Businesses Must Innovate or Stagnate This year’s sporting premiers can earn next year’s wooden spoon if they become complacent. Likewise successful organisations can lose their competitive advantage if they fail to innovate, warned Stuart Carr in his address to the 2009 Risk Management Innovation Conference in Sydney in August. Stuart’s presentation focused on innovating in uncertain times. As the director of business advisory firm, Carix Pty Ltd, Stuart has helped numerous clients navigate the difficult economic climate and to prepare for better times ahead. “While it is tempting to batten down the hatches to weather the storm,” Stuart said, “The greatest risk to business is when the economy picks up. Organisations that have been making do with less can find themselves in a situation where they are without the resources, or the cash flow, to exploit the opportunities that then present themselves.” “Innovation is an imperative for successful organisations,” said Stuart. “Innovation needs to be embedded into an organisation’s systems and processes.” “Innovation doesn’t have to be about committing massive budgets to R&D. Organisations need to look beyond the typical forms of innovation, such as product and technology innovation, to the more holistic business model innovation.” “While introducing new products or services, or applying new technologies, can expand the offerings of the business and improve the method for getting business done,” said Stuart. “Business model innovation has the power to totally transform the business and the way it competes in the marketplace.” Stuart cited examples of successful business model innovation: computer printer manufacturers drastically reducing the cost of printers and deriving profits from increasing the cost of consumables, ie cartridges; similarly mobile phone providers are now giving away handsets in exchange for lucrative secure customer relationships. “The business model approach encourages business owners to consider all the aspects of the business together,” said Stuart. “And, to consider them in light of the environment the business is operating in.” “History has shown that major economic upheavals bring about lasting changes to the economy and demand new responses from business owners. Therefore, businesses need to consider their customers’ future needs now, and to align the way they do business to meet these needs, and the needs of the business.” Stuart Carr is the director of Carix Pty Ltd and regular conducts workshops in Innovation and Entrepreneurship, Business Model Innovation and Small Business Consulting. [ Home ]