We Make Pesto, Not iPhones! #60 #cong17

By John Magee.

Why is it so difficult to connect start-ups & small businesses with the extensive range of supports available from the state to support product innovation?

As someone who works in the enterprise support arena, this is a question I regularly struggle with. Although it is often the case that the default thought process for many starting out in business is “sure there is no help available”, the truth is quite different. Ireland Inc has an excellent start-up support infrastructure, with over 170 different supports available to business, many of them aiming to de-risk the innovation process for early stage businesses. But the take up on many of these is quite low. Why is this? Why is there such a disconnect between available support and take up?

There is no easy, or single, answer to this. I think it has something to do with a fundamental misunderstanding of what innovation looks and feels like and a perception that innovation is an activity reserved for ‘big’ businesses or those in specific sectors. When the pesto manufacturer pointed out to me that he wasn’t making iPhones he was reflecting his view that innovation wasn’t at the forefront of his thought process. Having talked through his own approach to manufacturing a high quality product he accepted that there may be a few things he did that set his product apart from others in the marketplace and yes, he did have some further ideas that could benefit from technical support. Yes, his product tasted better because it was prepared differently. But innovation? Well that was a grudging acceptance. 

So, partly it is a failure to recognise the basic simplicity of innovation. It isn’t about a new gadget, nor about adding a new feature to an existing one. It is often about taking features out… making things simpler.  My pesto friend was creating a better customer experience by simplifying the product – real innovation.

This experience is in no way unusual. Try getting the small business community to attend a seminar or workshop on innovation. It’s a proper struggle. The real paradox here is that for most small companies they must be intrinsically innovative in order to get any significant traction in the marketplace in the first instance. Otherwise they’ll immediately come up against a better resourced or longer established incumbent. The disconnect, therefore, must relate to their own perception or understanding of their activity, relative to their perception of what constitutes innovation. Effectively they simply don’t think of themselves as being in the innovation arena.

A follow on question is therefore whether this inhibits the cultivation of a genuine culture of innovation in small business. If so many business owners instinctively recoil from viewing their activity as being innovative, then how can we expect them to invest in innovation or seek innovation support as they become established? How can we expect them to seek support to develop the next iteration, simplification or new product?

Or does it actually matter at all? Ireland ranks in the top 10 countries in the world in the Global Entrepreneurship Index, so we’re getting a lot right. Our small business sector remains the main engine behind new job creation nationally. It remains the case that micro enterprises actually have an innovation advantage in that they’re more nimble, flexible and innovative by definition.

We should also remember that start-ups and small businesses are not the same thing. Innovation is more intrinsic for a start-up, but not necessarily a more established small business. Start-ups might be more open to the various supports available, but for a variety of reasons they might not have the financial capacity, energy or operating ‘space’ to allow them to access innovation supports, whether training or programmatic. Proper targeting of supports is therefore essential.

It seems that in terms of supporting micro enterprises there is a constant need to demystify innovation, how it works and how it can be developed and supported. An integral element is to the consider whether the professional working in the enterprise support space truly understands innovation and its related dynamics. If these professionals struggle with the concept, then they’re poorly placed to positon and sell the range of innovation supports available. Perhaps greater emphasis needs to be placed on the advertising / packaging / explanation of innovation supports.

Given the various areas where the disconnect can and does occur… it’s hard to escape the simple realisation that many small businesses are more innovative than we all realise. It is also hard to avoid thinking of what might be achieved if we could plug the gaps and align supports with perceptions and invent a language around innovation that fosters greater business and agency engagement!  

My friend who makes pesto… he is at the cutting edge of innovation. For him. And that’s all that matters really.

CongRegation © Eoin Kennedy 2017 eoin at congregation dot ie