Curt Fowler

Innovation is a requirement to grow a profitable business.

Why? Because the market always has and always will commoditize your product or service. Capitalism is a wonderful system. It provides us with great products and services at great prices. If the product or service is not substantially better than its competition, the price will drop.

You cannot grow a profitable company if the market is pulling your prices down. Therefore, you must create an innovation pipeline for your business. You must create new products and services that deliver higher value that you can sell at higher prices.  

Think back to the prices of smartphones, airlines, computers – practically anything. The prices always start high because the product or service is differentiated with little competition. But that changes fast.

Great innovators are the most profitable companies in the world today. Apple earns about $1,445 in profit per second – about $50 billion per year.

3M has been a fantastic innovator and has produced margins two times as large as its industry.

We must innovate to be profitable, but we also must innovate to survive. Look at these factors converging to make innovation a necessity in every industry.

• Product cycle times are decreasing at a phenomenal rate. Knock off artists in China can have an 80 percent replica of your new product on the market within days of you introducing it.

• Global competition – The world is flat. Your competition wants your lifestyle and are willing to work very hard to get it. Hunger drives innovation while established players sit back and enjoy the fruits of their labor. If you sell a service, is someone overseas going to outcompete you?

• Quality and operational efficiencies have improved dramatically around the globe. Better quality and operational efficiencies are now table stakes. Only real strategy and innovation can protect your business.

Because of these and other factors, prices are dropping faster than ever on once new products and services. To thrive in today’s world we must be innovators.

3M demands that 30 percent of each division’s sales come from products less than 4 years old. They count this goal in their compensation system. 3M also gives their employees 15 percent of their time to invest in new product development of their choosing.

Innovation is required, and it drives results. How are you innovating to stay ahead of your competition?

If you are ready to invest in innovation I have great news for you. On Thursday, June 14 innovation expert David Peterson and the Valdosta-Lowndes Chamber of Commerce will host Innovate! 2018.

I will be one of seven speakers providing you with the information and motivation you need to create an innovation platform for your business. It is going to be a great day. I cannot wait to learn from the experts there and I hope you can join us.

You can learn more and register here – https://www.valdostachamber.com/calendar–events.html.

Curt Fowler is President of Fowler & Company (valuesdrivenresults.com) and Director at Fowler, Holley, Rambo & Stalvey (valdostacpa.com).