If You’re Competing on Price, You’ve Already Lost the Battle

April 18, 2015

8:00 am

Tesla Motors has been making some serious waves in the auto industry over the past few years. What makes this so remarkable is the size of the company compared to the major U.S. and foreign automakers. But unlike Audi and BMW, it’s not pricing that sets Tesla’s cars apart. In fact, the company recently introduced a $75,000 Model S 70D.

Tesla is winning with its innovation in meeting market needs, not getting stalled on price.

Provide Sustainable Value Through Innovation

Regardless of a company’s size, innovation is its lifeblood. A lack of innovation is what allowed Tesla to grab market share in the automobile industry, and it’s also what caused Blockbuster to buckle under the pressure of Netflix and Redbox. When a company rests on the laurels of its past success, it allows its competitors to develop sustainable innovations that work within the complex marketplace.

Just look at Nokia. It lost the high ground in mobile innovation that it made famous when it wrote Apple off as a niche manufacturer. Apple went on to favor innovation over price and transform the mobile device into the revolutionary contextual computing platform it is today while Nokia faded into the background.

Focusing research and development resources on developing viable innovations will empower your team to explore, validate, and experiment with the ideas of tomorrow. Eventually, you’ll create viable solutions that provide value to both internal team members and customers.

You can foster an environment of innovation in your organization by putting these six strategies into practice:

1. Have you ever watched kids play? They start with a concept for a game, but as the game progresses and more solutions are needed, the rules evolve. It doesn’t take long for a one-on-one game of basketball to evolve into a 50-on-50 game with every kid on the block.

The game changes as the game grows, and their mental resilience creates a vast and imaginative canvas where new ideas flow freely. Teach your teammates the art of play to remove the burden of labor and to prepare them to think outside of predefined boxes.

2. What seems impossible today is tomorrow’s reality. People are constantly developing new tools and apps to increase productivity, business development, security, and more. Keep an eye on trends to help predict where to focus innovation research.

3. A great product is more than a great idea; it’s the result of exploration, experimentation, and mistakes. Actually pushing an idea through to implementation allows your team to fully explore all of its intricacies. And when you build a culture around testing, building, and observing, you’ll learn how to document the unexpected.

4. Great ideas are fostered in an environment where flaws are celebrated. Instead of following disciplinary actions when a mistake is made, explore how it happened, what it created, and how you can make it better.

5. Empowering your team members with information grants them the confidence and education they need to learn and grow. I’ve worked for some of the largest firms in the world, and their internal communication and education is laughable.

6. Become a tool builder. I grew up living on a sailboat, and it’s something that continues to shape my worldview. I was always building, fixing, and making, from the sails all the way down to the engine. Success was defined by my access to tools.

Similarly, a great innovator needs great tools. Wearables, 3D printers, virtual reality, and robots all exist. Give them to your teammates along with a LEGO set and a clear mandate. Openness gives you the platform to ask, “How might we?” Education will empower your team to know the answer, but tools are the key to moving atoms and pixels.

Of course, low prices matter to consumers, but not as much as you might think. There was a time when anyone could pick up a $15 landline from any brick-and-mortar store, yet people still lined up down the block for a $500 iPhone.

Build smart, efficient programs that enable the best work to be done, regardless of your organization’s size. Understanding operations, project management, resourcing, and project planning are the key activities that drive delivery. If you’re competing on price alone, you’ve already lost the battle — true sustainable innovation is what transforms the world.

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Shanon Marks is the chief innovation officer at MU/DAI. His work focuses on the application of emerging technology and harvested data to augment and improve the human experience, accelerating the market through innovation and emerging technology. He simplifies technology through design, leveraging the analytical power of digital to create predictive and invisible experiences. He’s constantly searching for the innovations that will fundamentally improve our lives and our planet.

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