Review of Literature on Open Innovation

The given assignment is a comprehensive review of literature on open innovation in small and medium-sized enterprises (SMEs). It covers a wide range of topics, including concept, technology, and methods of developing university systems for innovation project commercialization based on effectuation. The assignment also explores innovation in start-ups, military-civilian partnerships, integrated roadmaps, and corporate foresight as tools of innovation management. Additionally, it delves into the theme of venture capital and cleantech, as well as the role of graphene commercialization. The summary provides an overview of the key points discussed in the assignment, highlighting its significance in the context of open innovation.

Innovation And
Commercialisation

Table of Contents
INTRODUCTION...........................................................................................................................1
LO 1.................................................................................................................................................1
P1) Define innovation and how it is important to organization. ................................................1
P2) Discuss firms, culture, leadership, teamwork and vision assist in shaping innovation and
commercialization. .....................................................................................................................3
M1) Examine various sources of innovation and how firm can foster an environment and
culture of innovation. .................................................................................................................4
D 1) Critically examine how innovation is developed and measured in an firm. ......................5
LO 2.................................................................................................................................................5
P3) Discuss 4Ps of innovation and use of innovation funnel to shape innovative ideas. ..........5
P4) Discuss frugal innovation with examples and how it is used in an firm. ............................6
M2) Application of Innovation funnel in organization...............................................................7
M3) Discuss role of frugal innovation........................................................................................8
CONCLUSION................................................................................................................................8
....................................................................................................................................................8
.........................................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Innovation can be defined as transforming an creative idea or thought into goods and
services so that customers are welling to pay monetary value in the market. Innovation are
necessary to emerge in the cut throat competitive market in order to uplift economy of the
country in terms GDP (Gross Domestic Product). By doing so it aid the organization to flourish
in the global market across the globe. This report is based on Essence Drink which was
established by Nirmal Kumar around two years ago in the United Kingdom. Firm is coming up
with Orange flavoured Lassi for it's potential customers in the UK market. This report covers
difference between innovation and invention as well as how innovation is important to business
growth and success (Chun and Ko, 2015). It also, throw light on leadership, culture, vision and
teamwork in order to shape innovation and commercialization in the competitive world.
LO 1
P1) Define innovation and how it is important to organization.
Innovation refers to as process of translating creative thinking, thought or idea into
product or services so that customers are willing to pay value in the competitive world.
Organization need to carry out innovation activity on continuous basis in order to create tough
competition for others firm in the market place. By doing so Business associates is benefited in
many ways such as, raise productivity level, improve brand recognition, increase
competitiveness, profitability ratio etc. in the market.
The main motive of company to do research for new product or services is to better
understand the dynamic needs of the potential customers as well as to uplift quality and quantity
of the innovative product. In the of 21st century business associates innovative product which is
“flavoured Orange Lassi” plays a vital role in the growth of the economy. As this leads to raise
in sales volume the profitability ratio will be increasing in parallel ways due to which directly or
indirectly economy of the nation will be uplifted (Datta and Jessup, 2015) .
The importance of innovation are explained as follows:
Reinforce brand: Innovation assist Essence Drink to reinforce their brand in the market
by coming up with flavoured Orange Lassi in the market. By doing so, huge market ratio can be
gained as well as profitability ratio can be gained at a large scale. It directly or indirectly helps
the company to increase their market value and goodwill in the eyes of the customers.
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Responding to competition and Trends: Essence Drink come up with Orange Lassi in
the UK market in order to satisfy the emerging needs of the customers. Firm carries out creative
idea in order to create tough competition for other business running successfully in the cut throat
competitive world. Successful organization not only come up with creative thought but also keep
eye on others loop hole so that it can be turned out as their opportunity for growth and
development (Engel, 2015).
The difference between innovation and invention are discussed as follows:
Basis Invention Innovation
Meaning Invention can be stated as
emerging of an idea for a
product which has never ever
been designed earlier.
