Innovation And Commercialisation (PDF)

Innovation and Commercialisation

Table of Contents
Introduction:....................................................................................................................................2
LO1: P-1: Explanation of innovation and determine its importance to the organisation in
comparison with the invention:.......................................................................................................3
P-2: Explanation of organizational vision, leadership, culture and teamwork effect on shaping the
organisation’s innovation and commercialization:..........................................................................3
M-1: Analyzing different sources of innovation. And how organisations can foster and
develop an environment and culture of innovation:....................................................................4
LO2: P-3: Explanation of the 4Ps of the innovation and the use of the innovation funnel to
examine and shape innovative ideas:...............................................................................................5
P-4: Explanation of the developments in frugal innovation and examples of how it is used in
Shazam:............................................................................................................................................7
M-2: Analysing the application of the innovation funnel in Shazam:.........................................7
M-3: The role of frugal innovation in Shazam:...........................................................................7
LO3: P-5: Explanation of the importance of the commercial funnel and the application of new
product development (NPD) processing for commercialization of innovation:..............................8
P-6: Build an innovation business case for an organisation including a way to access funding:....9
M-4: A detail innovation business case which includes how to measure its overall
effectiveness using appropriate techniques available to test. Iterate and improve:.....................9
LO4: P-7: Evaluation of the different tools that an organisation can use to develop, retain and
protect knowledge and intellectual property....................................................................................9
M-5: Evidence-based evaluation of these different tools in the context of the wider business
environment:..............................................................................................................................10
Conclusion:....................................................................................................................................11
Reference:......................................................................................................................................12

Introduction:
Innovation is a solution for creating a new idea or product to meeting the new requirement of the
customer. Innovation is a way to create new demand market. In the business, world innovation is
a must for an organisation to create new field and market place for them. Customers demand is a
never-ending process and for fulfilling the need of the customer is a must for business
organisation. innovation is a long process of formulating idea giving value to an invention and
commercialization. For an organisation’s innovation that organisation’s environment, vision,
culture, leadership and teamwork plays a big role (D Bogers and West, 2012) In this discussion I
will elaborate an organisation’s innovation process, different tools and process that needed for
innovation and how an organisation develop its whole innovation and how they commercialize
that in the context of ‘Shazam Entertainment Ltd.’.
Organisation overview:
Shazam Entertainment Ltd. is an application development company that works with their most
famous application Shazam. Shazam software is available for Android, macOS, iOS, watchOS,
tvOS, and Windows for entertainment purpose. Shazam was an independent organisation and
work with different entertainment company as a partner. Later on 2018 Shazam was bought by
Apple and now they do their app development work under Apple Inc. Currently, Shazam’s user
is 400 million around the world. Their turnover in 2017 was $53.7 million and their growth rate
in 2016 was 14.5%. Shazam is now working for software with an identification process which
will be a new feature of iOS 13, 2019 (Barnes and others, 2011).

LO1: P-1: Explanation of innovation and determine its importance to the
organisation in comparison with the invention:
Innovation refers to generating a new idea or process and gives value to customers. When a
company find out a new product or process they call it new invention but until some value is
given to that invention to make it available and useful for people it cannot be called as an
innovation it will just be an idea which is not that much use for anyone. Some business leaders
refer that innovation means be relevant and process to cop up with the current situation where for
gaining competitive advantages company develop a new product or improvise an existing one
and put a value to it for creating a new position in the market.
There is a significant difference between invention and innovation. Sometimes the idea between
invention and innovation is confusing. The invention is the processing of new idea which is not
available in the market where innovation is the improvisation of an idea of a product which may
exist in the market and give that idea a value in order to commercialize it. For example, creating
a Shazam app is an invention but make it available for the users and adding a different feature to
it is innovation for them (Bessant and Tidd, 2015).
Importance of the innovation to the organisation:
Innovation has great importance in an organisation. For competing in the market and for holding
their customer's interest in their product organisation need to improvise their product and
systems. These are all part of innovation. If we think about Shazam situation before launching
smartphone they gave their service with a pin number “2580”. People would dial the number and
listen to their favourite songs. But with the launching of Android and iPhone Shazam also launch
their software which is compatible with both of the phone even with the Microsoft they are also
now creating a new feature for gaining the competitive advantages and providing new services to
their customers. So for gaining competitive advantages, proving new product or idea in the
marker. For holding their customer demand and create a sustainable and productive market field
organisation need to research and innovate new idea and product (Burns and Sinfield, 2016).
P-2: Explanation of organizational vision, leadership, culture and teamwork effect
on shaping the organisation’s innovation and commercialization:
Organisation’s environment plays a big role in the innovation process of an organisation.
organisation’s culture, their vision and mission, employees working process, leading method
shape their environment and these elements also affect the innovation and commercialization
process of an organisation.
The organisation has a predetermined long term goal. Organisation’s strategic planners and top-
level managers determine the goal and process the vision and mission f that organisation where
their employees work for achieving that goal. If we think about Shazam creating the
entertainment field virtual was the vision of them and their mission was to increase their users
day by day. For achieving that they research the market create new demand for a new feature of
that Shazam application. Introduce a new way to make that app popular (Trott, 2012).

