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Innovation and Commercialization: A Case Study of Amazon Go

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This report explores the concept of innovation and commercialization, focusing on the case study of Amazon Go. It examines the differences between innovation and invention, analyzes various sources of innovation, and investigates how organizational vision, leadership, culture, and teamwork shape innovation and commercialization. The report also delves into the 4Ps of innovation, the innovation funnel, and the role of frugal innovation in the development of Amazon Go. Finally, it presents a commercialization plan for Amazon Go, outlining strategies for product development, market entry, and financial planning.

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INNOVATION AND COMMERCIALIZATION

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Table of Contents
EXECUTIVE SUMMARY................................................................................................................... 3
INTRODUCTION.............................................................................................................................. 4
TASK 1............................................................................................................................................ 5
P1 EXPLAIN INNOVATION AND DETERMINE ITS IMPORTANCE TO ORGANIZATION IN
COMPARISION WITH INVENTION..............................................................................................5
M1 ANALYZE DIFFERENT SOURCES OF INNOVATION, AND HOW ORGANIZATIONS CAN
FOSTER AND DEVELOP AN ENVIRONMENT................................................................................ 7
P2 EXPLAIN HOW ORGANIZATIONAL VISION, LEADERSHIP, CULTURE AND TEAMWORK CAN
SHAPE INNOVATION AND COMMERCIALIZATION......................................................................9
TASK 2.......................................................................................................................................... 11
P3 EXPLAIN THE 4PS OF INNOVATION AND EXPLAIN THE USE OF THE INNOVATION FUNNEL
TO EXAMINE AND SHAPE INNOVATION IDEAS........................................................................11
M2 ANALYZE AND APPLY THE INNOVATION FUNNEL IN ORGANIZATIONAL CONTEXT OF
AMAZON GO............................................................................................................................ 13
P4 EXPLAIN DEVELOPMENTS IN FRUGAL INNOVATION AND PROVIDE EXAMPLES OF HOW IT IS
USED IN THE CONTEXT OF AMAZON GO.................................................................................. 15
M3 EVALUATE THE ROLE OF FRUGAL INNOVATION IN AMAZON GO......................................17
TASK 3 & 4................................................................................................................................... 18
CONCLUSION............................................................................................................................... 32
REFERENCES................................................................................................................................. 33

EXECUTIVE SUMMARY
This report is about background information to explain the context for innovation at Amazon
Go. The company is facing the issues while generating sales in the market and this issue could
be solved by implementing the concept of innovation and commercialization in the company.
This report will help the management in developing the theories for the development of the
business.

INTRODUCTION
For the succession of business, it is important to continuously implement innovation in the
product and services of the organization. It has been observed that new business and
organization using innovative techniques for managing their business operations. The purpose
of this report is to recognize the concept of innovation and invention in the context of Amazon
Go and it also determines the difference between invention and innovation. The report also
examines the culture to develop the innovation and commercialization in the organization. It
analyzes the different type of innovation and concept of innovation funnel for the development
of innovative ideas within the business. It evaluates the role of frugal innovation in the
development of Amazon Go.

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TASK 1
INTRODUCTION
Innovation means to bring the new ideas and measure into the existing product. The aim of this
report is to explain the innovation at Amazon Go and determine the differences between
innovation and invention. Along with that, it discusses sources of innovation to critically analyze
the role of frugal innovation in the development of Amazon GO.
P1 EXPLAIN INNOVATION AND DETERMINE ITS IMPORTANCE TO
ORGANIZATION IN COMPARISION WITH INVENTION
Innovation is one of the important factors that help in the development of the business.
Innovation is an effective process, which helps in obtaining uniqueness and creativeness in the
existing product and services of the business (Dmitriev, et al. 2016). It is the process where the
new methods and techniques are used and it also increases the functioning of business
operations. The invention is the process of converting the technical ideas into the new and
innovative product, which was not in existence before the procedure of the invention. The
launch of Amazon Go is the invention by Amazon, where they innovate the concept of
advanced shopping technology.
IMPORTANCE OF INNOVATION TO ORGANIZATION OF AMAZON GO
The Amazon Go is the online grocery store, which is operated by Amazon. It is automated
through which customers can purchase the grocery products without the use of cashier and a
checkout. This will help the company to obtain the profit from the new products and the
organization can also use updated technologies for influencing a large number of customers
having different choices and also gain the competitive advantage in the market.

