I was considering recently that one of the primary barriers to innovation worries of change. Most businesses are extremely comfortable operating in marketplaces and getting together with customers that they understand. Changing the variables of the market, the customers or potential customers you use or the merchandise that you offer risks disrupting the human relationships that exist.
In this type of thinking, therefore, the least amount of change applied creates the best amount of certainty. Today, March 2011, it seems that everything is changing. We are concerned about the environment with the development of weather change. We worry about Europe and its own increasing debts levels in countries like Spain and Portugal, nevermind Ireland and Greece.
We worry about the changing romantic relationship between the US and China, as China seems poised to become the largest overall economy in the global world, which will let it lead more of the market than it offers previously. We disregard at our own peril an increasing debts level in this country that must be repaid to international interests.
Yet in the midst of this many executives will argue that it is innovation that is the risky investment, instead trusting in a stay-the-course management style. I suppose “stay the course” is reasonable in an environment where little changes, and customers don’t possess other options. In that kind of market you can generate income by sustaining existing products and services and constantly slicing costs.
Highly organized and in a position to meet deadlines
2011 Exhibitor List As Of September 26, 2011
Computers had started taking over huge amounts of automated trading
What major psychological processes influence consumer responses to the marketing program
But in a market where rules change, competition changes and customer preferences change, stay the course appears to me to be the most risky option. A business must be at least as nimble as its customers and competition in an era of change. Locking into a stay the course mentality and refusing to innovate when your environment is rapidly changing seems to be the risky strategy. As usual, we’ve reached a spot of diminishing returns.
Trimming costs, a lot more effective and effective business strategy are effective when markets are guarded, regulations don’t change and customers have little independence or choice. In a market where all of these factors are much longer true no, businesses that are nimble, agile, and go after advancement shall have the top of the hand.
Innovation, after the poster child for risky strategic thinking, will rapidly become the safe, proper choice. If innovation is the safe strategy, then everything about your operating model must change. We have to shift the dynamics of the firm from safe, “reasonable” slow change to identification of new opportunities and clients. We need to change rewards from cost trimming to intro of new products and services. We have to change what we should incentive and measure. Or, failing these actions, you can lock down your existing way of doing business and ride out the storm, since many of these market certainly, regulatory and competitive changes shall pass, and the pendulum will swing back into static equilibrium.
Harris Teeter once explained its remodeled stores salad club and ready-2-eat foods as CASH COWS. Safeway stock is up sharply on the same period with the proven results from their ongoing remodel ready food concentrated lifestyle stores. It must be observed here that throughout that 25 12 months period while the US people were booming, grocery stores dropped in number by 25,000 units as the restaurant industry grew by 200,000 plus outlet stores. The grocery-prepared food Industry management is being powered by European suppliers. Walgreens effort can best be called convenient food participation.
For the consumer it is interactive, participatory, and inviting, providing “like” homemade touches via component bundling creating personal satisfaction. This as extremely persuasive because Walgreens is an 81 Billion buck company well financed and which makes this very competitive for the restaurant industry. This isn’t a trend but a style that are 27 years in the making now. The trend started in 1985 with the meals industry focus on Home Meal Replacement (HMR) and has progressed into a full-fledged battle for the consumer’s food dollar and share of stomach by all retail sectors.