Role of Innovation and Technology in Business Organization and Economic Progress

This report provides an overview of how technology and innovation can be useful for growth of organisation and country. Report highlights importance of corporate governance and how corporate social responsibility model can be beneficial for society and organisation both. Use of new innovations and technologies for developing company and supporting country’s economy is described in this report. Finally, this report explains history of corporate governance and use of Archie Carrol’s theory in fulfilling CSR.

Business Environment

EXECTIVE SUMMMARY
This report provides an overview of how technology and innovation can be useful for
growth of organisation and country. Report highlights importance of corporate governance and
how corporate social responsibility model can be beneficial for society and organisation both.
Use of new innovations and technologies for developing company and supporting country’s
economy is described in this report. Finally, this report explains history of corporate governance
and use of Archie Carrol’s theory in fulfilling CSR.

Table of Contents
Contents
EXECTIVE SUMMMARY.............................................................................................................2
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
TASK 1............................................................................................................................................1
Role of innovation and technology on business organisation and economic progress of
country........................................................................................................................................1
Impact of innovation and technology on operations sales and profit of company......................4
Evaluating impact of new technologies on Sales and profit of company...................................6
TASK 2............................................................................................................................................6
Assessment of importance of corporate social responsibility for organisation...........................6
Archie Carroll’s Pyramid of CSR...............................................................................................8
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
This report enlightens business environment of a business industry and its various aspects.
Business environment refers to factor that may impact firm’s business ability and maintain
successful customer relationship. Business environment has both factors internal and external
factors and these factors can influence internal and external business environment (Artto, and et.
al. 2017). This assignment explains innovation and technology and its emphasis on business
organisation and economy of a country. This report introduces affect technology and innovation
in context of Next Plc. Scope and purpose of using technology and new innovations in business
is explained along with its impact on sales and profitability of company. Finally, this report
describes how CSR and corporate governance can be beneficial for country and organisation at
the same time with help of business analysis model.
MAIN BODY
TASK 1
Role of innovation and technology on business organisation and economic progress of country
Innovation is an idea which helps inventing new and unique ways of doing something. In
business context it can help in inventing new product or services or improving usefulness and
performance of old product and services of company (Bai, Cordeiro, and Sarkis, 2020). This can
be helpful in activating and developing new product in market with purpose of improving its
competitive advantage, efficiency, effectiveness etc. Correspondingly, technology refers to tools,
machines and other equipment created by human which help in achievement of objective,
producing goods or services, solving problem of society. This can be a mean to transform
scientific information into solution for issues or problems of the world. Machinery or equipment
created by applying scientific knowledge and engineering is known as technology. Innovation or
ideas can be used for inventing and developing technology. In context of business innovation is a
process of invention of new ideas and applying these ideas in business to find out distinct ways
of achieving company’s goals. These innovations can help in creating new product or services
and identifying how these can be helpful in increasing sales of company. Technology on the
other hand technology helps in running an organisation and its operational activities. It improves
business efficiency and enhance capacity of organisational operational processes (Ciobanu, and
Neamţu, 2017). It is beneficial for facilitating better structure of communication within
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organisation and outside of organisation with consumers and competitors. Technology have
become an essential part of day to day business activities and it has made business operations
easier.
Technological innovation refers to invention of new technologies which are helpful in betterment
of civilization. Innovations are not only used for inventing technology but other things as well.
Fundamentally this is an expanded version innovation that focuses on inventing technology. In
business technological innovations help in inventing new product or services or enhancing
features of existing product or services (Crowley, and Jordan, 2017). This helps organisation in
saving money, time, labour and other resources. Technology helps management of company in
managing financial as well as non-financial operations of business. Technology is helping small
business in achieving rapid growth rate and success also it provides competitive advantage to the
company against its competitors. Company can ensure adequate and appropriate use of available
resources with help of technology.
Contribution of innovation and technology in economic growth of UK: Technology is
growing rapidly in UK with help of new technological innovations every day. Economy of UK is
growing and getting stronger, innovation and Technogym has played an important role in that.
