The most prized, but often overlooked asset of any organization is its capacity to change and innovate.
This can be measured by the premium investors will pay to buy into the business.
Slow moving and growing companies are valued at very low multiples to their revenues and cash flows, while those possessive of strong brands and proprietary technology (ideally both!), and the capacity to build more of these assets are valued at very high (sometimes infinite!) multiples to theirs.
Investors realize that innovation capacity empowers that most valued coin of the business realm: Sustainable Competitive Advantage.
We live in a world where anything and everything we do can and is mimicked, copied, knocked off…
…and thus always under severe threat is our ability to efficiently attract and secure new customers , and more profoundly to sell and service those customers at price points where we can actually make a profit.
The logic is succinct: if we don’t constantly innovate and just get better, eventually, inevitably we will lose our competitive advantage and in turn lose money.
Now, “innovation” can be a scary word.
It conjures images of hotshot Silicon Valley technologists – of engineers, scientists, and programmers.
But while for sure technological prowess is a key component of innovation, it is not the only one.
Innovation, best thought of as simply introducing new ideas to change things for the better, can be imparted on any aspect of a business.
On the refreshing of its brand.
On the vigor of its culture.
On the “customer effectiveness” of its products and services.
For most companies, the easiest-to-grab and “make happen” innovations lie in process improvements.
Little things like moving from “wet” to electronic signatures with tools like Docusign, or seamlessly connecting disparate data platforms through integration tools like Zapier, or migrating business documents from desktops to hosted platforms like Google Spreadsheets, Dropbox, etc.
These little process improvements build upon one another, and as they do we have more capacity and confidence to take on big initiatives like brand and culture refreshing and the launching of new products and services.
Now, here is where many of us might feel that we just don’t have the creativity, the charisma, the technical chops to effectively innovate and grow in big ways like this.
Luckily, here is where the flip side of that brutally competitive world we all live in comes to our aid.
You see, while all of our “best stuff” is out there for all to see and mimic, so is everyone else’s!
We don’t need to come up with all of the great ideas, we can just “borrow” from what our best competitors are doing and really from any business whose stuff we like.
And no it does not mean it is okay to plagiarize.
But it is a foolish, lazy or unnecessarily prideful executive that does not take advantage of the wealth of innovation ideas available to them at the click of a button.
It is even better than that.
Not only do we not need to come up with all of the big ideas, we don’t even need to implement them!
We can hire a marketing firm to refresh our logo and brand identity.
A change management firm to refresh our culture.
Tech. developers to design and launch our new products.
We just need to always vigilantly and ruthlessly look everywhere and anywhere in our business where things can be done better.
And then act.
Slowly but surely our innovation “muscles” will grow stronger and leaner and as they do…
…our ability to grow and make money will be both more effortless and sustainable.