Understanding Innovation and its Types

This assignment delves into the crucial concepts of invention and innovation, distinguishing between them and examining different types of innovation. It explores the significance of innovation in driving progress and economic development, referencing scholarly works on systems of innovation, open innovation, and the role of venture capital in commercialization.

INNOVATION

Table of Contents
Introduction...........................................................................................................................................3
Task 1.....................................................................................................................................................3
P1 Innovation and Invention ............................................................................................................3
P2 Organization Mission, Vision leadership and culture ..................................................................4
Task 2.....................................................................................................................................................5
P3 4P’s of innovation........................................................................................................................5
P4 Developments in frugal innovation with examples......................................................................6
Task 3.....................................................................................................................................................7
P5 Commercial funnel's importance and product development process.........................................7
P6......................................................................................................................................................8
P7 Tools used for retaining, developing and protecting intellectual property..................................9
Conclusion ..........................................................................................................................................10
REFERENCES ........................................................................................................................................11

Introduction
Innovation plays a significant role in the success for every business organization in
the long run. Innovation related to the advancement of new product and use creative ideas to
convert in to reality and gain competitive advantage. It is long way approach where a
company try to identity customer need develop such need and make appropriate product and
services to them. The present report based on 4Com which is a small business organization
listed in the United Kingdom. There are two case discussed related to Apple and Virgin
Group based on innovation and technology (Drucker, 2014). The main aim of this report is to
use creative idea transform in to a business by using various approaches, so that they can
attain their long term goals and objectives in an effective manner.
Task 1
P1 Innovation and Invention
Innovation is related with the creating new idea and developed such idea in to a
product and services which satisfy customer needs. On the other hand, invention is refers to
the discovering new things through knowledge and skills. In the context of 4Com
communication to develop their product and launch in the market in an effective manner. It is
a systematic process which needs large number of investment and expertise for development.
Difference between innovation and invention
Innovation Invention
In this approach discovering new idea very
first time which has never been made
before.
Innovation refers to develop and implement
idea for product and also improve existing
product or services.
Improve product and services which
already exist in the market.
Create a new product or services very first
time.
It required various skills like marketing,
technical and management skills.
It needs scientific knowledge and expertise.
It needs limited research and development. On the other hand, invention needs more
research and development.
Importance of innovation
Create differentiate product: Innovation helps to develop creative and advanced
product which is too essential in the competitive market (Teece, 2010). For example, 4Com
can introduce such mobile phones which unique in design and technology. It helps to attract

customer and increase their sales of the company which helps to develop competitive
advantage as compare to rival corporation.
Increase customer expectation: It is another significance which helps to increase
customer expectation. For example, Apple is produce advanced IPhone which increase
customer satisfaction due to high product quality. Therefore, smart phone user waiting every
year for new product launch of Apple.
Long term success: Innovation need large investment for research and development
so that they can develop advanced and superior product as compare to its rival companies
(Manyika, and et. al., 2011). They having one step ahead in the market n research field which
provide long term success for their business in the future.
P2 Organization Mission, Vision leadership and culture
The mission and vision plays a significant role in the long term success for their
business. it provides a long term direction to its business. The mission statement of 4Com is
to provide advanced products to its customer and increase their market share in an effective
manner.
Mission statement: A business entity mission statement is related with the
stakeholder’s interest, ethical consideration of their business and long term target for its
business. each company is having own mission on the basis their operations. According to the
Apple case study the mission statement” man is the creator of change in this world. As such,
he should be above systems and structure, and not subordinates to them. In the context of
4Com their mission statement is to provide customer value in order to providing high quality
products and services.
Vision statement: It is related with the belief of a group of people where the
emotional invested. Each and every company is having their own values which helps in
attaining organizational goals and objectives (Tebbe, 2011). As per the Apple case study the
vision statement of the company is to producing those products which not changing over a
period of time by improving technology. They also focused on innovation which helps to
attract customer.com which is quite small as compare to apple needs to develop innovative
product and enhanced customer value.
Role of leadership: Leadership plays a significant role in success for every business
organization. It provides a right direction to their company which is too essential. It also

