Innovation vs. Improvement: Weighing the Benefits
A wise leader understands the value of improvement and innovation. An impactful leader understands the differences between the two. Though both are equally critical for long-term business success, the former enhances an organization while the latter redefines it.
Innovation and improvement should not be used interchangeably. So, it begs the question: when should you innovate, and when should you improve? The answer might surprise you.
Innovation vs. Improvement: What’s the Difference?
The ability to harness both improvement and innovation can drastically increase your business value. Organizations that embrace these methods not only survive, but thrive in today’s competitive marketplace. However, it’s paramount businesses understand what sets improvement apart from innovation.
Improvements, including process improvements and product improvements, are incremental changes that better a business’s goods or services. Improvements begin by analyzing an existing process and asking the question, “What can be better?” It can be applied to cost, value, quality, safety, or customer satisfaction. It’s generally low-cost and low-risk and is ideated and implemented by entry-level staff.
Innovation, including process innovation and product innovation, means introducing an entirely new business concept. As opposed to asking, “What can we make better?” change asks, “What can we do differently to achieve significantly better results?” Innovations introduce fresh ideas, goods, services, and knowledge to an organization. They can be applied to manufacturing techniques, internal processes, and management methods. Innovations are generally more impactful, higher-risk, and affect the people, not just the process.
Is Innovation Inherently an Improvement?
A common argument is that innovation is improvement by design. Consider a restaurant menu, for example. In this scenario, guests are complaining because the existing menu is hard to read. They’re frequently flagging down wait staff to ask questions or clarify a menu item.
An improvement would be to enhance the font size and utilize a more contrasting color palette to improve visibility. Innovation would be to implement a scannable QR code that allows guests to view the menu on their smartphone.
Does innovation also improve the problem? Yes. However, innovation introduces a re-imagined version of the product, while the improvement only builds upon the existing product. Innovation creates a secondary method of viewing the menu that can reduce customers’ frequent questions for waitstaff. The innovation will also cut down on business expenses in terms of printing and distributing new menus. In this way, the innovation outweighs the improvement, despite the benefits of both.
When is it Appropriate to Improve Rather Than Innovate?
There are instances in which improvement may be more impactful than innovation. When deciding if a concept requires improvement rather than innovation, consider what elements of the process have gone awry. Improvements carry much less risk and are generally less expensive and less arduous to implement. If the problem can be solved by implementing one small change, does it call for an entirely new process? In the situation above, perhaps the restaurant needed better lighting, not a new menu.
Consider it this way: implementing one minor improvement to your process will not disturb your overall workflow. Instead, it’s probable that the improvement will remove the roadblock you’ve been facing. Innovating an entirely new process can also eliminate that roadblock, but at what cost? A new process runs the risk of solving one problem just to create a dozen more. What if the aforementioned QR code confuses guests even further? When facing minor inconveniences or lags in your workflow, it’s best to first improve before redesigning your entire process.
When Does Innovation Take Priority Over Improvement?
In the instance where a product or process is riddled with issues, it’s best to innovate rather than improve. The reasoning is simple: innovation doesn’t just impact your overall product or service; it affects your employees. Your workers simply cannot be effective when their systems are broken. If you’re selling an unsatisfactory product or service, you can’t expect your workers to be at optimal productivity. The overall system is flawed, and it will affect your company from the bottom-up.
Unlike minor improvements, innovation requires collaboration, cooperation, and communication. It takes the unity of an entire organization to put in motion. By completely restructuring a broken concept, employee satisfaction and productivity increase in tandem. When issues in your process limit productivity, you’re likely due for an entire concept overhaul.
How to Develop an Innovative Mindset
Several founders, managers, and leaders are equipped with an improvement mindset. Even when a product or service is born of innovation, improvement continues to push the company forward. However, to generate long-term business success, you must be able to innovate.
Jeffrey Bartel, chairman and managing director of Hamptons Group and adjunct professor of business strategy courses, continuously advises peers and students alike to embrace an innovative mindset. With an extensive background in real estate investment, private capital, and advisory, he insists that without innovation, businesses cannot compete in a competitive marketplace. And as former senior C-suite executive at Fortune 200 companies, he understands what it takes to create a successful organization.
A company that prioritizes innovation will cultivate a culture that encourages employees to engage with one another as well as stakeholders in the company. Jeff Bartel believes this creates a high-performance environment that replaces an “improvement for the sake of inspection” mentality with a more positive and productive approach. Dedication to innovation will ultimately yield several long-term benefits, including employee satisfaction. Jeff Bartel notes repeated innovation among the likes of Apple, Dyson, and Nike also wins customer satisfaction and can offer an immediate return on investment when introducing new goods or services.
What’s Best for Your Business?
Innovation vs. improvement: which is best? Truthfully, each is impactful in their own right. It’s up to you to decide which is best for your business.