Technological Innovation in Firms
Technological innovation means coming up with and implementing novel products or services that are an improved or better version of the previous ones. Innovation encompasses translating ideas into concrete and replicable forms that are economical and satisfy individual needs. Firms need to be innovative to stand out in the every-growing market. According to Distanont & Khongmalai (2018), it gives businesses a competing edge by allowing them to present products and services to the market before their competitors thus increasing their market share. Innovation also gives the businesses a chance to stand out, thus improving their profitability. Some advantages of technological innovation include opening up new markets, hence allowing the business to grow beyond its locality. It also enables firms to reduce their costs by avoiding expenses such as laborers’ salary when they implement automated means. Technological innovation also allows timely information, speed, and efficiency.
Despite the above advantages, technological innovation also has some disadvantages such as its set-up costs. This expenditure may end up crippling the firm when it does not make profits in the long haul (Joseph, 2018). Various personnel in the company may also have a hard time adopting the change while letting go of what they are used to. It may also become a challenge when a firm adopts an alternative way of business such an automated machinery. This instance would mean lose of jobs for some employees who might have been in the firm for long and invested in their jobs. Technological innovation may also have wider outcomes in the external environment such as pollution. Notwithstanding the raising consequences, companies have to stay ahead of their competitors to stay in the market. Some fail in their implementation of innovation projects for reasons such as running out of money to invest in the undertaking. They may have poor plans leading to overestimation of their abilities, thus leading to losses. Most innovative plans require planning and strategic execution. The market is an uncertain and ever-changing venture, hence the need for adequate research before presenting one’s products to it. Without these, the business’s innovation project can fail and bring about unprecedented losses to a company.
References
Distanont, A., & Khongmalai, O. (2018). The role of innovation in creating a competitive advantage. Kasetsart Journal of Social Sciences.
Joseph, C. (2018). Advantages and disadvantages of innovative technology. Chron. Retrieved from https://smallbusiness.chron.com/advantages-disadvantages-innovative-technology-24267.html