How much is your innovation spend? This is a question often asked by those who ‘don’t get it’. These are the people who do not understand the concept of innovation and what it can do for them.
There have been many reports, with many more still to come I expect, that analyse the spend of companies on R & D. This is not a direct spend on Innovation but is directly linked. A recent report showed that techMARK firms in the UK claimed to be spending as much as 0.4% of revenue on R & D whilst the average spend over industry sectors was no more than half this figure. The report also states that the spend on R & D is increasing by as much as 4% per year (source Cambridge Design Partnership http://cambridge-design.co.uk/news/patent-box-report).
These figures are very rough and ready but let us take an example of a reasonably sized company with a turnover of £50 milliion. 0.4% of this is £200,000. Your R & D lab would really like to get its hands on a sum like this but what if I suggested to you that ‘real’ innovation could have a much greater effect on the fortunes of your business and could actually cost less?
Read more Business Creativity and Innovation blog.
At this time of year I like to ponder the things that happen at Christmas and then find humorous ways of saying why they could not possibly happen. For example:
- Jingle Bells (and other assorted tunes) – too loud, causing environmental noise pollution and hearing damage
- Christmas dinner – responsible for obesity epidemic, only healthy eating lunches allowed
- Christmas presents – in order to hit recycling targets no wrapping paper is to be used
- Three wise men – how wise are they, set up league tables for comparison
- Santa’s Outfit – not suitable for visually impaired/colour blind people
- Gifts for baby Jesus – select alternative gifts as current ones are choking hazards
- Sleigh delivery – restrictions placed by RSPCA on reindeer speed due to potholes caused by government cutbacks
- Dining table – workstation assessments required due to incompatible dining chairs/table combinations
And there could be many more!
The point is that it is possible to raise objections, cancel events or avoid taking actions altogether by hiding behind ‘the givens’. Normally these are rules and regulations but sometimes these are just personal or organisational barriers that can be demolished if we have the will to.
So let’s turn this on its head. If we can find lots of reasons not to do something as big and fun as Christmas, just think what we could all do next year if we demolished all of the silly barriers or objections that stand in the way (or which we put in the way).
No matter your strategic objectives, market disruption is a brutal fact of life for many middle market companies. Everywhere are the corpses of once-triumphant corporate behemoths who have fallen victim to disruptive innovation. Rochester-based Kodak, once the world’s largest producers of film, decided not to pursue the market-revolutionizing digital camera while its competitors did. In the end, Kodak’s film business would be disrupted and the company would file for Bankruptcy. Having strategic objectives is fine, but be prepared for disruption — and try to lead it.
Middle market companies should be driving disruption. This is not limited to technological innovation, according to the pioneer of disruption theory, Harvard Business School Professor Clay Christensen. Disruption is about serving customer needs that are going unmet. For example, the growth of the Internet created new opportunities for people to use online search capability to collect information about local restaurants, auto repair shops, and an array of local service providers. Users benefited by avoiding the cumbersome, clunky Yellow Pages. But it wasn’t until San Francisco-based middle market company Yelp arrived in 2004 that all this information was made accessible on a single, easily searchable website. Yelp has rendered the Yellow Pages almost irrelevant by offering added-value information such as customer ratings to local, online directories.