COMPARISON BETWEEN INVENTION AND INNOVATION
SOURCE OF COMPARISON INVENTION INNOVATION
DEFINITION It is the process of
transferring the technical
ideas into new and
innovative products which
do not exist before the
process of the invention
within the organization
(Zadeh, et al. 2016)
It is the procedure of
implementing new ideas in
existing products for which
the customers will pay freely
is considered as the process
of innovation.
ORIGIN The origin of the concept of
the invention is to generate
novel ideas.
The concept related to the
innovation is to executing
ideas practically in existing
products of Amazon Go.
MANDATORY SKILLS Research and technical skills Promotional, planned and
technical skills are required
under innovation.
EMPHASIS The invention process is
focused only on the
development of a single
product.
The innovation process is
focused on the altering and
making existing products
better and influencing for
customers.

M1 ANALYZE DIFFERENT SOURCES OF INNOVATION, AND HOW
ORGANIZATIONS CAN FOSTER AND DEVELOP AN ENVIRONMENT
Innovation has several sources which are implemented by Amazon Go and influence the large
number of customers towards the product and services offered by Amazon Go. The sources of
innovation are as follows:
 Change in Perception
The creative thinking of different people develops the concept of innovation in the
Amazon Go (West, 2014). It uses new and updated techniques due to this the
perception of people change.
 Demographics
Innovation also gets influenced by the aspect of age, area, geographical phases,
individuals etc.
 Industry and Market Structures
The innovation brings changes when the demand for market changes. The current
market demands updated technologies and online shopping of the grocery store. This
leads to developing Amazon Go to fulfil the needs of the market structure of the
economy.
 New Knowledge
Obtaining information and new and creative knowledge will help people in directing
processes and observations effectively that develop innovation.
 Process Need
If there is ineffectiveness in the operation of the business process then there is a need
for innovation in the organization.
 The Unexpected
Any occurrence of unexpected events such as succession and failure can also cause
innovation in the organization (Boor, et al. 2014).

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 Incongruities
Under this, the company can think differently from the other competitors in the market
to attain the satisfaction of the customers. Through innovation, an organization can
perform differently in the market and can influence a large number of customers
towards their organization.
FOSTERING AND DEVELOPING A CULTURE AND ENVIRONMENT OF INNOVATION
Amazon Go develops and enhances the product and services of offering online grocery store
according to the requirements of the customers. Increase in the competition influences the
revenue of the organization. The existing process of Amazon Go needs to increase their security
system because it does not require any registration and check out. At Amazon, Go customers
can go to the store and take the things they want and leave the store. The organization use
computer vision, which can misuse some relevant information of the customer. Therefore it is
required by them to develop the technology to the great extent and also make sure about the
security of the customers (Berry, et al. 2018). The adoption of innovation in techniques and
working pattern of Amazon Go can smoothly perform the operations of the business. It is
helpful in building a healthy relationship with customers and gain a competitive advantage in
the market. Amazon Go brings a totally different concept where customers just need to install
the application and can pay for their products through virtual carts. The technology can itself
detect the things which are being purchased by the customers and also get the receipt on
Amazon account. This is the great innovation by Amazon group which brings the environment
of innovation.

P2 EXPLAIN HOW ORGANIZATIONAL VISION, LEADERSHIP, CULTURE AND
TEAMWORK CAN SHAPE INNOVATION AND COMMERCIALIZATION
Through innovation and commercialization the vision, mission, culture and teamwork can be
achieved of the organization. In the case of Amazon Go, the vision is to obtain the market due
to their innovative and new techniques in the operation of their business. The concept of
organizational vision, leadership, culture and teamwork can be helpful in shaping innovation
and commercialization.
Figure 1: Flow from Innovation to Commercialization
[Source: P2P Foundation]
Organizational Vision
Amazon Go is an emphasis on offering the best qualities grocery items to customers at a
reasonable price with the best possible way. A clear vision will help the company to make their
employees with the motive to achieve the goal (Eesley, et al. 2014). Clear vision can be helpful
in forming the strategies of innovation and commercialization.

Leadership
The leadership style shows the way managers and leaders lead their employees towards the
goal of the organization. Leadership style helps in developing the relationship with employees
at the workplace. Good leadership skills of a manager can be helpful for the company to
enhance the skills of employees and motivate them towards the process of innovation and
commercialization.
Culture
The process adopted by the company for fulfilling the goal and actions for the development of
the company can create a working culture of the organization. The healthy working culture
helps the employees in motivating and empowering the employees towards the goal. Amazon
Go achieved the success, through the innovative and healthy culture of the company.
Teamwork
In Amazon Go, each employee comes from a different background but they use the effective
techniques collaboratively with each other (Akgun, et al. 2017). Due to this the organization is
benefited and achieved the goal more effectively and company can implement more innovation
and commercialization at their workplace.