Innovation can be explained as
executing of creating thought
for product or services for the
first time in the market place
(Sheep and Khazanchi, 2017).
Concept The concept of invention come
by working in theory.
In this case concept of
innovation is generated from
practical implementation of
creative idea or thought.
Necessary skills required For invention scientific skills
is required.
Strategic and technical skills
are required in innovation.
Activities carried out Invention activities are limited
to research and development.
In order to to come up with
innovation in product the
activities need to be carried
across the firm.
Concerned with Invention is concerned or
related with single product or
process in the market (Rubera
and Ordanini, 2016)
In this case, Innovation is
related with several product
combination.
What is it related to Invention is related to
designing, framing and
Here, innovation is related to
adding value existing product
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creation of a new goods or
product.
or services.
Investments involved Huge investment is involved in
invention process.
As compared to invention less
monetary value is required in
innovation of goods in the
competitive world.
Occurrence Invention occurs when new
idea strikes a scientist.
Whereas, Innovation occurs
when a necessity is required
for a new product or
improvement is needed in the
existing goods.
P2) Discuss firms, culture, leadership, teamwork and vision assist in shaping innovation and
commercialization.
Commercialization is the platform of bringing organizational product or services
available for customers in the cut throat competitive world. It is the place where goods and
services are made available to the clients according to their needs and demands in the
competitive world (Henttonen and Lehtimäki, 2017). This is important to carry out in the market
place as it takes into account marketing, distribution, customers, production and sales in order to
meet the commercial success . Essence Drink leadership, teamwork, vision and culture will aid
in shaping innovation and commercialization are stated below:
Vision: The vision statement of Essence drink for flavoured Orange lassi is “To become
world's customers- centric firm in order to build a healthy and nutrient Lassi”. Organization
frames vision statements so that they get motivated on continuous basis to design certain tactics
to achieve desired goals on time.
Teamwork: In an organization effective team aid in achieving set targets on time. As
well as encourages timely to come up with innovative product in the market to satisfy the
emerging needs and preferences of the consumers. Company is coming up with Orange Lassi for
the customers who are on diet and who are health conscious (Kuratko and Hoskinson, 2016).
Flavoured Orange Lassi is ready to come up in the market because of effective teamwork who
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worked day and night to fulfil firm's objective. Whereas, ineffective teamwork leads the
company and it's product at closing stage.
Culture: The culture of UK is to remain fit by focusing more on their daily diet plan.
Essence Drink decided to come up flavoured Orange Lassi in the United Kingdom market place
So, that innovative Lassi can benefit the health conscious people in positive way. This Lassi will
help the customers to remain fit and healthy as well as energetic throughout the day. The culture
of UK is very hectic and tiring in this case, Orange Lassi will be beneficial to their health. This
nutrients Lassi will directly or indirectly helps the organization to expand it's market share and
customer base in the competitive world (Hossain and Kauranen, 2016).
Leadership: Effective leader in an business associates assists in motivating employees to
work effectively and efficiently in order to achieve the desired goals on time. Essence Drink
leaders are effective enough in their work and carry out potential abilities and skills to make
unique strategies in order to pull potential customers for their flavoured Orange Lassi. Whereas,
ineffective leaders demotivate the workers and fails to meet the set targets on time. Potential
leaders guide the enterprise to design tactics so that they can set tough standards for other
competitors in the global market.
M1) Examine various sources of innovation and how firm can foster an environment and culture
of innovation.
In 21st century to remain in the competitive world business associates needs to carry out
innovation activities. Through innovation organization can survive in the cut throat world for
longer time duration as well as can fulfil the set targets on time. Essence Drink of Nirmal Kumar
is coming up with flavoured Orange Lassi in order to raise customer base for the drink who are
diet conscious. It is through creativity in Lassi that this organization in it's third year is coming
up with different Lassi flavour. In order to flourish in the international market there are
distinguished sources of innovation. According to Peter Drucker the seven sources of innovation
are explained as follows:
The Unexpected: Innovation takes place at any point of time. There is no specific place,
person or time to innovate a product or services in the market (Hossain, 2015). In our
surroundings there are many innovations emerged accidental in order to meet the satisfaction
level of people. Essence Drink deals in Lassi but by conducting research firm came to know that
Lassi should have flavours so that it can benefit every section of the society. It assist in
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development of environment by coming up with unique ways to safeguard environment from
exploitation.
