Why Is Innovation So Important for Businesses?

Innovation is essential for business growth and survival. Innovation can be defined as the introduction of something new, whether it is a product or service, process, or business model. It is a key driver of economic growth for society, accounting for up to 85% of all growth. Innovation is also crucial for individual businesses to grow, increase profits, and survive. Traditionally, innovation was synonymous with R&D, but the internet has changed the game, making information, knowledge, and tools accessible at a fraction of the cost. Innovation is not just about who has the most resources but who can find the best solution to a given problem in the market, which does not necessarily have to be expensive. The 70-20-10 rule for innovation suggests that 70% of a company's innovation resources should be aimed at incremental innovation of the core business, 20% to innovation that helps expand that core, and 10% to breakthrough innovation that can transform the future of the company. Incremental product innovation, process innovation, improved customer experience, and business model innovation are all forms of innovation that any organization could realistically pursue, even without much prior experience from innovation. While innovation is undoubtedly hard, not innovating is the biggest risk of all.