Business Innovation and Commercialization: Sony Corporation Analysis

This report provides an analysis of innovation and commercialization strategies, focusing on Sony Corporation as a case study. It discusses the importance of innovation compared to invention, highlighting how organizational vision, leadership, culture, and teamwork shape innovation and commercialization within Sony. The report examines Sony's application of the 4Ps of innovation (Product, Price, Place, Promotion) and the use of the innovation funnel to refine ideas. Furthermore, it explores Sony's developments in frugal innovation, including the Seed Acceleration Program and environmentally conscious product design, demonstrating how the company leverages limited resources to create value and address societal needs. The analysis covers various aspects of Sony's business practices, from product development to market strategies, providing a comprehensive overview of its approach to innovation and commercialization.

Innovation and commercialization
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Table of Contents
Introduction......................................................................................................................................3
Task – 1............................................................................................................................................4
Task-2..............................................................................................................................................7
Task-3............................................................................................................................................10
Task-4............................................................................................................................................12
Conclusion.....................................................................................................................................12
Reference.......................................................................................................................................13
Appendix........................................................................................................................................14
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Introduction
This assignment is based on the discussion on innovation and commercialization. Innovation can
be said a new idea or device through which a product can be modified for the better application.
Through the process of innovation, the value of a product or service is increased for which
customers pay (Wolin, 2016). Commercialization is a process through which a new product or
service is introduced in market. The five factors – production, marketing, sales, distribution and
customer support are involved in commercialization (Molnar, 2018). In this project, the example
of ‘Sony Corporation’ has been taken. Sony Corporation is a Japanese multinational company
headquartered in Tokyo. The company deals with electronic products, computer hardwares,
telecommunications equipments and others. In this assignment, it has been highlighted how
through various ways of innovation and commercialization the company has developed its
business. The 4Ps of innovation, innovation funnel and commercial frugal have been discussed
in this project for the understanding of the learner.
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Task – 1
Explain innovation and determine its importance to organizations in comparison with
invention (P1)
Innovation: The business world is changing day by day and with this, the minds of people are
also changing. The change in the minds of people has discovered the idea of innovation in
business firms. With the help of innovation, a business unit can develop its products and services
in the market and thus, can satisfy its customers. On the other hand, an invention is a unique
device or process with product development (Wagner, 2016). An invention mostly involves a
new engineering device for product development.
The differences between invention and innovation are the following:
Invention Innovation
Invention is a device through which a new
product or service is launched in the market.
Innovation is a process through an existing
product is developed with significant change and
presented in the market.
The act of invention is related with creation Innovation is an improvement of an existing
product
Invention process is new in the world. Innovation is new in the same existing market.
But not new in the world.
Invention is not dependent on the behaviour of
consumers.
Innovation is related to the behaviour of
consumers.
Invention is not related to modification of
product.
Innovation is related to modification of product.
Studies have proved that most business organizations are in favor of innovation because it
fetches promotion of business through the new tastes of customers and their satisfaction. The
need for innovation is increasing continuously and hence, innovativeness has become a major
factor in most of the business organizations. Sony is a multinational Japanese company having
its headquarter in Tokyo and deals with the electronic goods, computer harewares,
telecommunications equipments and others. The company was established in 7th May, 1946. The
company, for the past few years has spread its banking, financial, insurance, advertizing agency
and network services in the world. The net income of the company in the year 2017 was ¥507.6
billion and the revenue in the year 2017 was ¥6593 trillion. The company has total employee
strength of 128400 in the year 2017.
Sony, from time to time, has innovated its products and services through its numerous products
in the international market for its sustainability. The company has presented a lot of new
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electronic products all over the world. Some of the innovations by the company are the
following:
Based on the lithium-ion battery in the year 1991, Sony has contributed to the new focused
battery that has excellent energy and power. Again in the year 2009, the company innovated the
lithium-ion secondary battery in the storage battery market.
In the year 1992, Sony invented he first mini Disc Walkman Mz-1 that has the advanced
technologies for playback, recording with numeric keyboard. The device consists of recording
music, deleting music and some other functions.
In the year 2013, Sony introduced its first high resolution audio line up. At that time, Sony
became one of the first companies to invent such product. The device included the Zx1 Walkman
series that involved high resolution audio playback, knowledge and technology.
Thus, Sony has innovated its products from time to time and has provided a lot of new
technology in the entertainment of people all over the world.