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TASK 2
P3 EXPLAIN THE 4PS OF INNOVATION AND EXPLAIN THE USE OF THE
INNOVATION FUNNEL TO EXAMINE AND SHAPE INNOVATION IDEAS
The 4ps of innovation can be helpful for the company to examine the procedure of innovation.
The Amazon GO can use this tool for the development and implementing innovation. This
model is categorized into four different types:
Figure 2: 4p's of Innovation
[Source: Kim, 2014]
 Process innovation
Change in existing procedure, through adopting new and innovative techniques of
manufacturing product and services is known as process innovation. For example,
automatic bill services by Amazon Go are the product innovation.

 Position Innovation
It's emphasis on the changes, related to market and needs of people. It could state that
re-positioning of the product from one place to another for obtaining the profit in the
organization. Amazon Go uses various techniques for developing the very new concept
of online grocery, which builds a different market and generates huge profit for the
growth of the company.
 Product Innovation
The innovation in the product and services helps the organization in attaining the goal of
the organization (Cropley, 2016). The most innovation service is by Amazon Go, where
the customers can pick the product and can pay bills through their Amazon account
without having to queue and pay at checkout.
 Paradigm Innovation
It's emphasis on dominant innovative examples, which relies on the concept of
renovating the current structure of the organization according to the needs of the
market.
USE OF INNOVATION FUNNEL
Innovation funnel is the concept through which the new concept and ideas are being
developed. The innovation funnel is the phase where the process of manufacturing is
performed in a creative and different way. It helps the company in fulfilling the needs of the
company and produces the product innovatively (Rubin, et al. 2018). The stages involve in
innovation funnel can be used by the organization in collecting and generating innovative ideas
and refine the ideas, through which the best ideas are being filtered by the organization. The
innovation funnel helps the company to obtain the best innovative outcome for the growth and
sustainability of the company.

M2 ANALYZE AND APPLY THE INNOVATION FUNNEL IN ORGANIZATIONAL
CONTEXT OF AMAZON GO
The innovation funnel in the context of Amazon GO has been discussed as follows:
Figure 3: Innovation Funnel
[Source: Desai group, 2013]
 Inform and engage
The initial step of the innovation funnel is to collect and gather the innovative ideas for
the development of the organization. The higher number of idea generation can be
helpful in developing the product and services of Amazon Go. The company collects the
information through idea generation and engages in fulfilling the demands of the
customers.

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 Accept and stretch:
The next step of the funnel is a contracting segment, which refines the selected ideas
which are chosen at the initial stage of the innovation funnel. Under this, the chosen
ideas are reviewed by the team and being selected the best suitable ideas
(Vanhaverbeke, et al. 2017). The Amazon Go considered this step as an assessment of
ideas, where the risk and return are being evaluated for attaining the goal of the
organization.
 Selection
This is the last and narrower segment of the innovation funnel, where the Amazon Go
make sure that the chosen idea is appropriate for attaining the goal of the organization.
Confirming this can make sure that the innovative techniques of Amazon GO can fulfil
the desired outcomes and can satisfy the demands of the customers more than their
expectations.

P4 EXPLAIN DEVELOPMENTS IN FRUGAL INNOVATION AND PROVIDE
EXAMPLES OF HOW IT IS USED IN THE CONTEXT OF AMAZON GO
Frugal innovation is the procedure of technical innovation, which is adopted by the organization
for minimizing the complexity and cost of the business. The adoption of the concept of frugal
innovation is possible through the aspects of globalization.
Amazon Go performed the concept of innovation frugal for the betterment of the organization.
For example, The Amazon Go uses easy techniques for consumers, they develop the concept of
the online grocery store where the consumer does not need to register and there is no check
out as well. Amazon GO makes the purchasing easy for the customers where they can pay their
bills automatically through amazon account (Winterhalter, et al. 2017). The computer vision is
being used by Amazon Go that allows seeing what customers are picking and also unsure about
the quality and freshness of the products on their purchases.
DEVELOPMENT OF FRUGAL INNOVATION
There are several models that are helpful in developing frugal innovation. The concept of frugal
innovation has been developed in Amazon Go for various areas such as:
 Collaboration with Innovative Associates
The business operations can be performed more effectively if the company collaborates
with innovative firms through which suitable assistance is obtained by the organization.
 Consumer Fundamentals
The Amazon Go can develop their business by fulfilling the demands of customers in
different countries according to their preferences in the market.
 Development of New Ideas
The development of new ideas helps the organization to deliver the best quality product
and services to the customers and maximize the profit. The requirements of the
business should be analyzed and accordingly, the new ideas must be generated.

