Product Innovation: How Businesses Can Create New Products and Succeed in the 21st Century

The main theme of the article is business innovation, specifically focusing on product innovation. The author discusses how businesses in the 21st century cannot rely on luck for new product ideas and must actively invest in innovation. They highlight the importance of courage and risk-taking in successful innovation, using Apple Computers and Starbucks as examples of companies that took risks and found success with new products. The article concludes by indicating that the discussion will continue in the following day's session.

'All right. I think everyone is here, so I'm going to go ahead and get started. Let's go back to our discussion of business innovation. Yesterday I was explaining that in business there are many types of innovation. We said, remember, there's product innovation, there's innovation in business organization, of course there's marketing innovation, and there are other types of innovation. OK? Well, today, I want to talk about product innovation. That means how businesses come up with ideas for new products. First, we'll talk about innovation in the 21st century in general. Then I'll tell you about some qualities that successful innovators share and give you two good examples.

In the past, um, businesses got a lot of their new ideas because something they did was a surprise or mistake. Innovation was something they didn't plan at all. It was just luck. We all know that times have changed in the 21st century. It's not enough for companies to depend on luck to develop new products and compete successfully in global markets. In fact, the research shows us that the best companies make innovation a large part of their business. That means they spend a lot of their money on innovation. And that is exactly the opposite of waiting for luck to happen, right?

Let's step it up now. I want to point out one thing that these innovative companies have in common, one thing that they all have, and that is courage. Courage. What I'm saying is these companies aren't afraid to take risks. These companies are constantly trying new ideas, and even though they know they know that many of their ideas are going to fail, the business experts say that these companies 'make their own luck.' They make their own luck. They are risk-takers, to put it simply.

So, let's take a look at a couple of successful, innovative companies, meaning companies that are creating new products and are doing well. A great example for us to talk about is Apple Computers. Apple Computers.

Apple is a company, a computer company in California. Maybe you've heard of them. A while ago, they came up with the idea to make a totally new product, a digital music player that was small and easy to use—the iPod. Steve Jobs—he was the CEO of Apple—Steve Jobs realized it wasn't enough to create a fun little machine for music. People still needed a reason to buy it. So, he asked his company to think outside the box. He wanted his people to come up with a way for customers to use this little machine to get music out of their computers and the Internet. Then, they could listen to the music on their iPod everywhere they went—at home, school, at the gym, and so on.

Um, at the time, everybody said this was impossible because nobody had ever done this before. Well, Apple got to work and solved all the technical and legal problems, and today the iPod earns over one billion dollars a year for Apple. So, again, it's that courage to take a risk and try something completely new.

Let's move on because there's a second important characteristic of today's innovative companies, and that is, that they think about their product in a new way. When they do this kind of thinking, they also invent a new market. And of course, that means, you got it, higher profits. Are you with me so far? Good?

A great example of this is Starbucks. You guys know Starbucks, right? The coffee chain—10,000 stores around the world. I just went to Starbucks in China, as a matter of fact. Starbucks was looking for a way to get new customers, and they wanted a way to make customers stay in the store longer. And what else? Spend more money. That's when they started thinking outside of the box.

They realized that their stores could be more than a place where people buy a cup of coffee. They thought, they thought about what people do in their free time, and they realized that people spend a lot of time on the Internet. Everybody knows that Starbucks thought people might like to do it outside of their house, where they could maybe meet new people. They started to provide wireless Internet service in their coffee shops.

I've got to point out that Starbucks can't say for sure that their profits went up after this change, but they did find out that customers who use the Internet at Starbucks stay in the store nine times longer than customers who just drink coffee there. So probably they spend more money at Starbucks, too.

It's an example of how a totally new idea can change a business. In this case, they thought of a product in a new, and some people say, a strange, way. A way no one had ever thought about.

Well, I see we've run out of time. Let's pick up tomorrow.'

Summary sentence: The article discusses the importance of product innovation in business, emphasizing the need for courage and risk-taking, and provides examples of successful innovative companies like Apple and Starbucks.