Managing Innovation: Application of Disruptive Innovation Theory in OLO

This report explores the application of disruptive innovation theory in the historical and future development context of OLO, an online ordering company. It discusses the benefits and limitations of this theory in managing innovation and highlights the importance of value creation, differentiation, and low cost in gaining a competitive advantage. The report also emphasizes the need for market research and wise decision-making in implementing disruptive innovation strategies.

Managing Innovation
Assessment

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Disruptive Innovation Theory......................................................................................................3
Application of the Disruptive Innovation Theory in the historical development context...........6
Application of the Disruptive Innovation Theory in the future development context................9
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................11

INTRODUCTION
Managing innovation depict the collection of handling process, strategies and changes in the
products. It is important for having sustainable business as it look forward towards future and
also come up with creativity and new ideas that are not executed by the competitors. Further,
collaboration, execution and value creation are the major factors that are involved in managing
innovation. It tends to resolve complexities with suitable solutions by representing the business
values, increase productivity and new process to offer something new within the market. The
objective of this report is to develop an innovative roadmap to effectively present the innovation
process (Baharun and et. al., 2019). To carry forward this report, OLO is considered which is an
online ordering company situated in New York as company develops the digital ordering and
delivery programs for the cafes and restaurants. The platform of company permit customers to
place restaurant orders from the several organisations. The report leads to cover detailed
discussion about the disruptive innovation theory undertaking the suitable understanding and
effective concept which is related with the benefit and limitations of an organisation. Besides
from this, the theory is applied on the historical and future context of OLO.
MAIN BODY
Disruptive Innovation Theory
Disruptive innovation theory is an effective approach that refers to the simultaneous pursuit
of introducing new products into the market while taking into account their effective and
appropriate presence. One of the primary goals of this type of strategy is to both create and
capture market space. By providing innovative products and services in new markets, the
company can gain a competitive advantage over its competitors (Bauchner and Fontanarosa,
2020). Furthermore, it revolves around locating a location where there are very few enterprises
operating and there is no pricing pressure.
In today’s business world, most businesses work in a highly competitive atmosphere while
also attempting to increase their market share. The fundamental goal of this strategy is to capture
new demand by establishing a visible presence and by introducing items with appealing and
outstanding attributes. This corporation can simply attract more clients to its offerings while also
making significant profits.

In this regard, if OLO employs this strategy, new features and originality will be introduced,
allowing the company to increase market rivalry. This type of activity can also help a company
gain a larger piece of the market from its competitors. This approach primarily focuses on Value
Innovation, Differentiation, and Low Cost, all of which aid in increasing the company's
profitability in the marketplace (Bryson and et. al., 2020). As a result, it is critical for a business
to conduct market research prior to launching new items in a new market so that the company
can discover areas of opportunity. This will help the organisation build a competitive image in
the industry by grabbing more market share.
According to this theory, there are four major concepts that are often employed by people
for the application of theory in business. The following are the steps in the process:
 In today’s corporate world, innovation is both fashionable and a necessary tool for
adapting to changing circumstances and seizing current business chances. As a result,
businesses seek to create successful product innovation in order to meet market demand
and increase profitability (Dziallas and Blind, 2019). For this, the corporation must
disregard the requirements and preferences of clients who are not its target market.
 For this reason, new business entrants tend to focus on start-ups as well as downmarket
socioeconomic groups, taking into account their needs in terms of having an effective
target market to solve major requirements in a more efficient manner than before.
 For this reason, businesses should concentrate on their most profitable customers, while
audiences should disregard newcomers by not viewing them as competitors.
 Following that, entrants tend to make efficient use of the Disruptive innovation theory by
climbing upward in terms of giving superior solutions to additional segments and social
groups while contemplating effective consumer profit.
 The market attracts and tends to make room for new entrants who disrupt incumbents and
become a significant rival for a longer length of time in terms of changing attitudes and
core skills through appropriate innovation and development.
As a result, in this case, the theory is applied for not making a significant effort in terms of
bringing better products and services to a market that is ripe for disruption, and also tends to
redefine the mechanical factor of business by developing effective offerings that are of low value
in comparison to having a market presence, and also offer lower cost products to customers in

