The Importance of Innovation in Business

The assignment discusses the significance of innovation in converting new ideas into ultimate products and services that enable businesses to gain a competitive advantage over their competitors. It highlights various attributes that impact the innovation process, including the use of innovation funnels to screen out appropriate methods for production at affordable prices.

INNOVATION

Table of Contents
INTODUCTION.............................................................................................................................3
TASK 1 ...........................................................................................................................................3
P1. Innovation and determine its significance to organisations in comparison with invention. 3
P2. Organizational leadership, vision, teamwork and culture shapes innovation and
commercialization..................................................................................................................5
P3. 4Ps of innovation and use of innovation funnel.............................................................6
P4 What is frugal innovation ...............................................................................................8
P 5. Significance of the commercial funnel and the application of New Product Development
................................................................................................................................................9
P6 Build an innovation business case for the organisation..................................................11
P 7. Different tools used to develop, retain and protect knowledge and intellectual properties
..............................................................................................................................................12
Conclusion.....................................................................................................................................12
REFERENCE ...............................................................................................................................13
Books and Journals .............................................................................................................13

INTODUCTION
Innovation refers to some unique ideas, models, techniques or input that are entirely new
for an enterprise and leads to formation of new and improved products and services. In reference
to business,it refers to applying creative imagination, information, methods and implementing
them so as to produce some distinctive product that can help a firm to gain competitive edge
over its customers. This project is based on WorldRemit is an e-commerce based enterprise that
provides international payment services that enables people to transfer as well as receive money
to friends, relatives etc. living any where across world simply through smartphones, computers
or tablets (Aghion, Van Reenen and Zingales, 2013). It was established in 2010 with its
headquarters at London. This assignments involves explaining the meaning and importance of
innovation for an enterprise along with its the effect of vision, leadership , culture and teamwork
in shaping innovation. It will also explain about 4p's of it along with innovation funnel and its
importance an application in New product development cycle. Moreover, management need a
process of commercialise innovation which further assist in better results.
TASK 1
P1. Innovation and determine its significance to organisations in comparison with invention
Innovation is one of the most crucial yet significant issue of an organization as it serves a
catalyst in attracting new and potential customers and getting maximum output with higher
return by making business to adaptive and to grow in the dynamic market environment. In
simplest context, an innovation can be described as something original and more effective ideas
to either create an entirely unique product or to enhance the existing product. On the other hand
Invention is the process of creating and cultivating something unique, distinctive and
distinguishable ideas that has never been made or utilized by any one. In today's era of
competitive business environment, Innovation proves to be an important asset for maintaining
and improving an edge over business rivals (Anderson , Potočnik and Zhou, 2014). Thus, it
ultimately leads to an increase in customer's satisfaction as firm becomes efficient in catering the
frequently changing taste and preferences of customers. On of the most important aspect of
innovation is that it is not simple to build something new but also to make it better for the
customers as well for the society and environment. WorldRemit is one of the leading firm

providing payment and privacy security services that let people to transfer and accept money
from friends , relatives living any where in world in an convenient and cost effective way. With
its team of around 150 proficient employees, it works on product development, engineering ,
providing it solutions etc. providing services in approx 50 countries worldwide. For maintaining
and intensify its market position, WorldRemit should focus on adopting effective and efficient
strategies to make innovative products and services in the light of changing market scenarios to
boost up company's its productivity by making use of latest technical upgraded technologies in
their business operations.
Significance of innovation can be understand from the mentioned below points:-
Innovation leads business been adaptive to market changes- Innovation includes
developing new features or finding new usage of the existing product. Thus ,it helps business to
readily meet frequently changing taste and preferences of customers according market trends a,
fashion etc.
Maintaining an edge over competitors- : Innovation lead to not only crating a new
product but also improving the functionality of existing product making it better in quality. By
making use of creative ideas, new methods, models and techniques, it enables a firm to
differentiate its product from that of the competitors and to attract new customers leading to
gaining competitive advancement over its business rivals (Battistella and Nonino, 2012).
Implement best method for organizations: Innovation process involves depth study
about the present and possible future trends, market surveys about customers buying behavior
and their taste and preferences, needs and wants. This research serves as an useful tool in
designing and developing most suitable methods for manufacturing goods , marketing strategies,
policies and procedures. In addition to it is also come useful for other departments as well
Helpful in creating brand image:- By introducing latest and most creative and
competitive products customized as per consumer's requirements, innovation assists business in
in building and enhancing brand image of its goods and services in market.
Difference between innovation and invention is evaluated as below:
Innovation Invention
 Innovation is the action of
implementing new ideas and creative
imagination in order to make
 Invention is the procedure of creating
something totally new that has never
been created before by anyone else. It

