By Shashi Shekhar

The history of warfare and of business, is the history of innovation that renders past strategies ineffective.

If the rate of change inside the institution is less than the rate of change outside, the end is in sight. The only question is the timing of the end.

An innovation is the implementation of a new or significantly improved product (goods or services), or process, a new marketing method or a new organisational method in business practices, workplace organisation or external relations.

“INNOVATION IS AN INVENTION THAT GENERATES REVENUE AND PROFIT.”

From the aspect of 1. Customers : Innovation means products with better quality and better services, which together mean a better way of life. 2. Businesses : Innovation means sustainable growth and development, realization of great profit. 3. Employees : Innovation means new and more interesting job, which requires more mental faculty, which results in higher salary. 4. Whole Economy : Innovation represents a bigger productivity and prosperity for all.

 CREATIVITY – IS GENERATING NOVEL IDEAS  INNOVATION – IS THE PROCESS OF CONVERTING NOVEL IDEAS INTO SOMETHING OF VALUE

 INVENTION = A NEW PRODUCT  INNOVATION = A NEW BENEFIT

 Unique: The new benefits that are generated from the new service or product should be perceived from the target group as unique.  Important: The new benefits should be perceived as important by customers.  Sustainable: The new benefits should be sustainable or at least protected against followers.  Marketable: Organization should have the resources, competencies and capabilities to market the product.

INNOVATION ? ? ? ?

 TO GET AN ADVANTAGE OVER COMPETITORS  REACT TO CHANGE  AVOID BEING LEFT BEHIND OR OVERTAKEN

DOING SOMETHING IN A DIFFERENT, NOVEL AND BETTER WAY, NOT OBVIOUS TO OTHERS.

 THINK OUT OF THE BOX  CHALLENGE THE ESTABLISHED

CONTINUOUSLY (BUT WE SHOULD KEEP AN EYE ON THE COST AND BENEFITS )

 PRODUCT INNOVATON: Introduction of a good or services that is new or significantly improved with respect to its characteristics or intended uses.  PROCESS INNOVATION: Implementation of a new or significantly improved production or delivery method. This includes significant changes in techniques, equipment and/or software.  MARKETING INNOVATION: Implementation of a new marketing method involving significant changes in product design or packaging, product placement, product promotion or pricing.  ORGANISATIONAL INNOVATION: Implementation of a new organisational method in the firm’s business practices, workplace or external relations.

 Innovation starts with analysis of opportunities.  Innovation is a conceptual and perceptual activity.  Innovation, in order to be successful should be simple and focussed.  Innovation should start as “small”.  Innovation should not be very “smart”.  Many things should not be done at a time.  Don’t innovate for the future, but for the present.

 Financial backing to innovation  Give opportunities to employees  Skillful recruitment policy  Information from outside the organization  Employees should be rewarded

 Know where we want to go – VISION  Know where rest of the world is going – FORESIGHT  Have ambition – STRETCH GOALS  Have freedom to achieve our goals – EMPOWERMENT  Draw from and work with others – COMMUNICATION, NETWORKING  Be rewarded for our efforts – there is nothing more rewarding than RECOGNITION.

PROCESS OF INNOVATION

 Knowledge factors: Innovation potential (R&D, design, etc.) insufficient, lack of qualified personnel, lack of information on technology/markets etc.  Cost factors: Excessive perceived risks, cost too high, lack of funds within the enterprise.  Market factors: Uncertain demands for innovative goods or services and potential market dominated by established enterprises.  Institutional factor: Lack of infrastructure.

 A company's bottom line is the amount of money a company has after all expenses have been taken out. It is the last line of the company's income sheet, so it is called the bottom line. Top Line  In determining the bottom line, we first start out with a top line. This is the first line of the statement and includes all revenues and sales. Types of Costs Taken from the Top Line  Interest charges on loans, general administrative costs and advertising are all types of costs that come off the top line. Arriving at the Bottom Line  After all of the costs have figured and taken away on the balance sheet, we are left with a net earning or net profit figure. This is our bottom line and the profitability of the company. Significance of the Bottom Line  The percentage of the top line that reaches the bottom line shows the efficiency of the company's operation. Considerations  A bigger top line does not always mean a bigger bottom line. For the bottom line to grow, expenses must be controlled.

PROFITS = REVENUES – COST When a firm’s revenue from selling its product or service is greater than the cost of offering it, then it is concluded that the firm is profitable on that given offering.

 Create cost advantage – If we can produce the same product cheaper, we can improve our profitability. It can be done by process innovation and technology innovation.  Go for price premium – What differentiated product functionality or service will convince our customers to pay extra? It can be done by product innovation and value-delivery innovation.

 Increase the size of market share – Increasing the number of buyers in our market will positively impact the revenues. Product and technology innovations, would contribute to increase overall market share, in addition a firm can go for business model innovation and new venture.

 As the world becomes more technologically advance, companies must rely on their innovations to help stay ahead of their competitors.  The concept of innovation is always evolving so whoever stays ahead on the learning curve will come out on top in the future.

“Even if you are on the right track, you’ll get run over if you just sit there.” Will Rogers