Innovation and Commercialization Process in Essence Drink

The assignment discusses the difference between invention and innovation, highlighting the need for essence drink company to adopt innovative ideas such as innovation funnel and frugal innovation to improve its commercialization process. The document reviews various tools for protecting intellectual property rights and knowledge of the company. It provides a case study on how to create and sustain a strategic marketing plan through the 4P's of innovation, with reference to Red Bull energy drink company.

Innovation And
Commercialisation

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1. Importance of innovation to an organisation with comparison to invention........................3
P2. vision, leadership, culture and teamwork can shape innovation and commercialisation.....4
TASK 2............................................................................................................................................5
P3. 4 P's of innovation and the use of innovation funnel in examining and shaping of
innovative ideas:..........................................................................................................................5
P4. Development in Frugal Innovation.......................................................................................7
Task 3...............................................................................................................................................8
P5. Importance of commercial funnel in the organisation and the application of product
development process in commercialisation of innovation..........................................................8
P6. Innovation business plan for the organisation......................................................................9
Task 4.............................................................................................................................................10
P7. Different tools used by organisation to retain, develop and protect knowledge.................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Today all industry is facing competition in the market with the advent of new
technologies and Many new entrants are also entering into the market as the demand of the
market is changing rapidly with time and new opportunities are emerging in the market. In such
a competitive era organisations has to come up with new product innovation to survive in the
market. This study helps in understanding the difference between innovation and invention and
its importance in organisation. The study also highlights the 4P's of innovation, and techniques
for improving innovation ideas such as frugal innovation and innovation funnel and its
importance. The new product development has also been explained in the study for innovation
and commercialisation purpose.
TASK 1
P1. Importance of innovation to an organisation with comparison to invention
Innovation : Innovation is a conversion of new thoughts or new imagination into device or any
product for the commercialisation purpose(Difference between invention and innovation, 2016).
Commercialisation is the process of providing products and services to the customer in order to
generate money out of it.
Innovation in the other words can be defined as the the changes or improvement in the existing
product while invention is the process of bringing new product in the market which does not
exist in the market before(Powell, 2017.).
Importance of innovation in comparison to invention in case of Essence Drink:
Essence drink has launched a lassi in the UK market with the mango flavour in the first year the
company earned a huge profit but by the starting of third year the company start to suffer a loss
due to increase of competitors in the market. In order to survive in the market the company has
to invent new products periodically with the change in market demand. For example apple come
up with new product every year in the market and this is the main reason to be successful in the
market. The Essence drink company should come up with the new flavour other than mango
such as pineapple lassi. As this new idea will help the company to stand out from its competitor
as there are many companies in the market which manufacture drinks and lassis in order to beat
the essence drink and hold the share in the market but if company comes up with new innovation
it will help the company to capture the market with its new product. It will also attract the
customers toward the product as the needs of the customer is constantly changing with time if the
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company does not innovate new products daily the company may loss its customers the company
has to come up with new innovative ideas to stay in the market.
Innovation has of great importance to the organisation as without innovation it would be
difficult for a company to survive. Innovation is important for an organisation as it helps the
company to stand strong in the market.
P2. vision, leadership, culture and teamwork can shape innovation and commercialisation
Leadership can help in shaping innovation and commercialisation:
Every organisation has different work culture it is the duty of the leader to ensure that its team
member should maintain the culture of the organisation. The leaders in the organisation should
set aspirational goals, should be a good listener and should ask the team members about their
views, the leaders should support the thoughts of the its team members(Bag, Anand, 2016.).
The good leadership in the organisation can help in generation of new innovative idea for
commercialisation of products.
Essence drink should try to adopt good leadership style within the organisation. The
company can try to have democratic style of leadership within the organisation which will help
company to make its employee involved in the success of organisation.
Vision can help in shaping innovation and commercialisation:
The vision of the organisation should be realistic. It is long term in nature the company sets the
vision which describes what the company want to become in future in order to be successful.
The vision should be such that which shows employees the direction as it help the employee to
know what are the company main goals which will help the employee to bring new ideas which
is of use to the company.
The company should try to introduce employee to the vision of the organisation. It will
help employees to understand the purpose of the organisation. As well as top management
should try to set and conduct such activities which will help company to fulfil objectives of
company.
Culture can shape innovation and commercialisation:
Organisation culture is made up of values, norms and attitude which the employee of the
organisation hold. The organisation should provide there employees a friendly work culture
which gives the opportunity to employees to experiment and explore their ideas. Organisation
should give freedom to the employees to take their independent decision. The freedom in the
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work culture will help the employee to present their innovative ideas and work on them to
benefit the organisation.