 Identification of Business barriers
The organization needs to assess the business for managing the business appropriately
(Rosca, et al. 2017). The Amazon Go faces several barriers due to the competitive
environment in the market, which can affect the performance of the business and can
reduce the profit of the organization.

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M3 EVALUATE THE ROLE OF FRUGAL INNOVATION IN AMAZON GO
Frugal innovation plays a crucial role in analyzing and evaluating the performance of Amazon
Go. Through frugal innovation, the company can develop the new technology at the workplace
of Amazon Go. The role of innovation frugal in the organization is to analyze the current
situation of the business. The effectiveness in the operation increases due to innovation frugal.
Due to innovation frugal, the cost-effective services and products are developed in the market.
Frugal innovation plays an important role in framing strategies for the development of the
organization.
The role of innovation could be observed through the business functioning of the business. The
online billing techniques can be used for the growth of the organization (Saha, et al 2016). The
qualitative measures must be used for perishable products at the grocery store. The secure
techniques can also be used for offering safety to the customers while billing for the purchases.
There are chances that the implementation of frugal innovation will lead to a unique concept in
the organization. The Amazon Go brings a totally new concept of the online grocery store with
the help of frugal innovation and influences the number of customers towards the business and
attains the goal of the organization.
CONCLUSION
Through this report, the difference between innovation and invention is being discussed, along
with the importance of innovation. All these aspects are being discussed with the context of
Amazon GO. The report gives the brief about the development of innovation and
commercialization in the organization with the contribution of vision, mission, teamwork, and
culture of the business. It also discusses the sources of innovation for the growth of the
business. The report shows the concept of frugal innovation for Amazon GO and evaluates the
role of funnel innovation for the growth of Amazon GO.

TASK 3 & 4
Slide 1

Slide 2

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Slide 3

Slide 4
The Amazon Go use the commercial funnel to renovate the innovative strategies and ideas to
attain the profitability in the business. The commercial funnel can be utilize by the company to
introduce new market for perishable goods and develop an application software for the
purchasing of customers. With the implementation of commercial funnel the new ideas can be
developed and can be helpful in assessing the business at the market place for long run.

Slide 5
Commercial funnel process the Amazon Go can influence the large market place and obtain the
huge amount of profit. The company introduces the concept of online application software, due
to which customers can not only pay their bills online but can also purchase the products online
without coming to the respective stores.

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Slide 6
Under this steps the idea for developing an application for purchasing the grocery items from
Amazon could be understood in following manner:
In new-product strategy means to use appropriate process for developing the product for the
customers. Business analysis can easily evaluate the decisions regarding development of new
product. There are various platform for attaining profit in the business. The concept of testing
can give assurance to the company about the acceptance of the new idea in the market. There
are different sources as employees, staff, market through which new ideas can be generated.
The testing through market helps to know about the popularity of new ideas. Lastly it is
important to take reviews from the customers about the new product.

Slide 7
To generate a business plan it is important for Amazon Go to develop the business plan through
which the effectiveness of new development product can be measured. The effectiveness can
be helpful to analyze the satisfaction of the consumer towards the development of online
application for purchasing product by the customers.

Slide 8
Amazon Go can check their effectiveness through the evaluation of performance of the
organization. They can use different techniques to check on the performance of their
employees. Continous feedback of customers can be helpful for measuring the effectiveness
and developing corrective measures. The company can also use frugal innovation timely for the
development of the performance of the organization. The attaining of targets can also be
considered as the measure for checking the overall effectiveness of the organization.

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Slide 9
The company make sure about the quality of the product, through which the customers could
be influenced towards the product and services of the company. The online application software
needs to develop by the qualified person through which the customers can easily buy the
products from anywhere.

Slide 10
Bootstrapping is the process of funding which is performed by the company itself. The other
chains of Amazon can be helpful for maintaining the funds for new product development. The
Amazon is a big name in the market and it can easily take loans for the implementation of new
ideas. The company can also take support of some other company or bank, who can help the
company financially.

