Why Innovation is Your Competitive Advantage

May 3, 2022

When was the last time you saw someone use a Blackberry?

Once one of the most popular smartphones in the world, Blackberry’s stock dropped by 94% between 2007 and 2016. Why? A lack of realizing that innovation should be a competitive advantage.

Amid their roaring success in the business world, Blackberry didn’t fight to keep its competitive advantage. The company integrated apps into their operating system much slower than their competitors. They didn’t invest in the touchscreen technology that others jumped on. 

You can attribute Apple’s success, on the other hand, to relentless innovation. They led the way with idea after idea, which is still one of their top competitive advantages. And Blackberry couldn’t keep up.

While innovation always has elements of risk, Blackberry’s downfall proves it’s worth working through all the white-knuckle moments. It’s a challenge to master, for sure. Instead of staying ahead of your competitors, innovation requires you to keep besting yourself. It disrupts the status quo even on the smallest levels. And that can cause feelings of uncertainty that scares both employees and investors.

But without innovation, every business stagnates.

Innovation’s competitive advantage

Having an effective innovation strategy leads to long-term success in the market for two main reasons.

First, innovative ideas help you stand out. B schools teach execs to have a unique position in the market, your unique selling proposition (USP). An innovation strategy takes that philosophy to the next level. It ensures you continue elevate your organization year after year, regardless of market conditions or customer preferences. It’s how you stay ahead of fluctuations and lead expectations.

If your business is a one-hit wonder, you won’t be able to sustain the fireworks. True innovation shows value and impact consistently over the long-term. That is its competitive advantage.

Second, effective innovation lets your company evolve with the times. Don’t wait on sales of your star product to slow down before pumping money into creating a culture of innovation.

Implementing an innovation strategy now keeps your company in a better competitive position and lessens your exposure to risk. Instead of keeping up with the Joneses of your industry, you’ll wave to them in your rear-view mirror. In practical terms, this shows itself through constant, collaborative, and supportive conversations about new ideas across every department.

Shifting company culture

How can you implement an innovation strategy? The answer isn’t just pumping the greenback into endless R&D. You’ll have a bank of ideas that run up against hurdles at every turn of implementation. With 90% of innovation taking place outside of traditional product development, it’s time to make innovation everybody’s business.

This why designing and building a culture that supports innovation at every level makes innovation your competitive advantage.

Teach every department–from purchasing to human resources to finance and sales–practical methods of innovation. Reward them for trying new things. Use failures and a public forum for learning. Celebrate the stories that bring the culture to life. Only then will there be a greater willingness to invest in innovation and develop people’s skills to make it a true competitive advantage.

But how do you motivate everyone to start?

The trick to making the shift is rewards. For behaviors, structures, and mindsets to change to make innovation a “want to” rather than “have to”, everyone needs to see the benefits.

Encourage each department to trial new ideas. Reframe failures and opportunities to learn. No new idea works out perfectly every time. Let’s face it, an idea that’s certain of success from the get-go isn’t that innovative of an idea. If employees feel that trying something new could lead to consequences, they won’t bother.

Instead, encourage and reward the process of innovation. Create healthy jealousy between teams as you praise their willingness to experiment. This will push everyone else to go further. 

Only once the company culture has shifted will new, valuable ideas begin to take root.

Lead by example

Even the most powerful incentives can’t shift a culture overnight. At every level in your company, leaders need to understand and champion innovation. Executives must lead by example, and invest with both time and money.

But popular thinking in the business world is often the polar opposite of what innovation needs. Executives have to put aside the drilled-in messages about results, facts, figures, proof, and right or wrong.

Measurability is still important for rooting out the most effective ways to innovate. But leaders need to shift their attitude and loosen their grip on controlling everything. Teach employees the skills and then trust in well-selected teams.

The onus on executives doesn’t stop there. Leading by example also means becoming innovative thinkers themselves. Contrary to popular belief, it isn’t a talent you are or aren’t born with, but a learnable skill.

