Factors Affecting Innovation Process in FutureMed

This presentation discusses the factors that affect the innovation process in FutureMed, an Australia-based company in the radiopharmaceuticals industry. It explores internal, external, technological, and marketing factors that impact the company's ability to innovate and provides recommendations for improvement.

Dynamic Strategy
and Disruptive
Innovation
FutureMed

Introduction
 FutureMed in an Australia-based company which
operates in radiopharmaceuticals industry.
 There are seven board of directors who governs its
operations along with a senior management team.
 No systematic approach has adopted by the
corporation in order to identify or create potential
disruptive technologies.
 Various factors makes it challenging for the
company to adopt an innovative approach in the
business to sustain its growth.

Factors Affecting Innovation
Process
 The research and development (R&D) department of the
company consists of focus groups that only have limited
understanding of doctors and physicians actual needs
(West and Bogers, 2014).
 Market structure of the company assists it in determining
key factors which enables the company in expanding its
customer base while relying on disruptive innovations.
 Lack of involvement between the employees and
management makes it difficult for the company to adopt an
innovative approach (Keskin, Diehl and Molenaar, 2013).
 There are various internal, external, technological and
marketing factors which impacts the innovative capacity of
FutureMed.

R&D Methodology of
FutureMed
 Effective R&D process is crucial for implementing
innovative approach in the business.
 Relevant data is collected by companies through market
research and evaluation of customers’ demands which
drives the innovation process (Mahr, Lievens and Blazevic,
2014).
 FutureMed’s R&D operations consist of focus group
activities that evaluate its target market which include
doctors and physicians.
 The lack of understanding about the target customer base
makes it challenging for the company to rely on disruptive
innovation since it did not have a particular direction (Greer
and Lei, 2012).

Internal Factors
 The innovation process of companies are affected
by various internal factors.
 The lack of human resource capabilities is a major
factor which affects the ability of FutureMed to
innovate (Jiang et al., 2012).
 The R&D department of the company is not able to
understand the needs of target customers which
hinders the ability of the company to innovate.
 The age of the senior managerial team is a key
factor which limits the usage of technology in
FutureMed’s operations.

Internal Factors
 Size is a key factor which affect the innovation process of
companies.
 The size of the company is large; however, it is not using
its resources in an effective manner to promote innovation
(Laforet, 2013).
 Collaboration between lower, middle and top level
employees is crucial for supporting innovation which is not
the case with FutureMed (Melton and Hartline, 2013) .
 The directors and management practices did not support
innovative approach in the business which make it difficult
for FutureMed to innovate and develop new products.

Recommendations
 The corporation should change its management practices to
foster and promote innovative thinking by hiring young and
talented people in senior management team (Messersmith and
Wales, 2013).
 In-depth knowledge about customers’ needs is crucial for
innovation; thus, FutureMed should improve its R&D
department by hiring people who are expert in the area.
 Employee engagement should be a key part of the innovation
process of the company which will allow it to find business
opportunities to expand its operations.
 Ideas should be discussed between lower, middle and top level
management since it will assist in contribute their expertise
which is crucial to support new business innovations.

External Factors
 External factors creates obstacles or opportunities
for companies to promote innovation.
 Market structure is a key factor which affects the
innovation abilities of a company (Wu, 2012).
 FutureMed operates in monopolistic competition
and it can maintain its market position through
technological innovations.
 Currently, the company generates enough revenue
to distribute high dividend to its members;
therefore, it is not under pressure to innovate.

External Factors
 Instability in the external environment will affect the
competitive advantage of FutureMed and enforce the
management to innovate in order to stay relevant
(Bleda and Del Rio, 2013).
 The registration process of the Australian Register of
Therapeutic Goods (ARTG) is difficult which provides
advantage to FutureMed.
 The corporation also faces challenging in relation to
generating funds for its operations which are crucial
for innovation since radiopharmaceutical is a
developing science that few business financiers
understand.

Recommendations
 Evaluation of external factors is crucial for FutureMed to
develop innovation strategies in order to sustain its
competitive advantage.
 Senior management team should leverage the
monopolistic competitive position of the company to
expand its operations by using technological innovations.
 Resources should be invest in adaptation of new
technologies which promotes innovation by increasing
efficiency of operations (Bock et al., 2012).
 A positive competition is favourable environment for
FutureMed to rely on innovation by making it a part of its
culture.

