However, there’s really not much incentive. Let’s say you take a lot of money and you spend it on R&D. You do a bunch of market research, talk to some existing customers, and start developing some prototypes. Then, after a few years, the idea fails.

The ROI on your investment? Zero. Zip. Zilch.

Or, let’s consider another path. You take a lot of money and you spend it on R&D. You do a bunch of market research, talk to some existing customers, and start developing some prototypes. Then, after a few years, you become a huge success.

Then what? People start copying your idea.

The ROI on your investment? Small at first and then smaller. Why does it get smaller? Because people start copying your idea and cutting into your market share and profits.

Heads I win, tails you lose.

One solution to the situation is not to innovate. I’m going to ignore that because it’s the wrong answer.

Another solution is enforcement of intellectual property. By either using copyright, patents, or trademarks, you can protect a part or all of your invention for a period of time. Then, ideally, you could recoup some money for the length of the legal document. This only works for large companies with deep pockets. Small companies don’t have the money to enforce the patent issue.

Eli Whitney, the inventor and patent holder of the cotton gin, was eventually forced out of business due to filing lawsuits against knock-offs and competitors. This is a perfect example of how a revolutionary invention forced the inventor out of business. Doesn’t seem right, does it?

Why innovate then? Because it should be your goal to change the world. Don’t settle for mediocre. It’s rewarding to participate in something bigger than yourself. When you reach retirement age, you want to look back and say that you’ve contributed to changing the world.

Of course, there are economic and strategic reasons to innovate. I’ll talk about those next.

But I can tell you this, it’s not as exciting as changing the world.

Lucky or Smart

Identifying the right trends can make or break your business

There are several sites that can be used to watch the latest tech and social trends. These provide one way to watch for upcoming opportunities for your company. However, the identification of the trend isn’t the magic spot and understanding the opportunity isn’t really any more difficult.

The real aspect of things come into play when you try to figure out exactly which new trends make sense for you as a company. The risk associated with trying new things is real. And, just like everything, if it doesn’t work out, there is a chance you could lose time and maybe even money. However, there is a way that you can transition into the new initiatives in a way to minimize the risk to your company.

It’s a term I call – Iterative renewal. It’s a method and process of taking consecutive steps in increasing your marketing capabilities. It’s a combination of the Japanese concept of kaizen and the best practices from software engineering.

Links for trend watching:

TrendWatching

Google Trends