Innovation is a very important aspect of running a business. It takes innovative thinking for an entrepreneur to get started and get the business off the ground to begin with; and it takes innovation to keep a business fresh and in a state of growth. Since so much business is conducted via the internet, small businesses are no longer just competing with local companies in their region but with global businesses. One of the keys to being able to keep a business alive is having an emphasis on innovation instead of getting in a rut of just doing things the old fashioned way.
According to the dictionary, innovation is defined as introducing something new, whether it is a method, an idea or a device. To maintain an innovative atmosphere it is important to create a work environment that fosters, stimulates and rewards creativity.
Business Model to Include Innovation
When developing your business model it must be a top priority to include innovation and creativity as core values. Employees need to know from the start that the company has an emphasis on innovation and that creativity is rewarded and not shunned. When you are drawing up the core values of the company do not be vague about innovative ideas. There is not enough to substantiate the thought in a simple statement like, “our company strives to innovate.” It leaves the employee scratching their head and wondering what needs to be innovated products or processes. Be very specific with statements.
Let Everyone Participate
Engineers can be great innovators; however do not limit innovations to just one type of worker. You never know when a great innovative idea for a product may come from an office worker or an accountant. Don’t discount their new ideas on how to process purchase orders or invoices. They may have some innovations that end up saving the company a substantial amount of money. An idea that leads to improvements may come from anywhere; it is important to encourage an environment which is open to innovation for everyone in the company.
Build a Creative Atmosphere
It is up to you to create a creative atmosphere. Use colors which stimulate creativity and make sure there is adequate lighting; natural light is best if it is possible. Use inspiring colors and hang artwork throughout the workplace. It is also a great idea to provide a variety of creative activities for employees. Providing the right environment can increase employee’s creativity and output. There are some companies which provide stimulating games such as foosball and pool to help keep employee’s creative juices flowing.
Designate Time for Creativity
Stuffing someone in a cold white office for hours on end will stifle creativity. Get your workers out of the office now and then. Perhaps one Friday a month take a group outing. This may depend on the type of work that they need to do but trips to the library, gym or even a local coffee shop can spark creativity. One book company we are familiar with takes their design artists out to local bookstores/coffee shops once a month. They take time to discuss the various book covers, the creativity or lack of creativity in the designs. This fosters innovative thinking.
Reward Creativity and Innovation
Make sure to reinforce innovative ideas. They should feel comfortable sharing new ideas and it is important that they get credit for the ideas that are used. Rewards do not have to be outlandish, gift cards are an inexpensive reward. It is okay to reward with money and some even offer a bonus as well as a simple, but public recognition of their contribution.
To foster innovation will mean that you create an environment where new ideas are welcomed and rewarded. It is not an expensive undertaking to design a work environment that stirs up employee’s creative juices and foster innovation that each person has.
One of the most difficult challenges an entrepreneur faces is raising capital for start-up. Efraim Landa is an entrepreneur who has faced these financial challenges and co-founded a company who can offer advice for start-up and emerging businesses. The first thing that needs to happen is that there must be a clear-cut business plan in place. If the business has no plan for success investors and other possible financing options will not be as quick to “buy in” on the idea no matter how good it is.
A business plan should inform potential investors about how the business will function, how profits will be realized and a projected growth rate. These must be reasonably stated and if possible include research data. A business plan should give potential investors or lenders a good look at the company’s real potential. Without a proper business plan investors will not have anything concrete on which to base their decision of whether or not to invest in a company.
It is important to create ways to present the company’s information through a presentation. It should include information about your project, the market and marketing strategies, and how the business will be managed. Also explain why the product is important and why it will sell. This, in conjunction with a well written business plan can be the “selling point” for a business.
After the plan is in place it’s important to identify any potential investors. There are many options and companies like Effi Enterprises that are established to help entrepreneurs find investors. They can provide the guidance needed and they are also private equity investors. Get informed on the options available and pursue the routes that seem most productive.
A term sheet should be created which outlines why the company is a good investment. This will include a valuation. If it is uncertain there should be at least a reasonable estimate of the company’s worth. Investors will be interested in helping establish a business in which they will be able to reap financial benefit in the long haul.
Angel investors are usually individuals who are willing to offer start-up financing for a new business. Venture capitalists offer financing options for new and start-up businesses in exchange for controlling interest and a portion of the profits. There are several types of private equity financing options available. It may be in the company’s best interest to work with a consulting business such as Effi Enterprises which is a company who helps start-up businesses locate various types of funding options. They can also help with preparing or reviewing business plans. One area in which a business needs direction is in locating angel money and other sources of business capital.
Once a firm or individual is located which can help provide financial backing for the business, set up an appointment. Be prepared and present the business plan and the proposition is a very honest manner. Let them know how the business started and how it is functioning presently. It is important to convince them that the company is a good investment. Be prepared to discuss how business strategies, investment strategies and financial arrangements will be handled. It is imperative that the potential investor can see the progress of the company so far and its great potential for profit.