Managing Innovation for Lime: Blue Ocean and Disruptive Theories Applied

MANAGING INNOVATION
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Table of Contents
INTRODUCTION...........................................................................................................................3
Innovation theory.........................................................................................................................3
Blue ocean strategy /theory:..............................................................................................3
Disruptive Innovation Theory............................................................................................5
Application of the theory in historical development context.......................................................7
Company background........................................................................................................7
Business model canvas of Lime........................................................................................7
Historical Development.....................................................................................................8
Application of the theory in future development context............................................................9
Future Development .........................................................................................................9
Application of the theory to company's plans or their ideas:..........................................10
CONCLUSION .............................................................................................................................11
REFERENCES..............................................................................................................................12
APPENDIX....................................................................................................................................13
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INTRODUCTION
Innovation refers to improve or replace something. It a technique through which a
product or a service is brought up to date or is renewed by application of new techniques,
processes or new ideas to create a new value in them (Irani, 2019). Blue ocean strategy of
innovation is the simultaneous tracking of differentiation and low costs to open up a new market
space and creating a new demand. It focuses upon creating and tapping an uncertain market
space and making the competition irrelevant (Carton, 2020). Disruption theory on the other hand
states that when a new firm or company enters a market tackling all the competitors by offering
better products and services the existing firms will move towards innovations to defend their
business (Terry, 2020). This report will discuss the innovation theories and its historic
development with a context to Lime company and separately. The future developments of the
company using the innovations will also be discussed.
Innovation theory
The innovation theories explains the patterns and the speeds at which new processes, new
ideas or product and services will spread through the population. The companies use the theories
of innovations to create product differentiations and gain competitive advantage over the
competitors. The companies also uses these theories to know how they can reduce or eliminate
the possible future threats. Theories of innovations may include:
Blue ocean strategy /theory:
Blue Ocean strategy is referred to as a market strategy where owners have potential of
gaining high profits as there is no or less competition. This strategy revolves around the product
or business which are less in nature or very few operate and provide their services (Au and
Tucker, 2018). This results in no pricing pressure for owners to sell their Lime products. They
can set any price and customer is ready to buy that stuff.
In today's world many businesses operate under pressure related to competition and they
are trying to do everything to gain market share. When the product or service comes under
pricing pressure there is always the possibility that business has to go under threats in reducing
prices, or they are too similar to competitors. This situation takes place when the business is
operating under saturated market. This situation is known as Red Ocean (Iruthayasamy and
Iruthayasamy, 2021).
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The blue ocean strategy aims to capture new demand and make competitors irrelevant by
introducing the product which have more superior features. Example: Before 2003 the
competition between companies were related to listening of music by using compact disks.
Apple launched ITunes which makes the user to download and listen to music anytime and
anywhere. Customer will become more attracted towards Lime as they have shown innovation in
environment.
Benefits of the theory:
 No or less competition: Competition in market is very less which can result in less supply
but more demand which results in increase in price and more profitable of owners. There
are less market entry barriers which makes a Lime to enter and can reach to top very
easily (Alam and Islam, 2017).
 Less crises on Lime: There are situation where market declines irrespective of less price.
Customers want innovations and superior quality products each time which makes them
to go for new market. Lime uses electrical vehicles. As a result, it makes them more
innovative in nature to sustain in market.
 High ROI: By entering into market with less competition is a complex process. But there
is great margin also to earn for Lime. Less competition gives rise to more margin as
owners can sell the product according to their want for profit.
 Defeat depression: The nature of blue ocean strategy is that the business is the only seller
of particular good in market. This makes the Lime always gain the deand of customer
solely which means that even in situation of depression the business can survive easily
because of availability of the demand received by consumers in the market (Caballero-
Morales, 2021).
Limitations of the theory:
 Defensive structure: When a seller finds a new ocean, sharks from saturated market aka
the Red Ocean and other oceans will come in the new market. The business have to
strategically setup the defensive structure to stop them from entering. This sructure
consist of upgrading their technologies and awareness of their brand which is a costly
option for Lime.
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