In the last century, the companies used to grow, expand its staff, increase its turnover, and gain clientele for decades. In today’s world, it takes several years. For young technology companies, this situation is an opportunity, and for classic corporations – a threat. The threat is that many competitive small companies are constantly created, and the management of the conglomerate is too much regulated by procedures, tradition and bureaucracy. Therefore, corporate innovation is needed. We are going to describe the reasons, the evaluation and the application of corporate innovation. Explore the USA corporate innovations, when hiring rental cars in Washington State.
Corporate innovations are needed primarily for three reasons:
For example, the 3M Company, which is famous for its innovations, has earned millions on Post-it stickers. Innovative products provide 50% of GDP growth in the United States.
Providing yourself a competitive advantage.
Citibank took the lead when it introduced ATMs. Another example is Michelin, which conquered the US market when it introduced radial tires. Innovation gives a competitive edge.
In the modern world, digital events occur rapidly. New companies are emerging, which, with some destructive innovations, are changing sectors of economy and business models. A well-known example is Uber, which has changed its attitude to the business of PFW or General Motors. Corporations have understood that they are now competing not in the car market, but in the people mobility market.
Evaluation of corporate innovation.
The analysis of innovative measures takes into account a number of parameters characterizing the growth of profits starting from the creation of new products and services, operational efficiency, and cultural craving to the development of new projects.
Evaluation of the effectiveness of innovation is carried out using indicators of discount income, payback period, index and internal rate of return. Approach to the organization of innovation includes definition of the purpose of the analysis of activities, formulation of principles and objectives, stages of analysis, selection of types of effect with indicators’ specifying.
Giving up bad habits is another way to use innovation in a company.
Bad habits for the company are waste, unproductive expenses within the organization that do not constitute value for its customers. Value is what customers are willing to pay money for. Organizations spend more than half of the time and resources on things that do not bring value to their customers. These defects should be fixed. Examples of such waste are seen every day, but not everyone understands their scale in the organization in general. These are:
- Unnecessary movement of resources within the organization. For example, you have received sometime an e-mail, after reading it you do not understand why you were sent it and what to do with this information – this is an extra movement of information resources.
- Waiting for different people to complete the task. Have you ever waited in line for a printer because someone sent a huge document for personal use? This is about waste waiting.
- Inconvenient location. We are talking about the physical objects of production, since a lot of time is spent on moving from one place to another. One more problem may be in finding information in a complex internal system of folders and archives.
- Correction of errors or defects. For example, when you once again check the document for your colleague, or three times re-read the e-mail that you send to your colleagues.
- Reprocessing. When different people do the same things, or when the process contains too many approvals, when you manually enter information already available in electronic form.
These are all problems that need to be constantly solved using one of the three innovation strategies – innovations with an existing business model, which lead to an increase in profits. These are innovations in processes, assets, profit models and partnerships. The most striking example of the implementation of this strategy is the Toyota Company and its scientific approach to continuous internal improvements. This innovation strategy saved the company from bankruptcy in the 1950s and created a solid foundation for the development of its business model in the modern technological world.
Among the common parameters of working process, stand out the intensity and speed of innovation. When evaluating a project, a score method is used to set quality performance indicators. Comprehensive and system analysis is carried out using all factors. There are many benefits of corporate innovation; you just need to choose those, which fit you best.