Although technology sector of country is increasing 2.6 times faster than its economy but at the
same time this technological growth has helped growing economy. In current outbreak of
coronavirus when economy is dealing with hardship tech sector of company has shown an
immense growth. Tech sector of company has created jobs and means of digital business which
has help in balancing economy (Hamilton, and Webster, 2018). Tech sector of UK is helping in
recovering country’s economy from impact of covid-19, in middle of 2020 job vacancies were at
its lowest but technology sector generated jobs as well as digital platforms for online business.
Increasing skilled tech jobs has increased salaries of employees and economic growth od country
is also boosted despite the challenges of this pandemic. Tech sector of country is providing 10%
job vacancies in current time which is one percent higher than last year. Workforce of country is
getting job opportunities in tech sector which is quite helpful in times of pandemic when
population of country is not getting jobs. Innovation of new technologies has accelerated
economic growth of nation, despite of so many difficulties and economic backdrops tech sector
is providing 4% more salary than previous year. Specific tech jobs are in demand and tech
companies are paying 69% higher salaries in comparison of last year. People are getting better
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job opportunities which has enhanced sustainability in UK’s economy. Innovation business of
UK is increasing so country is inventing new technologies to support economic growth of
company. Country has attracted venture capital investment which has resulted in raising
investment of $15bn+. This figure is more than combined investment attraction of Germany and
France. Thus innovation and technology has increased economic health and growth of country.
Use of new technologies in business organisation: In current digital age technologies
have become inseparable part of business operations. Organisations are specially forming R&D
departments in company for innovations that help in inventing and improving technological tools
of company. Innovations are helpful in growing business and technology plays a vital role in it
so technological innovations are necessary for success of company (Hrechyshkina, and
Samakhavets, 2019). Technological tools have made business operations easier which has made
business faster. Technology is making various activities of business such as data collection,
financial management, advertising & promotion faster and easier. In this digital age companies
cannot accomplish various tasks and it can hamper growth of business as well. Company can use
technologies for increasing revenue and produce goods or services according demand of
customers.
Optimise management: Every industry, large and small size business and all kind of
business organisations are using technology for managing their business. Day to business
operations are also managed with help of technology so it helps in improvising business
management process and makes it comparatively easier.
Effective communication: communication is an essential part of any business
organisation and technology increases effective business communication. With help of various
innovations of technological communication tools employees can connect with each other inside
and outside the organisation (Ifinedo, Pyke, and Anwar, 2018). Apps, calls, apps, massages and
various other technological inventions can play an important role in connecting workforce with
higher management that ensures attainment of organisational goals.
Improved security: There are various tech gadgets available in market which help in
improvising business security. Data security is an important concern of company with help of
technology company can protect its data. Encryption and tokenization are playing vital role in
less exposing of essential data of company.
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Operational efficiency: Various tasks which are performed manually in organisation can
be done automatically with help of technology. Using technology in operational activities of firm
can help can save time, money and labour as well (Lamine, and et. al. 2020). Thus use of
technological inventions in operating activities of company can enhance operational
effectiveness of firm.
Impact of innovation and technology on operations sales and profit of company
Technology is helpful in innovating new product or services and handling increasing
competition of market. Next plc is a British multinational company and its headquarters are in
Enderby, England. Joseph Hepworth founded this business organisation at United Kingdom in
1864, founder opened 100 outlets of company till 1884 on his own. Company is clothing,
footwear, accessories, beauty and home products retailer which has around 700 plus stores
globally. Current share price of company is 7,812.00 GBX which indicates rapid growth of
company. Next retail, next finance, next sourcing, next international finance are different
segments of company. Next retails product of Victoria’s secret in UK and it sales feminine
products in Kendall and sons.
Use of new technologies by company: To standout in current competitive situations of
market and increase sales, company is developing technologies for online retailing, and improve
in-store experience of customers. Brief explanation of technologies used by company is briefly
explained below.
 Next plc has purchased new invented technologies for effective growth of business.
