Impact of Innovation on Ocado Group PLC: Business Report

This report assesses the impact of innovation on Ocado Group PLC, an online grocery solutions and logistics organization. It also analyzes the general environment of the company and provides recommendations for improving decision-making and ethical implications.

Business environment

Table of Contents
INTRODUCTION ..........................................................................................................................3
TASK...............................................................................................................................................3
Assess the impact of innovation on modern business organisations...........................................3
Assess the general environment of the company to identify the major opportunities and
constraints which it is facing.......................................................................................................5
For the chosen company:............................................................................................................6
Ethical implications of decision making in their company ........................................................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Business environment is defined as the collection of different internal as well as external
factors that that are related to business such as employees, supply and demand, government
activities, market trends, economic changes and innovations that have power to influence
business in both positive and negative manner. Business environment consist various
opportunities as well as threats that enable business to attain determined goals and objectives in
efficient manner. Proper understanding of business environment helps organisation to take
effective decisions and develop planning for future. In this report the chosen organisation is
Ocado Group PLC which is online grocery solutions and logistic organisation founded in 2000
by Jonathan Faiman. Headquarter of respective organisation situated in Hatfield, England, UK.
This report covers impacts of innovation in modern business organisation. Pestle analysis
regarding organisation and recommendations to improve business decisions and ethical
implications in business decision-making process is mentioned in this report.
TASK
Assess the impact of innovation on modern business organisations
In current business environment various innovations are adopted by the organisation to
run business in efficient manner and gain sustainable competitive advantages. In impacts
business performance, productivity and profitability. As Ocado is the online retailing
organisation which is one of the most innovative tech company in the world. Respective
organisation brings various innovation through using artificial intelligence and machine learning
in business operations. Organisation adopts end-to-end e-commerce to enhance its reach to
customers (Cristofaro, 2020). Organisation also start using fully automated warehouses that
consist various technologies such as internet, big data, machine learning and various other that
boost performance level of business and provides competitive advantages. Some impacts of
innovation is organisation are mentioned below:
Improves business sales and customer relationship: Innovation is the aspects that plays
important role in enhancing business sales as well as organisational relationship with customers.
Through adopting innovation organisation can improve its products and services that reduce the
risk of losing customers and become more innovative then other competitors. Ocado Group
invest time and money in innovation such as e-commerce that bring organisation more close to

customers and maintains effective relationship through provide quality products and services to
customers. Customers can purchase products from online modes on time with efficiency that
enhances organisational sales and profitability ratio.
Reduce waste and cost: Implementation of innovation is the factor that help businesses to
reduce wastage and overall cost of process which is in the favour of organisation. It helps
business to maintain effective positioning and concentrates on long-term objectives of business.
Ocado Group PLC adopts artificial intelligence and machine learning that enhances overall
operational efficiency of organisation. Innovations facilitates business to eliminates the
bottlenecks, enhance effectiveness of working process as well as reduce employees and
machinery idle time that reduces overall cost of production process (Bai Cordeiro and Sarkis,
2020). As implementing innovation , facilitates business to reduce waste that helps business to
complete business operations with lower cost, enhance profitability margin, enhance
competitiveness and improve organisational customer services.
Maintains effective market positing: Through adopting innovations in business
operations, organisation can quickly anticipate changes in market and get competitive advantages
by becoming first mover. It helps organisation to differentiate business practices and products
from other competitors that enhance organisational customer base and market share. Ocado
Group PLC analyse market trends, needs and demands of customers and activities of competitors
than take decisions regarding bringing innovation in organisation that help to attain determined
objectives. As current business environment, the trend of online shopping is enhances so, Ocado
Group PLC adopts e-commerce to provide its products and services to customers through online
mode that help business to enhance the ratio of sales and profitability.
Improve employees relations: Innovation at workplace stimulating for employees.
Organisation provides regular training to employees regarding adopting changes and perform in
efficient manner. Ocado Group PLC implements various innovations such as adopting artificial
intelligence and machine learning as well as provide training to employees regarding these
changes that reduces employees turnover rate and boost productivity (Chawinga and Chipeta,
2017). As organisational employees provides various ideas of innovation that lead business
towards success. Respective organisation understand employee point of view and take regular
feedback regarding innovation that improves their morale and retain them with organisation for
longer period of time.

Help in business growth and gain competitive advantages: As Ocado Group PLC being
various innovations in business working procedure through using artificial intelligence and
machine learning aspects that enable business to attain success as well as gain sustainable
competitive advantages. Respective organisation communicate all innovations and information
regarding changes at all level of organisation that help business to achieve higher work
performance and productivity of organisation.
In current business environment, it is important for every organisation to implement
innovation in organisation and working performance that facilitates business attain determined
objectives in efficient manner.
Assess the general environment of the company to identify the major opportunities and
constraints which it is facing
PESTEL analysis can be defined as a framework in which the company can make an analysis on
the macro environment factors which can make an impact on the business operations. Ocado
Group plc is a online grocery provider and also helps in delivering the technology to the other
grocery retailers in order to provide the best experience to the customers. There are different
factors which impacts the business providing them the opportunities and on the other side
constraining them to achieve the objectives.
 Economic factors- Economic factors are usually related with the production of goods
and services which is providing the business with good amount of profits. Ocado Group
plc as works in relation with providing the groceries products to the consumers through
online channels in which they might get affected with the changes in the economic
position of the country(Abdulaali, 2018). If the country is facing the situation of
recession then it can create constraints for the company to achieve higher revenue
because people will be making investment on those things which will be useful to them.
On the other side, the country which is good economically then the company will be
gaining more profits. The other factor will be the income of consumer in which if the
incomes of people will be increased then at this stage the purchasing power in the hands
of consumers will be increased which will be useful for Ocado Group plc.
 Technological factors- Ocado group plc is related with usage of technology because
with the beginning of the business the company developed the idea of providing the
products to consumers through online channels(Chernopyatov and et. al., 2018). Using

