In many cases, innovation is only associated with new products or technical renewals.
However, business model innovations can be significantly more profitable, and the current pandemic-driven changes in customer behaviour and technological innovations have created a window of opportunity for companies to explore new business models.
Every company has a business model, which must change to ensure success and ultimately, its survival. Even minor changes to a business model can have great benefit in terms of satisfying the needs of the customer.
Most innovations, such as product innovation, are incremental, but changing a business model is likely more radical as it changes the foundational decisions on which the business operates.
It, therefore, brings higher risk, but also the chance of long-term survival and success.
Companies like Uber, AirBnB and Spotify were able to disrupt each of their industry’s traditional business models by tweaking or inverting them.
In times of significant change, such as those stemming from a global pandemic and the associated impacts of the disruption to global trade, it is pertinent for companies to think about how the business environment is changing and what business model changes might help the company adapt to this shifting landscape. Whether this is a reinvention of a business model to manage fundamental industry changes, adaptation and experimentation to accommodate fluctuations or pivots in an industry, businesses cannot afford the luxury of complacency. Microsoft, for instance, has moved from being primarily a hardware company to become more cloud-focused, embracing enterprise and services.
While Africa has been viewed as being behind the curve in recent decades, it is quickly becoming a hotbed of innovation, and the continent is now an eager adopter of and innovator in all things digital and mobile.
Many challenges remain, but the seed of innovation has taken root. African startups and SMEs, along with non-profits and big companies, are using innovative technology to solve pressing needs in their communities. Deepening the continent’s competitive capabilities is essential if we are to diversify the continent’s economies.