One of the things that most business owners fail to understand is that innovation is the key to constant growth in any business.
As a business owner, it is your responsibility to look at different ways to bring innovation to your company.
So what do I mean when I say innovation is required? What is innovation?
In simple terms, innovation means new ways to run, manage, market, sell, or operate your business which will help you to grow faster and outperform your competitors.
Every entrepreneur must dedicate time regularly to figure out the areas in their business they can innovate to perform better.
So let us understand the different areas by which you can bring innovation to your company.
1. Product or service innovation
The way product or service innovation works is by asking yourself how you can improve your products or services to make them valuable to your customers.
This means looking at all the support you can add, creating ease of use, improving your quality, offering products and services for more use cases for your customers.
It means looking at all different permutations and combinations of situations in which your products and services will be required and ensuring their availability under those circumstances.
For example, Uber initially started as a company that allows you to book a cab to travel from point A to B. They then focused on further innovating their products and services by looking at all the possible circumstances under which they can be utilized.
This way, they were able to further branch out to rental services, intercity travel, and luxury car bookings, which directly impacted in increasing the value of their services and also more revenue and growth.
So your role is to look at what more you can do with your products or services under different circumstances to cater to your customers’ needs or desires.
2. Process innovation
One of the most underrated methods that can bring drastic changes in saving cost and increasing profitability for any business is, focusing on innovation in your business processes.
This means looking at a better way to operate or perform tasks in your business that improves efficiency, outcome and reduces time.
This is where CRM systems, ERP systems, SOP creations, and business automation come into the picture to decrease your and your team’s input and increase the output from the business.
3. Innovation in strategy:
I know you must have heard this countless times that you need to have an innovative strategy. So let us demystify this entire strategy innovation terminology.
Focusing on innovating strategies in your business primarily means you need to work on 3 areas.
- Innovating ways through which you market your brand, product, services:
This means, consistently getting more insights about your customer demographics and psychographics, constantly gathering data on where and which platforms your customers are spending time on, and consistently working on marketing offers and messages to keep filling the pipeline of inquiries.
- Innovating the way you sell your product and services:
This means, looking at consistently creating better deals, better offers, and focusing on constantly increasing the perceived value of your products and services.
Innovation in driving sales also means looking at new channels and markets to acquire customers and exploring new segments of customers from the same or different markets. This process will essentially help you create a bulletproof business that will never run across revenue or cash flow challenges.
- Innovating ways through which you can increase revenue per customer:
This is where you should understand a concept called Value Ladder, which means every business must have a different mix of products and services that can be utilized to upsell or cross-sell to increase the lifetime value of your customers.
4. Innovation for increasing profitability:
One of the biggest reasons why most businesses fail and die is because the business owner does not focus on finding new ways to increase their profitability in their business.
This is where a business owner focuses on better sourcing, a better pool of vendors, decreasing fixed cost, using technology to reduce manpower, and increasing product or service ranges with a mix of high volume and high margin products and services.
In conclusion, the idea is that a business owner has to consistently look for ways to improve profitability in their business so that you never get in trouble due to any external changes or situations, and truly build a business that can scale exponentially and generate wealth for you.
So these are the different areas in which you as a business owner must focus on creating innovation to build a business that lasts.
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