Explain how organizational vision, leadership, culture and teamwork can shape innovation
and commercialization (P2) 464
Sony’s vision is to increase the future scope of its business. Sony’s vision statement consists of
organizational goals through which the company will attain long-term sustainability and growth
in future.
The mission statement of Sony consists of the aims and objectives of the company through
which the company will attain its success every year. The company modifies its mission
statement from time to time to get its goals.
The elements – vision, leadership, culture and teamwork have a great importune on the growth of
business. The vision, leadership, culture and teamwork of Sony has shaped its innovation and
commercialization in the company.
Vision: Sony’s vision shows a long-term perspective of the organization. The vision of Sony is
to consolidate a long-term success in the international market. The company has faced a lot of
challenges in the path of its business and this has led the company to innovate its electronic
products, television and music players, computer hardware products, telecommunications
equipments and has commercialized them in the global market. The company for the past few
years has introduced its services in banking, networking and insurance services. Thus, the vision
of the company has helped it to innovate and commercialize its products and services.
Leadership: Sony’s leadership has a great importance on its innovation and commercialization.
Sony is basically engaged with dealing in its electronic products and the financial and insurance
services in the global market (Managementparadise.com, 2018). The leaders in the company
have inspired and motivated the team-members to participate in decision making and the
employee have shared their ideas of innovation with the management body of the company.
Thus, with good quality Sony has initiated a lot of products in the market.
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Culture: Sony’s culture has helped the company to innovate electronic products and financial
services. Sony has always emphasized on its customer satisfaction for retention of customers.
The satisfaction customers have always been interested to purchase goods from Sony again
leading to repetition of sales. Apart from this point, one more culture of Sony is to give value to
its employees. The company has always provided facilities to its employees and thus, has
improved employee morale and effects of organization. The satisfaction of employees of
Sony has motivated them to take part in innovation and they have shared their innovative ideas
with the management of the organization. Sony’s organizational culture is based on knowledge
and skills that has led the organization to identify customers’ choices and innovate new products.
Teamwork: The management of Sony directs a good teamwork in the organization for the
growth of business. Sony has organized training programs from time to time for the employees to
make them skilful. The management of the company has arranged online training programs for
the employees. Sonypeople.com site has the Sony project space and the employee can develop
project in this space. Thus, through advanced technology, the employees of Sony have been
skilful and they have taken part in innovation of products and services of company (Gershon,
2014).
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Task-2
Explain the 4Ps of innovation and explain the use of innovation funnel to examine and
shape innovative ideas (P3)
Sony Corporation has utilized its 4Ps of innovation for the promotion of its market. It has always
given importance its customer satisfaction and innovated its products and services accordingly.
The 4Ps of innovation are the following:
Products: Sony has its services in consumer electronic goods, computer hardwares, financial
and insurance services and some others. It has developed each segment of products according to
the needs of the customers. Most of its innovated products are in electronic equipments like
audio, television, video, computer games, mobile phones and others (Munir et al., 2018).
Price: Sony has always provided high quality of products at a high price. The company charges
high prices when the product launches in the market and then the price decreases gradually. This
means that at the time of launching the products the company maximizes its profit margin and
then with the price decrease the company increases its sales volume (Dhillon and Gupta, 2015).
Place: Sony, to introduce its innovative products uses proper places to distribute products to the
customers. The places are Authorized sellers, stores of Sony, its own websites and official
networks. Apart from these, the company has some wholesale distributers to sell products (Yu
and Tseng, 2016).
Promotions: Sony has promoted its innovative products in the market through various channels
and business strategies. They are advertizing, public relations through various programs and
campaigns, direct marketing and others. It advertizes through TV, social media and others. The
company advertizes its products involving many celebrities (Jackson, 2016).
Innovation funnel: The innovation funnel consists of three steps for the entire development of
the innovative products in the market. The following are the steps of innovation funnel that has
been followed by Sony:
Wide mouth of the funnel: Sony is famous for its specialty of sound quality. Through this step
of innovation funnel, Sony has evaluated its fundamental ideas of innovation for processing them
for the fulfillment of customers’ needs and requirement.
Narrow segment of the funnel: The ideas, thus selected by the pioneers of Sony are screened
through this step. In this step, it is checked whether the selected ideas are fulfilling the goals and
objectives of Sony. This step involves acreativity. For example it can be said that in
collaboration with Phillips, Sony discovered CD. The purpose of this was to provide the
customers more compact sound quality. A lot of ideas are considered in this step, but only one
idea is finalized by the company.
