Innovation and Business Strategy

This assignment delves into the realm of innovation and its impact on business strategy. It examines various aspects of innovation, including intellectual property, lean innovation, and commercialization processes. Case studies of Backbone Connect and Virgin Group illustrate how these concepts are applied in real-world scenarios, highlighting successful strategies and potential challenges.

UNIT 8
INNOVATION AND COMMERCIALISATION
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Table of Contents
Introduction................................................................................................................................3
Task 1.........................................................................................................................................4
LO1: Explaining the context for innovation and determining the difference between invention
and innovation:...........................................................................................................................4
P1: Explain innovation and its importance to employees of Backbone Connect, with
examples from the given case study in comparison with invention:.........................................4
P2: Explain to employees of Backbone connect how organisational vision, leadership, culture
and teamwork can shape innovation and commercialisation, with supporting references from
the given case study:..................................................................................................................5
Task 2.........................................................................................................................................6
LO2: Explain the different types of innovation to employees of Backbone Connect:..............6
P3: Explaining the 4Ps of innovation funnel to examine and shaping innovative ideas to
employees of Backbone Connect:..............................................................................................6
P4: Explaining how Backbone Connect can develop frugal innovation....................................7
Task 3.........................................................................................................................................8
LO3: Discussing the process required to commercialise innovation in Backbone Connect in
market with practical examples:.................................................................................................8
P5: Explaining the importance of the commercial funnel and the application of New Product
Development (NPD) processing for commercialisation to employees of Backbone Connect:. 8
P6. Building an Innovation Business Case including ways to access funding:.........................9
Task 4:......................................................................................................................................10
LO 4: Evaluating the range of methods for protecting ideas and understanding their
advantages and disadvantages..................................................................................................10
P7 Evaluating the different tools that Backbone Connect Company can use to develop, retain
and protect knowledge and intellectual property with practical examples where necessary...10
Conclusion................................................................................................................................11
Reference List:.........................................................................................................................12
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Introduction
The innovation and commercialisation is for those organisations who intend to bring
innovations to their company. Innovation is often misunderstood as invention but there is lot
of difference between the two. Invention is defined as the creation of a product or a process
for the first time while innovation is related to improving an existing product or process. The
innovations may include technological, engineering, design and scientific components and
can arise from identifying and researching the problems related to the organisations that need
to be solved. In today’s competitive market, different organisations are very critical in
innovating their processes and products in order to remain competitive in the market.
In this scenario, the learner is appointed as the CEO of a small organisation (SME)
naming Backbone Connect Company and responsible to embed commercialisation and
innovation in this company culture within next 9-12 months in order to the benefit of
Backbone Connect Company. For this, the learner will undertake several methods like
explaining the context for innovation and determining the difference between invention and
innovation, elaborating the different types of innovations, discussing the process required to
commercialise innovation, and evaluating the range of methods for protecting ideas and also
understanding their advantages and disadvantages.
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Task 1
LO1: Explaining the context for innovation and determining the difference between
invention and innovation:
P1: Explain innovation and its importance to employees of Backbone Connect, with
examples from the given case study in comparison with invention:
Annacchino (2007, p.554), opined that, innovation is breaking away from old ideas and
conventions and converting ideas into execution, which results in beautiful products that can
change a particular way of thinking. The needs of innovation arise from the increasing
demand of customers who become bored with old products or conventional concepts.
Therefore, innovation always aims at the mental satisfaction of the customers though it will
be not unwise to comment that most of the innovations were the brainchild of world-changing
thoughts, which has nothing to do with consumer satisfaction. The companies simply wanted
to make the world a better place to live and for that, they invented products, which will cater
the productive needs of the consumers. So, it is clear that an innovation always has a
particular purpose and that purpose is often giving the world an easier and better way to live.
Another point should be made here that innovation could often be something that was not
totally unknown to the community. The very concept of the invented product may exist. In
the words of Bicen and Johnson (2015, p.280), innovation tries to simplify the concept by
giving it a revolutionary touch. The upside down change in the aspect of the particular
product requires a great amount of imaginative power from the creator, who may be a person
or a company but the creator should have that vision to look into the future and should clearly
understand people’s demand.
Backbone Connect is a Tech-based SME, based in UK, which was founded in 2008.
The company provides internet access, wide area networks, and colocation services to the
business farms of UK. It is also one of the fastest growing data centre partner farm in central
London. The company operates through a number of Tier III data centres in the United
Kingdom, which includes Level 3 data centres in Central London. It also operates through
Global Switch 1 and 2. As there are a large number of tech-based SMEs that are speeding up
their business in London, our company should not cease its creative and innovative ideas
because that will help the company to keep its business alive in the market and will help the
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company to sustain. The company should take clue from the business of Apple Inc and Virgin
Group to understand how a company can achieve premium customer base only through
innovation and their skilful commercialisation in the consumer funnel.
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P2: Explain to employees of Backbone connect how organisational vision, leadership,
culture and teamwork can shape innovation and commercialisation, with supporting
references from the given case study:
Morgesonet al. (2012, p.40) stressed that, organisational vision, leadership, teamwork
and culture are the four key elements, which shapes the path of an innovation. Vision is the
most important factor among the four. The company’s vision to look into the future demands
or the company’s vision to set the future for the customers is the key element in the making
of a new product. A vision to change the world, a vision to make better, user friendly and
productive goods is the driving force behind any innovation. An enthusiastic and legendary
leader who can motivate his employees to touch the future should lead the idea or the vision.
