Market-led innovation will grow your sales and profits and create a more successful business for your customers, says Terry Green
During my career as a serial entrepreneur, as a part-time secondee to the government's prestigious Innovation Unit and as founder of the Sunday Times Enterprise Network, I have studied the way that successful businesses develop low cost, low risk strategies for maximising sales and profits. You can always tell when the businesses you deal with practice market-led innovation. There is a buzz around them and they manage all the relevant detail. They make it a pleasure to be a customer. It's a universal, no nonsense, low risk way of tuning up your offer and your business.
Market-led innovation is not about massive R&D budgets — it's about small, incremental improvements, at little or no cost, that steadily increase customer preference and reward you with improved profitability. A good example of this is the Tensabarrierᴿ — the post and webbing barriers that you see in airports all around the world. In the early Nineties, during a recession, I led the development process for the Tensabarrierᴿ that turned a product idea into a global brand, selling the product in 52 countries, generating an incredible 63% EBTIDA (earnings before interest, taxes, depreciation and amortization) and winning two Queen's Awards for export in the process.
So here's how you go about it:
1. Check the facts
Start your journey by examining exactly how your customers acquire and use your product and or service. Which elements do they value and which can you dispense with? Do they use the product in the way you intended it to be used? Can your customers suggest ways in which you can make your offer more useful? If they don't buy your offer — whose do they buy and why?
2. Put yourself in your customers' shoes
Answer honestly — how easy are you to deal with? How hard do you make your customers work and why do you do that?
3. Look at yourself (and your organisation) in the mirror
Why do you do the things that you do? Which of them add value and which ones are vanities that you could do without? Cut it back to the bone. Swallow your pride and practice relevant austerity.
4. Involve your whole team
Explain your vision for the future to them and the role that you want them to play. Give people permission to contribute and get them to take ownership — make it their plan, too. You will be delighted at how they will find the time and embrace the idea with enthusiasm.
5. Make a plan
Better to do the right things slowly than the wrong things quickly. It's about small incremental steps that edge you in the right direction. Your momentum will build.
Terry Green is an entrepreneur, author and mentor. His latest book, Cashier Number Three Please!, describes how Terry and his colleagues created an iconic queuing business which they ultimately sold for £26million. terry-green.co.uk
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