alteration in the existing products
which results in enhancing it
performance level.
 Innovation leads to adding value in the
exciting product and increasing its
worth.
 Innovation implies enhances the
effectiveness and productivity of
existing product either by modifying
or making alteration in it or finding
new way of using it .
might be a device, method, technology,
module or so on .
 Invention is launching an entirely new
and unique product for meeting up
customers needs and aspirations. .
 Invention involves hiring specialists
team with talented people to design
new products.
P2. Organizational leadership, vision, teamwork and culture shapes innovation and
commercialization.
It is evident that most successful companies in long run are those who have been
figureheads in introducing innovation and creative products in market. They follow philosophy
of being ahead rather than competing with their business rivals. Thus, for accomplishing it
objective of catering each a every needs and requirement of customers to get maximum returns
and getting higher profits, introducing new and innovative products is the key factor for a firm to
survive. It is where the importance of efficient leader comes into existence. It is because a
company can't innovate on it sown (Boons and Lüdeke-Freund, 2013). It is employees that
brings out change by giving creative ideas and methods or suggesting new ways to do a
particular task. Thus, it is responsibility of a leader to channelize the pace and encourage
creative thinking and participation of its workforce so that business can have pool \ of different
imaginations that can be analyzed and worked upon to select a different and unique approach for
manufacturing products and services. It is therefore requisite for WorldRemit to adapt new and
advance structure by constantly working on attaining its objectives and conducting its activities
in a befitting manner with an influential and efficient leader who can influence its employees to
give their best efforts to achieve vision. To stand ahead in the market an enterprise should
create :-

Vision: Vision is description of probable future picture of the company that it wants to
attain in its long run. WorldRemit vision is to making the money transfer process fast, more
secure, low cost and quick enough for people to receive payment wherever and however they
want.
Leadership: The major responsibility of manager is to motivate its workforce to give
their best efforts in one direction towards achieving organizational objectives. The manager or
leader must follow democratic leadership to induce employees to be participative and proactive
in decision making process so that firm can get benefit of creative and innovative ideas. Team Work: Team work is the most significant factor for the success of project as as it
establishes coordination and cooperation among the workforce which assists in the
smooth functioning of business operations. In a SME like WorldRemit team work plays a
key role in performing tasks effectively and effectively within specific time frame with
minimum errors and maximum output (Boudreau and Lakhan, 2013).
 Culture: Culture is defines as value, norms , beliefs and attitude of employees that are
working in a firm. Culture has a direct and significant impact on development and
innovation. Being on of the leading online service provider firms require. WorldRemit
can take advantage of multi culture diversity to encourage employees to give different
innovative ideas that can be utilized in new product development leading to enterprise
gaining good reputation and upper hand over competitors.
P3. 4Ps of innovation and use of innovation funnel
John Bessant and Joe Tidd. Invented 4Ps of innovation also known as innovation mix. It
involves four different attributes that assists firm in shrinking its research and investigation on to
the most feasible and specific area that can result in innovating a new product and adding value
to it. WorldRemit utilize these 4ps of innovation to develop a new technique, method, product or
service that can be most suitable in providing customer satisfaction. Four components are
described below :
 Product Innovation: product innovation is introduction of new and improved goods and
services by either adding new feature to it to enhance quality of the product. It is
capability that is necessary for the firm to keep a track of so as to be figurehead in fast
changing business environment.

 Process : An outdated method of production generally leads to company incurring high
maintenance, production costs, taking more time an decreasing production efficiency of
the enterprise. Thus, it in benefit for company to timely update and improve its method s
and technique of production and operation process to maintain quality, reduce cost and
generate maximum outcome with higher profits. It enable enterprise to sell high quality
product sat affordable price to its consumers (Díaz-García, González-Moreno and Sáez-
Martínez, 2015)
 Position : it searches out most suitable target group whose requirements are best matches
with the new and improved product that is been introduced by firm. Innovation enables
business to maintain upper hand in market by being proactive and combative enough to
provide advanced and improved products and services to it customers.
 Paradigm : Paradigm is changing the way things are done on regular basis. It is done by
either modifying or entirety bringing a change in operational system, procedure or
strategies to make it easy and comfortable for consumers to understand and follow it.
Innovation funnel:
Innovation funnel is the method adopted by a manager to utilize and apply the best
suitable ideas, innovation , methods, procedures that can be helpful in fulfilling market demand
in most reasonable fashion. From the pool of options and opinions distinctive ones are selected
that can prove beneficial for both business and clients. It involves systematic development of
innovation initiating with generation of an idea, thought, screening and scrutiny the best options
from the many available alternatives and finally selecting most innovative idea. Mentioned
below are three steps involved in innovation funnel;:-
 Focuses on wide mouth of funnel: At initial stage business increases its knowledge ,
information and collects as many ideas as possible. For this it uses various sources like
information from competitors, university, exiting partners etc. to analyze current market
trends to find out the capabilities and competitiveness of the firm.
 Narrowing segment of funnel:- This step in concerned with short listing from
plethora of creative ideas with reference to objectives and aims of an enterprise. Each
option is deeply studied for its feasibility and risk factors.