makes their business profitable and motivate subordinates in contributing organizational
goals. There are following role of a leader in the context of Apple case study:
Influence the behaviour of others: This is key role where a manager tries to
influence their subordinates. He brings their staff and pull them in for specific task in an
effective manner. They having ability to influenced their employees which is too essential for
a company and enhanced its loyalty towards business organization. 4Com needs to develop
such leadership skills in their staff which impact on others.
Introduce new change: Business environment change rapidly which needs to modify
its strategies (Gassmann, and et. al., 2010). Such changes sometimes not acceptable for
employees and they oppose these changes. Therefore, it is the responsibility of the leadership
to manage such changes within the organization in an effective manner.
Helps in solving conflict: There are various issues within corporation between
employer and employees. It is essential for them to solve these issue so that an entity attain its
target. This is the role of leadership to sole such conflict which enhances employee’s
satisfaction level.
Motivate subordinates: A motivated employees contribute in the business by
working with productivity. 4Com needs to motivate their staff by using appropriate tools and
methods in an effective manner.
Task 2
P3 4P’s of innovation
Innovation is a continuous process which required large amount of capital and
research. Every business organization is try to improve their products according to the
customers needs and make an attractive product in terms of design, quality, technology and
so on (Crossan, and Apaydin, 2010). There are following 4P’s of innovation given below:
Product: This is one of the major element of innovation which is related with the
product and its uniqueness. In the context of Apple, which provide a large number of product
such as IPhone, IPod, MacBook’s etc. The best thing in product is the design and technology
which provide competitive advantage as compare to rival companies. For example, IPod
shuffle which is a music product provide highest level of satisfaction for their target market.
The idea generated to produce such product only in which music can be there and it was an
idea and that is being converted into product is a innovation funnel. Apple is such company

who mainly focus in generating ideas and convert them into reality. Therefore, 4Com can
focused on innovation and research and development which provide advanced products
which never change.
Process: It is another element of innovation which is related with the overall system
of the company in order to producing a product (Lee, and et. al 2010). Each firm is having its
own manufacturing process for producing products and services. According to the case study
of Apple, there are large number of suppliers of company who provide components for their
goods. The major task of the corporation is to assemble these goods and make a final product.
For example, Foxconn provide IPhone camera and other hardware. It helps to Apple to
focused on other aspects to achieving organizational goals in an effective manner. Iphone
camera is somewhere the best in quality and it was their idea to choose that specification in
mobile which can attract many other customer as well. They converted this into reality and
Iphone is that which is still a dream to buy for many people. 4Com can use such strategy
which provide long term success in an effective manner.
Position: In this approach a company is try to identify their targeted customer and
offer its product in an effective manner. there is various positioning strategy can be used by
then for their innovative products and services. In the context of Apple which having a wide
variety of goods it includes IPhone, IPod, macOS, IPad, MacBook etc. each product having a
particular target market. For example, IPod shuffle is designed for teenager’s target market
and focused on MP3 players. Iphone do bring innovative ideas in their product and services
they try to bring in minds of customer about their innovation and ideas through phone and
other things. 4Com can designed their products approach these customers in an effective
manner.
Paradigm: It is related with additional facility of the products and services, therefore
every company try to provide something extra to their customer. it helps to increase customer
satisfaction level and loyalty which enhanced competitive position in the market. Apple
provides various products with after sale services which is too essential (Melville, 2010).
Apart from that, these products can be upgraded over a period of time which increase its
maturity level and product life cycle as compare to competitors in the market. As, if the
product is being advertised or met to provide extra benefit to it in rural areas any of them
could by their product. Iphone is making advertisement and targeting people of urban areas

that why they are able to earn higher profits. It is required by company to make right
selection and paradigm as well.
P4 Developments in frugal innovation with examples
Frugal innovation is a systematic process of improving product which provide value
to their customers. This process helps to reduce cost and time and reducing the complexity of
its products. In this approach a company make their goods and services in a limited resource
which is affordable for an individual customer. According to the high authority’s data there
are large number of companies who invest more than 600 billion in its research and
development and innovation process. 4Com needs to concentrate R&D and developed
appropriate products for the market.
Increase additional features in existing product: It is essential for a business to
focused on continuous improvement in their existing product range. According to the given
case study Apple is focused on improve their product over a period of time and developed
advanced products to their customers. For example, IPhone which is one of the most selling
product of Apple provide additional features over a period of time which enhanced customer
loyalty and increase profitability (Leiponen, and Helfat, 2010). Therefore, 4Com needs to
provide some extra features in their existing product line. It provides long term growth and
development to their business which is the core objectives of a business organization.
Reduce the cost of production: Cost is one of the major concern for a company and
they try to overcome these such cost. The key aim of frugal innovation is to overcome cost of
production by using creative tools and methods. For example, Apple is one of the profitable
corporation around the world where main focused is to cut unwanted cost and increase
revenue. In this context, they having production facility in other countries like India and
China where cost of operation is very low. Apart from that, there are also various cost saving
methods like economies of scale which minimise cost of operational and increase profit
margin.
Expansion of product line: If a company is having wide product range it provide
competitiveness in the market. for example, Apple is having a verity of products such as
smart phones, MP3 players, MP4 plyers, IPads, Notebook etc. All these products are high
quality and technologically advanced. 4Com required that increase their product range for
ever customer segment.
On the basis of other frugal innovation process 4Com can meet its long term objectives.