Necessity: In order to innovate anything in the market place there should be necessity for
it. Essence Drink felt that UK people are more conscious on health and diet so that decided to
add flavours in Lassi. By doing so firms product which was Lassi did not hampered and
necessity for health drink was fulfilled respectively by adding fruits flavours to it. Business
associates sensed the necessity for the drink in the market and came up with Orange Lassi to
meet the emerging preferences.
Demographics: The raising living standards in the global era is another source of
innovation. The living standards of customers are enriching day by day and accordingly their
needs, demands and preferences are changing dynamically in the competitive market place.
Essence Drink calculated health of the customers and decided to come up with Lassi as a base
with different flavours added to it (Kolychev and Prokhorov, 2015).
D 1) Critically examine how innovation is developed and measured in an firm.
In order to generate innovative thinking, idea or thought firm needs to involve employees
in their decision making process. Staff members working in Essence Drink should be given
proper freedom to explore their ideas in a better way so that firm can come up with innovative
results. As well as workers should be given the liberty to utilize their skills, capabilities and
abilities to generate a creative thought which can be used to generate unique goods in the market
and to set tough competition for others in the global market.
LO 2
P3) Discuss 4Ps of innovation and use of innovation funnel to shape innovative ideas.
Essence Drink adopts 4ps of innovation which was developed by John Bessant and Joe
Tidd in order to calculate where the firm is standing in the market and how business associates
innovate to improve position, product, process and paradigm (Isaksen and Jakobsen, 2017).
This tool helps in exploring enhancements in every area of business. However, the 4ps of
innovation such as Paradigm, process, product and position are explained as follows:
Product: Essence Drink is launching Orange flavoured Lassi in the UK market in order
to satisfy the emerging needs of the customers. By doing research and development on
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continuous basis taste , flavours, quantity, prices etc. can be improved respectively. Which will
help the enterprise to bind potential customers with Lassi for longer time duration.
Process: As it the third year of Essence Drink, and is coming up with innovative Lassi
which is flavoured Orange Lassi in the UK market to gain profits from the customers. Company
is gradually increasing the process of production in the market. As the demand for Lassi will
raise the process of production for Orange Lassi will also raise parallelly (Miller and French,
2016).
Paradigm:This refers to as viewing the same thing with different prospects in the
market. Essence Drink choosed Lassi as their base for nutritious drink and added orange flavour
to it. They did not come with totally new drink but modified the existing Lassi for Customers.
Through this paradigm Essence Drink is successfully running in the third year and is able to
raise their market value.
Position: Orange Lassi is ready for the customers in the market. The main targets of the
drink are diet and health conscious people of all age group. Essence Drink is gradually capturing
the market ratio in the UK market as well as is able to hold strong position in the cut throat
competitive world.
Innovation Funnel can be explained as a process to examine thoughts or ideas and
conceptualize goods in the market place. The main motive of this is to take an idea from concept
to reality by converting to a particular goods in order to achieve market needs in economical and
manufacturable form (Paradkar and Hansen, 2015). Essence drink uses innovation funnel in their
working premises so that the idea of providing healthy Drink to the customers can be
transformed into reality. By doing so organization can set standards for other firm in the market
place and can flourish in the global village.
P4) Discuss frugal innovation with examples and how it is used in an firm.