Becoming an innovative leader requires the right mindset, skillset, and toolset.

I’ve already covered mindset, which calls for leaders to be open to progressive ideas. Skillset means ensuring each employee has the position’s necessary skillset as well as knowing how to think like an innovator. Toolset requires implementing idea generation techniques, such as actively championing brainstorming sessions, building rapport, and understanding how to build high-performance teams that can deliver innovative results.

Though simple in its description, when combined, these three elements can generate ground-breaking ideas at every level of your business.

Empower your employees

Management has been called the enemy of innovation, but it doesn’t have to be that way.

If every idea filters through a stream of higher-ups, many will get rejected. Of course, not all ideas can or should be acted upon. But if innovators don’t have the power to choose which projects to go after, they’ll lose motivation fast.

On the other hand, if you give people authority to put them to work, quality will skyrocket. This is because they choose what projects to invest in—meaning they have skin in the game—and get the satisfaction of seeing them through.

It takes just a few steps to balance efficiency with autonomy. Start by making sure teams are small enough to make decisions efficiently. Just as an idea passing up the chain of command is inefficient, a team too large to work together on decisions will waste time and resources.

Consider employing the “Two Pizza Box” measure. This approach says that you should be able to feed an entire team with just two pizzas. If the size of teams you have in mind don’t satisfy this rule, shrink them to the most valuable contributors.

Second, teams that have authority also need clear boundaries. Areas they should have absolute clarity on include…

– What big picture goals should they be aware of and work toward?

– What goals they are expected to reach in a given timeframe?

– How much funding do they have  for each project?

– Who should they go to if they need funding?

When a responsible team is formed with this level of autonomy and clear direction, innovation naturally follows.

Innovation with a problem in mind

Understanding the problem you need to solve is the first place any innovation effort should start. Maybe you need to solve a specific problem or address a market trend you can see coming your way.

For example, a team might try to tackle the trend of eco-friendly vehicle manufacturing. They challenge themselves with “how can we make a car that runs only on water?” At the outset, the challenge may seem impossible. Rather than giving up and moving on to something more concrete, teams need to break the problem down.

What parts would a water-powered vehicle need? How could an engine run on water? What new thinking would that require?

Eventually, you’ll dissect the problem into more solvable facets. As a team works on these beginning stages, you’ll slowly begin to find things to measure. This, in turn, reassures higher-ups of the validity of the investment. It also builds awareness, excitement, support, and collaboration with teams across the organization.

This harnesses the collective thinking of your company and ultimately creates your competitive advantage – innovation and innovative thinking.

Start making changes

To have a competitive advantage in the business world, innovation strategy is beyond essential. You have the ability to make change happen. And, if you’re an executive or innovation leader, you also have the responsibility to see it through.

Once you get started, measurable results will begin to trickle in. Eventually, this one change can push you to the top of your industry.

Even if you know where to start, it can feel overwhelming. Reach out to me for a free consultation call. I’ll show you how your business can implement these techniques and more.

Plus, you’ll receive a free PDF of my latest book RE:Think Innovation.

Photo credit: ABWI74 via Pixabay

     About Carla

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Carla is a world-renowned storyteller, an entertaining speaker, and a prolific author. Having lived, worked, and studied on five continents, she's partnered with top brands and conferences to train thousands of people how to rethink the work that they do and the impact they can have. Her visionary expertise has inspired and equipped leaders at all levels to embrace change, welcome new ideas, and transform their business.

Her work with Fortune 500 brands served as the foundation for many of her books. Her tenth, RE:Think Innovation, is a #1 new release that busts the myth that innovation is something that requires a specific degree or special training. In fact, Carla explains why, to be a successful company in today's hyper-competitive, customer-driven world, innovation must be everyone's business. Her goal is to teach one million people how to become innovators by 2025.

Consistently named one of the top influencers in B2B, digital and content marketing, Carla regularly challenges conventional thinking. Today, she travels the world teaching anyone (and everyone) how to cultivate idea-driven teams that breed unstoppable creativity and game-changing innovation.