Factors Generating Innovation In Small Business Firms Business Essay

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Innovation itself can be described as a term where a new product or service is in the market or the company operation, but it is different from the rest. Innovation is any concept that is not yet in the market or not being used by the business in terms of its running, changes in the product include materials that are used, process, or making changes in the service that is included in the innovation process. The purpose of innovation is to gain the attention of the customers and serve them in different ways that can help to satisfy the need and wants of their customers. Different organisations get the help from the external sources and the purpose is to gain the access to the market in a way that can attract people toward the organisation (James, 2009).

One can say that the purpose of a business is to enter the market, have a product, sell the product and gain market share. For the product to be different from the rest may require innovation. Introducing different, new, and innovative products or services for their customers can gain market share, as the customer may see the business upto date with the new trends and thus allowing the business to compete with competition. The purpose of the business is initially to make a profit and expand into a larger business. Small businesses, however, are faced with a big risk of having to take on the innovative process that is widely time consuming and risky. The risk lays in the question weather the customer will accept the innovation result, as every market is different and weather the actually ways the innovation was carried out by the small business was worthwhile doing.

In this report, the innovation process and its factors or principles are being discussed from the context of a small business that how innovation is carried out in the small businesses and what are the factors that support in generating positive outcomes. The purpose is to provide a better understanding to the small business and techniques for keeping its demand higher in the market.

Small organisations or businesses are found to have more creative people usually that can generate more bright ideas and are able to produce more better and refine products, services, or processes for their customers. Innovation is a very effective way in which high market share and efficiency can be gained. It is a process that must be properly managed and implementation should be spot on in order to have maximum innovation.

The risk linked with the innovation in the small organisations has found to be of higher level because the chances of failure and success of any project are equivalent. If the organisation fails to generate a profit for the organisation then the organisation has to bear a loss and suffers in the market. Usually small organisations and businesses are not having enough capital and resources that they can go through different failure stage to capture a niche market, that’s the reason usually small organisations have found to lack initiative approach toward new ideas and thinking. There is a fear of bearing loss by the organisations and they keep on following and adopting the techniques and method available for the people in the market.

Main Body

Many small business leaders are very innovative but do not realize it (Waldek, 2009) most of the innovation coming from learning their customers demands through close interaction. This interaction between customers makes the small firm very customer centric (Zhorsky, 2012). Larger companies differ from smaller companies in terms of employee size, funding and capital that can be used in the innovation department. These are major factors that are used to launch innovative ideas and smaller businesses may not have such funding or employee numbers to focus purely on innovative ideas. In contrast to this disadvantage, small businesses have the advantage of interacting with their customer base on a more personal scale and knowing first hand what they require. This is the main reason why small businesses are more accurate in knowing what their next innovative move requires. In contrast, large businesses have to go through large amounts of data, analysis the information and thus start n what they think the next innovation should lead to.

In order for small businesses to progress further, they need to have consultations by experts in innovation. This is a measure to further their inside knowledge by experts who have experience in both large and small business innovation. Such methods can help a small business in areas such as product introduction to the market or new services that are being launched. Having a cutting edge in innovation through consultation and excelling in areas such as introducing a successfully innovative product can make the business an innovative success. (National Research Council, 2007). Finance boosting from the Government to encourage such innovation has been introduced (Department for business innovation and skill, 2012)

Since it is wrong for any small business to implement innovation as its primary nature, they should only concentrate on the everyday running of the business more. Innovation is what is very important for a small business but it is likely to be resources consuming, small businesses do not have that many resources to use that can all be used only on innovation. For this reason small businesses are required to use their resources and apply innovation on a small scale so their resources are not overstretched. The innovation process should not effect the small businesses normal everyday activities (Thomas, Miller, Murphy). Some of the important factors required to be analyzed for the innovation are as follows:

For introducing any effective plan for the organisation, it is necessary that the organisation utilize their time in the most effective way. The reason is that the variation in the demand, technology, resources, and other linked factors are found to play an important role in the innovation and all of these factors are found to go through the transformational stage over a certain period of time. Therefore, time should be available for analyzing all these factors for implementing any innovative and new plan in the organisation.

Ideas are meant to generate through different techniques from the management team because more the availability of ideas more better decision can be made for the innovation process. For the organisation, internal and external both factors are found to have the great importance because none of the factor can be ignored by the organisation. One can, also, say that the business wants to have a favorable working relationship with other businesses and make a joint venture to improve their innovative techniques than this is always an option.