Frugal innovation is a activity of decreasing complexity and cost of goods and it's
production. It refers to as eliminating non essential features from durable goods so that sales
volume can be raised and profitability ratio can be raised accordingly. Here, are some of the
examples of durable goods such as, rice, cereals, wheat etc. The principles of frugal innovation
are discussed as follows:
Search opportunity in adverse conditions: To be successful in the market firm should
figure out growth opportunity in adverse situations (Gaddy and Wayman, 2017). Essence Drink
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garbed the opportunity of flavoured Lassi and decided to come up with orange Lassi in the UK
market. Due to which huge market ratio is captured and profits are gained accordingly.
Example: Essence Drink research that UK crowd is more health conscious so firm decided to
come up with nutritious Lassi which is full of natural minerals. They captured the opportunity
and is able to gene rte huge profits.
Do more with less: Innovation should be done by utilizing resources in effective manner.
Essence Drink did innovation in the existing Lassi just by adding flavour of orange in it. Here,
resources were optimizes effectively and efficiently with less or no wastage of natural orange.
Example: Orange Lassi is a innovative product but with less resources in it. It is a big innovative
product but by using less resources (Rasmussen and Eliason, 2017). By doing so more customer
base can be raised and profit can be maximized.
Think and act flexibly: Essence Drink should be flexible in nature as well as should be
adoptable to the dynamic environment so that customers needs can be satisfied. In this case
business associates should be improvisational rather than rigid so that best outcomes can be
achieved. Example: Nirmal Kumar founder of Essence Drink is very flexible in nature and came
up with the Orange Lassi to benefit the customers who are health conscious.
Keep it simple: Innovative product should be simple. There should not be complexity as
it becomes difficult to address to the customers in the cut throat competitive world. Essence
Drink came up with simple Drink with flavours of Orange in it. Example: Lassi with flavour of
Orange is simple in nature and customers are easily consuming it in their daily routine to stay
healthy and fit.
Include the margin: Essence Drink should involve consumers in their decision making
process so that best results can be achieved. Firm should work on the feedbacks of the clients in
order to bind consumers towards their Orange flavoured Lassi in the market. Example:
Customers feedback weather negative or positive should be taken as positive sign. By doing so
goodwill is raised in the eyes of the customers and and by carrying out improvements more
customer base can be raised respectively.
Follow your Heart: Top management of the Essence Drink should be passionate enough
to carry out the innovative drink in the market. The zeal and passion for carrying out innovative
product will help the firm to be successful in the market (Vishnevskiy and Meissner, 2015).
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M2) Application of Innovation funnel in organization
The application of innovation funnel are explained as follows:
Identification: Essence Drink identified the idea of flavoured Lassi in the market and
decided to launch Orange Lassi for it's potential customers. This the step where idea is generated
on a piece of paper.
Define: A blueprint bis made of the idea how, what , when etc. are put on the idea before
executing it in real terms. Essence Drink designed a layout of the Orange Lassi in which roles
and responsibilities, how much resources are required, time duration to complete the task etc. are
put up.
Measures: When the idea is designed it is measured weather the decided creative thought
is feasible or not. Essence Drink measured the flavoured Lassi in all terms like, taste, flavours
etc. so that goals can be achieved.
Analyse: Essence Drink made examined the market before launching Orange Lassi in the
market. It was done to analyse market scenario in the competitive market place (Xiao and Yan,
2016.).
Implement: Orange Lassi was implemented in the market when all the above task are
completed effectively. Here, Lassi is finally ready for potential customers in the market place.
Control: In this stage all activities are controlled so that errors can be eliminated at the
initial stage. By doing so profits can be gained at a huge scale and goodwill can be created in the
eyes of the customers.
M3) Discuss role of frugal innovation
Frugal innovation helps the business associates to choose best innovative idea out of the
several ideas. By adopting this model it guides the organization to choose the most appropriate
innovative ideas out of the listed several idea. It directly aid the business associates to select the
most reliable idea which will be benefiting the company in the future. It also, a crucial role in the
company as it guides the firm to choose the most appropriate idea (Xiao and Liu, 2016).