Leadership always play a big role in innovation. Peoples who work for the innovation process
need constant motivation for researching the market, need help for processing the idea and they
need credit for that innovation where a leader can help them the most.
The culture of an organisation improves the innovation field the most. Nowadays companies get
categories with innovative and non-innovative criteria. When the company set a budget and
motivate their teams to introduce a new idea or improvise an idea that a company can bring
something new in the market. When a leading method, team processing of that organisation
focus on the innovation then the company can bring new things in the market and can gain a
place in the competitive field. In Shazam, they have continual attention towards their customer
so that they can innovate new ideas for improvising their software and a new feature to making
the software more compatible for the user’s devices. Their organizational working process,
leading and teamwork all of them put effort for their services.
That’s how organizational culture, leadership, vision and mission all affect an organisation’s
innovation and commercialization process.
M-1: Analyzing different sources of innovation. And how organisations can foster and
develop an environment and culture of innovation:
According to Peter Drucker (Drucker, 2006), there are 7 sources of innovation which are stated
below:
The unexpected: Market is a totally unexpected place full of opportunity. Innovation comes from
this place. People research the success of an idea grab an opportunity and commercialize new
innovative idea in the market with the unexpected demand and situation.
The incongruity: For innovation one must know what needs to be and should be done in a current
situation. They need to expect the upcoming demand and try to adopt a new idea for meeting that
demand. Like Facebook, they anticipate the market situation and introduce their service when
Myspace was an established service at that time. But Facebook grab customer attention with
wide service and better scenario,
Process need: Sometimes the company doesn’t need to formulate a new idea for generating
innovation. With the process synchronization and improvisation, they can commercialize and
introduce better service in the market.
Demographic: Demographic area and position of a country create new demand and situation
which drive the innovation prospect of that country.
New Knowledge: With the technological evaluation new opportunity is being created. These
opportunities are opening new idea for innovation. Like with the internet innovation new
services were introduced.
Industry and market structure change: Globalization idea changes the industry and market
structure which also created a new opportunity for new business and process innovation.

Change in perception, meaning and choice: Day to day for economic and educational
development need and demands criteria are changing. With the constant watch of these change,
organisations can find a different area for innovation.
Shazam fostering and developing an environment and culture of innovation:
With the growing changes, Shazam adapts different policies and formulated different innovation
in their organisation. They have fostered the change, the changing demand in the market. They
have studied their customers, learn their new demand toward androids, iPhone or other devices
and created featured software for those every customer. They have developed their organisation's
environment and culture, motivated their employees towards research and customer analysis.
They made the situation and adapt the different process for making their company more
innovative and tried to bring variation in their process with that thought.
LO2: P-3: Explanation of the 4Ps of the innovation and the use of the innovation
funnel to examine and shape innovative ideas:
The innovation mix or 4Ps of the innovation are the fields which helps the innovation or on
which innovation can occur. Product, process, position and paradigm (the entire situation) are the
elements of this innovation mix.
Figure 1: The 4Ps of innovation.
Innovation means introducing new idea and feature in the market and make it useful for the
customer. In the innovation process, a product idea is developed which is either improvised form
of an existing product or a whole new product. They innovate and introduce it to the market.
Process innovation refers to the improvisation of the process. These help to find a more efficient
and effective process for the organisation. it helps to minimize the total cost of the organisation
and helps to adopt a profitable working process and helps to minimize the wastages in the work.
The main objective of this innovation is to gain cost leadership (Leiponen and Helfat, 2010).

Position innovation helps to identify product placement in the market. It defines the similarity or
the difference an organisation or a product held than the others in the existing market. It helps to
position the product or organisation in the market.
Paradigm innovation refers to the change in the whole system. innovation in this sector describes
brought a new idea and adopt a whole new process for commercializing it. This paradigm
innovation changes the strategy and mission of the organisation and sets new goals according to
the change.
The use of the innovation funnel to examine and shape innovative ideas:
Innovation funnel helps the management to select the effective path to introduce innovation in
the market and help them to choose the right way for this. With the help of this funnel, the
company can make a decision on whether they should bring the change or not on the basis of
feedbacks. That innovation funnel has stated below:
Inform and Engage: On these step companies target the large area of this funnel. They make a
sample and introduce their change first on them. They engage the sample people and inform
about the variation of the change and how the change will impact them (Rohrbeck and
Gemünden, 2011).
Figure 2: The innovation Funnel.
Accept and stretch: If the sample accepts the change then the company decide to stretch the idea.
They will regenerate and develop that idea with the feedback of those sample customer. They
will now focus on the cost minimization and revenue generation. And will make the idea ready
for launching. The company will assign its research and development team in this process
Selection: After the development of the idea the company will try to launch the pilot project. The
best idea chosen by the top level management and research team marketing team will make the
arrangement for commercializing the idea. They will select their customer to target an area for
launching the idea (Acklin, 2010).