Essence drink should try to have diversity policy within the organisation which includes
fair treatment to each employees, friendly environment, equal opportunities to all etc. it will help
company to have good work culture within the organisation.
Nation culture also plays an important role in the process of innovation and commercialisation as
alike the work culture the different countries follow different culture.
Teamwork can shape innovation and commercialisation:
Innovation comes from a person i.e., innovative ideas comes from an individual but teamwork
can help in putting the idea into action. As there are many people in team and each with different
view points therefore as many the people the more the suggestion and the way of doing the work
therefore a good teamwork can help in shaping innovation and commercialisation.
A company should try to conduct such activities which will help its employee to
understand the importance of working in a team. Teamwork will provide employees support of
each other. As essence drink is trying to introduce new product in the market. Therefore
company should work in a team including marketing department, finance department, sales
department etc., which will help company to successfully launch its product in market.
TASK 2
P3. 4 P's of innovation and the use of innovation funnel in examining and shaping of innovative
ideas:
4 P's of innovation: it is the innovation mix which is used by a number of organisation as it
helps in creating new ideas and thinking for introducing new product and services. The 4P's
model was given by John Bessant and Joe. The model helps in understanding the individual and
the organisation where are you , who are you and how the new product and service can be
improved(Pavón, 2017).
The 4P's of innovation are:
Paradigm : Essence drink should launch a new flavoured lassi which will help the company to
gain competitive advantage in the market as many company has came in the same business this
will help the company in attracting new customer and increasing market share.
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Product: Product is something which fulfil the needs of the customer it can be electronic devices,
food products etc. Essence drink should take the suggestion of their team members that how can
their product or service can be improved.
Process: the company should launch the new flavour lassi such as pineapple lassi in order to
capture the market share again and increase the profit of the organisation and again make the
company stable .
Position:This factors tells the company than what people think about them. And how image can
be improved(Asiedu, 2016.). As the company has face the failure in the market this offers a
company a second chance to present themselves in a different way in front of the customer.
Use of innovation funnel in examining and shaping of innovative ideas:
Discovery: first the idea is discovered it can come from various innovation sources such as
process needs, incongruities, demographics, new knowledge etc.
Scoping: one's an individual is clear with the idea the next step is analysing the situation in the
market to know whether there is scope in the market or not. For example essence drink is
planning to launch new product in the market such as pineapple lassi so the company should first
analyse the scope for the product in the current market.
Build business case: Business case is built in order to present the ultimate goal of project to the
stakeholders. It helps the participants to present their individual views about the project. After
the completion of project business case helps to analyse the whether the estimate made in regard
to benefit is correct or not. The business case is necessary as it is a referral point and it help
company to answer such questions(Wang, 2017).
Development: the business case helps in knowing what is wrong with the project idea is the idea
should be carried further or not. In this stage the necessary changes is done in the project.
Testing & validation: Once the idea seems to be successful the prototype is created of the
product which is checked within the organisation and then the customer are introduced to the
product for the trials if the feedback from the customer are favourable than the idea is carried
further.
Launch: thus is the final step in the innovation funnel where the product is launched in the
market for commercialisation
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P4. Development in Frugal Innovation
Frugal Innovation is the process of cutting down the cost of the product without compromising
the value and provide the products and services to the poor and middle class consumer. It is used
for removing the unnecessary process in the production process to reduce the cost of product and
improve the quality. The dimension of development in frugal innovation are quality, adaptability,
performance, scale up, servicing, distribution and input cost of research and development.
Frugal innovation helps to commercialize the innovation of pineapple lassie by Essence
Company. It helps to improve the quality of the product in the market and attract the consumer.
It helps to measure the quality of product by standard benchmark or by test marketing and do the
necessary changes in the product. Essence company can improve the performance by innovate a
new product in same range with different flavour (Frugal innovation, 2019). The idea of
innovating the pineapple lassie helps them to differentiate their products from others or
competitors.
A new flavoured lassie can also change the consumer perception about the old or existing
product and the frugal innovation helps to change their taste and provide a new product. Frugal
innovation helps to improve the existing product with some new techniques or changes in some
ingredients.
Frugal innovation also helps to reduce the cost of output and research and development for the
new product. By improving the existing product Essence Company can reduce the cost of
research for the new product it overall reduce the cost and provide the product at lower cost
which increase their sales and help to capture the market.
