Table of Contents INTRODUCTION...........................................................................................................................1 TASK 1............................................................................................................................................1 P1: Comparison between invention and innovation and its importance to organisation.......1 P2 The way in which organisational vision, leadership, culture and teamwork can shape innovation and commercialisation..........................................................................................2 M1 Different sources of innovation used by Sainsbury.........................................................4 D1 Analysis of the way in which innovation is developed, embedded and measured in the organisation............................................................................................................................4 TASK 2............................................................................................................................................5 P3 4Ps of innovation and the use of innovation funnel to examine and shape ideas.............5 P4 Developments in frugal innovation and examples of its uses...........................................7 M2 Analysis and application of innovation funnel in an organisational context...................8 M3 Evaluation of the role of frugal innovation in an organisational context........................8 TASK 3............................................................................................................................................9 P5. Importance of the commercial funnel and the application of new product development (NPD) processing for commercialisation of innovation.........................................................9 P6. An innovation business case for Sainsburys..................................................................10 M4AdetailedInnovationBusinessCasewhichincludeshowtomeasureitsoverall effectiveness using appropriate techniques available to test, iterate and improve...............12 TASK 4..........................................................................................................................................12 P7 The different tools that organisations can use to develop, retain and protect knowledge and intellectual property..............................................................................................................12 M5.Evaluation of different tools in the context of the wider business environment...........13 D2 The nature of innovation and the context in which it is developed...............................13 CONCLUSION..............................................................................................................................14 REFERENCES..............................................................................................................................15
INTRODUCTION Commercialisation is the process in which a new product is introduced in the market by using marketing and promotions. Innovation is the process of creating a unique featured product or services which can fulfil the needs of market and people. Innovation and commercialisation is very essential for the organisation in increasing the productivity and performance in the market. Thechosenfirm in this report is Sainsbury which is agroceriesstore based intheUK. This report will explain the difference between invention and innovation along with the value and importance of innovation to organisations (Ahnand. et. al.,2015). Further, this report will discuss the different forms of innovation and the four directions of change an organisation can take and explanation of 4Ps of innovation. This report will also discuss the approaches that the Innovation Manager can take to process innovative ideas along with the steps the Innovation Manager should go through to derive a new and innovative product. TASK 1 P1: Comparison between invention and innovation and its importance to organisation Overview of the organisation:Sainsbury's is the second largest chain of supermarkets in the United Kingdom, with 16.9% share of the supermarket sector. It is founded by John James Sainsbury with a shop in the year 1869 and based in London. This organisation operates with 1415 shops and employee approx 190,000 employees in different branches of the company. Innovation:It is a process of transforming idea into products and services so that potential customer can satisfy their needs and demands by using it. Main aim of using innovation is to modify the existingproductsso that it would become easier for customers to use it and live their life smoothly (Ahnand. et. al.,2017). But on the other hand, invention refers to creation of new products and services in the market. Both factors are essential for an organisation asthey assist companies to gain competitive advantage over others. For instance, if Sainsbury's has launched their new product which is not produced by any of the other competitors then it would provide temporary competitive advantagebecause then the company will be able to compete in the business worldwhich is a positive sign of company's growth. In terms of process innovation, it assist organisation to reduce their cost. For instance, if Sainsbury'sisabletoimprovetheirprocessofmanufacturingproductsthenitwould automatically reduce cost of product which ends up at enhancing profitability of company to a 1
