At G2 Innovation we have come across a number of myths associated with the concept of Innovation. Here are our top 3 myths.
1. Innovation is all about invention.
‘Innovation’ is closely linked to exciting market entries, medical research and technological advances, so it’s not surprising that the majority of people associate innovation with inventions.
The problem is that focussing on the invention only is an expensive, resource heavy and potentially wasteful exercise.
All we have to do is look at the patent database. Only 3% of patented products make any money for anyone.
Innovation has to be innately about commercial success, otherwise it becomes redundant.
True innovators identify a market need or opportunity, analyse the financial returns and then develop a solution which meets these aims.
There are businesses everywhere investing time and money into coming up with ideas, then even more time and money proving that these ideas work perfectly, rather than talking to the market first and identifying the opportunity forcommercial return.
Likewise, consultants in this field love to brainstorm, use ideation tools and problem solving techniques without first asking the questions: What does the market need? How much money will this actually make?
At G2 Innovation we focus first on establishing the market need, then taking the idea to commercial success.
2. Innovation is expensive and risky
When businesses feel under pressure to get a product to market quickly, they often spend excessive amounts of money refining the prototype to prove it works perfectly.
We encourage businesses to make a low-cost prototype and test it on the market.
If the inexpensive model fails to excite the market, then 9 times out of 10, so will the expensive model. In some cases, the difference between failure with a low-cost prototype versus a perfect prototype can be the difference between the life and death of a business.
We also find that many people are unaware of the tax breaks available to businesses that are undertaking a research and development programme. For instance, the HMRC’s R&D tax relief scheme exists to encourage investment in research, development and innovation by UK companies.
The benefits are huge with companies claiming back between 9p and 33p per pound spent on development. R&D tax relief can be used to reduce corporation tax payments and even loss-making businesses can benefit. The sums involved can be sizeable.
3. Innovation is only the responsibility of Senior Managers
In many organisations, Innovation is the responsibility of senior managers or at best an Innovation department.
However, in the same way that the 1980’s and 90’s saw the introduction of total quality management systems in the workplace, in this age, innovation must encompass the entire workforce.
Innovation should infiltrate company ideology and every member of the workforce should feel empowered to improve and enhance their own duties. This is called a Culture of Innovation and can be the least expensive form of innovation.
For instance, an office based employee who finds a quicker and faster way to process and communicate client information across departments has just innovated a process, whilst the monetary cost to the company is negligible, the commercial benefit is considerable.
Every strand of business from products and processes, financial and risk management, talent development, branding and promotion, should be included within Innovation.
Once your employees have bought into this strategy they will feel more valued and the result will be a more committed, engaged and productive team members.
With Innovation de-mystified, it’s easy to understand why an increasing number of businesses are beginning to invest resources into creating a Culture of Innovation. The costs can be kept low, but the potential for success is high.
If you're looking for a team to help you develop your product ideas we'd love to hear from you. Or if you'd be interested in talking to us about your potential R&D Tax Relief claim, please get in touch.