CONCLUSION
From the above it can be concluded that Innovation plays a vital role in the growth and
success of the business in the market. Organization should carry out innovation so that tough
competition can be given to the other competitors prevailing in the market. 4Ps of innovation aid
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the business associates to improve product, process, paradigm and position in the competitive
world. Also, uses of innovation funnel are studied so that firm can flourish in the market.
Moreover, frugal innovations principles are studied so that complexity can be reduced
accordingly .
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REFERENCES
Books and Journals
Chun, D., Chung, Y., Woo, C., Seo, H. and Ko, H., 2015. Labor union effects on innovation and
commercialization productivity: An integrated propensity score matching and two-stage
data envelopment analysis. Sustainability. 7(5). pp.5120-5138.
Datta, A., Mukherjee, D. and Jessup, L., 2015. Understanding commercialization of
technological innovation: taking stock and moving forward. R&d Management. 45(3).
pp.215-249.
Engel, J. S., 2015. Global clusters of innovation: Lessons from Silicon Valley. California
Management Review. 57(2). pp.36-65.
Henttonen, K. and Lehtimäki, H., 2017. Open innovation in SMEs: collaboration modes and
strategies for commercialization in technology-intensive companies in forestry
industry. European Journal of Innovation Management. 20(2). pp.329-347.
Hossain, M. and Kauranen, I., 2016. Open innovation in SMEs: a systematic literature
review. Journal of Strategy and Management. 9(1). pp.58-73.
Hossain, M., 2015. A review of literature on open innovation in small and medium-sized
enterprises. Journal of Global Entrepreneurship Research. 5(1). p.6.
Kolychev, V. D. and Prokhorov, I. V., 2015. Conception, technology and methods of
development of university system of innovation projects commercialization based on
effectuation. Asian Social Science. 11(8). p.44.
Miller, F. A. and French, M., 2016. Organizing the entrepreneurial hospital: Hybridizing the
logics of healthcare and innovation. Research Policy. 45(8). pp.1534-1544.
Paradkar, A., Knight, J. and Hansen, P., 2015. Innovation in start-ups: Ideas filling the void or
ideas devoid of resources and capabilities?. Technovation. 41. pp.1-10.
Rasmussen, T. E. and Eliason, J. L., 2017. Military-civilian partnership in device innovation:
Development, commercialization and application of resuscitative endovascular balloon
occlusion of the aorta. Journal of Trauma and Acute Care Surgery. 83(4). pp.732-735.
Vishnevskiy, K., Karasev, O. and Meissner, D., 2015. Integrated roadmaps and corporate
foresight as tools of innovation management: the case of Russian
companies. Technological Forecasting and Social Change. 90. pp.433-443.
Xiao, X., Li, Y. and Liu, Z., 2016. Graphene commercialization. Nature materials. 15(7). p.697.
Xiao, Z., Meng, W., Wang, J. and Yan, Y., 2016. Thermodynamic Stability and Defect
Chemistry of Bismuth‐Based Lead‐Free Double Perovskites. ChemSusChem. 9(18).
pp.2628-2633.
Gaddy, B. E., Sivaram, V., Jones, T. B. and Wayman, L., 2017. Venture capital and cleantech:
The wrong model for energy innovation. Energy Policy, 102, pp.385-395.
Isaksen, A. and Jakobsen, S. E., 2017. New path development between innovation systems and
individual actors.
Kuratko, D. F. and Hoskinson, S., 2016. Technological innovation: Generating economic results.
Emerald Group Publishing.
Rubera, G., Chandrasekaran, D. and Ordanini, A., 2016. Open innovation, product portfolio
innovativeness and firm performance: the dual role of new product development
capabilities. Journal of the Academy of Marketing Science. 44(2). pp.166-184.
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Sheep, M. L., Fairhurst, G. T. and Khazanchi, S., 2017. Knots in the discourse of innovation:
Investigating multiple tensions in a reacquired spin-off. Organization Studies. 38(3-4).
pp.463-488.
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