Slide 11
The owner of the development of new idea has right for his innovation techniques under
patents. In case of trademark a sign that is used by Amazon cannot be used by any other
organization. Copyright is obtain when the company gets right for any artistic creation as
Amazon introduce online billing concept this can be copyrighted by the company. The design of
packaging can be used as trade dress and information related to shape and strategy can be used
as trade secrets of the company.

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Slide 12
As the detail of the customers are being shared to the company, it is advised to the company
that information must be protected and the innovative ideas can only be shared to the investors
of the company. The company should use innovative market for perishable products for
maintaining the quality of the organization. Company can form strategy for marketing and
developing the business environment of the company.

Slide 13

Slide 14

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CONCLUSION
The above report is helpful in recognizing the role of innovation in the context of Amazon Go.
The organization gain success with the help of innovation and attain the desired outcomes
through it. In addition to this, the report discusses the tools and techniques for the attaining the
effectiveness in the business and securing the product and services from the competitiveness in
the market. Overall, the information and knowledge that has been obtained through this report
can be used in the organization for its development and growth in the future.

REFERENCES
 Akgun, A.E., Keskin, H., Ayar, H. and Etlioglu, T., 2017. WHY COMPANIES GO POSITIVE
MARKETING INNOVATIONS: A NEW THEORETICAL PROTOTYPE FOR 4PS OF INNOVATION.
Journal of Business Economics and Finance, 6(2), pp.70-77.
 Berry, F.S. and Berry, W.D., 2018. Innovation and Diffusion Models in Policy Research.
Theories of the policy process (pp. 263-308). Routledge.
 Cropley, D., 2016. Measuring the capacity for innovation in local government organizations.
 Desai Group, 2013 Accelerate the Evaluation and Maturity of Innovative Ideas: The
Innovation Funnel (Online available at http://www.desai.com/our-approach/innovation-
funnel.php) last assessed on 8th August 2018.
 Dmitriev, V., Simmons, G., Truong, Y., Palmer, M. and Schneckenberg, D., 2014. An
exploration of business model development in the commercialization of technology
innovations. R&D Management, 44(3), pp.306-321.
 Eesley, C.E., Hsu, D.H. and Roberts, E.B., 2014. The contingent effects of top management
teams on venture performance: Aligning founding team composition with innovation
strategy and commercialization environment. Strategic Management Journal, 35(12),
pp.1798-1817.
 Khalil Zadeh, N., Khalilzadeh, M., Mozafari, M., Vasai, M. and Amoei Ojaki, A., 2017.
Challenges and difficulties of technology commercialization− a mixed-methods study of an
industrial development organization. Management Research Review, 40(7), pp.745-767.
 Kim, 2014 what is Innovation Space 4Ps? (Online available at http://knowledge-
innovation.purot.net/dimensions-of-innovation/) last assessed on 8th August 2018.
 P2P Foundation, 2014 Flow from innovation to commercialization (Online available at
http://wiki.p2pfoundation.net/File:Flow_from_Innovation_to_Commercialization_v1.1.jpg)
last assessed on 8th August 2018.
 Rosca, E., Arnold, M. and Bendul, J.C., 2017. Business models for sustainable innovation–an
empirical analysis of frugal products and services. Journal of Cleaner Production, 162,
pp.S133-S145.

 Rubin, G.D. and Abramson, R.G., 2018. Creating Value through Incremental Innovation:
Managing Culture, Structure, and Process. Radiology, 288(2), pp.330-340.
 Saha, R., Dahiya, R. and Sarkar, M., 2016. Frugal Innovation: Growth Accelerator for
Emerging Economy. Selected Readings in Business Sustainability and Inclusive Growth, 131.
 Van der Boor, P., Oliveira, P. and Veloso, F., 2014. Users as innovators in developing
countries: The global sources of innovation and diffusion in mobile banking services.
Research Policy, 43(9), pp.1594-1607.
 Vanhaverbeke, W., Roijakkers, N., Lorenz, A. and Chesbrough, H., 2017. The importance of
connecting open innovation to strategy. Strategy and communication for innovation (pp. 3-
15). Springer, Cham.
 West, J. and Bogers, M., 2014. Leveraging external sources of innovation: a review of
research on open innovation. Journal of Product Innovation Management, 31(4), pp.814-
831.
 Winterhalter, S., Zeschky, M.B., Neumann, L. and Gassmann, O., 2017. Business models for
frugal innovation in emerging markets: the case of the medical device and laboratory
equipment industry. Technovation, 66, pp.3-13.

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