Hidden innovation needs to be brought out from the shadows and into the spotlight.
Many companies developing their businesses are possibly not even aware that they are innovating and that this process can be financially beneficial.
Thus the only way to reap any residual benefit from transforming a company’s fortunes through is to bring it into the open.
Increased competitiveness is a crowded marketplace is obviously the number one priority from investing in innovation.
Core business development to gain that extra one per cent of gain over rivals will always remain crucial to success.
But claiming Research and Development (R&D) tax credits can lead to increased investment and thus greater gain as the ‘virtuous circle’ grows ever wider.
UK companies failing to invest resources, time and cash in innovation projects are either so self-assured that what they are doing can’t be improved or are simply meandering and sleepwalking on a path to stagnation.
In a nutshell, without innovation there can be little progress – and no chance of taking advantage of the generous incentives available to support innovative activity, such as the Research and Development tax relief scheme.
So, we recognise that innovation, particularly with regard to manufacturing (but the analogy covers most sectors), equals increased revenue, new or improved products, reduced operating costs, better productivity and a much improved business model businesses.
This, therefore, begs the question as to why more companies don’t plunge headlong down the innovation and investment route but seem rather hesitant to commit funding to this fundamental process.
However, the good news is that many companies are innovating constantly as they go about their daily basis. They just have to realise this.
It may be a case that innovation is still regarded as the invention of the wheel, the discovery or radium, putting men on the moon or starting up the internet.
Anyone of a certain age will remember the BBC’s Tomorrow’s World programme and the jetpacks with which we were supposed to be transporting ourselves around by now.
Not all ideas have to be big. The UK registered charity innovation foundation Nesta (founded as NESTA, National Endowment for Science, Technology and the Arts 20 years ago with Lottery backing) acts through a combination of practical programmes, investment, policy and research, and the formation of partnerships to promote innovation across a broad range of sectors.
Some years ago Nesta came up with a series of indicators detailing different types of hidden innovation which remain true today.
Type I: Innovation that is identical or similar to activities that are measured by traditional indicators, but which is excluded from measurement. For example, the development of new technologies in oil exploration
Type II: Innovation without a major scientific and technological basis, such as innovation in organisational forms or business models. For example, the development of new contractual relationships between suppliers and clients on major construction projects
Type III: Innovation created from the novel combination of existing technologies and processes. For example, the way in which banks have integrated their various back office IT systems to deliver innovative customer services such as internet banking.
Type IV: Locally developed, small-scale innovations that take place ‘under the radar’, not only of traditional indicators but often also of many of the organisations and individuals working in a sector – for example, the everyday innovation that occurs in classrooms and multidisciplinary construction teams.
It may well now be more obvious that the word ‘innovation’ can cover a multitude of bases and that businesses may wish to engage in a little self-analysis to see whether potential can be maximised, particularly in sectors (ie not science or technology) where it might be felt there is little or no development.
That is where we at business innovation funding and tax relief specialist GovGrant can step in to help businesses understand how they can monetise innovation.
Call us today on 01727 738600, a simple phone call is all it takes to find out more….