businesses become more innovative or contact us to take the next step in business success today!