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certain level. Beside this, it also assist company to increase their brand awareness in the market as innovation and invention attracts high number of customers from every brand which is directly linked with the brand equity of the company (Azarmi, 2016). Invention:It is termed as the process of creating a new idea which have not yet been introduced by any other individual or organisation, is termed as invention. The invention process involves an overall engineering and product development process. It is an improvement in the existing range of the products served in a particular sector. As innovation is the process of introducing a range of product in the market that helps to earn competitive advantage to Sainsbury. Innovation of introducing artificial intelligence in business will help in becoming highly competitive and cost effective in the long run for business organisation. Where as Invention is the concept that is introduced a new product or series for the first time in the world. The process of invention is not simple as high level of research and development is required with futuristic mind to think for new inventions. Benefits of new innovation to Sainsbury in comparison to Invention- Businesses that are operated in the supermarkets are facing high competition and to maintain good performance ofsales and profitsinnovations needs to be done onaregular basis. Innovation of introducing artificial intelligence to serve large consumer base with minimum cost in long run (Chun, Chung and Bang, 2015). Innovation is the process that needs to be taken on regular basis to compete with competitioninmosteffectivemannerandwheninventionisdonetodealwith competition it will be effective but it takes time and it is very expensive. P2 The way in which organisational vision, leadership, culture and teamwork can shape innovation and commercialisation Business environment is continuously changing intheUK and to maintain good position in the business Sainsbuty needs to make innovations onaregular basis. Innovation helps in making changes in their current products so that changing expectations of the consumers can be met in the most effective manner. While implementing innovation of artificial intelligence executives ofSainsbury needs to focus on certain points that will help to shape innovation and commercialisation (Cunningham, 2013). These are described as follows- Vision:It is a vivid mental image of business that needs to be achieved at some point of time in future, these are based on goals and aspirations of business organisation. As increased 2
competition leads Sainsbury to introduce some innovation that will help business to achieve its goals. As future is more of high technology and serving consumers with artificial intelligence will be cost effective and chances of any mistake can be minimised. As vision of the organisation is to provide best shopping experience to its consumers and introducing Robots to serve them will be a different concept that will attract large number of consumer group. When service is provided with artificial intelligence then more quality services can be provided and that will help in gaining competitive advantage for businesses. Therefore, vision is an aspirational description of what an organisation plan to accomplish in the mid and long term goals and objectives. Leadership:Leaders in the organisation plays major role while implementing any innovation. As all the subordinates of the Sainsbury are motivated through leaders who work dedicatedly for achieving all the business objects. Innovation leads to implementing something new to business that helps in managing business operations effectively. As employees of the business may resist in accepting changes that takes place through innovation. Leaders make it possible that changes can be implemented as planned (Hemphill, 2014). Leadership is the ability of the individual to influence the people in the organisation so that they work in accordance to fulfil the goals and objectives. Culture:In Sainsburry hierarchy organisational culture is followed that gives business a structure which is well formulated by keeping all the business objectives in mind. This helps in designing a plan to implement the innovation that is going to be introduced in the business at each level in most productive manner.Organisation culture is concerned with the environment and surroundings which will enhance and motivate the individual to work with full zeal and confidence such that business objectives can be attained. Teamwork:Providing services that helps in gaining satisfied consumers can be achieved through effective teamwork that helps in achieving planned objectives. When new innovation of artificial intelligence is launched in the business is supported by team work then business of Sainsbury will give tough competition to all its competitors. All the managers of innovative team needs to take care of all the above elements as this will help in implementing innovation in far better manner (Kutvonen and. et. al., 2014). M1 Different sources of innovation used by Sainsbury PETER DUCKER MODEL 3
Introducing a innovative product and serving consumers in new manner is one of the most important tool that helps to deal with competition. As retail market is becoming more and more competitive and managers of Sainsbury needs to use different sources of innovation that are described as follows- The Incongruity:Organisationsperformdifferent functions that are performed to achieve business objectives. Their is difference between what is and what should be done. By introducing artificial intelligence in stores for providingmultipleservices will help in achieving business objects and providing services to consumers that should be provided to be competitive will help in becoming more competitive (Maritz and Donovan, 2015). The unexpected: the market place is one of most important area to look various opportunities and to grab large no. of consumers marketers constantly research about market. In case of Sainsbury they constantly observe taste and preferences of their consumers. Process need: In process needs includes evaluate factors that work as an weak points of