The fourth in a series of blog posts.
Small businesses are often formed because the owner has a good new idea. If the idea has legs, then the business grows to a reasonable but fixed level of revenue, then begins to flatten out. Established data tells us that only half of small businesses survive more than five years, and further decays continue over time. There are five success drivers that are most crucial to small business survival. In my last blog post, I discussed growth planning. In this blog post, I will expand on ongoing innovation.
Tools to Innovate
Innovating is the hardest of the crucial five drivers of business growth, but it’s also the most important. Your business will not continue to grow without innovation. Your small business leadership team must recognize that your initial success driver ages over time. Additionally, competitors enter the market with a lookalike product at a lower cost. Either meet it or bring an improvement into the fray. No one knows the needs and values of your current and future customers as well as you do. Our Rapid Value Assessment (RVA) framework provides you with a foolproof approach to bringing new products to your market.
Two competing areas of your growth focus are continuous product improvement and cannibalizing your existing product. Product improvement seems most prudent at first, but has a shorter life span. Cannibalizing your existing product is more painful initially, but not as much as you think. Product replacement is a drawn-out process. Additionally, new innovation will most likely include finding new customers, making your customer base even larger. The continuation of this cycle not only accelerates growth, but also transitions your business across adjacent markets, as well as providing an opportunity to enter new geographical markets.
Our Rapid Market Assessment (RMA) framework helps you do the right work to expand into new markets quickly and with less risk of failure. RMA and RVA have very similar tools and vocabulary, so once you are comfortable utilizing one, the other is easy to use.
Do you want to discuss this further? Leave a comment below or contact me.