Innovation and Entrepreneurial Competitiveness
In highly dynamic global markets, businesses seek ways of maintaining or enhancing their competitive advantages. The invention of the internet and technology has eliminated physical borders and made it mandatory for businesses to compete globally. Consequently, entrepreneurs must innovate to succeed in such competitive environments.
Innovation has existed from time immemorial and forms an essential aspect of human survival. According to Distanont and Khongmalai (2018), it is a process of converting an invention or idea into a viable commodity capable of additional yield demand at the market. That is, it entails an organization deliberately encouraging imagination, information, and initiative in targeting different or more significant values from the resources it controls. Entrepreneurs often lead the way in innovating products, services, or processes, and for several reasons. Some of these reasons are as follows.
The approach helps them to stand out from competitors. The approach entails creating an enhanced commodity distinction in its form, appearance, qualities, benefits, or availability. Substitute commodities progressively concentrate the markets, making it essential that businesses distinguish their products or services, or seek new markets. Innovation supports creating the kind of uniqueness that makes a brand easily notable.
Moreover, modernization helps meet changing market preferences and tastes. The commercial market is constantly changing, and what was fashionable this year might be undesirable next year. Leading multinational corporations recognize this need and actively invest in ensuring they lead the way in innovating. For instance, Zara, a leading fashion retailer, has gone an extra mile in recognizing market dynamics by committing to invent new attires on a bi-weekly basis (Zara: Zara Collection, 2020). Innovative leaders are always on the group listening to the clients and noting changing perspectives to inform the development of new solutions. The contributions they impart by innovating helps them retain or attract clients, which impacts the company’s market share positively.
Attracting top talents is also a consequence of maintaining an innovative culture. Often creative and talented individuals whose skills are in high demand prefer working for leading firms (Aziz & Samad, 2016). The fondness is part of their intention to meet the challenge posed while at the same time elevating their career opportunities. Active entrepreneurs understand this need and actively promote a culture of openness and creativity. The more skills and talents at the disposal of business leaders, the more competitive a corporation becomes.
Finally, innovation is a prerequisite for rapid growth. Innovative corporations have a rapid growth rate that is higher than that of the less innovative firms. They can secure new clients and markets faster, making it easier to penetrate existing and new markets. In times of crisis, such as the ongoing COVID-19 pandemic, innovative firms have continued to find viable alternative ways of remaining competitive amidst erratic social engagement policies. For example, moving business operations to virtual platforms have helped leading tech firms, such as Microsoft and Google, to remain competitive. The other non-responsive firms have either shut down operations or are operating below capacity.
Nevertheless, an innovative culture threatens a lack of follow-through and might involve engagement in risky conduct. Innovators have rapidly reorienting mindsets that at times become a burden. Changing perspectives risk leaving new projects ignored or unattended, which can be risky and costly.
Overall, innovation is a prerequisite for entrepreneurs in ensuring survival. It not only helps them to stand out, but also meet changing market preferences, attract high-demand skills, and ensure rapid growth. Firms that pursue this approach have higher chances of succeeding in future amidst changing market dynamics.
References
Aziz, N.N. A., & Samad, S (2016) Innovation and competitive advantage: Moderating effects
of firm age in foods manufacturing SMEs in Malaysia. Procedia Economics and Finance, 35 (2016), pp. 256-266
Distanont, A., & Khongmalai (2018). References The role of innovation in creating a
competitive advantage. Kasetsart Journal of Social Sciences. Retrieved on 11th July 2020 from https://www.sciencedirect.com/science/article/pii/S2452315118300080
Zara: Zara Collection (2020) available at https://www.zara.com/ww/en/z-company-l1391.html?v1=11112 [Accessed 17/6/2020]