Typeactivity activity to help you explore the

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type=“activity” Activity to help you explore the importance of strategic advantage through knowledge in innovation is available on the Innovation Portal at Why Does Innovation Matter? As we’ve already seen, innovation is about survival and growth – if we don’t change then competitive forces may threaten our future. But on the positive side there are real opportunities for those able to manage the process well. For example, in its regular survey of ‘innovation leaders’ in 25 sectors of the economy, the consultancy Innovaro reports not only that these companies outpace their competitors on a year-by-year basis but also that this has a marked effect on their share price. In the period 2003 to 2013, they regularly outperformed the average share price index on the NASDAQ, Dow Jones and FTSE markets, and in 2009, when other companies’ share prices grew on average by between 40 and 70%, the Innovation leaders’ average growth was 130%. It’s also important for whole economies – as the economist William Baumol pointed out: ‘Virtually all of the economic growth that has occurred since the eighteenth century is ultimately attributable to innovation.’ 2 Not for nothing do regional and national governments spend a great deal of money trying to stimulate and support innovation in different ways. But part of the problem is that innovation involves a moving target – simply being able to manage it effectively today is no guarantee of long-term success since technologies, markets, regulations and other elements are constantly changing. So successful innovators are concerned to develop ‘dynamic capability’ to change their approaches. The risk is clear if organizations fail to keep pace: there are plenty of examples of major corporations which began with an innovative flourish but ended up beaten by their failure to innovate fast enough or in the right directions. The examples of great photographic pioneers Kodak and Polaroid are graphic reminders that competitive advantage doesn’t always last, even if you are a major spender on R&D and have powerful marketing skills. type=“caseStudy” Case Studies of this challenge – Fujifilm and Marshalls – are available on the Innovation Portal at
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To Whom? Innovation is about survival and growth, so simply leaving things to chance is not a great approach. Instead, individuals and organizations need to take innovation seriously; it has to be more than just a slogan. And that means having some clear idea of where and how making changes can take us forward – a ‘strategy’ and some idea of how we will implement that strategy, how we will make innovation happen. But innovation also matters to a range of what we might call ‘policy agents’ – organizations which have a broader concern with innovation. These include: ! governments (local and national): innovation creates economic growth, jobs, etc., so fostering innovation becomes a key issue !
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