Innovation and Commercialisation

This document discusses the importance of innovation and commercialisation in an organization, focusing on Toyota Motor Limited. It covers the drivers of innovation, sources of innovation, 4 p's of innovation, frugal innovation, and the commercial funnel. Additionally, it explores the application of new product development (NPD) in Toyota.

Innovation and
Commercialisation
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Table of Contents
INTRODUCTION...........................................................................................................................4
1. Innovation and its importance to company........................................................................4
2. Driver or Shaping force of Innovation...............................................................................6
3. Source of Innovation..........................................................................................................7
4. 4 p's of Innovation and Innovation Funnel.........................................................................8
5. Frugal Innovation.............................................................................................................10
6. Importance of commercial funnel and application of NPD..............................................10
7. Innovation business case in context of Toyota.................................................................11
8. Different tools that company can utilize to protect IP and knowledge............................13
9. Measure overall effectiveness using techniques to iterate, test and improve...................14
10. Evaluation of IP tools in regard to wider business environment....................................15
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................17
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INTRODUCTION
Innovation is defined as a process that helps to translates an idea or invention into a
good that used to create the value for customer. Toyota Motor Limited is a Japanese
Multinational automotive manufacturing company headquarter in Japan. Company generally
used to employee 364445 number of employees in an organization (Toyota Motors, 2020).
Current study highlights difference between innovation and invention and different source of the
innovation for the company. Then report goes on to highlights 4 p's of innovation, principle of
frugal engineering and innovation funnel. After that report highlights concept of commercial
funnel and NPD. In the end report explain different type of intellectual property rights available
for the firm.
1. Innovation and its importance to company
Innovation is defined as a process of carrying out of new Combination that generally
includes introduction of the new goods and service or new method of production. Innovation
generally brought in organization with an aim to enhance quality and product line of the
company in market (Scott and et.al., 2020). There are many businesses who interlinks the
innovation and invention together in the long run but in real they are very different from each
other.
Difference between Innovation and Invention are as follows:
Basis Innovation Invention
Meaning Innovation generally refers to
the process of bringing or
building something new in
already existing product in a
market.
Invention at the same time
refers to bringing something
new which has been not
brought by anyone in past.
Concerned with Innovation generally
concentrate on the single
product or process in an
organization.
At the same time Invention
used to concentrate on looking
at the combination of various
product and process in an
organization.
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Process Innovation is very easier and
simpler process as compare to
other (Rasmussen and
Eliason,2017). Reason behind
the same is that Innovation
looks to add value to the
existing product.
Invention is much tougher
concept as compare to the
Innovation. Invention looks at
bringing out something new
for the customer in the market.
Importance of Innovation
In the era where there is good sort of competition faced by all an organization
irrespective of the industry they are operating. Innovation is regarded as a back born of variety of
activity which are generally carried out in an organization. Not only that there are variety of
different importance which are also seen by an organization due to innovation. Some of the
importance of Innovation are as follows:
Enhance Growth: Innovation in Toyota will help company in seeing good sort of the
growth in the market. Reason behind highlighting same is that with the help of the innovation
company is able to improve the product line of the company and also help company in attending
the need of customer on the regular basis.
Optimum Utilization of Resources: Innovation in Toyota will help an organization in
optimum utilization of the variety of different resources which is possess by them in general.
Innovation generally focuses on bringing out best possible outcome from the resources which are
available in front of them.
Help in responding to competition and trend: Innovation generally help an organization in
responding to the trend which is prevailing in the market (Eberhardt and et.al. 2017).
Organization generally drive the innovation process in organization in a way that it used to
understand need and preference of different customer in market and help company in offering the
product in an organization which can help customer in satisfying their need very easily.
Importance of Invention
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 Invention in Toyota Motor will help the company in seeing good competitive advantage
in the organization. As with the help of the invention company will find it easy to attract
the eye of the customer as new invention of product will certainly target toward achieving
the need of the customer.
 Invention in Toyota will help the company in improving the product line of the company
in the long. As company will able to offer more number of the product in the market.
2. Driver or Shaping force of Innovation
There are variety of the different forces which generally used to shape the level of the innovation
in an organization. Some of such type of the forces are as follows:
Organizational Vision: Organizational Vision statement is described as a statement
which used to highlights the future view which is possess by an organization. This vision is set
up by considering variety of internal and external factors. Hence, organization generally looks to
bring the different sort of the innovation in an organization in a way that organizational Vision is
achieved successfully. For example, Organization Tesco is having vision of improving profit
share of company, for the same reason they will innovate in the manufacturing process not in
organizational product. Reason behind the same is that manufacturing process will only help
company in reducing cost to enhance profit margin.