Marketing Factors
 A company’s approach towards marketing affects its
abilities to innovate in order to expand its customer
base.
 Innovative marketing enables the company in
transferring its message to its target audience which
increases its sales (Arnett and Wittmann, 2014).
 Ineffective marketing reduces the ability of FutureMed
to generate capital for its operations since most
investors are unaware about this industry.
 It reduces the funding of R&D department and making
it challenging for FutureMed to promote innovate
approach.

Recommendations
 FutureMed should invest in adopting an
effective marketing campaign to spread
awareness regarding its products and services.
 Marketing campaign should be targeted on
understanding and fulfilling the needs of target
audience.
 The company should invest in adopting
innovative marketing approach to reach its
audience while saving its overall marketing
costs.

Technological Factors
 Technological advancements enable companies to
generate and maintain a competitive advantage
in the industry.
 However, technology changes at a fast pace
which makes it difficult for companies to sustain
their competitive advantage (De Medeiros,
Ribeiro and Cortimiglia, 2014).
 The management of FutureMed did not invest in
technological advancements which can improve
the current operations of the company and save
its costs.

Technological Factors
 The R&D department is unable to understand the
needs of target customer base which reduces
effectiveness of technological innovations
(Perrotta, 2013).
 The senior management team include old
members who are less likely to adopt or invest in
technological advancements.
 Employees are conservative and they resist
change which makes it difficult for the company to
adopt technological advancements to support
innovation process.

Recommendations
 Increasing the investment in use of the latest technologies
can assist FutureMed in improving its innovative approach.
 The R&D department should hire employees who have
understanding about the latest technologies which can be
used to meet customers’ needs (Ritala and Sainio, 2014).
 FutureMed should invest in technologies such as artificial
intelligence and 3D printing in order to reduce its
production costs.
 The management should embrace technological changes
which will enable the company in adopting an innovative
approach and sustain its competitive advantage in the
industry.

Conclusion
 There are many factors which affects the
innovation capabilities of FutureMed.
 The company will not be able to sustain its
market growth without adopting an innovative
approach which is crucial to meet customers’
needs.
 Improvement in marketing and technological
factors and understanding internal and external
challenges will enable FutureMed in implementing
an innovative approach in the business.

References
 Arnett, D.B. and Wittmann, C.M. (2014) Improving marketing success: The role of tacit knowledge
exchange between sales and marketing. Journal of Business Research, 67(3), pp.324-331.
 Bleda, M. and Del Rio, P. (2013) The market failure and the systemic failure rationales in
technological innovation systems. Research policy, 42(5), pp.1039-1052.
 Bock, A.J., Opsahl, T., George, G. and Gann, D.M. (2012) The effects of culture and structure on
strategic flexibility during business model innovation. Journal of Management Studies, 49(2),
pp.279-305.
 De Medeiros, J.F., Ribeiro, J.L.D. and Cortimiglia, M.N. (2014) Success factors for environmentally
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 Greer, C.R. and Lei, D. (2012) Collaborative innovation with customers: A review of the literature
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 Jiang, K., Lepak, D.P., Hu, J. and Baer, J.C. (2012) How does human resource management
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 Keskin, D., Diehl, J.C. and Molenaar, N. (2013) Innovation process of new ventures driven by
sustainability. Journal of Cleaner Production, 45, pp.50-60.
 Laforet, S. (2013) Organizational innovation outcomes in SMEs: Effects of age, size, and
sector. Journal of World business, 48(4), pp.490-502.

References
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during the innovation process. Journal of Product Innovation Management, 31(3), pp.599-
615.
 Melton, H.L. and Hartline, M.D. (2013) Employee collaboration, learning orientation, and
new service development performance. Journal of Service Research, 16(1), pp.67-81.
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young firms: The role of human resource management. International Small Business
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 Perrotta, C. (2013) Do school‐level factors influence the educational benefits of digital
technology? A critical analysis of teachers' perceptions. British Journal of Educational
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 Ritala, P. and Sainio, L.M. (2014) Coopetition for radical innovation: technology, market and
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