Innovation – Good Idea or Not?
Innovation – good idea or not? Let’s see how that works, so you have an existing business that is doing well, but whilst doing well, a member of your staff has come up with a new idea – does this potential innovation fit the business, is this innovation a good idea or not?
At what point do you work out if you want to pursue it?
You need to sit down and ask the following and work out if it fits.
Does it fit in with your objectives?
The business has a set of defined objectives or should have that are all part of your growth plan, ie by year X you want to be selling Y to attain Z – so does this new idea work as part of this strategy.
Does it fit in with your existing portfolio?
Let’s use Apple as an example – they started out originally with computers with their own operating system that beat the trend, but then realised they could adapt this and create mobile phones with this new operating system, and they also worked on how to get music available on smaller machines that the old Walkman’s. I think you will agree that this is a relevant and connecting portfolio of goods.
Does it complete the existing brand?
This fits in with the point above, in that you don’t want to offer something under your already branded business that will fight what you have already achieved.
What are the costs involved?
Obvious I know, but before you hit the roll out button, of course you need to understand the cost implications.
Will it generate revenue and what’s the potential profit margin?
Profit margin should form part of the cost implication above, but revenue generation is slightly different.
Have you gone down the research and focus group route yet?
If not, why not? Surely you need to ascertain that it has potential. All form part of the revenue generation part of working out if it’s got legs.
How risky is it?
You have decided to go with it, but take up is slow at first, so do you have the cashflow capacity to sit on it for some months? Will it make money instantly? If it’s a large product, do you have the capacity to store it if it doesn’t sell immediately? Have you taken on new staff to deal with it, so can you continue to fund them whilst it sells?
How long will it take to get to market?
Can you fund it whilst its being produced/worked on before it gets to market is all part of working out if it’s the right fit for your business.
Does it give you a better USP that adds to your existing branding?
A simple idea that could affect the other items that you handle – will it have a knock on effect in the immediate moment that might fund the further development of it?
Is their something similar on the market now?
Working out if your idea has something that stands out from potential similar products – does it have the WOW factor or is it simpler to use, more efficient, cheaper – all have implications in getter it to market.
Is supply chain good and others on board with this?
Nothing is worse than having a great solution to something that falls down due to delays from supply chain.
Do you have funds to continue development of it?
Nothing is perfect the first time and new technology etc will always come up and encourage people to want to upgrade, therefore can you fund continued development.
Of course, they are many more questions you need to ask, that would include funding – ie do you have enough to go it alone or do you need to speak to funders/accountants etc, questions on customer service follow ups etc, processes in place and cost implications of all that.
Essentially you need to work through your new concept/process/idea to ensure you can progress it, otherwise it will beat you and some weeks/months/years later you will see someone else making a success of it.
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