Innovation for Growth: a new report from SINC
Croydon-based incubator Sussex Innovation Centre shares a taster of its new white paper. Read on for a full download.
The unprecedented events of the past year have forced us all to innovate in order to cope with a world that was never envisaged. We saw pivots, digital transformation and a surge in e-commerce all in the space of a few months. Closed shops and restaurants had to take their offer online while other businesses had to employ new technologies to cope with a sudden move to remote working.
These changes came out of necessity, however, businesses should always be looking for ways to evolve in order to stay competitive and find opportunities for growth. It is often easier for start-ups and SMEs to innovate as they are more agile, flexible and able to take risks than larger organisations. This is something we see within our membership at Sussex Innovation Centre (SINC); our community of ambitious start-up and scale-up businesses all innovate in their own way.
We understand that having a clear innovation process is critical to a business’s growth and success. We’ve recently published a white paper to share some of our insights from helping entrepreneurs, start-ups and scale-ups across the South East to innovate. Here is a taster.
The 4 Ps of innovation
At SINC, we use Tidd and Bessant’s “4Ps of Innovation” model as a framework for organising and managing the innovation process in businesses. The model states that there are 4 key areas that businesses can interrogate as they look for opportunities to innovate:
Product innovation is the most familiar and recognised kind. It can apply to an entirely new style of product that shakes up an existing industry (like the first iPhone), or incremental improvement within an existing product category (like the one-upmanship between major smartphone manufacturers ever since).
Process innovation is an internal change that focuses on operations, productivity or supply chains. The famous story of Henry Ford and the first mass-manufactured automobiles is the perfect example of process innovation. In recent years, process innovation has played into branding and public perception, with companies adopting more sustainable and ethical practices.
Position innovation is slightly harder to pin down but can result in the biggest shifts in the way a market behaves. It is about changing the contexts in which a company’s products or services are introduced, capitalising on the strategic advantages of the current business to unlock a new audience. A company like BIC – who went from manufacturing cheap and reliable pens into similarly cheap and reliable razors and cigarette lighters – are masters of position innovation.
Paradigm innovation is best thought of as a challenge to pre-existing business models, informed by the way consumer demands are changing. Changes to paradigm are responsible for some of the most famous ‘disruptive tech’ innovations. One example is Spotify, which changed consumers’ habits from buying one-off physical products to a subscription streaming model.
Innovation for growth
Innovation is about enabling and shaping change. It gives businesses a way to move forward and stay relevant, as well as a way to control improvements. Innovating in any of the 4 key areas, either radically or incrementally, creates new opportunities.
However, it is important to remember to innovate with the customer in mind. New products or services should solve problems that formerly had inadequate solutions or none at all. In our white paper we discuss the “job to be done” theory, developed by disruptive innovation expert Clayton Christensen, which provides a framework for defining, categorising, capturing and organising customer needs. According to this theory, people buy products or services to get a job done: as Harvard Business School Professor Theodore Levitt said: “People don’t want to buy a quarter-inch drill. They want a quarter-inch hole!”
Read the report
Innovation has been essential for survival through the pandemic, and in the post-pandemic world it will still be essential for any business that wants to thrive. For more guidance, you can sign up to read the Innovation for Growth white paper and our other insight reports.