Task 3
P5 Commercial funnel's importance and product development process
Selling a new product is related with the commercial funnel. 4Com produces
electronic gadgets to its customer at the affordable price(Johnstone, and et. al., 2010). Apart
from that they also provide additional services like internet connection, software for mobile
and laptops and so on.
For a company new product development is significant for the consistent growth in
the market. therefore, every corporation is try to launch a new product before saturation of
existing product. It is long way process which meet time and money and supported by
marketing plan. There are following NPD stage for 4Com:
Idea generation: The development of a new product starts with concept and idea. For
this a business unit try to identify customer needs and develop a creative idea for satisfying
customer needs. 4Com required to use innovative idea from various stakeholders such as
employees, customers, suppliers etc.
Idea screening: This is another step where a company select appropriate idea. There
are various approaches can be used by the marketing manager (Lam, 2011). The criteria for
idea screening can be return on investment, affordability, market demand etc.
Concept development: In this stage the production department make a prototype for
their new products which is too essential for the company.
Business analyses: Once product concept has to be done the next stage is related with
the profitability of the market. It includes design appropriate marketing strategy, develop
target market and so on. The top management of 4Com needs to examine demand of their
new product and its profitability.
Product development: Once product is approved by the higher authorities, now it will
send for technical and marketing development. they need to start initial limited production of
their proposed product. They also need to identity and add few additional features as per the
customer demand and technical specification.
Test marketing: It is most critical stage which is related with the testing their new
product in to selected target market.

Commercialization: Once product has been approved for new product needs for the
commercialization or mass production (Samila, and Sorenson, 2010). The role of marketing
department is critical at this stage where they need to set price of their products which must
be affordable for the potential customers.
Launch: This is the final stage of new product development where 4Com launch its
product first time in the market. The role of marketing and promotional and marketing
strategy is too critical where they spend large amount and create awareness of their products.
Innovation funnel refers to the development of product by taking an idea from
concept of reality and converting this idea in order to make specific product which helps in
meeting needs of market in economical and manufacture form. Every company has some
innovative ideas which they need to undertake and transform in such a way that will help in
enhancing the features of product. The average success rate of this transforming ideas to
make specific product is less therefore the company should hesitate to convert their ideas as
there is high chance s of wastage of amount of investment and time that they contribute
towards modifying their product. They should need to analyse the behaviour and needs and
demand of the customers and therefore need to enhance the product so as to provide
maximum satisfaction to their customers. While implementing ideas the company should
faces many hurdles in process of manufacturing new product therefore there is less chance for
company to adopt their ideas in order to enhance the features of existing product.
P6
Cited company started in year 1999, they wanted to improve SME market
communication services across UK. Business phone is one of the most popular item made by
cited organisation. Its make significant contribution in their revenue. Following are steps of
innovation business case:
Executive summary – Their main market is telecommunication industry, they make
and launch new products and service by applying innovative techniques. Organisations who
do innovation in regular interval of time get public attraction which help them in getting good
reputation in market.
Target – Business phone is product which can not be used in every house. Their main
target is corporate client who can take maximum benefit of this item (Balachandra, and et. al.,
2010). They also aim at general public because they also provide services like installation of
broadband connection, application development, etc.

