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Cambridge Judge Business SchoolInnovation

Innovation does not need a big investment

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For an SME to be innovative it doesn't require a big investment.

Innovation does not need a big investment

Growth from technology is a big misnomer and I think is a very widely spread misunderstanding.

When people talk about innovation, usually what they have in mind is it’s got to be investment in new technology and that is way too narrow a conceptualisation of what innovation is.

Very large companies develop their own technology. SMEs don’t. They don’t develop technology. They don’t have the resources to do it. They buy technology from the outside. They buy IT systems from an IT supplier. They buy machines, artefacts, which embody new technology from a printing company, from machinery companies.

SMEs get new technology from the outside and then what the good ones do is they use this technology in clever ways.

They use it in unanticipated ways that even the vendor of the machine didn’t foresee and they tinker with it and they do small changes all the time, all the time, in the interest of their customers.

Where SMEs innovate is in the processes that apply – how they treat their customers, how they use the technology, what additional service they can offer, how they change their own processes and set ups in order to be more useful to the customer.

That’s where SMEs innovate, modifying the technology that they buy from the outside in small ways and becoming ever more useful to their customers. That’s innovation in a SME.

So to stare at where are you investing in technology for an SME is the wrong way of doing it because technology development is so risky and so expensive and there’s plenty of it around. You get it from the outside and you think very hard how you use it.

 

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One comment

  • Jim

    July 11, 2016 at 8:07 am

    I’ve been browsing online or more than 4 hours today, yet I never found any interesting articles like yours. In my view, if all site owners and bloggers provided content as you have, the net would be a lot more useful than ever!

    Reply

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