an organisation and creating or redesign them. In that task oriented solution should be cover under it. Industry and market structure change: Industry and market conditions continuously changes and some products shrinks in that aspect one of their example is deregulation. In case of Sainsbury some kind of circumstances come in market and deal in positive way. Demographics: organisation have to constantly observe the changes that occurs in their industry such as in population, income level and capital of human and age ranges in positive way so that major changes should be occurred. New knowledge: With the advent of advancement in technology organisation have to adopt them so that they can welcome the opportunities and widen their market. Changes in perception, meaning and mood:Over the period of time perception of people change. Sainsbury provides services to the public at large and while providing services it is seen that after some period of time due to change in technology consumers preference 4
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changes. This change needs modification in the process of providing various services. It is seen that innovation needs to be made on continuous basis to get satisfied consumers. To develop environment of innovation all the employees in the business needs to understand importance of innovation and take all the possible steps that will help in applying all the innovative ideas in most productive manner. D1 Analysis of the way in which innovation is developed, embedded and measured in the organisation Innovation is not an easy task that can be implemented with some decision. When innovation of artificial intelligence is implemented in Sainsbury organisation then before its implementation various analysis is required (Mazzarol, 2013). As implementing technology in the business is very costly and together with this acceptance of this form of innovation by consumers needs to be analysed. Executive in the top level management of business have full vision regarding future market conditions, competitors reactions and objectives of business in long run. When needs and preference of consumers keep on changing then innovation to satisfy them is introduced which helps in enhancing sales and maximising profits in long run. TASK 2 P3 4Ps of innovation and the use of innovation funnel to examine and shape ideas The innovation mix and 4 Ps of innovation model was developed by John Bessant and Joe Tidd. This process of innovation mix can improve concept of business which helps in achieving business objects. The innovation mix of paradigm, product, position and process is not same with market mix (Mohannak and Samtani, 2014). This mix helps to understand current business position and by considering future aims how innovation should be implemented to perform effectively. Four innovation mix are described as follows- 5
(Source: 4 Ps of Innovation, 2019) Paradigm:In that context innovation should be used to improve the way of doing business and the changes should be radical in changes but all changes are not positive. In that scenario identification is very much potential to reach at desirable goals and objectives.As per this innovation is used to improve the way in which business is performed(Mazzarol, 2013) . The change could be radical and it should always be kept in mind that all the changescan not bring positive results for business. All the results and implications will be analysed in mind of executives who take decision for implementing innovation in Sainsbury organisation Product:This tool of innovation mix helps in guiding business organisation regarding what changes needs to be made in the services offered by Sainsbury. Innovation leads to improvement in the quality of service offered by business organisation. In this tool of product 6 Illustration1: 4 Ps of Innovation, 2019
various suggestions can be made to business organisation that will make quality of service better and leads to incremental change. Process:This does not only include the preparation process of the service provided by Sainsbury. All the process that is required to implement an innovation is included in this business process. These steps includes hiring people, training, workflow and supplying of all the required resources that will help in implementing innovation. Position:A new method through which services are provided is implemented by Sainsbury in innovation. Implementing innovation is not enough as a new method of introducing this innovation to general public is also required in the business. Position innovation guides businessorganisationstomakerequiredmodificationsinthemethodofmarketingand promotions for new products (Pellikka and Malinen, 2014).Therefore, the innovated product or service can be positioned with the help of various promotional tools like advertisements in news paper, radio, posters, hoardings, social media, etc. Innovation funnel:In the process of development of new product an innovation funnel is a common model used by business organisations to evaluate ideas and conceptualize products. This can be used by Sainsbury to implement the process of serving consumers with artificial intelligence. Various steps of this model are described as follows- Illustration2: Innovation funnel, 2016 (source: Innovation funnel, 2016) Investigation:In this step a research is conducted by Sainsbury that will help in identifying changes in taste and preference of consumers. This step helps to guide to make changes required to be made so compete effectively. 7