Solution – Some time companies make products whose feature are so difficult that a
laymen fail to understand them. Cited company should make ''easy to operate'' goods so
people can get maximum out of it. Items should focus on fulfil the needs of customers.
Why product is innovative – Consumer pay extra amount when they get some
special features in a product. 4Com recently launch HiHi, this business person can make
video call from this phone. They are ready to pay more money for this facility.
Customer research – Cited company need to identify demands of potential clients
because it will assist them in innovating future products. They should target big companies
because their can give orders in bulk which will play crucial role in increasing their revenue.
Technology is a field in which changes happen on continuous basis (Mu, and Di Benedetto,
2011). They should do research in short period of time so they can make necessary changes
in their items.
Funding and expected benefit – They should gather funds for expansion like for
product development. They can take loan or acquire funds from angel investors. By using
past information and data they can determine expected benefit.
Task 4
P7 Tools used for retaining, developing and protecting intellectual property
Intellectual property right is helps to provide right to an individual for its creative
idea, plan, design and other aspects. It will help to provide financial advantage due to its
uniqueness and innovation. There are following types of intangible asset are given below:
Trademark: It is related with the sign and symbol used by a company, person or
other corporation which differentiate its product and services among others. It is a brand
which shows that company image in the market.
Patent: It is group of exclusive right for an inventor for its innovation. Patents are
issue for a legal authority which is depends on the laws for a particular country (Tebbe,
2011). for such right an individual required that to claim for their invention and meets various
criteria for patent.
Copyright: It is also an exclusive right for creative work in different fields such as
books, music, art, file, photograph and so on. 4Com required that to use these right for their
creativity which provide long term profitability in the long run.
Trade secrets: It is another protection for creative idea for the improvement of future
innovation.
Design right: There are various shapes, design which developed by an individual.
These design are unique or with specific features. It can be related with specific

This is responsibility 4Com to use these right in order to protect their exclusive right for its
innovation and technology. So that they can protect the misuse of these assets among fake
people (Edquist, 2010). Because it provides competitive advantage in the market over its
rival companies. In the context of UK, which having various laws and legislation regarding
IPR should be followed by each and every company.
Conclusion
From the above mentioned given study it can be summarised that innovation is of
vital importance to the given organisation. It helps management in development and using the
giving technology in more effective manner as through the process adopting change output
can be raised. Designing of change varies with the mission culture and objective of the cited
organisation and it is given in the above report that how elements of marketing mix can be
applied in the surrounding of business. User can enhance his knowledge about the concept of
funnel which helps in evaluating the various options and assist management to choose the
best suitable alternative. Lastly, the text concluded with how product development is made
possible by using different strategies and frugal concept, products of which are less expensive
and gives more utility to the consumers.

REFERENCES
Books and Journals
Drucker, P., 2014. Innovation and entrepreneurship. Routledge.
Teece, D.J., 2010. Business models, business strategy and innovation. Long range planning.
43(2). pp.172-194.
Manyika, J., and et.al., 2011. Big data: The next frontier for innovation, competition, and
productivity.
Edquist, C., 2010. Systems of innovation perspectives and challenges. African Journal of
Science, Technology, Innovation and Development, 2(3). pp.14-45.
Tebbe, J., 2011. Where good ideas come from: The natural history of innovation.
Gassmann, O., Enkel, E. and Chesbrough, H., 2010. The future of open innovation. R&d
Management. 40(3). pp.213-221.
Crossan, M.M. and Apaydin, M., 2010. A multi‐dimensional framework of organizational
innovation: A systematic review of the literature. Journal of management studies.
47(6). pp.1154-1191.
Lee, S., Park, G., Yoon, B. and Park, J., 2010. Open innovation in SMEs—An intermediated
network model. Research policy. 39(2). pp.290-300.
Melville, N.P., 2010. Information systems innovation for environmental sustainability. MIS
quarterly. 34(1). pp.1-21.
Leiponen, A. and Helfat, C.E., 2010. Innovation objectives, knowledge sources, and the
benefits of breadth. Strategic Management Journal. 31(2). pp.224-236.
Johnstone, N., Haščič, I. and Popp, D., 2010. Renewable energy policies and technological
innovation: evidence based on patent counts. Environmental and resource
economics. 45(1), pp.133-155.
Lam, A., 2011. What motivates academic scientists to engage in research
commercialization:‘Gold’,‘ribbon’or ‘puzzle’?. Research policy. 40(10). pp.1354-
1368.
Samila, S. and Sorenson, O., 2010. Venture capital as a catalyst to commercialization.
Research Policy. 39(10). pp.1348-1360.
Balachandra, P., Nathan, H.S.K. and Reddy, B.S., 2010. Commercialization of sustainable
energy technologies. Renewable Energy. 35(8). pp.1842-1851.
Mu, J. and Di Benedetto, C.A., 2011. Strategic orientations and new product
commercialization: mediator, moderator, and interplay. R&D Management. 41(4).
pp.337-359.
Online
Difference Between Invention and Innovation. 2016. [online]. Available
through:<http://keydifferences.com/difference-between-invention-and-
innovation.html>. [Accessed on 14th July 2017].