The Importance of Innovation in Business - Assignment

Running head: FORCES IN BUSINESS ENVIRONMENT NECESSITATE COMPANIES TO
INNOVATE
FORCES IN BUSINESS ENVIRONMENT NECESSITATE COMPANIES TO INNOVATE
Name of the Student
Name of the University
Author Note

FORCES IN BUSINESS ENVIRONMENT NECESSITATE COMPANIES TO INNOVATE1
Innovation – Is it Critical?
What if we could have a device that could read our minds and assist us with our
thoughts? When we didn’t have a smart phone it was all about just calling people, but now it is
about taking pictures to getting inside the world of virtual reality. What we think aboutis way
ahead of what we have and that leads to Innovation.In the era of global competition innovation
justifies competitiveness, economic growth and development (Goffin and Mitchell 2016).
Business organizations that understand and act upon opportunities proactively through
innovation will not just survive, but it will be at its top even in the toughest market conditions.
Change is constant and it is inevitable. Innovation has clearly become the strategic
agenda for the business environment. According to 84% of business executives, innovation is a
key strategy to growth (Lee et al., 2017). The changes in the market forces have changed the way
a company functions. Evolution has taken place in the philosophy of production and
diversification (Vey et al. 2017). Creativity has become the important capital resource for the

FORCES IN BUSINESS ENVIRONMENT NECESSITATE COMPANIES TO INNOVATE2
business organizations and innovation management is the only stair ways to sustainability and
success.
Forces requiring Companies to be Innovative
Business organizations arealways aware of the opportunities and they act accordingly.
Today’scompetitive business world has developed the culture of agile innovation.
Commoditization is an inexorable pressure, which pushes price downwards and it is an important
competitive force that drives organizations to be innovative. For example - Wal-Mart manifested
commoditization of world’s retail supply chain and outsourced manufacturing to Asia. Digital
Revolution accelerated commoditization and the goods that were considered luxuries are now
cheap. In order to compete in a market where goods are already available at a cheaper price,
innovation is necessary.