Frugal innovation also helps to improve the distribution system and servicing of the Essence
Company. Improving the existing product's performance with new flavour help to increase the
sales. Essence company add the pineapple flavour lassie in its existing product line to increase it
sales in the market and target the young and adult age group consumer (Rosca and et.al., 2017).
They also focus on the health conscious consumer with adding the fruits in lassie and reducing
the sugar.
The company can generate the fund from the different sources to innovate the product and
execute their planning to get the competitive advantage in the market. They can borrow funds
from the market, take loan and use the personal savings to innovate new flavour lassie. They can
also take the help of investors by preparing market plan to attract the customer.
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Task 3
P5. Importance of commercial funnel in the organisation and the application of product
development process in commercialisation of innovation
Importance of commercial funnel : Commercial funnel explains the journey of the consumer
toward the sales of the product. It brings the potential customer to the organisation to promote
the product. It is the strategy of attracting the customer and convert the lead into potential
customer. The stages of commercial funnel are awareness, interest, decision and final call.
Awareness : commercial funnel aware the customer about the product of essence company and
their innovation. It helps to solve the queries of the consumer immediately to stay the consumer.
On increasing the demand of product decreases the attention toward the consumer which
ultimately create the situation of retention of loyal consumer (Quinlan and et.al., 2019).
Commercial funnel helps to focus on the demand of the consumer.
Interest : To retain the consumer towards the product it is necessary to attain their problems
quickly. Commercial funnel helps to modify the product according to the consumer demand and
needs and provide them solutions of their problem.
Decision : Commercial funnel is important for the organisation. It helps the consumer to make
their purchase decision by providing the better quality of product in the market compare to the
other product. Essence Company take the feedback from their consumer and implement the
opinion of consumer in their product.
Application of New product development process in commercialisation of innovation
New product development process include certain activities to deliver the new product in the
market. These process helps to commercialise or introduce the new product in the market.
Commercialisation is the process which converts the idea and research into the actual product
and formulate the effective distribution channel, service and manufacturing strategy to aware the
customer about the product. The product development process helps the essence company to
generate the new idea and convert the idea into actual product.
Idea generating stages helps to generate the idea of innovation. Many idea's comes into the
mind to redevelop the product.
In idea screening process organisation need to take the useful idea among the various idea ho
helps to improve the product. It helps to reduce the cost on unnecessary activities in
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manufacturing the product. It also helps in market research, consumer preference and increasing
ROI.
Product concept helps to generate the blue print of the product and budget. It helps to select best
idea which can generate the profit for the Essence Drink Company.
Business strategy and development helps to analyse the different tolls and techniques which
are required in product development. The effective business strategy minimize the cost of the
product and helps to attract the more consumer towards the organisation.
In test marketing product is introduced in the market for research and feedback. These helps to
innovate the product according to the consumer preference and also aware the customer about
the pineapple lassie in the market. Feedback from the consumer helps to improve the product.
Commercialization of new product helps attract the target market (Fuller, 2016). For
commercialization of product they need different promotional techniques like social media,
advertisement and mass communication. They can also organise some events to commercialize
their product.
P6. Innovation business plan for the organisation
Executive summary : Essence Drink Company manufacture different healthier drink. To
increase their sales in the market they want to innovate new flavour in lassie. The pineapple
lassie create a new market for the health conscious consumer by providing them sugar free lassie.
Essence company require various resources like consumer data, market trend, fund and raw
material. They also forecast the required fund for their organisation.
Required resources : Essence company require the data of consumer like their need,
preferences, demand regarding the product. They also need fund to purchase the raw material,
manufacturing of product and marketing.
Solutions : Essence company can collect the data of consumer by the market research and test
marketing. It helps them to capture the target market and consumer taste. They can also organise
some events and health camp to get the feedback from consumer.
Need of innovation : innovation business case is needed for improving the existing product by
adding some additional feature. It helps to increase the sales of organization by reducing the cost
of product. It also helps to target a new market and attract their attention.
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Market research : Market research helps to analyse the current trend in the market. Essence
Drink company research the market and find their target area (McKenzie, 2015). It helps to
generate a new market for pineapple lassie. Market research helps to know the consumer taste
and modify the product.
Budget :
Type of expenses Cost
Raw material $400
Manufacturing expenses $550
Salary $350
Management expenses $200
Promotional and distribution expenses $220
Miscellaneous expenses $300
Total $2020
Benefits : benefits of innovation business case are :
 It helps to increase the productivity and profitability of the organisation.