low market segments. It also tends to examine four important criteria while examining pertinent
advice for effective innovation, as follows:
Not all innovation is disruption: According to experts, disruption is defined in a variety of
ways, depending on which prominent things are new and successful, and which prominent things
are also prominently addressed as disruption (Eukel and et. al., 2021). Disruptive innovation
theory is used in the business and industry context only when the incumbent organisation focuses
on a certain product and segment and misjudges the needs, preferences, and aspirations of other
social groups. It usually depicts the possibility of being developed for new developers, such as
small businesses and start-ups.
Disruption can be low ended or new market: This theory tends to take two notable
characteristics that are useful to new entrants in terms of entering and creating their presence.
Disruption can be low-end or new market: This theory tends to take two prominent aspects that
are useful to new entrants in terms of entering and making their presence. The first is low-end
disruption, in which businesses tend to enter the market at a lower level and also serve customers
to provide appropriate pleasure to meet their needs (Fitjar, Benneworth and Asheim, 2019). For
this, the lower profit market and effective social groups are discovered, taking into account the
demands that the incumbents overlook, and also tends to show effective concern in order to meet
the effective requirements for effective profit margins. Aside from that, the new market
disruption is one in which businesses tend to maintain their focus on competing against new
consumption for lesser profit towards the social environment. For this reason, the products and
services provided are sufficient in terms of keeping their customers satisfied at reasonable
pricing. Since a result, the disruption types are relatively diverse, as it focuses on providing good
service while also focusing on underserved people.
Instead of products and services, disruption innovation is a process: This approach is
based on developing the appropriate method for efficient execution and also at the entry stage for
a new company in the market, rather than substantial products and services (Goode and et. al.,
2019). For this reason, innovation factors are more concerned with and focused on the most
efficient way to enter and acquire market share in terms of being inventive and unique in
producing new services.
Choose the battles wisely: While new arrivals are not always disruptive, the incumbent
tends to be quite vigilant and keeps an eye on rising firms for various kinds. As a result, the

current business organisation must be extremely complex in terms of comprehending and
influencing new business in terms of entering a new market area, as well as making appropriate
decisions by considering the appropriate impact of disruption and considering the impact to bring
effective opportunities within the market area in terms of offering suitable benefits.
Benefits of Disruptive innovation theory:
 This theory is beneficial to develop the new opportunities regarding the success options
of industry. The industrial development and effective enhancement is influential
undertaking the needs of customers to effectively fulfil their needs (Graham, 2020).
Furthermore, it is beneficial for developing competitors to motivate for the better growth
and opportunity undertaking the critical viewpoint in order to provide services to
customers.
 This theory proves as beneficial while offering long term vision for their new entrants.
Apart from this, it also provides far vision to enable their users to become more
competitive to give competition to the large organisations and also undertake suitable
aspects.
Limitations of Disruptive innovation theory:
 The drawback of this theory is that it need suitable innovative process and also develop
effective strategy. It also undertakes the suitable process which is being developed and
also focus on the suitable issues of social groups that are unanticipated in regard of
leading way towards the success and effective development.
 This theory also concentrates on the suitable ideas and overall development of concerning
products considering the effective level and need of population (Jana and Pal, 2019). It
undertakes the suitable demerit by undertaking the disruptive theory that results as the
suitable profitability for offering suitable practices regarding the new arrivals by which
business owners need suitable amount of resources, motivation and money factor.
Application of the Disruptive Innovation Theory in the historical development context
Company overview:
OLO is the New York based B2B company that leads to develop digital ordering and
delivery programs regarding the restaurants. This platform permits customers to place restaurants
orders from the several origination points, third party market area, social media platforms, home
assistants and many more. The company was founded as GoMobo in 2005 by Noah glass in New

Haven and its initial product was the mobile phone app that permit the user to pre-order through
text message from coffee shops for pick-up.
Vision:
The vision of company is to save time of people and eliminating crowd and long queuing
in order to wait for the long time. Also, after the pandemic of COVID-19, respective company
launch new product for the contact less delivery which is they deliver food through drone as with
the help of this medium company can provide their services without any human contact.
Mission:
The mission of company is to provide convenient services according to their ease with
the help of their new product that is helpful in reducing the spread of virus with the help of their
new product. Also, by providing convenience to customers as per their own needs it becomes
easy for company to achieve success in business environment.
Business canvas model:
Key Partners
 Hotels
 Cafes
 Restaurant
s
 Machine
Suppliers
 Malls
 Multiplex
Key Activities
 Design
 Promotion
 Fast and
convenien
t delivery
Value
Proposition
 Provide
convenien
t services
to their
potential
customers
considerin
g their
comfort-
zone and
ease.
Customer
Relationships
 Provide
fast, clean,
safe and
convenien
t services
to
customers.
 Stop the
Spread of
virus by
providing
contactles
s delivery
considerin
g the
logistics
Customer
Segments
 Families
with kids
 People
who
migrate
 Young
people

and
drivers by
software.
Key Resources
 Customers
 Suppliers
 Volunteer
s
 Managem
ent
Channels
 Cafes and
restaurant
s
 Social
media
Cost Structure
 Cost of buying and renting machines
that include delivery drivers, payment
costs and so on.
 Sales and marketing that continue the
acquisition of new customers and
merchants to network.
 Warehousing and continuous
development of platform.
Revenue Streams
 Commission on every orders: Flat fee
for consumers and 30% commission for
restaurant on order value.
 Subscription model which is $9 per
month and delivery fee is waived per
order.
Historical development of OLO:
OLO is the online ordering and delivery service that permit restaurants to place orders
from their own website with the help of social media platforms, home assistants and many more.
Initially, OLO launch mobile phone app that permit users to pre-order food with the help of text
message from the coffee shops for pick-up. After that company change its name and the new
name is OLO that reflect its change from being a customer facing application to being a B2B
software company used by restaurants in order to manage mobile device orders (Kohli and
Melville, 2019). With the help of suitable vision and mission, OLO can provide convenient, safe
and clean food delivery to their potential customers through drones in regard of promoting