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Development:When appropriate information is collected in the previous step regarding changes that needed to be made so that buyers of the product and service are willing to make orders for the services offered by Sainsbury organisation. Shipping products:This is the last step of the innovation funnel that involves supply of the product in the market for sale. P4 Developments in frugal innovation and examples of its uses Frugal innovation or frugal engineering is the process of reducing the complexity and cost of a goods and its production. This method of innovation helps in removing non-essential features of a durable good. This innovation to the product helps in improving sale of the products in developing countries. When a product is introduced with high amount of specification then it is seen that in some countries demand for the product with less specification and more durability is high. Frugal innovation helps in introducing products as per consumers requirements. Through minimising the use of resources in development, production and delivery or by levering them in new ways, frugal innovation results in dramatically lower-cost products and services. Successful frugal innovations are not only low cost but outperform the alternative and can made available at large scale (Pollitzer and Schraudner, 2015). For example- Sainsbury is implementing a new method in providing services to consumers this innovation leads to reduction of some unessential features of service that will make services offered by company more attractive to targeted consumers. Their are six principles of Frugal innovation that are described as follows- Engage and Iterate:As per this principal businesses rather then using insular research and development departments that rely on giving educationabout consumers needs enhances chances of consumer satisfaction. For this consumers behaviour in the natural environment is observed and then relevant product is considered to be developed as per consumers requirement. Flex your assets:New tools such as robotics and 3D printers and new approaches such as social manufacturing can help operations and supply chain managers “flex” their production, logistics and service assets to satisfy consumers in better and cheap manner. Create sustainable solutions:Research and development and manufacturing managers helps in developing sustaining solutions that help both businesses and the environment in which components and materials are repeatedly recycled (Robertson, 2014). 8
Shape customers behaviour:Business organisations can influence consumers into behaving differently and feeling richer while consuming less. Co-create value with prosumers:Research and development in the business whether taken by an individual and group of persons must add the feature that is highly demanded by the large number of consumer group. Make innovative friends:Products and services that are innovated through frugal innovations reflects ,ore efficiency by collaborating with diverse external partners then by working alone. Frugal innovation plays important role in implementing new method of providing services to consumers. As artificial intelligence will be an innovation that is introduced by Sainsbury and this will help in removing unessential process that is used previously for providing various services in business (Sonne, 2012). M2 Analysis and application of innovation funnel in an organisational context Innovationfunnelisthecombinationofthreedifferentstagesthatstartswith investigations regarding needs and demand for innovation(Trimi and Berbegal-Mirabent, 2012). After this development takes place, in this step what is identified in the first process of investigation is developed for implementing. All these steps are used by Sainsbury while making an innovation for introducing an artificial intelligence in the method of service providing. First of all market research is conducted that will help in identifying requirement and then method is developed for providing service with new technology for getting better results. M3 Evaluation of the role of frugal innovation in an organisational context FrugalinnovationmethodisbeneficialforSainsburyorganisationasithelpsin simplifying the process of development and also cost of production is minimised with this method of innovation. When services rendered by Sainsbury is through artificial intelligence then it will help in reducing cost of employees and total cost will be reduced for business. As low cost will help in providing products to consumers at low cost that will attract large number of consumer group (Theyel, 2013). 9
TASK 3 P5. Importance of the commercial funnel and the application of new product development (NPD) processing for commercialisation of innovation Commercial funnel:It is a buying process which represents the stages which companies goes through to lead consumers at the time of purchasing products. It involves the combination ofemail campaigns, blogging, search engine optimization, SMS marketing, advertising and many other strategies (Trimi and Berbegal-Mirabent, 2012). Following are the stages which helps in understanding sales funnel: Awareness Stage:Such stage creates more awareness of the product with the help of suitable tools.For this the company will use various promotional tools and methods so that they will be able to tap the customer. It will involve advertisements in newspapers, posters, hoardings, social media, etc. Interest stage:At this stage, interests are created among the targetted customers for the product with proper research. Evaluation Stage:This stage helps in evaluating the dynamic and competitive market. Engagement Stage:At this stage, positive relationships are build with the potential customers. Commitment Stage:Also known as purchase stage. Here, purchase is made by the customers. Importance ofcommercial funnel:Commercial funnel plays an essential role in performing the operations of any organisation. It helps in attracting the potential customers and converting them into the loyal customers by encouraging them to make a purchase decision. Such funnel is used to maximise the value of customers by reviewing the sales(Tsai, 2015). Commercial funnel is important for the managers of Sainsburys as it helps in formulating the effective marketing strategies, generating more sales by building effective relationships with customers and promoting the activities for improving performances. Application of new product development process:New product development is a systematic process of launching a new innovative product or service in the competitive market place. The executives of Sainsburys formulates and launches new innovative services to deliver the products to the customers. The process includes following steps: 10
