Thursday, December 6, 2007
Being a small, nimble technology company, innovation has to be integral to our daily lives. For us to build a successful company we know that we have to constantly discover new ways to deliver our service, improve client experiences, and exploit needs in the marketplace.
When you innovate, however, everyone needs to be mindful of the risks and downsides. As the innovating firm: are you making a bet on a new feature that the market can’t support? Could the money spent on sales people be used to make the product better? How do you best support a growing client list and turn your customers into raving fans? As the customer: how will the new way of doing things positively impact your business? Are the implementation risks too great in relation to the upside the innovation can deliver? What if the product doesn’t work?
There was an interesting article in the NY Times this week about how we are currently experiencing the downside of innovation in the financial markets with the growing fall out from questionable sub prime lending practices and the housing bubble. It is scary to see how the lure of significant short term financial gains forced credit lenders to ignore the inherent risks in the system they were creating – they figured it was the responsibility of the buying public to know better. With hindsight this was, of course, completely irresponsible. The fallout has been dramatic, far reaching, and unfortunately it doesn’t look like we have seen the bottom yet.
The moral of this story: innovation can be truly great when there is a partnership between the innovators and the consumers of the innovation. One where everyone understands the upsides and the risks, and the customer understands that the value the new innovation is far greater than any downside associated with it.