These are all about the innovation mix and the innovation funnel which helps an organisation to
bring their innovation in the market properly.
P-4: Explanation of the developments in frugal innovation and examples of how it
is used in Shazam:
Frugal innovation result cost minimization in an organisation. company adapt frugal innovation
in order to make their changes with the limited resources. These help to reduce the unnecessary
step from the production and helps to take an effective and efficient measure for production.
In Shazam, this frugal innovation brought change in their profitability. They selected a
partnership business which is a part of that frugal innovation. They try to minimize their cost in
the application commercialization. That Shazam app is compatible with all type of operating
software. What they did is that they brought change in their software onetime. They develop
their software compatibility in a way that they don’t have to change the compatibility of that app
from time to time. That’s also a part of their innovation plan. The commercialization part of
Shazam also adapted that frugal innovation which made them introduce free app in the market
which will help them to get more users and will help to increase their share price.
This is the adaption of frugal innovation in the Shazam which helps them to make more profit
with the effective decision (Vanhaverbeke and Cloodt, 2014).
M-2: Analysing the application of the innovation funnel in Shazam:
Innovation funnel is the function of innovation that helps to commercialize the innovative idea
with a proper and effective way. Shazam showed great use of this innovation funnel. Shazam
first applied in a mobile phone as a media of entertainment where with a pin number customer
can get access to their decided song and in 2008 this app was developed for Android, iOS and for
Microsoft system. but the researcher team of Shazam find an opportunity to make the app more
popular with TV program feature and different offer. What they did was to lunch the offer
system first where they sectorise the offer premium and regular with a minimum charge and run
a research about the demand of customer how they much benefits they want from this
application. That research bought many feedback like less money charge, new feature, music
videos and TV series offer etc. So Shazam research team develop an idea with this feature that
they will make their app more available in the apple store and android play store and will add
desire feature. So the management team agreed with the plan and launch the app with the
additional TV program and with the addition of the different offer in their app. With more
feature, they got a strong customer base and with the add, they got a way to earn money from
that free app. This is how Shazam applied innovation funnel in their system (Henke and Zhang,
2010).
M-3: The role of frugal innovation in Shazam:
In Shazam, they have a limited application of Frugal innovation. Frugal innovation is basically
applied for finding an effective and least cost way of production with limited resources. Shazam
wanted to find these least cost way of production which drives them to software compatibility
development. The research team of Shazam wanted to reach the whole smartphone market that’s
why they wanted to cover all the operating system that is available. With that thought, they

developed their software which makes them more popular in the market. With that idea now they
are adding different features only with the app like musically, tik-tok application, TV series
addition etc. They find an effective way to commercialize their software with that frugal
innovation (Zeschky, Widenmayer and Gassmann, 2014).
LO3: P-5: Explanation of the importance of the commercial funnel and the
application of new product development (NPD) processing for commercialization
of innovation:
Commercialization is the process of bringing the new innovation in the market in an effective
way. Commercialization funnels help the management to find that effective and efficient channel
for introducing that new idea in the market. Commercialization funnel has different sector like
innovation, production, marketing etc.
The innovation funnel helps the organisation to introduce the new and improved product in the
market where marketing funnel helps them to introduce a new way of marketing the product in
the market. These commercialization funnel helps the company to get competitive advantages
and help them to get a position in the market with a strong and loyal customer base. Proper use
of this funnel makes an organisation be more effective and innovative (Kelly and others, 2010).
New product development (NPD) processing for commercialization of innovation:
If we think from the Shazam context for introducing a new feature like “identity verification” in
the software will be commercialized in the market. For this process, their R&D team will
generate and
Figure 3: New product development process.