Applications like Oracle HCM Cloud, Unit for travel and expenses and kronos
workforce central. After applying these technological innovations in business
revenue of company grown to $5.91 billion in 2019. Company is a retail
organisation so it is needed to provide new and developed products which is
possible with help of technology.
 E-commerce is growing rapidly in country and retailers can provide multi-channel
offering to its customers with help of it. Digital business places that are invented
by technology are used by company for its online selling of products.
 Company is providing distinct home products, clothes, accessories and beauty
products online. Current coronavirus outbreak has impacted in-store business of an
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organisation but company can operate its business successfully on digital platforms
with help of latest technology.
 Next plc is planning to invest in emerging technologies such as artificial
intelligence, IoT, blockChain, autonomous database, HCM, EPM, etc. all these are
helping company in faster attainment of its objectives.
 Organisation conducted a survey to understand consumer behaviour towards
proposed technologies. That survey resulted in positive response of customers for
technological transformation of company.
 To improve in-store experience company has connected a suite of enterprise apps,
this has helped UK’s largest retailer in digital transformation. Organisation is
currently using a suit of 75 apps that are helping Next plc in cutting stock inventory
times and stock management. Xamarin-built apps are helping organisation
digitalising store of company.
 Use of technology allowed Next plc in fast-tracking new capabilities and provided
software solutions which were required for business hurdles.
 With help of new technological tools company can handle its data or other
information very easily and it has helped company in bold decision making. These
decisions have helped company to grow faster.
 Internet of things (Iot) is used by company for communication of its physical
devices and data sharing.
 Facial recognition technology is used by company that helps identifying customers
at point of sale by using loyalty cards and other means. Company wants to provide
personalized experience by identifying customers through this app before they visit
stores so that sales staff can provide better experience to customers.
 Company is planning to invest in cashierless store technology that will help
customers in avoiding long queues. With this technology customer can go out with
their items without waiting at cash counter as items purchased by customer will be
scanned automatically and amount will be debited from consumers account. This
technology is very useful in minimising human contact in pandemic like
coronavirus which is spreading widely.
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Evaluating impact of new technologies on Sales and profit of company
Current outbreak of coronavirus has impacted whole economy of country and Next plc also
got huge impact of this pandemic on its sales and profit of this period. In comparison of last year
earnings per share value of company has decreased by 50.8%. In year 2019-20 it was459.8p but
it has reduced to 226.3p in 2020-21. Total revenue of company is also decreased from £4.3bn to
£3.5bn also profit before tax which was £749m in previous year but it came to £342m this year.
All these losses occurred because of covid-19 pandemic situation, which resulted in decreasing
total group sales of Next plc by 17% this year in comparison of last year. Given the current
circumstances offline retail stores of company are closed and company is depended on its online
stores for sales and profit generation. So company’s priority is developing online selling
platforms with help of latest technologies. Company is planning to invest £121m to develop and
support system and technologies required for online business. Online sale of company has been
increased by £221.8m in comparison of previous year which has shown +10% variance in annual
sales. By using latest technologies for digital business methods company has balanced its losses
from offline store due to lockdown imposed by government. By using tech inventions for online
activities company has gain a +18% variance in its profit from online business. Profit from
online sales was £399.6m in the year 2019-20 but it has increased to £472.1m in 2020-21. Thus
use of technology has helped company in continuing its business in time economic hardships.
TASK 2
Assessment of importance of corporate social responsibility for organisation
Corporate governance is a collection of mechanism, rules, processes, regulations, laws by which
business of company is controlled or regulated. All these factors can be internal or external and it
impacts interest of people within organisation and outside of organisation (Longmore, Grant, and
Golnaraghi, 2018). Stakeholders, shareholders, customers, management of company and
government regulators are people who can get affected by corporate governance. Corporate
government ensures that company adheres to best practices, ethical standards and works for
benefit everyone who is concerned by applying well-defined business structure.
