Innovation is rife in the technology sector. As it continues to evolve at pace, tech developers want to be working on exciting transformations, and due to the competitive nature of the industry, it can be easy to get caught up in the innovation hype.
However, it’s important not to innovate for innovation’s sake when starting up a business. For startups and small to medium-sized businesses (SMBs), there is a fine tightrope to be walked between innovation and capital, and getting it wrong has led to many transformations failing before they even get off the ground.
Whilst a level of innovation is essential for businesses and organisations to stay competitive and relevant in today’s rapidly changing world, when every penny counts it’s more important than ever for businesses to critically assess any investments in innovation – and not to get carried away chasing the ‘latest and greatest’ new idea or technology.
Tempering the Temptation to innovate
According to search terms,
‘Innovation is the practical implementation of ideas that result in the introduction of new goods or services or improvement in offering goods or services. It is the process of creating something new or significantly improving something that already exists.’
All of this sounds positive for businesses, however, true innovation often requires significant investment in research and development, as well as the time and resources to bring new products or services to market. Whilst many SMBs initially have very clear goals in mind, a downfall for many comes from going off on a tangent trying to solve and innovate, at a large cost, which doesn’t map back to the original business goals. Having a clear understanding of what your business’s core strategic goals are, and making sure that you stick to those during the set-up phase, is crucial.
This can be especially difficult in the tech space. Developers are by nature tempted to problem solve, but this runs the risk of getting carried away and forgetting to take a macro approach to what the underlying problem was. This in turn can lead to products or services that are not well-received by customers and if you’re not careful, you could end up innovating for innovation’s sake and creating something that no one wants or needs. It can also become costly if time and money are required to fix or even abandon the project.
Test and iterate
However, innovation should still be embraced. There is a lot to be said for trying new things and evolving the business strategy as you get feedback or hit hurdles – especially in the early stages. This is where implementing a ‘test and iterate’ model can be beneficial, rather than going straight for large-scale innovations. Experimenting with new ideas can help to keep your developers and team engaged, whilst allowing you to see which ideas work and which don’t, on a smaller scale. Not only will you avoid wasting time and money on projects that are not likely to be successful, but it will also allow you to invest in the ones that are likely to result in success.
Build innovation around your business model
With any startup or SMB it’s important to make sure you’re checking back to your original business model throughout those early years. Focus on innovation that is aligned with your business goals. Keep reminding yourself of what your long-term goals are for your business. Then ask yourself how can innovation help you achieve those goals. It is important to do this as sometimes certain innovations can lead to changes in your business model that you’re not prepared for. This can be a major challenge, as you’ll need to adapt your operations and processes to accommodate the new changes.
For customer-centric businesses like ours, we knew from the start that we wanted to base everything we did, and the decisions we made, with the customer in mind. Once you truly understand your customers’ needs, you can start to identify areas where innovation could make a real difference and avoid going down rabbit holes that may become costly mistakes.
Finally, it’s important to be realistic about your budget and resources. Innovation can be expensive, so don’t over-commit to projects that you’re not able to fully fund or support. Not only can that lead to financial difficulties, but it can also push away those that are working on projects that then get abandoned and leave you struggling to fill those crucial staffing gaps.
Be great when you innovate
Innovation should always be driven by a clear purpose. It should revolve around; solving problems, improving customer experience, or creating new opportunities for your business. Test and iterate as you grow, but ensure you are always mapping back to what you were truly trying to achieve when you set out on this business journey. The great tech businesses are those that stay true to what they set out to achieve and innovate as they go, but do so in a way that is going to solve their specific customer needs, rather than simply copying competitors. Learn to innovate, not chase!
About the author
Sarah-Jayne Van Greune, Chief Operating Officer for Payen and ILIXIUM.
Sarah-Jayne, is responsible for providing the vision and strategy to achieve mission-critical reforms for Payen and ILIXIUM, as well as harnessing advances in data management and technical service operations to best serve their clients. With over 15 years of experience in payments and back-end-technology, Sarah-Jayne can offer expertise in managing enterprise-wide data and information strategy, covering all aspects of governance, compliance, cybersecurity, policy development, risk management, and data lifecycle management.