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Idea generation: the first step is to generation of the innovative ideas. Various ideas are generated from various sources.For an example Sainsbury before implementing any new product or idea into market place organisation conduct through research by that major results should be accomplish in proper way.The sources are as follows: Internal sources:incentives are provided to employees, staff workers for generating new ideas. External sources:Various external sources includes competitors, customers, market research, SWOT analysis. All these helps in generating new innovative ideas for providing services. Idea screening:various ideas are generated but only few are suitable. Such step includes the screening of the feasible ideas for providing innovative services.In case of Sainsbury they passes through an definite path from that new products and services should be build in positive way so that they can reach at desirable outcome. Concept development and testing:The ideas at screening stage are converted into concepts for testing. A concept refers to a blueprint of the strategies of services. The ideas are developed by the associates of chosen entity to develop the new services. Business strategy analysis and development:when the concept is finalized now it's time for formulating and developing various business strategies such as competitors strategy analysis, break even analysis and many more. Service development:when the strategies are developed then they are put into actions. All the strategies are tested and implemented to promote the services in competitive market. TestMarketing:Suchstagehelpsingettingfeedbacksfromcustomersafter implementation of the innovative services. It helps in making the services ready to launch. Commercialization:The owners of selected business understands the importance of innovative measures will provide profits. They commercially launches such services. P6. An innovation business case forSainsburys It is very important for any business to formulate new innovative products and services for engaging the potential customers and achieve a position in the dynamic market. The following steps are followed for building an innovative business case study for Sainsburys: Mission :The company aims to provide different and unique taste to the customers. 11
Products and services :It will offer various products and services like clothing, food, financial services, etc. to its customers. Summary:the organisation prefers to launch its servicesby following specific steps. By launching the services such as robotics at workplace to cater various services to customers for increasing the brand value along with market share. Objectives:the objectives are set by the authorities of Sainsburys are straightforward to be understand by others. The major aim is to survive and increase the market share by increasing the profits with the help of providing innovative services. Solution:Various typical problems are faced by the Sainsburys to cater the services to distinct customers. The company introduces an effective solution of using artificial intelligencesystemstodelivertheprescribedservicestovariouscustomers. Implementing such service helped in building effective relationships with potential customers. Innovation in service:It refers to framing a new service. By using the stages of new product development, the executives of selected businessinnovates artificial intelligence systems of providing innovative services than the existing services (West and Bogers, 2014). Research:Marketingresearch helps in developing new services. By conducting the market research, the marketers of chosen firm measures the requirement and customer’s preferences. Current trends in the market are analysed by using various marketing research strategies. Funding:Various sources of funds are identified and used for fulfilling the daily operations of business. Following funds are required for new service development: ParticularsAmount(£) Market research and development71500 Experts guidance61000 Implementation47500 Total180000 12
Sources of funds:above mentioned funds are requires to plan and implement the services successfully. The managers can take loan from the banks , can offer the share of ownership, merges with the competitors. Theeconomic sector of thegovernment can also helps in giving grants for introducing a new innovative service.Customers and suppliers can also provides funds to introduce the new service development activity. Benefits:Selectedentitygetsbenefitsbyavailinginnovativeservicestovarious customers with the helps of robotic system which results in changing the perception of potential customers and converting them into loyal customers. M4 Adetailed Innovation Business Case which includes how to measure its overall effectiveness using appropriate techniques available to test, iterate and improve The owners of Sainsburys applies various techniques and methods for the purpose of new service development. The main objective being new innovation is to survive and increase the market share by increasing the profits with the help of providing innovative services along with building brand image. For