Innovation and the economic crisis
Companies in times of economic uncertainty certainly have to make a more innovative product as well as having leadership strategies to ensure that there business remains competitive. The ways in which companies can innovate to remain competitive during the economic downturn is to make there product stand out in the market place. The pricing and the product extension strategy could be used to ensure that the companies products are priced to sell more as well as the product should have more product benefits to ensure that more customers are aware of the product that a company markets. One aspect of marketing strategy is to ensure that the product extension strategy targets more customer markets and that the product meets the needs of there target market. Project management can ensure that costs are reduced to an optimal level and that budgets are not exceeded by costly mistakes or costly budget decisions that places the companies finances under excessive pressure.
Other areas of business innovation can come from the better design of products and to also have strategies for the business as a whole to be more innovative. The levels of competitive advantages can result in much better profits and more target customers being won. Production innovation can include examples such as better production methods and using total quality management techniques in order to make the product more fast and efficiently as well as effectively. The economic crisis means that businesses have to make more efficient use of resources and plant and machinery innovation throughout the business should be used. Companies also have to make use of better decision making, such as budget variances, cost per unit, all of these factors should be investigated to minimise costs as well as making sure that the company has good control over costs and ensuring production levels are optimised.
If businesses fail to innovate then this has the disadvantage for existing customers who would think that the company is not up to date in its processes and in its business image. The failure to innovate can also mean that employees view the business as a whole in a negative way which also affects productivity and morale in the work place. The ways in which companies can innovate is to measure there innovation rate by using benchmarking techniques, using surveys to ask samples of people about specific businesses. Other ways a company can innovate is to increase spending on research and development, employ consultants to assess ways in which a company can innovate and become a more successful business.
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