Leadership: Type of leadership opted by the leader in an organization used to influence
the amount of the innovation which is present in an organization (Zahedi, Mirghfoori and Abadi,
2018). As all the leaders generally posses’ different sort of characteristic and view point in
regards of the way through which activity in an organization can be carried out. For example, a
leader using democratic leadership style generally asks different subordinate in the team to
present their view point or thoughts on different issue which is seen by an organization. This
ultimately will help the Toyota Motor Limited in seeing good flow of idea which ultimately
bring good sort of\innovation in organization. At the same time leader who follows Autocratic
leadership style generally used to make variety of different decision by their own. This generally
used to impact or influence the innovation in the negative manner.
Culture: One of the most important drivers of culture in an organization is regarded as
internal culture of an organization. A culture of the innovation is one thing which actively
encourages and supports good sort of creativity in an organization. As good and positive culture
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in Toyota Motor Limited thinks about the people or the employee which are working in an
organization and also helps them in keep their point of view in an organization (Khajeheian,
2016). This eventually used to allow innovation to flow in an organization.
Team Work: It is another important element or driver which used to drive the flow of
the innovation in an organization. Team generally refers to the group of the people working
together to achieve the common objective of the team. In team environment all the individual or
member of the team are asked to pass on their point of view in an organization. This ultimately
will help enhancing the level of innovation in Toyota Motor Limited. For example, in an Asda a
Research and development team is facing issue related to selecting the best source through which
different data can be collected in an organization. To overcome the same issue all the team
member had passed on their view point, out of which management had decided to select view
point of one employee as technique passed on by that employee was very unique in nature.
3. Source of Innovation
There are variety of the different source through which idea of innovation can be adopted
in an organization. Some sources of the innovation are presented below:
Market Research: It is one of the most important sources of innovation for all an
organization. All an organization, generally used to research the market and on the basis of same
try to find out the different opportunity presented in the market and on the basis of the same
innovation process is set up in an organization to endure the marketing opportunity in the best
way possible in an organization.
Unexpected Occurrences: It is another source of innovation for an organization, there
are variety of the situation which generally occur in front of an organization which they have
never expected. This eventually used to force the company in thinking out of the box to
overcome the same issue. Hence, it sometime used to give rise to innovation in an organization.
Industry and Market Change: They are another important source of innovation for the
company, it has been identified that any change in the Industry generally drives the company in
innovating their service and product to overcome issue related to change. This ultimately flows
good sort of innovation in organization.
Way of developing good environment and culture of innovation
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To develop good culture and environment of innovation in an organization, organization
has to make sure that they are open to adopt variety of the different changes in an organization.
Also, they have to make sure that they used to adopt the participative decision making in an
organization. This will eventually help the company in getting point of view and new thoughts
from all the employees present in an organization.
4. 4 p's of Innovation and Innovation Funnel
4 p's of Innovation is generally described as a mix of innovation which includes all the different
element which are important at the time of innovating something in an organization. 4 P's of
innovation are as follows:
Product: Product innovation, is describe as a process in which different values is added
in the current product of the company to make the product more effective and efficient in nature.
Product innovation can be in the form of enhancing the shape, colour or appearance of the
product.
Process: Innovation in process is describe as a type of the innovation which has been
brought in the manufacturing process so that quality or efficiency of end offering of the company
has been improved. Process innovation can be any idea which helped in optimum utilization of
resources for an organization.
Position: Position innovation can be described as a perception innovation as well, this is
the type of the innovation in which organization looks to satisfy the perception of different
interested parties in an organization. This element looks at making different innovative decision
to improve the perception of different parties toward the product of the company.
Paradigm: It is another element of Innovation mix, this element looks at bringing
changes in the way different things are done in an organization (Cebotari and Benedek, 2017).
Changes can be the way the sales are done in an organization, or change in the distribution
channel of the company. These changes are brought to enhance the efficiency and effectiveness
of different activity of an organization.
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Innovation Funnel
Innovation Funnel used to describe the process or stage which will be followed in an
organization to innovate different thing in an organization. Phase and stage of Innovation funnel
is as follows:
Stage 1: It is the stage in which individual or organization is stuck with the idea of bringing
innovation in an organization.
Stage 2: It is the stage in which different information is gather about the idea which has been
selected in the first phase of innovation funnel.
Stage 3: After that in the third phase different data which has been collected in the first two
stages and tested to check the viability of variety of information which has been collected
Stage 4: In the last step the idea which has passed from first 3 phase start to take shape into a
potential product of the company.
Knowledge of Innovation will help the company in checking the viability of innovative idea in
the better way. It had been identified that with the help of 4 p's information company will able to
understand the importance of bringing the innovation and with the help of Inovation funnel,
company is able to understand the viability of idea gather by them.