such reasons, the managers have introduced the artificial intelligence servicewhichusestherobotstoprovidevariousservicestodifferentcustomersatthe predetermined time. Such service is different from the existing services. It helps in attracting more loyal customers. Various issues and problems are faced by the selected business but has overcome them by using distinct techniques and methods. The new innovative service helped to achieve the planned objectives effectively and successfully. TASK 4 P7 The different tools that organisations can use to develop, retain and protect knowledge and intellectual property Intellectual property plays crucial role in performing tasks to set up a business. It is a kind of property where intangible creations is used. It encourages the production of various intellectual products and services (Barjolle, 2016). Protection of such property helps in reducing or eliminating the unauthorised use of licensed intellectual property. Various tools of intellectual property includes trade marks, patents, trade secrets, copyrights, design rights. These improves the operational capabilities to provide new products or services to customers. The description of the tools are the following: 13
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Service marks:trademarksare used for protecting the brands. It includes the specific logo,sign,orexpressionoftheproductorservicewhichisdifferentfromthe competitors. The managers of Sainsburys uses slogans which describes the robot services which helps in building an unique identity in the market (Chen, Bharadwaj and Goh, 2017). Copyright:These are the legal right used as the exclusive rights for the innovator of original work. These are granted by the governments of different countries. The reason of forming the copyright laws are to protect effort, creativity along with time of the innovator. The owner of Sainsburys possess the copy right of the power to provide authorization to others for reproduction of some services. Design rights:Ithelps inprotectingthe designs against getting copied by others. These can be sold, bought or licensed. It do not protect the functionality but protects the features related to the appearance of the product or service. The selected business uses such tool to protect and register the design of the robots to the way they looks. Patents:It is an another kind of intellectual property. It provides the owners the rights related to making, using and selling their unique creativity (Loggie, 2016). Such rights are granted after publicly disclosing the innovative technique, product or service. Patent rights are granted to the innovators for formulating new ways of performing operations or offering new technical solutions for the critical problems. The managers of Sainsburys uses such rights for protecting the new innovative services of artificial intelligence systems. M5.Evaluation of different tools in the context of the wider business environment The intellectual property tools provides protection to foster innovations. All the tools and techniques of such property are useful in distinct environment situations. The adoption of all the toolsinwiderenvironmenthelpsinsettingthebusinessoperationsapartfromdistinct competitors. These tools helps the Sainsburys to offer various different and new services to loyal customers and attract the potential customers. The managers also makes sure which tool is used at what time according to structure of organisation. These tools helps in protecting the creativity of the innovator in the wider and dynamic business environment. D2The nature of innovation and the context in which it is developed Sainsbury is the second largest organisation dealing in supermarkets. Operations of the company are conducted from many years but it is seen that level of competition has grown up. A 14
innovation of introducing artificial intelligence in the business organisation serving to large number of consumers is something new to supermarkets that helps in creating good brand image of the company. Company have main object of maximising profits by acquiring large market share and that is possible only when large number of consumers are satisfied with the service of the company. CONCLUSION From the above report it has been concluded that innovation and invention are two different concept that needs to be understand to make business more competitive. Business environment is changing rapidly and it is seen that to compete with high amount of competition each business organisation needs to introduce some innovation in the product served or service provided. Innovation is done by analysing current market demand that needs to be satisfied to gain competitive advantage in business organisations. The method of innovation is analysed effectively before implementing to get better results so that all the objects of business can be achieved in pre determined manner. To implement innovative idea in business teamwork, leadership and vision of business plays important role. 15
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Theyel, N., 2013. Extending open innovation throughout the value chain by small and medium- sized manufacturers.International Small Business Journal.31(3). pp.256-274. Trimi,S.andBerbegal-Mirabent,J.,2012.Businessmodelinnovationin entrepreneurship.InternationalEntrepreneurshipandManagementJournal.8(4). pp.449-465. Tsai,S.P.,2015.Dynamicmarketingcapabilitiesandradicalinnovation commercialisation.International journal of technology management.67(2-4). pp.174- 195. 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. Online 4PsofInnovation.2019.[Online].Availablethrough: <https://innovationmanagementsite.wordpress.com/2015/09/07/innovation-space-4ps/> Innovationfunnel.2016.[Online].Availablethrough: <https://egyptinnovate.com/en/innovation-tool/4ps-exploring-innovation-space> 17