Final step of the funnel: In this step, the idea selected by Sony has delivered its actual
objectives. Through this step, Sony has launched and released its innovated products in the
market. This funnel concept is very easy to understand and Sony has applied this concept in the
market.
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Figure 1: Diagram of Innovation funnel
Source: (slideshare.net, 2018)
Explain developments in frugal innovation and provide examples of how it is used in an
organizational context (P4)
Frugal innovation: Through frugal innovation, something new product is created with the
available limited resources. This is a process through which customer value is focused at
predetermined points of price (Winterhalter et al., 2014).
Sony has continuously faced with various challenges and innovated products and services
through various technologies and thus, has contributed to society. The stakeholders have also
learned a lot of things from this frugal innovation policy of Sony Corporation. Sony has various
types of human and non-human resources in electronics, computer hardware, entertainment,
telecommunication equipment, music, television, video games, financial services and insurance
services also. Introducing new technologies through talents, only Sony can innovate various
types of products and services in the world. The Seed Acceleration Program of Sony was
launched in the year 2014 for collecting ideas and the program was beyond the other existing
programs. This program was launched in the market through the process of commercialization.
Sony’s Entertainment Access glass has helped people to enjoy movie through closed view and
excellent sound system. This system has helped those people who have hearing difficulties by
excellent sound system and also by visualizing the movie with superior quality of picture.
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Keeping in mind the evil effects on environment, Sony has highlighted on the lower greenhouse
gas emission and evil effects from emission of CO2 in the environment. It has considered the
matter of energy saving. It has devised its products in such a way that when the customers will
use Sony’s products, the emission of CO2 will be lower than normally it is. In cinema industry,
Sony has contributed its digital camera through which not only the emission of CO2 is less but
the quality of picture has been superior. In the digital camera, the image is converted to data
instead of film. Thus, a high quality of improvement is possible through such high device. On the
other hand, in the digital recording system it is possible to check immediately the shot scenes.
One more invention of Sony is the movie theatre. Because of the delivery of digital data to
digital camera compatible movie theatre on a hard disc, the film need not to be developed and the
use of water and chemicals reduces simultaneously. Thus, on the one hand it improves the
quality of films and non n the other hand it reduces the emission of CO2. The following are the
fields where the emission of CO2 has been reduced:
 The CO2 emission is reduced during the manufacturing of film
 The CO2 emission is reduced at the time of transportation.
 The CO2 emission is reduced from the projector during showing movie
 The power consumption is less at the time of showing movie.
 The CO2 emission is reduced at the time of manufacturing HDD
 The CO2 emission is reduced at the time of transportation of HDD
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Task-3
Explain the importance of commercial funnel and the application of new product
development (NPD) processing for commercialization of innovation (P5)
A commercial funnel is very important at the time of launching and releasing the product in a
market. While introducing new product in a market, out of a large number of customers, only a
few will provide their contact numbers. The company will select a few out of those and will
make them its own customers. Through a commercial funnel, these processes will be completed
(Ratcliffe, 2017).
In this case, Sony is going to launch a new audio music system in the market. The company
wants to represent the new product in the market at a lower cost. It will represent the new
products in such a cost effective manner that on the one hand the company will earn profit at the
maximum level and on the other hand the customers will get the high quality products at a lower
price. Through this commercial funnel, Sony can test the new audio music system before
launching in the market. Sonny will follow the following steps:
Determining the industry funnel: This is the top stage of the funnel. This is the time of
Information technology and most of the people spend their time in social media, Sony’s website
and on other digital platforms. The first task of Sony will be to look at what valuable user actions
the other competitors take care of. For instance, it can be said that in Twitter an account can be
created and a picture can be uploaded and a group can be created. On the other way a new page
of Sony can be created in Facebook with some special type of apps where the users can give their
remarks about their choices and needs. This technique will give Sony an overview what the
industry competition is doing and then the company can prioritize its business growth strategy
for launching the new audio music system in the market.
Choosing where to emphasize marketing efforts: Sony has to wrap its business and marketing
in a number of places in the commercial funnel. The most common places will be the top and
bottom of the funnel. But they have some problems. For instance, the top of the funnel may be
beautifully viewed in the website by attractive pictures and indicates retention of customers
through inspiration. In this situation, it is hard to convert the inspiration into a profitable process
as the inspiration involves better engagement and lower customer acquisition. On the other hand,
it is easy to monetize from the bottom level. But at the bottom level it is hard to acquire
customers inexpensively. In this situation, Sony has to target a starting point to start the business
on.
