BLOG: Why Some SMEs Find It Hard To Innovate

25 November 2013

Brian McNicoll Photo

This post is written by Brian McNicoll. Business Partnership Manager for Design in Action. Prior to joining DiA Brian setup and managed his own computer games business for over 8½ years. You can follow him on Twitter.


When a business is in start-up phase there is a real excitement and enthusiasm with the founder(s) believing they are going to revolutionise their chosen market. The business idea may have come from a variety of sources such as:

• Their frustration with a known problem/product they want to improve or fix

• A gap in the market identified by working in that specific area for another company perhaps

• A replication of an existing business model that they think can be executed more effectively

All of these methods are quite organic and observational. The business idea will grow over time as more market knowledge is acquired, backing-up their beliefs from their initial moment of ‘inspiration’ until they are ready to take the plunge and rollout a new business to deliver their solution.

Taking an oblique observation, this innovative freedom to start a new project in a creative and non-restricted way is much easier for a start-up (admittedly most likely without the required skills and experience to properly execute straight off the bat), compared to an established Small to Medium Enterprise (SME). SMEs can have the restraints of previous product thinking and also competitor noise that can limit and obscure any real lateral thinking. These two restraints, when combined with the on-going pressures of running a business, can mean it is far more difficult for new and innovative ideas to emerge.

What is clear from history is that it is vital that an established SME continues to innovate as markets, technology and customers change over time. Most business owners are quite aware of the necessity to innovate and adapt, but implementing a pivot to the over-arching strategy (which might no longer be working) and finding the time to test out a new idea is a daunting experience. It is the reason that once-successful businesses are failing.

Of course innovating in the wrong way, into the wrong market and at the wrong time can be just as crippling but it is important to allow enough research and development time so that if the business does lose a key client, or finds their product becoming obsolete, there is something to fall back on quickly.

At Design in Action we have identified this area of frustration for established SMEs who have the leadership, connections and expertise in place to allow them to flourish but are continually struggling to diversify and to innovate. Our solution is Chiasma – a thinking space for your business in a unique environment you will find nowhere else. We will connect you to remarkable people from completely different disciplines in design, academia and also other businesses. During the 3-day workshop you can extract yourself from the shackles of your workplace to try and identify completely new project opportunities.

Regardless of whether your business may or may not want to work on your Chiasma-generated project, you will be able to return to your business with new perspectives, connections and processes. These are what will provide your business with the confidence to start innovating and to re-discover that spark and excitement that made your business a success at the very beginning.