RACO Investment founder Randall Castillo Ortega offers the keys to process innovation

Process innovation is given more by market needs than by the impetus of technology. This is mainly due to the improvements that are made day by day in the known activities and the accumulation of experience in the company. However, process innovation can also be a conscious, directed, and controlled effort that aims to significantly improve the performance of a process. Randall Castillo Ortega, a successful business expert and founder of RACO Investment, provides insight into process innovation for new and seasoned businesses.

Process innovation includes methods, tools, and techniques that seek transcendent advancements in the power and effectiveness of organizations. Achieving the aforementioned process innovation requires a combination of leadership, experience, vision, teamwork, advanced technology and best practices. The combination of all these elements will achieve radical changes and profound results with minimal risk.

Closely linked to process innovation is continuous improvement, whose role is to intervene in the supplier-organization-customer value chain and in the processes that configure it. The continuous improvement of processes aims to optimize effectiveness and efficiency, improve controls and strengthen internal mechanisms to respond to unforeseen events and to the demands of new and future customers.

For traditional businesses, introducing process improvement can be challenging. To implement it, they must analyze the workflows, set customer satisfaction objectives to be able to lead the execution of the processes, develop improvement actions with the protagonists of the process and involve the actors of the process.

Innovation and process improvement are related, but should not be confused. Explains Castillo, innovation always pursues a level of radical change, while improvement aims to perform the process in the same way, but with a higher level of efficiency.

Designing and producing new products and services is an endeavor that requires the capabilities and experience of interdisciplinary teams to get the job done. However, as studies over more than half a century have demonstrated, teamwork is difficult. Conflicting viewpoints that foster creative ideas and informed decision-making can also lead to conflict that wastes valuable time and strains relationships.

Studies of teams in different contexts show that their effectiveness is a function that includes a well-designed task, the right composition of the team, and the availability of information, resources, and rewards. However, many studies to date have focused on the typical work of teams composed of relatively homogeneous members. It is therefore necessary to re-examine what has been discovered about product development teams that do not have these attributes.

More recent studies have focused on more complex and dynamic tasks and emphasize the need to pay attention to the interpersonal conditions of teamwork. Team members must normally engage in learning an activity vitally important to new product development and act despite the discomfort of working in an uncertain environment with a high risk of failure.

Although the challenges of teamwork are very real, if skillfully overcome, they can actually contribute to the development of resilience at the individual and team level. By facing the intrinsic challenges and conflicts they face, teams and the people who compose them can, in fact, develop capacities that will be increasingly valued in a dynamic and uncertain environment.

Despite widespread acceptance of the potential of teams to optimize innovation and learning in organizations, the realization of these benefits has been contradictory. While some teams meet and even exceed what is required of them when it comes to developing new and better products, others falter, fail to deliver expected innovation, or deliver it at a higher cost. raised. This variation in team performance occurs not only within organizations, but also within organizations.

If a company is not constantly innovating, it is very likely that its competitors will release much more advanced products with differential functionality. In fact, many leading companies, fully aware of the importance of innovation, have been threatened by other companies that have been able to use technology in innovative ways and have succeeded in capturing a substantial part of their clients.

Evolutionary or incremental innovation is what the vast majority of companies practice, Castillo explains. It consists of gradually improving their products to increase their profits, without worrying too much about making big changes that involve breaking with their processes or creating new products.

Moreover, these companies do not take into account new products or services offered by other companies because, a priori, they do not consider that they could constitute a threat. It is precisely at this stage that new organizations can take advantage of the neglect of other companies. Although the newcomers play in lower conditions, they offer their innovative products at better prices.

Little by little, they get followers and visibility, and that’s how in the end the tables turn. It is these companies that achieve market leadership. This is how disruptive innovation happens: an abrupt change in the sector that breaks with the previous model and wrests power from companies that previously had it.

Customers also have a fundamental role in this disruption process. There comes a time when they see no benefit in the evolutionary innovation that has been applied to the product.

They are therefore looking for other elements that offer new utilities, more modern technologies or are at a better price. Innovation, in all its modalities, is vital for any company to advance and adapt its business model to market demands and customer needs.

About RACO Investment

RACO Investment is a financial investment company serving small and medium enterprises in Panama and Costa Rica. It was founded by Randall Castillo Ortega, an expert financial advisor who has his roots in the import and export industry in Latin America. The company has helped many startups find the financial backing they needed to get started. It has also provided bridging loans to help those looking to restructure or improve their operations.

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