Innovation and entrepreneurialism are buzzwords that get bandied about a lot these days. Everybody wants to be seen as innovative and entrepreneurial and so everybody calls themselves innovative and entrepreneurial. But it’s not that easy. There’s a huge gap between calling yourself something and living it.
If the PR hype is to be believed, nearly every business out there is an innovative one. In fact, I tried a little Google search experiment to check this hypothesis out. You can replicate it easily: just type in “we are an innovative *” (the asterisk being the wild card search function) and check your results.
Here’s what I got in the first page: “We are an innovative new company…” begins one life insurance company’s LinkedIn advertisement. “We are an innovative partner for our clients…” states a marine engineering firm. “We are an innovative and sustainable resource for re-usable cotton cloth bags,” says another home page. I’m not saying these guys aren’t necessarily innovative in their fields, I’m just illustrating how overused the word is today.
So here are four things innovation is not:
Resting on laurels
You were once the upstart challenger brand who shook up the industry and gave the establishment boys a run for their money. But now you’re more or less part of the establishment yourself and running on the gas of past successes. Unless you take risks again, that gas will run out. The corporate landscape is littered with the carcasses of former giants who thought they were too ubiquitous and entrenched to fail: MySpace, Blackberry, Kodak…
Groupon was an innovator for spearheading group discount deals online. All their imitators were not. They were just doing something another business had already proven profitable. Soon, the market reacted to the glut and the tulip bulb-like craze of group discounts was pretty much over. Innovators do not follow what the rest of the market is doing, they disrupt it.
Some of my favourite brands are the ones who realise these truths and constantly evolve to keep their brand fresh. One of my favourite examples is Netflix. I love them and people are sick of me going on about them However, for those who have had their head in the sand for the past five years or so, Netflix first introduced no late-fee DVD rental to the world, and then dealt a knockout blow to the video store business (and a healthy blow to illegal piracy as well) when it brought in legal streaming of video content. Not content to lose business to copycat streaming services – or remain reliant on expensive rights deals with the studios – Netflix went into the content business itself, developing shows that have gone on to win viewers, critical success (below) – and a couple of Emmys, too.
This is always a hard one to sell to more established businesses – ironically so, since they perhaps can weather potential failures much better than those less risk-averse businesses with smaller customer and capital bases. But innovation is risk. Sometimes exactly what your business needs is to break the mould.
In advertising and branding, innovation applies not only to products and company culture, but to marketing as well. If you’re a new entrant and simply copy the market leaders, you’ll get lost in the landscape. And if you’re already a market leader and keep doing the same thing, you’ll open yourself up to disruption from a start-up.
If a business looks only inward, it’s going to miss out on a whole lot of interesting and inspiring goings-on in the world. That’s not to say that a healthy dose of self-reflection isn’t good – it’s necessary – but truly innovative companies take inspiration all around.
Sometimes that means bringing in outsiders or fielding ideas from your fans. Coca-Cola, for example, is doing both those things with its ‘Founders’ project. To solve some of its hard-nut-to-crack challenges, the soft drinks giant is soliciting ideas from start-ups and entrepreneurs across the globe. The viable ideas will get access to Coca-Cola’s resources while Coca-Cola gets a minority stake in the business. So everyone wins.
If we’re going to bring real meaning back to innovation, we have to stop diluting it. That means we need to stop self-applying it when our businesses don’t deserve it. And once we’ve earned it, we have to keep earning it. We owe that much to our customers, our employees and our shareholders.
Simon Hakim is CEO of Hunter