On Monday morning at the Chambre de Commerce in Luxembourg-Kirchberg, Luxinnovation held a very interesting conference entitled "Innovation is accessible to all" which attracted around a hundred representatives of small and medium enterprises to hear about the benefits that focusing on innovation can bring about for their businesses - this is part of the aim of this national government agency which clearly wants to increase its proximity to companies with innovative potential worth being developed.
It is believed that just over one in two Luxembourg SMEs innovate. Even if this figure is satisfactory on a European Union scale, the scope for growth is still important and should not be underestimated. On the contrary, Luxembourg has everything to gain from developing the link between SMEs and innovation which must be strengthened, Jean-Paul Schuler, Director of Luxinnovation, said in his opening speech.
Most companies that dare to take the plunge focus exclusively on product innovation or process. Yet other types of innovation (business models, services, marketing, etc.) exist, and can bring real added value. Various partnerships between innovation experts and entrepreneurs were presented together and offered participants the opportunity to discover new innovative techniques, employed by some companies that have had first-hand experience:
Today more than ever, companies, particularly small ones, are concerned about their survival against a market which is becoming increasingly competitive. It is perhaps difficult, in this context to be visionary, inventive or creative yet many tools and methods are available to them to help them change their business model, anticipate the expectations of their clients or more generally to reinvent themselves. "It should not be a matter of courage but of organisation, "said Michèle Detaille, CEO Alipa Group, who has applied the foundations of "Lean Manufacturing" in No-Nails Boxes in her company. Changes to activities, models or organisation often risk a decline in revenues or in the profitability. "Lean” is a method that was created and originally applied by large Japanese companies. It is however also appropriate for SMEs, and with the same efficiency or effect. This method has enabled Alipa to increase their workshop efficiency ratio by 15%, she said.
A change in the trajectory of business in the current economic environment requires SMEs to face changes to root activities to ensure that they can better meet the promises of service made to customers. They must therefore focus their efforts on new strategies and development, even if it involves a 90-degree turn. Sadly many business leaders fear the mere mention of such change in the trajectory of their activities. There are however consultancy companies out there that roll up their sleeves and physically demonstrate suggested changes without excessive costs. Mme Detaille was clearly happy with her experience and highly recommended her consultants who had presented the “lean management” methodology earlier in the session.
However some have dared to take steps to reinvent themselves: Olivier Louis, Director Deputy General at Naturhome, presented their activity in the construction of wooden ‘ecological’ houses - Ncube. He explained how "the design of this new business model was greatly facilitated by the use of the “Business Model Canvas ".
To be effective, today business must be visible. Visible on the market, of course, but also and more and more, visible on the Internet. Winning new customers via the web, is part of the new strategythey adopted. However, SMEs are still not yet fully familiar with the new world open to them. Due to lack of time, money or knowledge in the field, small companies often tend to neglect these modes of communication, unlike their sister startup companies, which often bathe in this field from early creation.
Many SMEs actually need to be reassured in the internet field. Pierre Friob, President of the Luxembourg Federation of E-Commerce, eCOM.lu and CEO of Abitare Kids demonstrated his experience: He insisted "E-commerce is complementary to the management of physical stores. It allows not only access to new customers but also improves the chance of retaining them. " E-commerce can generate substantial profits, in marketing or internationalisation.
"Today 90% of Abitare Kids e-commerce turnover is generated abroad”. From the beginning, we have used the Internet in our business operations, making Abitare Kids one of the largest stores for children 0-8 year olds in Europe. “A super and very amusing film showing how young children are “synchronized” with the internet at a very early stage was shown and this was followed by an interesting presentation by an internet marketing company the advantages, dangers etc., incorporating search engine optimization (SEO) and other techniques.
Luxinnovation programs entitled "Fit for" aim to release the innovation potential of SMEs by comparing business concerns with real and concrete examples of successful innovation approaches. They hope to demonstrate how innovation can be extremely beneficial to existing or future businesses. "We have developed different programs dedicated to SMEs. The support program "Fit for Innovation" - in its diagnostic and planning phase has been a remarkable success since its launch in January 2014. “The first 7 companies that completed the diagnostic phase, showed potential gains of some 5 million euros. Due to the great response from SMEs in 'Fit for Innovation ', Luxinnovation now intend to compliment the program by two new tools which include 'Fit for ICT' and 'Fit for Circularity said Jean-Michel Ludwig, Head of the Start-up Creation Department & SME Performance in Luxinnovation.
Luxinnovation will also experience some innovation of its own soon because the National Agency for promotion of innovation and research will become a financing agency for part of their files in 2016, which will reduce the administrative burden for companies and enable them to benefit from accelerated procedures.