Minimizing risks: While starting a new business, Sony will have to play with various types of
risks. Sony has to focus on identifying the risks in its business model first. This identification
will help Sony to understand where the challenges lie actually. In this case, Sony should start
from the bottom of the funnel to attract customers in a cost-effective way and thus, create an
opportunity. In this way Sony will repeatedly acquire customers.
Upward movement limit: In this stage, if a customer is in the funnel and want to transact, Sony
will noise around them on the page. In this stage, it will be fruitful for Sony to use a paid user
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than using a free entertainment user. The user experience is to be focused and prioritized with
feature sets.
Building defensible differentiators: After picking marketing position and defining priorities,
the features are to be built. The funnel positions are to be ensured by Sony through intellectual
properties of the company. Sony has to figure out its requirements and optimize the different
customer acquisition methods according to its business goals. This is a productive policy for
long-term.
Build an innovation business case for an organization, including ways to access funding
(P6)
Sony will launch a new audio music system in the international market in April, 2018. The new
audio music system will have some features of audio books and a mobile telephone system with
all features of smart phone attached with it. The battery power system of the device will be
excellent chargeable capacity. This new innovative product will be firstly initiated in 20
countries all over the world. The price of one set of the audio system will be $500 million. The
new set will also free from any CO2 emission effect and easy to use. Sony has to fund for the
introduction of this new product.
Funding from banks: The total cost of the project for launching the new audio system will be
$400 million initially. Sony has to make a long-term loan of 60$ from the Bank of Japan. Sony
has made a funding of $30 million from its own banking source.
Crowd funding: Crowd funding is a funding system under which funding is collected from a
large number of individuals through internet. Apart from the loan from Bank of Japan and its
own funding source, Sony has resorted to the crowd funding from internet. The amount of
funding is $10 million. This funding system will help the company to manage a small amount of
money to run the business. As Sony has entered into various social media and websites for
availing this funding source, a large number of customers can view the company and thus, they
can view the company’s new products. In this way Sony will be able to advertize its products
free of costs.
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Task-4
Evaluate the different tools that organizations can use to develop, retain and protect
knowledge and intellectual property (P7)
Intellectual properties are the most valuable assets in any type of business. Anything in the
business like logo, product can have such intellectual property. Sony before protecting its
intellectual properties has to see whether these properties can be registered or not. With
maintaining and protecting these intellectual properties, Sony can protect its future markets.
Below are some of the most common intellectual properties that should be protected by Sony:
Trademark: A trademark can be a logo, slogan or a name. Sony should register its logo so that
other competitors cannot use its logo for business purpose. Thus, registering logo will protect
other competitors to imitate Sony’s brand. In case any competitor imitates Sony’s logo, Sony can
take a legal action against that logo user.
Patent: A patent can be said to be a tool for an innovated product and Sony must register its
patent before introducing the new product in the market. The patent of Sony should be signed by
its suppliers, contractors.
Copyright: Copyright is an authentic protection for anything created by Sony including
photographs, software and others. Sony has to employ its employees to create its intellectual
properties and maintain them by renewing whenever necessary.
Sony’s intellectual properties in software: Sony, being a renowned company must have some
personal data in its software system. These data is related to business and ethics of the company.
It is the responsibility of Sony to protect those valuable data so that other competitors or any
customer can view them. In some cases, it will be possible for Sony to protect computer
programme with the protection of patent if there is technical effects and database rights are
attracted by a collection of software modules.
Conclusion
In conclusion it can be said that innovation is the process which an existing product can be
modified in a better condition for the satisfaction of customers. Through innovation, the value of
a product is increased in the minds of the customers. Commercialization is the process through
which an innovated product is represented before the customers in market. Invention is the
process of inventing a new thing in the market or world. This assignment is based on the
innovation and commercialization in a business organization. Various innovation strategies
through innovation funnel have been highlighted here. The various steps in commercial funnels
have also been shown in this project. The example of the renowned company Sony has been
taken here to discuss the subject. It has been shown here that how Sony has applied various types
of innovation and commercialization tools in different situation to promote its business. The
various eco-friendly processes of innovation adopted by Sony have also been shown here. It has
been assumed that Sony is going to introduce a new product in the international market. The
various sources of funding by Sony have been shown here. Finally, various intellectual
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