 Narrow segment of funnel:- This is the last stage where after ensuring about the
feasibility and competency of the new product to fulfill the needs and want of consumers
company launches it in the market (.Drucker, 2014).
P4 What is frugal innovation
Fugal innovation (FI) is the process of introducing new models of for business activities,
modifying or recreating product or removing non requisite features of product so asto enhance
the equality and productivity of goods and services to make it more reasonable, , value chains,
redesigning product or eliminating the non essential features of a product so as to make the
product service more affordable, durable and sustainable with high quality. Mentioned below
are the significance of FI are listed below:
 The ultimate objective of FI is to provide necessary functions that are required by people
at a cost which they can afford.
 FI is most appropriate and effective technique for developing countries who seeks for
finding out opportunities to sell their goods and services at lower price so as to capture
attention of target audience who prefers economic products. s..
 FI take into consideration bottom level approach gradually making it upward at top levels
to provide benefits to all its clients.
 FI helps in reducing and cutting down the cost incurred on research and development,
production and other functional areas. It proves to useful for firms at the time of financial
crisis.
 FI enables business to minimize its cost of production leading to providing products at
affordable prices that ultimately increases the sales volumes of organization.
Considering the cases of two most prominent brands Renault and Dacia, who are the
one of the leading firms with their business operations in round the globe and have customized
their automobiles in accordance with customer's needs. By making use of FI technique both
these brands have launches an entirely new segment of their cars in automobile industry that
amalgamates quality with affordability. This method will be advantageous for WorldRemit can
the firm can create new products for its clients so that they can have the latest and updated
solution related to problems like cyber security, slow bandwidth etc (Gennaioli, Shleifer. and
Vishny, 2012).

P 5. Significance of the commercial funnel and the application of New Product Development
Commercial funnel also known as sales funnel visually explains the sales process that initiates
from customers contact to final sale. It uses an idea of leaky funnel where the firm can drop out
sales opportunities when potential consumers become disinterested or no more fit into target
audience It various stages of commercial funnel refers to degree at which customers are ready to
seal a deal to purchase. WorldRemit should make efforts for adopting this technique to get
maximum output. Mentioned below are its five stages:-
 Awareness : Awareness is concerned with firm's efforts to explore exiting solutions for
difficulties that are been repeatedly encountered by consumers.
 Interest : In this phase knowledge and interest of target audience towards goods and
services of firm is been identified and studied.
 Evaluation : In evaluation process the prospects explores and examines all possible
solutions that are applied by its competitors. This stage left prospects an inch away from
so that it left them an inch ahead from taking final buying decisions.

 Decision : It involves taking the final decision related to purchasing the product. The
potential customers in this stage starts here are ready to buy and starts comparing all the
available market solutions. The task of firm here is to convince its customers to purchase
products from instead of their competitors. In the later stage the decision regarding
purchase is made and clients starts negotiating (Lee, Kao and Yang, 2011) Purchase : In this last and final stage the prospects make the purchase.
New product development process
This procedure involves all the processes carried out for developing a new and improved
product. Mentioned below are the stages of new product development :-
 Generation of idea : This is initial phase that involves nurturing an idea by testing its
feasibility through SWOT analysis to ensure that it is realistic and logical.
 Screening of idea : Screening includes selecting most prominent ideas and removing the
other non feasible options.
 Funding : Funds are required to convert business plan into action. Thus company explore
and finds out the expected stakeholders that are interested in investing in business plan.

