The true value of innovation: Why it pays to think outside the box

According to a study by McKinsey & Company, companies that are in the top quartile of innovation performance are 50% more likely to achieve above-average revenue growth than their peers. This is because products become outdated, and customer preferences change over time, making market disruption very common. Therefore, successful businesses need the skills to innovate and adapt to changing environments.

• Consumers will pay a premium for innovative goods and services  
• Investors choose them as they are likely to be profitable
• Employees want to join and stay with innovative employers 

The COVID-19 pandemic disrupted business on a scale previously unheard-of in modern times. For many organisations, routine operations were rendered obsolete overnight. Research shows that companies that shifted their business model to meet the demands of the new landscape tended to recover better than those that didn’t. Innovation is, therefore, essential for adapting and overcoming the challenges of sudden change. 

As companies like Apple and Tesla know only too well, customers are willing to pay more for truly innovative goods. PWC’s Breakthrough Innovation and Growth study on 1,757 businesses found that the most innovative companies are set to grow at twice the pace of the global average and three times faster than the least innovative over the next five years. This proves that it really does pay to be innovative.

Not only will customers pay more for innovative products and services, but if they have a positive experience, they’re more likely to return to your business. Research conducted by Harvard Business Review found that companies that embrace innovation are more likely to achieve high levels of customer satisfaction and loyalty, as well as increased profitability and market share.  

Creating a culture of innovation is also an effective way of creating a workplace culture where employees feel engaged, valued and empowered by their work. Being part of the decision-making process gives staff a sense of ownership and encourages people to think more creatively when faced with a problem. Research has also shown that when employees are rewarded for their creativity and innovation, they are more likely to engage in innovative behaviours in the future. 

Building a culture of innovation isn’t a short-term project; it’s a longer-term strategy that requires time, planning and effort. The rewards come in the form of greater profitability, greater growth, and a more future-proof business. So, if you’re ready to get started, Innovate NI’s four-step Innovation Framework offers an easy-to-follow guide for turning your idea into value. You can also take our Innovation Assessment to see where you are in the process.  

This free online assessment takes less than fifteen minutes to complete - we will review the information you provide, map your current innovation activities against the framework, and help progress your project to either commercialisation or implementation. Businesses that have completed some or all the framework steps will also receive an innovation recognition certificate from the Department for the Economy.