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5. Frugal Innovation
Frugal Innovation is regarded as a process in organization which concentrate on reducing
the level of complexity and cost associate with the production and manufacturing of goods.
Different activity under frugal innovation generally concentrate at reducing variety of different
non essential features from durable goods. There are variety of different type of innovation
which generally used to govern the frugal innovation in an organization. Nisa a SMEs is well
known of using Frugal innovation in the organization to reduce cost of their product. There are
some principle which can be adopted by Toyota to adopt frugal innovation.
Find opportunity in adversity: This principle used to govern that Toyota has to consider
problem as a adversity and they have to look at bringing best out of the same. For example, if
company in investing extra cost then they can look at optimum utilization of resources by
developing good number of products.
Optimum utilization of resources: Another principle of frugal innovation is to optimum
utilize the different resources which is present in front of Toyota.
Keep it simple: Organization has to make sure that they are keeping different activity
very simple in an organization, so that it brings good sort of clarity in organization (Mohammed,
Hafeez-Baig and Gururajan, 2018).
Be flexible: It is another important principle of frugal innovation; Toyota has to make
sure that they are flexible enough to adopt different changes in the operations.
6. Importance of commercial funnel and application of NPD
Commercial funnel is a step by step procedure that enables Toyota Company to bring
their target buyers one step near to their existing offers and a purchasing decision through a
range of marketing actions like video, automated, landing pages and articles that will do selling
for chosen brand. This concept is important for organization because it help to increase
conversion rate rather than before (Kuznetsov and et.al., 2019). It is important in context of
chosen brand, because it help to generate more profits and increase consumers base even better.
It lead to attract each buyer towards purchase to organization products and after sales services.
New product development-
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Idea generation-
According to this phase, company needs to generate innovative ideas which make them
able to increase sales after selling new products that are electric car that reduce negative impact
of those vehicles that cause air pollution.
Idea screening-
At this level, generated ideas will be screened and one of the best will be chosen by top
authority (Munck and et.al., 2020).
Concept development & testing-
With selected idea, production department transform it into tangible manner and then
manager test it which is really very important.
Marketing tactic development-
Marketing department after passing above phases, develop an effective marketing plan
through which company can increase their consumer’s base rather than before.
Product development-
Overall process of innovation goes under this phase, management should develop
physical version of goods in order to take their test.
Commercialization-
After above stage it’s time to launch new item in market where number of buyers seek to
use Cars for their supply chain activities.
Post launch review-
Management after product launch needs to review and consider consumers feedback
which allow them to known success of goods in market.
7. Innovation business case in context of Toyota
Executive summary-
Toyota is one of the leading automobile organizations in the UK, they provide the best
vehicles in the whole world (Soviar and et.al., 2019). Firm is accountable for marketing,
consumer’s relationship, and sales and after sales services for Lexus & Toyota in the United
Kingdom. Company by using appropriate techniques and suitable IP tools, effectively achieve set
objectives of business.
Analysis-
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There are varied factors accessible in the world of business that can put negative or
positive impact on success of plan and strategies. Here, it can be analysing that technology
advancement is one of the best external elements that can contribute in achieving all objectives
of company in systematic manner. With advanced technology, firm can manufacture vehicle that
produce less pollution and have auto direction feature.
Description of the problem of the company –
Toyota faces issue in context of production operation due to concern of consumers and
government to reduce carbon foot print. People seek to use and purchase products that are less
harmful for overall environment.
Reason behind innovative solution-
Above problem is the main reason behind developing new electronic cars, which will use
less part to funnel energy through experience less energy conversion. Firm want to sustain within
market place and retain potential buyers for longer period of time and for this Toyota decide to
innovate something new.
Use of NDP model-
Toyota can use overall stages of new product development and follow these while
producing new vehicles.
Possible options or sources of funding-
Companies in automobile industry used right option through which they are taking funds
or amounts because of manufacturing innovative products, especially for target market. Here,
Toyota also can use Bank loan or angel investor as sources of funding, which allow them to
achieve above objectives in systematic manner (Herck Giaquinto and Bortoluzzo, 2020). Bank
loan is an amount of money required according to specific work or project like new product
development in regard to Toyota. It can be taken in form of loan at interest by private or [public
bank to a borrowers, mostly on collateral security, for a few months or year. With angel investor
option, company can take require amount from group of people who allot money based on needs
of ventures. It is a high net worth company or group of people who caters financial services for
well known and small companies as well as start ups. Firm can take bank loan from well reputed
bank in their home town, which is a legal process that can provide security and trust.
Recommendations-
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Both sources of funding are beneficial, but firm can choose the best one and that is bank
loan because it is legal procedure.