 Development and testing : This stage includes concept development and testing it on
selected market segment. For this selected consumers are provided with information
about the new product and their opinion is asked. If the survey reveals positive results t
the concept is adopted for further execution.
 Business strategy analysis : In this stage profitability of converting chosen concept into
new product is determined by conducting market research and customer surveys. Product Development:- Int this phase strategies related to finance, marketing,
production,advertising etc. are formulated and new product is created with all
specifications. Test marketing: It involves introducing new product into selected market to verify for its
success. Feedback are taken to know about any required modification in the product.
 Commercialization: In the final stage product is full fledged launched in the entire
market and business starts product promotion by using various strategies of marketing
mix (Lee, Olson, and Trimi, 2012).
P6 Build an innovation business case for the organisation
A project to be successfully converted into plan of action requires funds so as to carry out its
business operations. There are various sources through which an enterprise can raise its funds.
Ansoff software needs to find out prospective stakeholders that are convince to invest in its
business plan so that it can successfully convert its innovation into anew product Tthis can be
done by following innovative business case:
 Ansoff Software is an IT company providing software solutions to its customers all
across the globe. Following its market expansion strategy company is thinking to launch
a new and latest software for recording call to track down fake and unusual call and
also to decrease online traffic. The mission statement declared regarding this innovation
is:
 “To implement new and innovative solutions for making customer experience more
effective”
 For completing the development process and commercialising the goods and services,
business is required to determine and arrange certain sources of funds that enables firm

to get maximum returns besides successfully managing its operations.
For this company can opt for any of below mentioned sources of funds: Internal sources: Retaining or reinvesting profits into business itself serves as a
important and cost effective source of finance as it reduces the risk of debt. In addition to
this other sources can be selling out company's assets to raise funds
 External sources: Various external sources of funds can be through bank loan, over
draft etc. These enables the company to arrange funds from outside business world.
P 7. Different tools used to develop, retain and protect knowledge and intellectual properties
It is of vital importance for an organization to protect and safeguard its innovations so
that it is not steal, imitated or used by its competitors. To protect such property and their rights
government had laid down certain legislations which define as an intellectual property right
which secures the major invention and innovation made by a person.
 Copyright : It refers to legal rights provided to the owner of intellectual property the sole
and exclusive right to used ,manufacture, publish or sell its creation. This is significant
and most effective measure for safeguarding one's intellectual property. In case any one
else would try to use,s ell or claim for the new innovation of WorldRemit then they will
be penalized by the government (Owen, Macnaghten. and Stilgoe, 2012).
 Patents : Patents are exclusive rights that are given by government to the busine4ss for a
specific time period which prevents others from commercially utilizing , selling,
distributing or importing an invention that is patented without asking the permission if
the real owner.
 Trade mark : Trade mark is any symbol, logo, image, letter, colour combination etc. used
by any firm and that cannot be utilized by any other firm without the permission of the
owner (Strayer, 2012).
Conclusion
The assignment concludes that innovation is a vital term for converting new ideas into
ultimate products ad services which enables firm to achieve competitive edge over its
competitors. Various attributes are there that impacts the innovation process. Manager can use
innovation funnel to screen out most appropriate method for production at affordable prices.

REFERENCE
Books and Journals
Aghion, P., Van Reenen, J. and Zingales, L., 2013. Innovation and institutional ownership.
American economic review,103(1). pp. 277-304.
Anderson, N., Potočnik, K. and Zhou, J., 2014. Innovation and creativity in organizations: A
state-of-the-science review, prospective commentary, and guiding framework. Journal
of Management, 40(5). pp.1297-1333.
Battistella, C. and Nonino, F., 2012. Open innovation web-based platforms: The impact of
different forms of motivation on collaboration. Innovation. 14(4), pp.557-575.
Boons, F. and Lüdeke-Freund, F., 2013. Business models for sustainable innovation: state-of-
the-art and steps towards a research agenda. Journal of Cleaner Production. 45. pp.9-19.
Boudreau, K.J. and Lakhani, K.R., 2013. Using the crowd as an innovation partner. Harvard
business review. 91(4). pp.60-9.
Díaz-García, C., González-Moreno, Á. and Sáez-Martínez, F.J., 2015. Eco-innovation: insights
from a literature review. Innovation, 17(1). pp.6-23.
Drucker, P., 2014. Innovation and entrepreneurship. Routledge.
Gennaioli, N., Shleifer, A. and Vishny, R., 2012. Neglected risks, financial innovation, and
financial fragility. Journal of Financial Economics. 104(3). pp.452-468.
Lee, J., Kao, H.A. and Yang, S., 2014. Service innovation and smart analytics for industry 4.0
and big data environment. Procedia Cirp. 16. pp.3-8.
Lee, S.M., Olson, D.L. and Trimi, S., 2012. Co-innovation: convergenomics, collaboration, and
co-creation for organizational values. Management Decision. 50(5). pp.817-831.
Owen, R., Macnaghten, P. and Stilgoe, J., 2012. Responsible research and innovation: From
science in society to science for society, with society. Science and public policy. 39(6),
pp.751-760.\
Strayer, J.F., 2012. How learning in an inverted classroom influences cooperation, innovation
and task orientation. Learning environments research. 15(2). pp.171-193.