Today I attended a business breakfast hosted by the Institute of Directors West Surrey branch in Guildford. It was run by the indefatigable Chris Ragg. You get a good breakfast and plenty of lively business people to network with. One of the topics we were asked to review was ways in which the future will be quite different. Among the many things that came up there were some that will promote the need for innovation and some that might well inhibit innovation.
Some of the forces that will increase the need for innovation were:
1. Increased competition – particularly in services.
2. Increased consumer knowledge and choice.
3. Demand for sustainable green solutions.
Some of the forces that may inhibitit innovation and entrepreneurial activity were:
1. Higher levels of taxation will deter risk taking and start-ups. Why leave a comfortable job and risk starting a new business if the government is going to take over half the profits?
2. Banks will remain cautious about lending for some time.
3. With higher taxes and lower pension pots many people will defer retirement and work into their 60s and 70s. This could lead to an older generation of leaders who are more cautious and risk averse.
4. General uncertainty about the economic and political outlook.
I believe that innovation is imperative in private and public sector organisations. It remains the best way to cut costs, improve services, increase competitive advantage and to survive. However, we need to recognise and counter the forces that will increase caution and deter risk taking and entrepreneurial activity.