Business practices need to be progressive: innovative products in themselves will not suffice if they are combined with obsolete management practices. This is not the right way to succeed.
Are mobile phone and broadband providers leading the race as far as digital innovation is considered? In fact, according to an article on the director.co.uk website, in terms of customer experience they are often among the worst-performing companies.
Yes, they do bring new products to the market. However, management at these companies uses outdated practices, so much of the complexity associated with new products is shifted onto customers. This can be a really annoying experience if, for example, you want to arrange broadband connections when moving home.
Stay relevant or become history
Companies cannot retain customers merely by introducing new products and services. Challengers often redefine what is taken for granted within an industry. And consumers then start questioning the value of offers which have already been on the table for several years.
Innovative companies ask new questions and highlight neglected issues. Even if their new products cost more, they offer a fresh perspective and are usually able to solve problems more quickly and precisely.
Challengers are not constrained by historical trajectories. Therefore, it is easier for them to adopt lean business practices, which accelerate their decision-making and make them more responsive to dynamically arising challenges. Even so, established companies still have the chance continously to transform themselves and stay relevant. Apple, Ikea and Volvo have proved that innovative changes can help them remain on the market and use new technological innovations to their own benefit.
-jk-