 It increases the market share of essence drink.
 It helps to commercialize pineapple lassie.
 It helps to achieve the goal of essence drink company.
Ways of access funding
There are different ways to collect the fund for the innovation of product. Capital is an important
part of innovation or any business without capital a business cannot run for long time. Essence
company can generate the fund from the market like shareholder. They can take the help of
government to raise their fund. They can borrow the money from the bank, friends, family and
peer group.
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Task 4
P7. Different tools used by organisation to retain, develop and protect knowledge
An organisation uses different ways to protect the product and services from their competitors in
the market. These tools help them to differentiate their product from others and increase their
sales.
Intellectual property right : it adds value to the human creation and invention by applying
different laws against the usage of product. Every organisation has to register business or product
in intellectual property right office to protect themselves. They have to disclose all their details
so no one can copy their product (Gibson, 2016). There are 4 ways to protect the product and
service.
11 Patent : patent is granted by government to the owner of the product, they give the right
to the owner to protect their product from the competitors and if anyone copies the
product then owner can file case against them.
Drawbacks : Patent of the product and services are legal process which require huge documents
and time. It also an expensive process which need capital to take the right of protecting the
product.11 Trademark : It distinguishes the one product from the another product in the market. It
can be distinguish by logo, name, sound, word, signature, picture, brand, tagline, caption
etc.
Drawbacks : Trademark of product and services charge fee for the registration and renewal of
the product. Like the patent it also requires huge documents to verify that the owner of the
product are real.11 Copyright : copyright is applied for some creative work like create a software
programme, artistic works, film, sound recording, music etc. It protects the owner from
others to copy their creative work.
Drawbacks : It does not allow owner to give the right to other person to use the product and
services. Copyright of the product also does not provide full protection to the product and
services.
The essence drink company have to use the patent intellectual property right to protect the
invention of pineapple drink from the competitors. Patent right helps to distinguish the essence
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drink from the others. Patent right helps the essence drink company to strong their position in the
market and increase their return.
CONCLUSION
The study helps in knowing the difference between innovation and invention. As the essence
drink is facing failure in the market due to increase in competition therefore the company should
adopt some innovative idea like innovation funnel in order to improve the innovation process.
The company can also take the use of frugal for improving the innovation ideas for the
commercialisation purpose. Therefore the study uses the innovation and commercialisation
process in context of Essence drink. The company instead of providing the same mango lassi
should provide other flavour lassi to the customer such as pineapple lassi. The various tools has
also been discussed in order to protect intellectual right and knowledge of company.
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REFERENCES
Books and Journals
Asiedu, E., 2016. How to create and sustain a strategic marketing plan through the 4p’s of
Innovation: With reference to Red Bull energy drink company.
Bag, S. and Anand, N., 2016. The importance of innovation leadership in cultivating sustainable
supply chain management and enhancing organisation performance. International
Journal of Process Management and Benchmarking. 6(4). pp.469-490.
Fuller, G.W., 2016. New food product development: from concept to marketplace. CRC Press.
Gibson, J., 2016. Community resources: intellectual property, international trade and protection
of traditional knowledge. Routledge.
McKenzie, D., 2015. Identifying and spurring high-growth entrepreneurship: experimental
evidence from a business plan competition. The World Bank.
Pavón, M. and Pavón, F., 2017. The Use of ICT and the 4P’s of Creativity and Innovation in
Education. In Handbook Of The Management Of Creativity And Innovation: Theory And
Practice (pp. 99-115).
Powell, W.W., 2017. A sociologist looks at crowds: Innovation or invention?. Strategic
Organization. 15(2). pp.289-297.
Quinlan and et.al., 2019. Business research methods. South Western Cengage.
Rosca and et.al., 2017. Business models for sustainable innovation–an empirical analysis of
frugal products and services. Journal of Cleaner Production, 162, pp.S133-S145.
Wang, J., 2017. Structuring innovation funnels for R & D projects under uncertainty. R&D
Management. 47(1). pp.127-140.
Weyrauch, T. and Herstatt, C., 2017. What is frugal innovation? Three defining criteria. Journal
of frugal innovation. 2(1). p.1.
Online
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Difference between invention and innovation. 2016. [Online] Available through
<https://keydifferences.com/difference-between-invention-and-innovation.html>
Frugal innovation. 2019. [Online] Available through <https://www.nesta.org.uk/feature/frugal-
innovations/>
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