Financial analysis-
Basis Cost
Market analysis 500
Idea creation and implementation 1500
Hiring 600
Training 500
Automobile parts 1800
Marketing 600
Total 5500
Toyota can develop appropriate market for electric cars as new product by targeting and
segment consumers. Furthermore, they can develop it by creating effective marketing tactics and
approach.
Firm can improve their commercialization techniques and tactics by conducting market
research, because it makes company able to identify profitable methods which business
management could use to commercialize products in market.
8. Different tools that company can utilize to protect IP and knowledge
In the world of business, organizations are using appropriate and suitable intellectual
property tools which are quite beneficial for them as well as their businesses in term of
protecting key knowledge and products from others.
Copyrights-
It is a legal means of protecting an owner ideas, items and work. It is a form of
intellectual property tools that caters exclusive publication and usage rights for owners
(Samuelson, 2019). Here, Toyota can use this tool to protect their innovative and creative ideas,
their creativity and strategies relate to products, which they especially manufacture for target
market and other people who are interested within it. It can be said that, organization with this
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tool can protect different types of content such as documents related to product idea, etc. The
best thing about this IP tool is that it give right to reproduce same product and modify it. On the
other hand, this tool does not permit company to allow others to utilize their work in public, as it
slow down productivity and not published at all.
Patent-
It is right granted to company by federal government that allows business to exclude
others from making, utilizing and selling vehicles for duration of time. Toyota can use this thing
because it encourages firm to innovate that are unique and helpful to community. It gives
organization right to save their ideas from other companies, operated in same sector since for so
long. It helps to give management power to stop others from copying and distributing their cars
without approval. Company get protection for a pre-identified limit, permitting them to keep
rivals at bay. Negative aspect of this tool is that it can be expensive procedure even when it is
unsuccessful.
Trade mark-
It is a form of IP consisting of a considerable design, signs and expression that
determines services or goods of specific source from those of others, although this tool can be
used to identify things are usually called service marks. Toyota by using this method can apply
for their trade mark registration, which is beneficial for them in term of allowing them to sell
products only in their home town, that means known one can sell the same things to customers.
On the other side, when company use this tool for new project or product it require a lot of
money in form of registration in every 10 years.
9. Measure overall effectiveness using techniques to iterate, test and improve
Innovative business case has been developed with key description of funding sources that
Help Company to collect amount require to needs in regard to vehicles. This case is quite
effective as it provides further ways to organization which they will consider to achieve set
objectives and desire results. Above business case effectively incorporate techniques to measure
its entire effectiveness in effective manner. It can be measure by considering outcomes of
innovation, which in return provide benefits to company in term of increasing their sales even
better. Furthermore, it can be said that organization would effectively test and identify
effectiveness of business case when management recognize view points of buyers and read their
reviews after product launch.
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Manager needs to conduct a market analysis where they can be able to gather a lot of data
about likes and dislikes of their goods. These types of things customers have been given via
social media platforms and discussed with other people live around them. When profitability has
been increased, then management will understand that business case it successfully
works in market and help drive sales of company rather than before.
10. Evaluation of IP tools in regard to wider business environment
Above discussion, provide clear understanding about intellectual property tools such as
trade mark, copyright and patent in context of Toyota. All the tools are effective and useful for
organization because they provide benefits to its business and products. For example, when
Toyota use patent as IP tool, they can stop other enterprises from copying their ideas and sells
same goods in market to customers. This advantage can only be fully analysed, when firm has a
effective patent and has an appropriate patent enforcement plan in workplace so that
management can effectively detect and take legal action against an infringer. Furthermore, trade
mark is as beneficial as other intellectual property tools. It protects products against same things
that have been mentioned above. No one can use or copy logo registered by firm under trade
mark.
Through trade mark, Toyota can establish good will in market and builds trust between
consumers and their business. But it can be analysed that in term of protecting goods, trade mark
registration is that weakest rights amongst copyright and patents protection. No payment of
renewal amount may cause removal of this tool from register.
CONCLUSION
From above analysis, it has been concluded that by using innovation funnel and ways to
innovation Toyota and its management effectively shaping creative ideas, which is very
beneficial for company. As it helps manager to obtain desire outcomes, increase profitability and
productivity level rather than before. Furthermore, it has been summarized that by following the
stages of new product development, firm efficiently developed unique vehicle through which
they attracted customers towards purchase and its increased consumers base rather than before. It
has been identified that by using patent, company protected their innovative cars and ideas
related to it from being stolen by others in effective manner.
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Moreover, it has been analysed that by using varied techniques such as profitability
analysis and consumers reviews, organization successfully measuring the overall effectiveness of
innovative business case as it allow them to make further improvement, which are beneficial to
obtain desire results.
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Online
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