contactless delivery. Presently, company provide concerning products to those who prefer
contactless delivery and promote drone services to eliminate the spread of virus.
By doing this, OLO tends to make suitable initiatives to stop the spread of covid-19 and
disruptive innovation theory that effectively fit undertaking the functioning of the objectives and
overall development of OLO. By undertaking the present condition, it is essential that company
provide contactless delivery to their customers which is beneficial for the whole world from the
spread of deadly virus. Thus, it is useful in order to make people more comfortable during their
surroundings by providing them hygienic and safe food services for their health.
Apart from this, descriptive innovation theory is effectively applied on company by
identifying the needs of individuals that are addressed undertaking the offered products and
services of an organisation (Mittal, Dhiman and Lamba, 2019). Despite from this, OLO tends to
develop their application that provide suitable alert to them in regard of providing suitable
services and safe delivery to their potential customers by focusing over the sustainable marketing
to offer several services along with their application. OLO tends to change the dynamics of
market by entering into the business world with their suitable accessibility without any extra
cost.
Hence, the disruptive innovation theory was established and helpful for the company to
develop their presence in market and also at the global level and organisation tends to acquire
approx. 92 market areas of the world. Currently, OLO is well known as the online delivery
services that provide safe, clean and fast food delivery to their potential customer and their
services are useful in making environment clean and sustainable.
Application of the Disruptive Innovation Theory in the future development context
The disruptive innovation theory is the process that represent various stages to lead
organisation and suitable applicant to reach towards the specific conclusion and also add value to
the particular solution to take entry within the market by developing the suitable presence and
also make the suitable usage of market research to identify and enhance the competition by
undertaking the USP in the particular sector (Scott, 2020). In regard of future growth and
development of innovation, undertaking the offerings of OLO, the company enhance their
working area to offer quality food products and services to their potential customers by
considering additional services like their health factors.

Presently, the contactless delivery is in trend while considering the pandemic situation as
most of the people focus over making environment more effective considering their surroundings
and also take initiatives to stop the spread of virus by spreading awareness about it with the help
of programs and seminars (Noviaristanti, Hanafi and Trihanondo, 2020). For this, people take
initiatives to keep them and others safe by having suitable interest of other eliminate the impact
of virus across the world and prevent the citizens from the deadly virus. OLO leads to identify
the effective need of market condition considering their preferences and demand to explore the
suitable needs of other culture and related factors.
In relation with this, company leads to take several initiatives in regard of stopping the
spread of deadly virus and develop suitable programs for it like contactless payment and
delivery, drone delivery and so on. For this, they also involve number of communities and people
towards their program and sustainable practices to make world free from the situation of
pandemic (Odoom, R. and Mensah, 2019). Apart from that, they also find new ways to promote
their sales, profitability and revenues. OLO also provide premium services to their target
customer base to reduce the cases of COVID-19 and also make environment pollution free after
considering the sustainable practices for their surroundings.
Despite from this, the contactless delivery is beneficial to enhance the awareness about the
virus in the overall environment and also make things concerned undertaking the sustainable
development of the overall condition by considering the global impact and other causes over
health condition of individuals. Also, this theory enable company to expand their portfolio for
the offered facilities by undertaking the various discoveries and significant application and
website whichever is more convenient for their customers.
It further provides opportunity considering the development and growth and also need to
create potential features of the company that are offered by them regarding the general public
and also post their new services by advertising by podcast and magazines. The effective plans
lead to bring useful things for the potential customers of an organisation undertaking the
development of large customer base for the company (Sizova and et. al., 2019). Besides from
this, the descriptive innovation theory tends to enable company to take innovative and creative
power to have proper expansion and also undertake prominent collection of positive reviews
from their customer base. The respective company operate and function undertaking the suitable
guidelines and ethical regulations which are issues by the government.

CONCLUSION
From the above discussion, it has been analysed that innovation and creativity need proper
implication of concerning product which is being offering by an organisation to their potential
customer base and also undertake new trends in the specific sector. The report tends to cover the
suitable basis in order to manage the innovation with the help of disruptive innovation theory
that has been applied to the historical and future thoughts on the basis of extraction of suitable
benefits for it. Besides from this, this theory undertakes the process and identify the effective
ideas related to their strategy for entering into the market and also develop aim to enhance their
overall presence in the competitive business environment. Therefore, this theory open doors for
the innovation and creativity regarding the development and innovation to offer several services
undertaking the growth options and effective expansion.

REFERENCES
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Online
Tap into the potential of on-demand delivery with the control you need. 2021. [Online] Available
through: <https://www.olo.com/solutions/delivery/>./