Why do some businesses thrive while others remain stagnant? What makes some entrepreneurs prosper while others fail? Is there something that catapults ventures into success – a trait missing from companies that just get by?
Potential answers are as numerous as businesses themselves, but regardless of the industry or sector, one factor is a constant: whether they realize it or not, businesses that succeed are the ones that innovate.
“The word innovation has different definitions for different people,” explains Kyle Harfst, economic development executive director of the Office of Economic and Regional Development at Southern Illinois University. “I especially like the one from businessdictionary.com that says innovation is the process of translating an idea or intervention into a good or service that creates value for which customers will pay.”
Harfst, who oversees activities of the university’s research park, small business incubator program and the local office of the Illinois Small Business Development Center as well as other programs to promote entrepreneurship and business, further simplifies the meaning.
“Basically it is the activity that comes from, ‘I’ve got an idea or I made a discovery, now how do I make money from it?’” he says.
For Curt Jones, inventor of Dippin’Dots and CEO of 40 Below Joe, a company that manufacturers coffee “beads,” innovation is all about new ideas.
“To me, it’s trying to create new ways to do things, watching the market and seeing if there are opportunities there for something new,” he says. “I always am questioning, wondering if there is a better way to do this and just keep asking myself questions.”
Business News Daily reports from a study by Accenture which found nine out of ten executives hold that the long-term success of their company will be based upon the ability to come up with and implement new ideas.
Harfst says the idea of innovation is not one just for new products or start-up companies, rather he stresses that in order to be successful, all business must be innovative.
“It’s one of those things where if a business does not innovate, it may not be around long,” he says, pointing to the stream of new products and services from companies such as Apple as an example of innovative firms. “A business may be able to get away without innovating, but to be successful, innovation needs to be a part of the core activities and that innovation has to come from being attuned to discovering what the customers want.”
“Innovation is finding the cutting edge, the out-of-the-norm, the outside of the box,” explains Kyle Loyd, director of the Illinois Small Business Development Center at Shawnee Community College in Ullin.
He says for many Southern Illinois companies, innovation comes in the form of technology.
“How can we reach more markets through social media or how can we be more effective with e-commerce? Those are some of the things where technology is a key to innovation,” he says.
Yet, Loyd says businesses have to be careful, however.
“They have to be able to blend customer service still with the technology,” he cautions. “Look for the perfect balance of cutting-edge technology with a mom-and-pop-style customer service mentality. As a millennial, I still believe that people ultimately buy people, meaning we want that personal touch.”
He adds that innovation doesn’t have to mean development of a new offering or a new app.
“I think innovation can even mean just simply doing the same old things just more effectively.”
That is T.J. Cowan’s approach. As a continuous improvement specialist for Southern Illinois Healthcare, he is looking to made processes better. In fact, SIH has a team of people assigned to the task.
“Basically, we’re just looking for ways to do things better,” he explains. “That is better, not perfect. Things change too often, so it would not stay perfect even if we were ever able to get there, but,” he stresses, “we never get satisfied even after an improvement event. That’s why we strive for continuous improvement.”
Cowan says that the organization often holds what it calls “Kaizen Events.” The name comes from the Japanese word for improvement and refers to activities or steps which involved employees at all levels and aim for gradual and constant improvement.
“You have to get all of the stakeholders including the frontline staff – everyone involved in whatever process you are digging into,” he explains. “Talk to the people actually doing the work. They know what works and what doesn’t.”
Innovation experts agree that owners and managers must look at their companies through the eyes of their employees or customers to see where changes should be made, yet often businesses take a top-down approach. The Accenture study showed that most employees feel that their companies do not foster innovation and a study by Deloitte Touche Tohmatsu Limited reported that only about 25 percent of millennials think their bosses and managers encourage the development of new ideas in the workplace.
Jones says the concept of innovation is very simple and should be a part of every business, regardless of size.
“It’s simple,” he explains. “You’re always looking for ways to improve.”
Cowan says the idea of innovation can be intimidating, but, like childhood vaccinations, he says it’s for our businesses own good.
“Innovation really is kind of a scary word,” he says. It feels like starting over. It feels like change. It feels like something brand new. It's been untested and, and a lot of times there's a lot of anxiety that comes with it.” It does not have to be that way and that's not necessarily true.”
He recommends business leaders use a very simple approach: what he calls a PDSA cycle (see sidebar article).
“It is something very basic that I think everyone can do with their existing business, even if they don’t have a team to dedicate to innovation,” he says.
Harfst says programs such as those offered by Illinois Small Business Development Centers and SIU’s Entrepreneur-in-Residence efforts can help business leaders with innovation.
Loyd adds that every business needs to be willing to change.
“Our markets change,” he says. “It’s different than it was 10 or 15 years ago. Even if the product or service is still needed, the market’s different. Innovation really is finding out how to become effective in that. The whole point is how can you better serve your demographic, your customers and how can you be a step above the competition.”
He adds, “Innovation is just never stopping moving forward. It’s a constant mindset. It’s not necessarily creating something new, it’s just keeping a top-of-mind awareness of how to be better and more effective.”