Corporate social responsibility is a business model that helps company in becoming socially
accountable so that company can contribute towards society and organisation. By using
corporate social responsibility company can evaluate what impacts organisation is making on
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society in political, social and economic factors (Maqueira-Marín, Bruque-Cámara, and
Minguela-Rata, 2017). Firm can boost its brand image by fulfilling corporate social
responsibility voluntarily or according to requirements of business. With help of CSR company
can establish better bond with employees by fulfilling their needs it boosts their morale and
loyalty towards company.
History of corporate governance in the UK: Corporate governance was not even a
concept 22 years ago but now it is common around the globe not only companies but other
organisations as well. This has become essential part of how organisations are operated and most
importantly it has focused on integrity, accountability and risk management of company
(Santoso, 2018). In UK revolution of corporate governance begun in 1990 when Adrian
Cadbury presented recommendations for mitigating corporate governance risk and factors by
arranging company boards and accounting system. This Cadbury code was adopted by city and
stock exchange for better management of boardroom. Similarly, new reports on corporate
governance start getting published in upcoming years. In 1995 Greenbury report was published
on corporate governance which resolved concern of director remuneration, it was released and
researched by United Kingdom confederation of British industry. Later in 1998 Hampel report
was released, this report clarified that there was no need of change or revolution in corporate
governance system of UK by evaluating Cadbury and Greenbury’s report. In 1999 Turnbull
report on internal control and Higgs report in 2003 for reviewing role of non-executive directors
came in 2003 and since then corporate governance policies are improving for better.
Importance of CSR in organisation: Next plc is one of largest clothing retailers in UK
which provides, clothing, footwear, accessories and homewares. Company’s website is serving
in almost 70 countries and it has over 5million customers globally. Organisation is fulfilling
ethical and environment related obligations with help of corporate governance. Firm is getting
most of its turnover from UK and Eire so company is focusing more on fulfilling corporate social
responsibilities in these regions. Company is an international retailer so it has lot of stakeholders
and company ensures that company leaves a positive impact on these stakeholders with help of
principles of corporate governance principles. Company operates its business in ethical manner,
recognise and protect human rights, take responsibility of impact on environment. Firm
maintains positive relationship with customer and suppliers also it provides job opportunities by
recruiting responsible employees. Organisation also support society by donations to charities and
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community organisations. In current situation of coronavirus outbreak company has fulfil its
social responsibilities and it has developed better relations with stakeholder, customers and
suppliers. This year company is thinking to fulfil its corporate social responsibilities by working
on salient human right risks to ensure priorities and approach to these priorities remain relevant.
Archie Carroll’s Pyramid of CSR
This is most accepted theory of CSR which was developed by Archie Carrol in 1991 by
name “Pyramid of corporate social responsibility”. According to this theory corporate sector
should fulfil its responsibilities at four stages that are economic, legal, ethical and philanthropic
(Šebestová, Krejčí, and Šiška, 2018). These stages are explained below in context of Next plc.
Economic responsibility: This is lowest level of pyramid which suggests that business’s
first responsibility is to be profitable. If Next plc does not earn profit it will shut down before
fulfilling corporate social responsibilities. Company can benefit society by earning profits and
completing all responsibilities towards organisation and society.
Legal responsibility: This responsibility refers to obeying the law, which represents how
company conducts its business in market. Next plc adheres to laws such as health and safety of
employees, tax regulations, and employment laws to fulfil its corporate social responsibility.
Ethical responsibility: This responsibility suggests doing right thing, being fair and
causing no harm to anybody. Next plc not only follows all laws but it functions its business
ethically as well. Company provides environment friendly products also it treats its employee
and suppliers fairly.
Philanthropic responsibility: Business Firms are mostly criticized for increasing
pollution, using natural resources and their carbon footprint so this responsibility suggests that
they should give back to society. Next plc follows environmental laws and uses technologies
which avoid carbon emission.
CONCLUSION
This report concludes great emphasis on use of innovation and technology together with
role of corporate social responsibility in an organisation. Further this report enlightens how
technological innovation has helped in growing economy of United Kingdom along with use
of these innovations in business organisation to increase sales and profit of company. This
report has included brief review on corporate governance and corporate social responsibility.
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REFERENCES
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