eBusiness Weekly
Dunny Mupesa
There is no executive task more crucial or challenging in the current business landscape than the ongoing management of creativity and transformation.
Companies must develop new goods, services and procedures to compete in this dynamic market. If they want to gain sustainable competitive, they also need to embrace innovation as a long way to go.
Innovation is anything that is new in its context and that contributes to making a product or service viable and profitable.
The writer seeks to explore ten types of innovation in business which are profit model innovation, network innovation, structure innovation, process innovation, product performance innovation, product system innovation, service innovation, channel innovation, brand innovation and customer engagement innovation.
Innovation is viewed as a critical component of economic companies’ success, as it is how customers can be satisfied and their desires fulfilled.
It entails coming up with a novel concept that will be put into practice to give the businesses a competitive edge at a time when they have similar chances to showcase their goods at a reduced cost.
Innovation is the commercial or industrial creation of something novel, such as a new financial institution, product, manufacturing process, market, or supply source. Innovation can also be a new idea or improving an existing one.
Profit Model Innovation (PMI)
Profit Model Innovation is the business model innovation of how the company makes money where innovative profit models find a fresh way to convert a firm’s offerings and other sources of value into cash.
Excellent profit models that demonstrate an in-depth understanding of what users and customers genuinely value as well as potential revenue and price options, can be found in profit model innovation.
Flexible pricing modifies prices in response to demand from the market. One of the examples of a profit model innovation is switchboard, which links several consumers and sellers to form a new marketplace.
Therefore, firms should invest more in profit model innovation so as to yield their revenue base.
Network Innovation (NI)
Network innovation is an innovation which provides a way for firms to take advantage of other’s processes, technologies, offerings, channels and brands.
Basically, it’s also about how a business can increase its competitiveness in its market by establishing connections with others. An alliance is a type of network innovation in which partners share benefits and risks to achieve a common objective, like increased purchasing power. By openly publicising demands, network innovation additionally assists executives in outsourcing research and development.
Structure innovation (SI)
Structure Innovation is how you organise and align your talent and assets. It is focused on organising company assets in unique ways that create value. It often requires major organisational change in addition to investment and sponsorship from senior leader.
Structure innovation can also provide an excellent competitive advantage because they are inherently hard to copy. It also helps to attract to the organisation by creating extremely productive working environments on fastening a level of performance that competitors cannot match.
Process innovation (PI)
Process is the implementation of a new or significantly improved production or delivery methods. It includes the processes and operations that result in the main products that a business offers.
A business can manufacture its goods or services faster, cheaper, more customer-pleasing, or more efficiently than its rivals thanks to process innovation.
Additionally, proprietary technologies typically embody the core of an organisation’s daily operations.
Finally, there is space, where duties are assigned and expensive for others to complete.
Product Performance Innovation (PPI)
Product Performance Innovation (PPI) is the innovation which addresses the value, features, and quality of a company’s offering. It encompasses not only completely new products but also updates and line extensions that add significant value; typically, they offer a temporary competitive advantage due to their easy copy-ability by rivals. Product performance innovation also talks about how a particular product saves resources for the environment.
Product System Innovation (PSI)
Product System Innovation is an innovation type which is fundamentally about how you create complementary products and services. It makes the customers to think that they need extra or additional components to perfectly complement of what they are already enjoying.
Product system innovation is rooted in how individual products and services connect or bundle together to create a robust and scalable system. It is also a way to create valuable connections between otherwise distinct and disparate offerings. Product system innovation helps ecosystems that captivate and delight customers and defend against competitors.
Service innovation (SI)
The way you serve your consumers is through service innovation. It can also mean maximising and supporting the value of what you have to offer.
At the customer’s request, it provides unexpected and loosely linked services. Innovation in services facilitates a product’s trial, usage and enjoyment. Additionally, it transforms even sub-par and uninteresting products into captivating experiences that entice clients to return and time again.
Customers are influenced by service innovation to associate a product with favourable experiences and certain feelings.
Channel Innovation (CI)
Channel innovation, (CI) encompasses any novel customer-facing approaches that optimise sales, improve profit margins, or heighten brand awareness and favourable connotations. It guarantees that customers can purchase what they want, when they want, and how they want it with the least amount of hassle and for the most amount of joy.
Moreover, channel innovation can reduce lost time or effort when outsourcing sales using techniques like indirect distribution. A flagship store is an example of a channel that innovates invest in highly branded, experiential retail locations where shoppers can interact with your business.
The flagship store serves as a premier location for a retail chain, serving as a representation of the business or brand. Firms should also consider channel innovation so as to improve brand awareness; thereby attracting more customers as well as increasing revenue and profits.
Brand Innovation (BI)
Brand innovation is the process of making sure that users and customers identify, recall, and favour your products over those of rivals or stand-ins. It has the power to transform ordinary goods into valuable products and give your business and its products purpose, meaning and value.
There is a certification process that gives your brand a distinctive designation name that may be applied to goods or services provided by third parties.
Firms should appreciate and consider brand, simply because it helps establish a strong brand identity and recognition in the market. This is accomplished by launching novel features, offerings and designs that differentiate the brand from rivals.
Customer Engagement Innovation (CEI)
Innovative approaches to customer engagement centre around the creation of an entire customer experience — that is, how you build an overall experience for customers. It gives people new paths to explore and supports them in discovering methods to enhance the enjoyable, meaningful and memorable aspects of their life.
In other words, customer engagement innovation is all about knowing the core desires of users and customers and applying that knowledge to create meaningful connections with them and your business.
Innovation in customer engagement also improves the whole customer experience and frequently simplifies difficult tasks, transforms ordinary experiences into extraordinary ones, or fulfils regular obligations.
Conclusively, the above ten types of innovation can lead to redefine your business services, products, or offerings in such a way of creating and capturing value. In other words, the ten types of innovation in business are pillars of Business Model Innovation (BMI).
Denny Mupesa is a digital practitioner; and the chief executive officer (CEO) and chief innovation officer at The Institute of Innovators Zimbabwe (IOIZ). He is also the executive director at Linkertview Corporate Services (LCS); a consulting firm of innovation and design thinking, technology, FinTech’s, strategy, new product development and research. He is a digital business and innovation trainer. He has trained over 1000 entrepreneurs. Denny can be contacted at 0787507669/0712854235.
