What is business innovation? We explain everything!

Business innovation seeks to satisfy the needs of companies or clients in a specific period of time. At Cloudworks we show you what it is and what are the most used trends.

Definition of innovation

This concept is a process by which a product or service is renewed and updated by applying innovative methods and techniques or establishing successful ideas to create new added value.

The word “innovation” derives from the Latin verb innovare, which means to renew. In essence, the term has retained its meaning to this day, signifying to improve or replace something, ranging from a process to a concept or idea. However, the expression needs a more specific definition in the business context. 

The explanation of innovation in the corporate environment refers to the design of solutions that satisfy the needs of clients or companies within a specific period. 

This process changes existing ideas and work systems to produce tangible improvements in the organization. It is not just about adding new features but about comprehensively applying modifications. 

Types of business innovation

Types of business innovation adapt to new trends and therefore vary over time. Currently, there are different ways to innovate within a corporate context. Here we will talk about some of the most common methods of innovation today. 

Process innovation

Process innovation is the improvement or introduction of new technology, such as a production or delivery method within the company’s production system. 

Some examples of this type of innovation are changes in production or distribution techniques, improvements in marketing strategies, or technological updates to ensure that the company remains a strong market competitor.

Product innovations

This type of innovation refers to improvements in performance characteristics of the product and enhancement of its attributes. 

Innovations of this type are always tangible and can involve radically new technologies or be improved versions of an existing product. 

Changes of this type occur when an overhaul of a current product is required, such as:

• Changes demanded by the clients themselves. 
• A need to increase the product life cycle
• The desire to access new markets or segments.
• Improvements to the appearance or convenience of the product. 

This type of innovation is a great way to improve product quality and reliability, as well as gain a competitive advantage or maintain your market position. Furthermore, it can reduce production and manufacturing costs.

Sustainable Innovation

Eco-innovation or ecological innovation seeks to adopt new ideas or business models that positively impact the environment. This is achieved through the implementation of work, manufacturing or distribution methods that are respectful of the environment.

Business Model Innovation

Transforming the way an organization works can represent a fundamental change in business activity. The objective of this innovation is to provide greater value to the customer. 

In practice, it tends to occur through the development of new pricing mechanisms, income streams, or distribution channels, thus posing more significant risks for a company in the short-term, but essential for long-term survival. 

Service innovation

This type of innovation refers to the introduction of innovations or improvements to a service, product or process. It can be, for example, a new distribution channel, a system that improves the delivery process or new solutions in the interface with the customer.

Differentiating your business in how you serve your customers is a great way to generate more value for them, whilst bringing more revenue to your organization. This is the key to this type of innovation.  

Aspects of business innovation

To implement innovation in your company effectively, you must take into account the fundamental pillars on which new business ideas are based. 

• Collaboration: collaboration between different departments and people allow for new ideas to flourish and find solutions to issues. 
• Ideation: fresh and disruptive proposals help your organization stand out from the crowd, differentiating you from the rest of the competition. 
• Implementation: What good are new ideas if they are not put into practice? The implementation must be supported with the technology and resources necessary for successful execution. 

Value proposition: innovation is wasted if ideas do not generate value. Organizations must implement the most effective and useful programs.

Benefits

Innovation brings significant benefits since it can help you solve problems, generate profits, increase your market share or get ahead of your competitors.

However, these are not the only advantages. There are other highly relevant benefits:

• Improving productivity.
• Reducing costs.
• Increased competitivity.
• Increased brand recognition and value.
• Promotion of new partnerships and relationships.
• Stimulated growth of turnover and profitability.

Innovation provides a creative vision that allows you to see things from a different perspective, regardless of whether you are developing a new product, revamping your strategy or finding an original way to stand out from the competition. However, one must be aware that there is no secret formula to stay ahead in your sector. Your approach to innovation will depend on your business. 

To be disruptive, meeting places that inspire the creativity of the professionals in the company is essential. At Cloudworks, we offer flexible and integrated workspaces that encourage creativity, productivity and social well-being. Whether you choose one of our private offices, coworking spaces or serviced offices, we offer you the ideal work environment for your team to allow new ideas to flourish.