the right technology at the right time is very important because it helps the business to be
competitive in nature and also the existence of company for longer time in the market
also increases. Technology will provide the business the opportunity to grow because it
also makes an impact on the cost structure of a business. The main aim of Ocado Group
plc is to use the technology and automation to make the transformation in the online
grocery market in which the company have now become the most advanced business in
e-commerce and in the logistics business. But the major constraint is that it is very
expensive and the company also have to fulfil the regulations which at time becomes
problematic.
 Socio-cultural factors- Socio cultural factors are related with cultural norms, population
growth or the health and safety factors which helps the companies in making betterment
in their plans by using different strategy(Perkin and Abraham, 2021). Ocado Group plc
have made an analysis of the needs and betterment of the consumers because of which
they have come up with the idea of providing the grocery products to the consumers
online. This provides the facility to consumers to make the order from any place from
where they want to so that the issue of coming to the grocery store can be reduced. With
this the development of technology is also the another factor which is useful for the
consumers because with it the company wants to make the delivery of technology to the
other grocery retailers so that they can enable the consumers to make the benefit of it.
Ocado group plc is providing all the facility to the consumers so that they can get the best
experience in their purchases(Harrington and et. al., 2019).
For the chosen company:
Two recommendations on how the company can make improvement in decision making
 While making decisions in the company with the better strategy it is very important that
the management is making the recognition that on which topic the decision needs to be
made. Sometimes, it happens that with the formation of any decisions the management
does not gets the exact point that in which thing they want to make their decisions
(Seclen and Barrutia, 2018). In case of Ocado Group plc, it has always tried to make the
decision in only one direction which will be beneficial for the company and on the other
hand will also provide the benefits to the consumers in getting the products at a very
feasible manner.

 It is also important that the management of the company is also making an analysis on the
alternatives which they have kept before making the final decisions. Alternatives are
selected on the basis of making full analysis the situation so that perfect decisions can be
made which will be helpful for the company in the achievement of goals(Krueger and et.
al., 2021). Ocado Group plc should also make the full evaluation on the alternatives
which are available so that the chances of getting greater results can be measured with the
marked standards.
Ethical implications of decision making in their company
There are various ethical aspects that are considered by the Ocado Group PLC to take
decisions regarding business operations, process as well as innovations that are adopted by the
organisation. Ethics in decision-making is defined as the process in which business take
decisions through considering various code of conducts (Cravo and Piza, 2019). Respective
organisation take professional guideline and organisational policies as well as rule out any
unethical solutions of problems. Ocado Group PLC implements PLUS model to perform
business operations in ethical manner. Aspects of PLUS are stand for different meaning that are
mentioned below:
P: P stands for policies and procedure, all the decisions that are take by Ocado Group
PLC are aligned with business policies.
L: L stands for legal considerations, means all decisions that are taken by the
organisation are based on laws and regulations that facilitates business.
U: U stands for universal, means Ocado Group PLC take decisions with core values and
business culture. Organisation take decisions of ethical bases.
S: S stands for self that means that Ocado Group PLC to meet standards of fairness and
honesty.
All these ethical considerations that are followed by the organisation to take effective
decisions for organisation that lead business towards success and help to gain competitive
advantages.

CONCLUSION
From the above report it can be concluded that business environment is dynamic in nature
which affects the performance of a business in a larger way. It depends on the company that what
measures they are taking to reduce the impact of such factors in the business. The innovation can
play a major role in it where the company have to develop new ideas and products which will be
helpful for them in gaining competitive advantage in the market. Innovation in the present time
have become so crucial that without this it would be difficult for the business to exist in the
market for longer term. The external and internal environment are the two factors which can
affect the business so it is important for the company to make an analysis of such type of factors
so that it would be easier for them to achieve the objectives.

REFERENCES
Books and Journals
Abdulaali, A.R., 2018. The impact of intellectual capital on business organization. Academy of
Accounting and Financial Studies Journal, 22(6), pp.1-16.
Bai, C.A., Cordeiro, J. and Sarkis, J., 2020. Blockchain technology: Business, strategy, the
environment, and sustainability. Bus. Strategy Environ, 29(1), pp.321-322.
Chawinga, W.D. and Chipeta, G.T., 2017. A synergy of knowledge management and competitive
intelligence: A key for competitive advantage in small and medium business
enterprises. Business Information Review, 34(1), pp.25-36.
Chernopyatov, A. and et. al., 2018. Entrepreneurship development and business activity in the
Russian Federation. Journal of Entrepreneurship Education, 21(4), pp.1-12.
Cravo, T.A. and Piza, C., 2019. The impact of business-support services on firm performance: A
meta-analysis. Small Business Economics, 53(3), pp.753-770.
Cristofaro, M., 2020. E-business evolution: an analysis of mobile applications’ business models.
Technology Analysis & Strategic Management, 32(1), pp.88-103.
Harrington, R.J. and et. al., 2019. From goods-service logic to a memory-dominant logic:
Business logic evolution and application in hospitality. International Journal of
Hospitality Management, 76, pp.252-260.
Krueger, N. and et. al., 2021. Advancing family business science through context theorizing: The
case of the Arab world. Journal of Family Business Strategy, 12(1), p.100377.
Perkin, N. and Abraham, P., 2021. Building the agile business through digital transformation.
Kogan Page Publishers.
Seclen, J.P. and Barrutia, J., 2018. KIBS and innovation in machine tool manufacturers.
Evidence from the Basque Country. International Journal of Business Environment,
10(2), pp.112-131.