Will develop the idea. They will run a screening for this new idea for which they will need the
feedback from the customer. What will they do is learn the customer demand and the market
situation to get the feedback. After that, the R&D team will develop their idea in a better way to
fulfil the need of the customer (Grönlund, Sjödin and Frishammar, 2010). Then the strategic
managers will testify the idea that how beneficial will be the idea and how much cost they will
need to add the ID verification system in the software. If they find this idea beneficial then the
coding team will develop the software and run a test marketing with it. If the selected Shazam
users give positive feedback for this new addition, then Shazam management team will develop
the marketing idea and will launch the idea properly to all of their users.
After this NPD process, the R&D will run an analysis of how this feature is working and will get
the feedback which will help them to develop that feature and make it more useful for the
customer.
P-6: Build an innovation business case for an organisation including a way to
access funding:
Shazam app is basically a musical app where with the audio frequency they show the name and
details of a song. Shazam app is more popular for its security and vast information which help
the customer to get a song in minimal time. But Shazam is now focusing more on their security
system and like google music service they want to provide identity verification in their new
update feature for iOS13. So they already got the customer feedback that this security is needed
in the market for securing customers to account in Shazam (Gasser, Rossetto and Schuldt, 2019).
Shazam management team approve that idea that that can be beneficial for their system and it is
needed in the market. As they have nearly 400 million customers in the market providing
security is a must for them. With the planning, they found that they need a minimum account of
£1.4 million for the development of this system. this budget included all the research and
commercialization sector of this feature. As now they are working under Apple Inc. so the
management thinks they can handle 70 per cent of these cost from equity financing and will go
for debt financing for the remaining 30 per cent.
M-4: A detail innovation business case which includes how to measure its overall
effectiveness using appropriate techniques available to test. Iterate and improve:
Shazam has decided to launch its user identity verification in its upcoming application. For that,
they have decided to get 70 per cent of equity financing and 30 per cent of debt financing of the
total budget. They need to develop this application for ensuring the security of their user. In
order to measure the overall effectiveness of their new innovation, they need to run a test
marketing and need to apply some technique. They can measure their ROI from this test
marketing and can measure the profitability of that feature. With the Key Performance Indicator
(KPI) they can measure the performing level of that application in the market. With this two
measurement technique, the strategic management team can measure the effectiveness of the
innovation from their test run and can make the decision for launching it in a wide market
(Gershikov and Gabler, 2018, August).

LO4: P-7: Evaluation of the different tools that an organisation can use to develop,
retain and protect knowledge and intellectual property:
Innovation in an organisation help to increase competitive advantages. The organisation need to
protect their innovation with proper management and create an environment for making more
innovation in the future.
Tools for developing intellectual property:
Research and development: Company needs to make its research and development team more
strong for making a more innovative idea for their company. The main purpose of these team to
research the market and generate an idea for new innovation. With the help of these department
other team commercialize the idea and get competitive advantages (Thompson, 2018).
Innovative culture: the company should adopt policies and another measurement that help and
encourage innovation. Their leading policies and teamwork system should be compatible with
innovation purpose.
These tools will help an organisation for its innovation.
Tools used to protect intellectual property:
Trademark and licensing: Trademark and licensing help to protect the innovative idea. When a
company develop a new product they need to make a license for that product and take a
measurement to protect their trademark so that other organisation cannot use their mark, sign or
process.
Copyright: Copyright law is made for protecting intellectual property. The idea generator needs
to copyright their idea so that their idea cannot be used by others and they can get the credit for
their innovation (Toma, Secundo and Passiante, 2018).
These tools will help the organisation to protect their knowledge and intellectual property.
Shazam takes the measurement and gets its copyright under Apple Inc. for securing the
application.
M-5: Evidence-based evaluation of these different tools in the context of the wider
business environment:
Innovation generates a new idea and gives value to that idea. But the organisation system affects
its innovation sector most. Shazam R&D sector and culture is more innovation-friendly that’s
why they are now one of the top innovative organisation in the UK. Shazam developed research
facilities and teamwork method help them to introduce a new feature in the market.
Protection for innovation also helps the organisation in a big way. If we think for the wide
business environment idea theft is one of the big issues. Lots of big company fight for giving
developed and new service to their customer. So when a company generate and the idea they to
secure it first so that others can not use it and that company get the most competitive advantages
for that idea. That’s why big company get copyright for their innovation under their name so
whenever others use the idea that copyright company get the credit. So in the wider environment

the importance of securing the intellectual property in significant (Abbott, Cottier and Gurry,
2019).

Conclusion:
Innovation in producing a relevant idea for the current market situation and commercialize the
idea with an effective communicative way. For a company, innovation carries great significate as
the market is more competitive and they all drive to get a higher position in the market. But
company innovation depends on the companies vision and mission strategy and their
environment. If that is suitable for innovation then the company can generate a more innovative
idea. Here we have discussed the Shazam Entertainment Ltd. companies’ situation. How their
developed R&D team help them to know their customer better and help them to provide a more
effective feature for their customers. And how using different funnel and tools they make their
innovation more effective. The organisation need to create an innovation-friendly culture more to
make the market more efficient and to need to follow a proper step to maintain and secure those
intellectual properties and innovation (Stojcic, Hashi and Orlic, 2018).

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