The caliber of corporate innovation is a large determinant of an organization’s success. Due to their ground-breaking breakthroughs, well-known innovators like Apple, Samsung, and Uber have solidified their positions as leaders in their respective industries. Meanwhile, some large firms have lost their market share because they were slow to respond to changing market conditions. But why do business innovations suffer from a lack?
Latest Read: A Closer Look At Integrated Document Management And Accounts Payable Software
An illustration of innovation failure
In this sense, the Kodak case is a well-known illustration. How did it fail despite having a market share of more than 80% in the US and roughly 50% globally in its heyday as the leader in the photographic film? The first digital camera was really created by one of the company’s engineers, Steven J. Sasson, in 1975. But, management did not support it. It missed the fact that digital photography will revolutionize its sector.
They believed that since printed images had been around for more than a century, people would not choose anything different. Also, Kodak did not want to promote the new technology that did not require film rolls in order to hurt its film roll business. But, no one can control innovation; it will emerge in some way. And that’s exactly what had happened, causing Kodak to be forced off of its own throne in the end.
Let’s look at some of the main reasons why corporate innovations fail and, more importantly, how to avoid them now that we have a better understanding of how even large firms struggle with innovation and suffer painful consequences as a result.
Must Read: Top 10 Crucial FinTech Trends for 2023 You Must Know
Business innovations fail for what reasons?
1. The Fear of Failure
If the right conditions are not there, a seed will not grow. Similarly to this, an environment that fosters creativity is necessary for effective business innovation. Companies frequently avoid taking risks because they are too paralyzed by the dread of failure. Employees are consequently uninspired to come up with novel ideas. What is the point? is how they seem to be thinking. In any case, my employer will reject it. Giving your team members the freedom to explore, fail, and learn is the first step in creating a culture of innovation.
2. Lack of comprehension of consumer demands
Never lose sight of the people for whom you are innovating: your customers. Hence, when investing in a new good or service or updating a current one, you should constantly take into account their needs. Otherwise, you risk making a product that your target market didn’t actually need. Despite the funds and effort invested, it will be a failure in terms of creativity. Coca-Cola made the already sweet soda considerably sweeter in the late 1900s and released New Coke, a modification that the public had not requested and which they, of course, abhorred. Coca-Cola was forced to reintroduce the old recipe as Classic Coke just 77 days after it was first introduced.
Must Read: Why Is Financial Planning Important?
3. Paying Attention to Short-Term Objectives
Naturally, achieving short-term goals is a very wise strategy. But, businesses shouldn’t do that at the expense of ignoring their long-term goals. In addition, many businesses have a tendency to use the “let’s do this for now” strategy to temporarily resolve problems. The long-term effects of this are actually negative because it leaves a number of gaps that are rarely noticed. As a result, “short-term solutions lead to long-term issues,” as the adage goes. Also, businesses frequently spend a lot on marketing and sales due to the need to accomplish short-term goals. As a result, they spend a sizable portion of the money, leaving little for R&D and innovation initiatives.
