SMEs may need templates for innovation.


Back in the day, Toyota rolled out their business system and we all got excited about saving cost. It worked for then. Today we need something different. But an innovation template? Really?

Today, the cost of waste isn’t quite so easy to see. Factories used to talk about money lying on the floor and, of course, that was an easy win. Sweep the scrap up, stop it from happening again and the waste figures fell away. Put up some shadow boards next to machines and job changeover times fell. Better efficiency, better cost management, better everything. Except…

Once the operational costs are saved and you’ve introduced your new project management software something new has to happen to keep you ahead of the competition. Something like innovation. Because you are now efficient doing what you do, you’ve achieved an essential gain, probably, at the expense of flexibility – but don’t worry. You’re efficient, right?

Wind forward to the 2010’s. Apple, Google, and Dyson have declared an intent to make cars, AirBnB has become a fixture in the accommodation industry and established business groups (Black cabs) are re-organising to fight back against the disruption Uber forced into the market. 3D printing is changing the injection moulding supply chain and robots are answering phones sounding like humans. For students of ‘change’ the current era is brilliant.

For SMEs looking for a way to convince investors that they can cope with unprecedented change it’s a different story. Nothing is certain.

Out of Toyota came a useful tool. It’s called an A3 because it was intended that you should be able to describe a business case on – ahem, a piece of A3 paper. There are lots of versions after years of iteration but one of the simplest explanations of how to use an A3 is here.

Simply put, without enough work to describe your future it’s hard to adequately develop an argument to be as succinct as a single page plan demands.

Other tools exist now. Among them, Strategyzer’s Business Model Canvas is a business planning tool very much in vogue at the moment and this too makes a similar demand.

Our point is that a single page plan imposes a requirement to justify some assumptions. A large part of this is the absolute need to believe in a micro view that is short enough to be realistic and to justify your macro view of what you think will happen to be believable. The resulting scenario combining a micro and macro view of your market, that your business will exist in, has to be defined so that it can be constantly reviewed and developed as new insight is collected.

Whether, or not, you like the idea of a template to capture your thinking, it is a good way of recording why you decided to do what you do. On the flip side it’s also a great way of recording why you decided not to do something. In itself, the discipline of justifying your innovation plan is a huge step forward.

Future thinking. Future proofing. Innovation justified. It’s what we do.