When Innovation Takes Your Mind Off Your Focus For Profits

Often small startup entrepreneurs are dreamers and innovators in their own right. Thus, they will continue to try to run the company even after they set in place a management team that is highly skilled and is running the company purely for profit. These entrepreneurial innovators and dreamers are often more focused on coming up with really cool features that they might like to have. The only problem is that each new feature in their product line may not transfer itself to greater profits for the company.

Ah, but the visionary wouldn’t care about that, now would they? See, the problem? We must never forget that a for-profit private enterprise is in business to make money, and if they spend all their money in research and development coming up with great new innovations that the marketplace doesn’t want, or the customers won’t pay for, that’s a really nice thing to do for mankind, but it is very unwise for their bottom line; shareholders equity and quarterly profits.

Now then, this is not to say that innovation and pure research is not a wise idea. History in corporate America proves that those companies which spend money on research generally outpaced their competitors in the marketplace over the long haul. Companies like Intel Corporation, Microsoft, IBM, and others are perfect examples of why you should spend lots of money on research and development. Even consumer products companies like Kellogg’s or Procter & Gamble spend vast amounts of money on R&D.

They do this because they know if they will continue to come up with new products that customers want their return on investment will be well worth their efforts. But note all these companies mentioned have one thing in common, they run their innovative departments and set their project management teams on a clear focus; to bring great products and services to market that customers will love and be willing to spend money for; and that equals profits.