Innovate or die?!

“Innovate or die” is a business slogan which has been around since the mid-1990’s and was often used by the Microsoft founder Bill Gates.  It struck me this week that considering this train of thinking is nearing 20 years old now, how fundamentally relevant it is in today’s challenging economy…

Let’s face fact: it’s tough out there at the moment… Many large corporates, who were once extremely successful, are announcing worse than expected performances in the first quarter of 2013. This news isn’t curtailed to just banking either – it’s across retail, automotive and consumer electronics amongst many others.  For these businesses to survive, there is now immense pressure to innovate in order they differentiate themselves in an ever-crowded marketplace.  Arguably, one brand which currently feels this pressure on a monumental scale is Apple.

Apple has been the darling of the IT industry over the last 10 years as it has transformed itself from a somewhat niche, small-scale computing manufacturer to a global “mega brand”.  Through truly ground-breaking innovation, they managed not only to re-invent themselves as a business but – fundamentally – how consumers use technology in their everyday lives.  It started with the iPod back in October 2001 which, practically overnight, re-wrote the rule book for the manner in which consumers not only listened to music but the way in which it was procured. The launch of iTunes in April 2003 will be looked back as being one of the major game-changers of its time as consumers were introduced to the world of digital content. Not satisfied with revolutionising how we listen and purchase music, Apple then focused on the humble smartphone, launching the iPhone in June 2007. By this stage, consumers the world over couldn’t get enough Apple in their daily diets, to the point of mass hysteria breaking out whenever the next product was released.  Indeed, when they launched the iPad in April 2010, nobody could have predicted the phenomenal demand and the creation of the tablet marketplace so readily – not even Dell or HP!!

However, in recent years, it could be argued that the level of innovation from Apple has dramatically halted.  Key releases have been refinements to existing product lines rather than transformational new products and though sales are still at an enviable level, net profits have fallen for the first time in a decade which has seen their share price fall 40% since its all-time high in September last year. However, to contextualise this, net profits of £6.2bn over a 3 month period are the sort of results most other businesses would metaphorically kill for at this moment in time…!!

So what does Apple do now??  Their competition has been slowly catching up in recent years and some technologists claim that Samsung are now the lead innovator in their field, leaving Apple to scratch their heads.  If the rumours are to be believed, however, then Apple are gearing up for their next transformational play with Tim Cook recently stating that “the most important objective for Apple will always be creating innovative products”.  If the postings on various internet chat rooms are to be believed, then Apple have a number of exciting new products which are close to release.  Some believe that the next new product will be the “iWatch” – a Dick Tracey style gadget which will allegedly transform our lives with it being able to not only tell the time, but view messages/emails, play music, take calls with and track our activities such as fitness programmes.  The other big prediction is that Apple will enter the TV marketplace, launching a product which does away with the need for a remote control and is instead operated by human gestures.

Whatever Apples decides to do next, one thing for sure is that they do need to innovate if they are to continue their success over the last 10 years.  Maybe that is an impossible task – after all, competition in their marketplace is higher than it’s ever been as other brands look to get a share of the enormous revenues that exist.  Samsung already have in existence today televisions which can be controlled via hand gestures and smartphones which can use eye movement to scroll through content; Google are close to launching a pair of glasses which interact with your daily lifestyle to take pictures of what you see, give you directions and pull in contextual information from your surroundings. In my opinion, to succeed in today’s market, not only does a company need to invest in a programme of continuous innovation but they need to ensure they don’t invent for the sake of it – to excel in your marketplace, you need to add value through innovation and not solve problems which don’t exist…