How SMEs remain attractive through benefit innovation

The challenge

In the fat years, companies like to lose their focus and expand without hesitation. They throw new products onto the market that are not part of their core business. In difficult times, they scramble to get back on track; products and entire divisions are sold off, resulting in short-time work or job cuts.

These cycles will undoubtedly always exist. However, we dare to doubt whether such extremes are beneficial. In order to initiate a benefit innovation, we recommend companies to take a differentiated look at their industry: What are the rules, what are the most important factors that determine the market? The company analyzes its position in comparison to its competitors in terms of the valid market factors and the level of offering, for example, in terms of service costs or customer support. Where are the company’s own performance characteristics above those of its competitors, and where are they below? And where is room for additional customer benefits?


Of course, the optimum is a customer benefit that has not existed in the industry up to now. Without unique selling propositions, competition is known to take place mainly on the basis of price. However, in times of crisis such as we are currently experiencing, this is not an ideal starting position for Swiss SMEs.


Overcoming the hurdles

The results of the industry analysis then serve as a basis for realigning one’s own company, away from competition and towards real alternatives. The task now is to break market traditions: Individual supply factors in one’s own portfolio are deliberately reduced below the industry standards or even eliminated completely. Other factors, on the other hand, are deliberately increased or even newly created. They must provide tangible customer benefits and be clearly differentiated from the offerings of competitors.

The new strategic orientation must now be anchored in the company. This involves overcoming four hurdles:


  • the political hurdle
  • the awareness hurdles
  • the resource hurdles
  • the motivation hurdles


These hurdles vary from company to company but they all have to be overcome. The political hurdle is crucial for anchoring the new strategy at the top management level.

If the strategy is to take effect quickly in the company, a universally respected and experienced key person from management must be brought on board from the very beginning. Together with the allies necessary for success, this person ensures broad acceptance of the strategy within the company.

In the case of the awareness hurdle, it is then necessary to consciously overcome the company’s adherence to the old order (corporate culture). The top management must make necessary changes in the strategy transparent to the employees. For this purpose, mountains of presentation slides with figures that employees often do not understand are the wrong means. The employees belong at the scene of the action. They need to see, feel and sense where the real problems lie. Only those who experience the problems on their own body will change something.


Here are two examples: In order to make employees aware of the scrap produced every day, a company demarcated an area in the production hall with barrier tape. Each scrap part or product was presented there. So employees saw directly how the mountain of scrap was increasing each day. In the other example, the CEO called his employees together. He presented them with a pile of gold bars, imitations of course, and used them to show how much money the company was losing per month if it continued to operate as it was. Presentation slides with sober Excel tables would hardly have had a comparable effect.

Jumping over the resource hurdle means: taking targeted action against the employees’ desire to leave everything as it is. The only thing that helps here is to focus all activities on the goals that have been set and on the important core processes. Value-added processes that do not contribute anything significant to customer benefits must be reduced or discontinued.

Now the company faces the motivation hurdle: How do I motivate my employees to participate in the project? Managers should create an environment in which employees can develop and contribute. This means actively encouraging and challenging innovation and creativity.

Prioritize initiatives

The strategic challenge is broken down into clear initiatives with corresponding prioritization. To ensure that the initiatives are driven forward in a tangible way, the management relies on a small number of key people to drive the initiatives forward. In this way, quicker results, so-called quick wins, can be generated at various levels.

The company must communicate these results internally without delay. A benefit innovation becomes successful quickly and at a manageable cost if the company manages to get employees excited about the new project within a short period of time.


Implementing a benefit innovation and with it a change in strategy is not an easy undertaking. Implementing it quickly and at low cost increases the challenge many times over. Ideally, therefore, companies should focus on benefit innovation in good times. That’s when the necessary financial resources are available. In good times, however, it is more difficult to turn away from the status quo, because: After all, the company is doing well, so why change anything?


But initiating and implementing benefit innovations in good times makes a company more resistant to crises and strengthens its market position. In economically difficult times, there is no need to haggle over every franc. After all, a benefit innovation provides the customer with indispensable added value. But be careful: Benefit innovation is not a one-off project. It is a strategic process that takes place on an ongoing basis. As a result, the company is constantly forcing itself to focus on the benefits perceived by the customer.