Why your Business Must Innovate and Diversify by Vic Oenning, SR Vice President and General Manager
With many economic challenges, increased competition, and the growth of technology, businesses large and small are struggling to maintain growth. Many managers are jammed for time just trying to keep the status quo and new ideas seem impossible to implement. The questions we face every day are many – is our service still a factor? Is our competition growing? Is my team’s daily performance driving growth? Will we make our annual plan? These are all good questions, but short-term in focus. Long term thinking is critical in today’s ever-changing business environment. Innovation and diversification are the fuel for long-term success, but they take resources. If you are already operating lean and struggling to meet annual profit targets then it is hard to commit the time, resources, and capital necessary to innovate and diversify.
At Corwin we have taken two approaches to diversification:
- We have looked for new products and services that we can sell to our existing customers in order to generate new revenue. We looked for products our customers needed that we could simply add to our existing deliveries. Some products we have added are coffee, chips, candy, and nuts. When we secured a new item, we utilized the team approach to creating the implementation plan for going to market. As new products are chosen they are taken to market using the previous product’s implementation plan and its learning’s so we benefit from previous successes.
- We diversified our customer base by taking our products to the Portland metro area. This geographic expansion has added new revenue to help offset our growing operating expenses and the rising cost of goods. Additionally, we have utilized employee committees to develop the implementation plans for these projects, which in turn will create a team that is empowered to own the project and its success.
Innovation is another key for businesses today. With today’s economic challenges you need to constantly be looking for innovation in current processes, in the products you offer, and in the way you do business. Innovation can be a double winner for any business. For example, it can lower costs by re-inventing a current process or it can add revenue by adding a product or service via totally new customers. The primary goal with innovation and diversification is to generate new revenue and profits, but other wins can be attained as well. By correctly implementing innovation and diversification you can challenge your team and provide some noticeable benefits.
Those benefits include:
- Employee engagement grows by creating ownership of projects and this dramatically improves your odds of success.
- Employee empowerment helps improve productivity, builds employee loyalty, reduces turnover, and also helps employees embrace change.
- Organizational commitment grows and helps the team to build a sense of responsibility towards the mission of the company.
Today a forward thinking company should aim for innovation and diversification and not get bogged down by the day to day that prevents you from being the best in your field. To start momentum a company must develop a sense of urgency for diversity and innovation, create a plan, and then dedicate the right resources to this strategic long-term need. The result is diversification and innovation become part of a company’s annual budget, its strategic plan, and most importantly, its culture.