Whenever the innovation is meant to be introduced in the organisation, it should be according to the one that satisfy the needs and wants of customer by providing them the maximum satisfaction. The reason is that many projects are not found successful by the organisation, but found to delight the customer wants. All such projects are meant to in the favor of the organisation and should be implemented because these plans are on the right track as the customers are the end user and meant to be satisfied from the product and services fo the organisation.

The innovation can be linear in which changing is made in the existing plan, procedures, and operations of the business. Such a type of innovation is carried out if the organisation wants to make improvement and introduce improvement in the business plan. While the other innovation plans are also an option that is meant to bring change by introducing different and new product or service for the customer. Selection should be made according to the best of understanding with the business requirements.

If we look at Google at an early stage when it was a much smaller business in 1998, they found a unique innovative idea by developing a search code in their home page and started to provide such an innovative product that it was developed on a larger scale and serves a vast amount of users all over the world.

When the organisations are meant to introduce any plan for the organisation they should go through the analysis stage according to the availability of the resources. Decisions should be made that are in the best interest of the organisation and lead to proper utilization of the resources of the organisation. Any plan demanding high resources should be ignored by the organisation due to lack of availability of the resources.

Hard times during the recession have also encouraged business innovation (Business Ideas, 2012) as businesses seek new techniques to attract customer income. Furthermore, the Business Ideas, 2012 project survey shows: “53% of businesses had introduced new or improved products and services last year, while 51% intend to continue innovating next yearâ€Â This is a figure which has increased from before the recession. Business week , 2012, concludes that the recession has led many small business firm to invest in making themselves more innovative to survive in the economic change to be seen in the future.

The employees of the organisation play an important role in providing any innovative and new plan for the organisation. They are meant to give their efforts by providing plans for the organisation that can be implemented and organisation can enjoy the motivation of having edge in the market by satisfying the needs of customers in a new and innovative way. Employees can produce ideas through brain storming and other ways that can help in finding maximum ideas of employees that can be implemented and then they can provide an alternative for the better implementation of the plans as well.

Organisation should always mean to learn from the past experiences, if the organisation has introduced any plan in the past, then it outcomes and procedures should be evaluated for implementing new plan in the organisation. Experience gained through different stages is of great importance for the future decisions and plans of the organisation and it should be helpful in making better decision for the future of the organisation (National Research Council, 2000).

Technology has been found as the most effective way for the implementation of the innovative plans for the organisation. The reason is that the advancement in the technology helps to serve the customers in a better and effective way by satisfying the customers of the organisation. Technology advancement has now become the source of running of the organisation in the market. Any organisation without new and latest technology cannot enjoy the incentives like the one with better technology in the organisation.

These are some of the important factors that play an effective role in making a successful plan for introducing new and innovative product for the organisations operating on small scale. According to Willets (2012) innovation is the main thing for business success.

CONCLUSION

These are some of the important factors that play an effective role in making a successful plan for introducing new and innovative product for the organisations operating on small scale. According to Willets (2012) innovation is the main thing for business success.

In the end, different facts and information linked with the process carried for the innovation in the small business have been analyzed. The basic purpose was to get the better understanding to the innovation in the small organisation and business having low capacity for bringing any big change. It has been observed that the organisation size is not the big issue for the implementation and designing of the innovative product, but the technique and ways adopted for gathering the information has been found as the real issue. The technology and the techniques used are required to be up-to-date and of the nature that can satisfy the needs and wants of their customers in an effective and better ways.

There are different types of innovation process available depending on the type and want of the business, selection should be made from the available method.

One can say that since smaller businesses are more in touch with their customers, they know better what their customer needs. Knowing this the small business can make their innovation more innovative by making their innovation process more efficient and developing it in to a larger process. Furthermore, knowing what is needed can be used as a selling point in terms of brand loyalty, people can use innovation when they are in a small business to create a niche brand and further make the brand bigger. The whole innovation process requires risk. Resources are very important to any small businesses and the risk lays within what resources are used where in order to be innovative.

It has been declared as a better decision for the organisation to become specialized in a small unit, instead of following or being a part of larger organisations. That’s the reason that the organisations are required to produce an innovative product of their own, lead the market and enjoy the incentives of a sole owner of the product. Different organisations are acting on a small level, but are successful to capture the market that is required for the successful survival of the organisation in the market. Together with business support from the government and hard time in the economic recession has led many firms to carry on being innovative to increase profits.

Overall, innovation is important, as previously mentioned Googles success came from innovation. If such innovation had not been used than the, once small, company would not have been a worldwide company this day. Using resources efficiently can boost innovation of a small business significantly, as long as the resources are not all put on innovation as being a primary need; instead all resources are utilized effectively in balance. Innovation should be done to compete; however using the help of other small businesses can sometimes be beneficial for both parties in question.

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