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8 Key Areas of Business Innovation

8 Key Areas of Business Innovation

Business innovation is something which senior managers talk about a lot but don’t necessarily do much about in practice, perhaps with the exception of the odd meeting in which some simple brainstorming might occur, now and again. Even when this happens, the brainstorming may be concerned with a particular problem that needs to be solved and the input may not be that creative or innovative in real terms. One of the ways to create more interest in and time to be more innovative is to start to think about where a company may want to apply more innovative thinking. In broad terms this gives a focus to the discussions and helps to create a guiding framework.

Although it is not restricted to these headings, in the list below are eight categories that can provide some very useful context for a business discussion on innovation in particular to occur. Let’s therefore briefly look at each of these one by one:

1. Strategy Innovation

Forward strategy is always a significant realm within which innovative thinking can be applied because it asks individuals to generate options about the possible future direction of a team, department or whole organization. The types of sub areas that are often covered here therefore include:

  • Innovative enterprise direction
  • Innovative organizational growth strategies
  • New Innovative venture/collaboration strategies
  • Innovative competitive positioning strategies

2. Business Model Innovation

A business model is the method by which any organization makes money, such as fee for service, regular subscription, pay up front, monthly retainer, direct sales etc.  The types of sub areas that are often covered here therefore include:

  • New forms of selling, pricing, and packaging products or services
  • New management/control methods and models
  • New approaches to information, idea and knowledge protection and management
  • New possible strategic partnerships and alliances

3. Product/Service Innovation

People tend to think about product or service design possibilities most when they think about business innovation but this can be “push” oriented (provide a new design and educate the customer to use it) or “pull” oriented in which underlying customer needs or “pain” is discovered and then drives innovation. The types of sub areas that are often covered here therefore include:

  • New/different products/service design (push or pull)
  • Adapted products and services (push or pull)
  • Extended/augmented products or services (push or pull)
  • Product/service line extensions (areas of added value)

4. Process Innovation

This innovation tends to be focused on the operational side of a business and how efficient or effective its processes may be at all levels, especially versus competition or best-practice. The types of sub areas that are often covered here therefore include:

  • Innovative Process Management Systems
  • New processes and operational methods and techniques
  • Potential quality improvements
  • New “lean” or “agile” execution approaches

5. Marketing Innovation

Marketing innovation (incorporating sales) is focused on the new ways in which products and services can be promoted, including new/different channels to market. The types of sub areas that are often covered here therefore include:

  • New segments and niches (in existing or adjunct markets)
  • Use of social media and other new marketing channels
  • New forms of differentiation, positioning, and advertising
  • Innovative customer service approaches

6. Technology Innovation

Most people are familiar with the often disruptive impact of new technology when it is highly innovative, although some technology is incremental (perhaps only automating a manual process) while other technology is transformational.  The types of sub areas that are often covered here therefore include:

  • Development of new technologies (both incremental and step-change)
  • Increasing online connectivity at all levels and areas
  • New ways of commercializing via technological innovation
  • Strategic technology acquisition and use

7. Supply Chain innovation

As many businesses can now sell their goods and services to the world, managing the supply chain from supplier inputs all the way to the end consumer needs thinking about and innovative thinking. The types of sub areas that are often covered here therefore include:

  • New approaches to value chain management
  • Make or Buy decisions
  • Off-shoring potential
  • Outsourcing potential

8. Organizational/People Innovation

Although people-side innovation may be contained in many of the above categories, innovative approaches can also be applied specifically to the way that people think, behave and work. The types of sub areas that are often covered here therefore include:

  • A new or different culture (for employees or customers)
  • New forms of motivation, communication and teamwork
  • New forms of employee participation/involvement
  • New channels for creative input and ideas

Each of the above realms or categories create a kind of “conversational scaffolding” for possible innovation to occur. It may therefore be useful to pick just one of these and allow people to focus their attention in this one area (at least at first) so that it concentrates the attention and allows forward action to potentially be taken without spreading execution resources too thinly.

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About Dr. Jon Warner

Dr. Jon Warner is a prolific author, management consultant and executive coach with over 25 years experience. He has an MBA and a PhD in Organizational Psychology. Jon can be reached at

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One Comment

  1. JamesJune 15, 2015 at 5:25 am

    Innovation is required so as to add values to the existing products in the market. The structure of thing s need to change for effective and smooth operation. Thanks for such an awesome article.

About the Editor and Primary Author

Jon Warner

Jon Warner is an executive coach and management consultant and in the past has been a CEO in three very different companies. Read more

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