Then comes the part of team role and work management. An efficient team can transform the
vision into reality by their hard work and passion to do something new. In Belbin’s theory, an
ideal team should distribute the work among the team members and should consists of nine
types of employees, namely, resource investigator, team-worker, coordinator, plant, evaluator
or monitor, specialist, implementer, shaper and finisher. Each of them is skilled in different
aspects of a task and their collaboration can make the product outcome swifter.
An example of visionary leadership, teamwork and management can be found in
Apple’s revolutionary digital music player iPod. iPod was launched under Apple’s line up of
personal digital products. Back in 2001, when iPod was launched, personal digital products
market was crowded with digital cameras, camcorders and PDAs or pagers. Portable music
player was not a very popular item back then. Apple CEO Steve Jobs had a vision that the
clunky and useless portable music players should be replaced with portable music players,
which would be lightweight, full of functionality and should have a large storage capacity.
Thus, iPod was born from this vision and within a decade, it changed the way people listen to
music on the go. Steve Jobs was a perfectionist and he rejected a number of prototypes of
iPod but his team never gave up and ultimately came out with the world’s smallest but most
powerful music player. Pellikka and Pellikka (2012, p.229) noticed that, the visionary idea, a
legendary leader and an unwavering team spirit made the world’s highest selling portable
music player.
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Task 2
LO2: Explain the different types of innovation to employees of Backbone Connect:
P3: Explaining the 4Ps of innovation funnel to examine and shaping innovative ideas to
employees of Backbone Connect:
An innovation funnel like any other funnel narrows down the inputs to make the final
output. An innovation starts with a large set of ideas and eventually the ideas are cut short to
make the final product. This is like a funnel, which narrows down the ideas into a trimmed
down concrete concept. There are 4 Ps in an innovation funnel paradigm, position, process
and product. Sohmen (2013, p.11) noticed that, the first process is paradigm or paradigm
shift. In this process, the company thinks of something that can change the idea of a pre
existing product into something new and innovative. The idea should be out of the box and
fresh. The idea can contain conventional values but will never stick to the conventional
principles. A paradigm shift of thought and ideas happen in this stage. The next level is the
positioning of the product, which helps the company to determine the position of the product
in the current range of products the company offers. For example, iTunes was introduced to
let the people listen to their favourite music without downloading the actual file. This was
positioned in the Apple’s web based services like iCloud and Apple Pay. Once the company
sets the position of the product, it tries to turn the idea into reality by entering in the process
stage.
In the words of Morgeson et al. (2012, p.40), the process stage is the most important
in the funnel and it does the main function of narrowing down of the ideas. In this regard,
Backbone Connect can take a clue from Virgin group that how the process of innovation
should be done. Virgin takes the innovative ideas and narrows down them into a number of
categories. Among the categories if not anything goes with the current process of an existing
company then the proposal is sent to the corporate development department for a detailed
review. The corporate development wing analyse the idea very carefully and gives the green
signal if the idea is fully compatible with the company’s business strategies. Then the idea is
executed into action. Virgin also experiments with the taken idea so that the idea can be
proven more productive in a long run.
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[Refer to Appendix 1]
The process of product development ultimately leads to the making of a product or execution
of an idea. The final product or action is very different from the resources gathered because
during the process of funnelling every unnecessary idea and function is trimmed down.
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P4: Explaining how Backbone Connect can develop frugal innovation:
As opined by Urbancová (2013, p.50), frugal innovation is very important for a
company because through frugal innovation or frugal engineering a company aims at
decreasing the amount of complexities in a product development process. It means
simplifying the process of making a product. Complexity indicates the number of steps in the
product development and how complex each step is to perform to get the desired result. A
company can save a large amount of wages if it follows the method of frugal innovation. The
less amount of complexity in product development means the consumed time will also
decrease and that will result in a faster product making and delivery.
Backbone Connect is a tech SME that provides connectivity solutions to its clients.
Connectivity is the most important factor today in growing a business. They manage their
networks for business and public sector organisations. According to Cornish et al. (2013,
p.58), as the company works on managing business networks and communication, they
should try to invent such a common platform trough which they can connect all the clients.
Another method for frugal innovation should be introducing an Android App and a windows
phone, which can be accessed from any device. The company has an iPhone App already but
keeping in mind the large percentage of Smartphone market which android has grabbed, an
android app will be much useful to get in touch with the farm 24x7. The company should try
to develop such a technique, which will encompass all the data centre techniques (Tier III,
Level 3, Global switch 1 and 2) into one. This step will make the company to perform in a
hassle free way.
There are six principle of frugal innovation that would be applied in the organisation:
Find opportunity in adversity: The organisation should reframe the issues that are occurring.
With this analyse the threats and try to convert them into opportunity.
Do more with less: The organisation should make best possible use of the available
information and data and resources to find best solution.
Think and act flexibly: Use the way of improvisation instead of rigidity
Keep it simple: even if the problem is complex make it easy instead of finding various
alternatives
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Include the margin: Take the feedbacks from the customer and tell them to participate in
problem solving approach
Follow your heart: At the end, be innovative and courageous to use the idea that is put
forward.
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Task 3
LO3: Discussing the process required to commercialise innovation in Backbone
Connect in market with practical examples:
P5: Explaining the importance of the commercial funnel and the application of New
Product Development (NPD) processing for commercialisation to employees of
Backbone Connect:
Zakic et al. (2012, p.20) opined that, a commercial funnel is a special type of
marketing technique which is customer oriented. The commercial funnel is designed from the
viewpoint of the customers. The theory of commercial funnel tries to explain the theory of
customer behaviour and their purchase patterns. The commercial funnel is a critical process,
which involve a number of steps. The very first step is the launch of a new product in the
market by a company. The goal of the company is to market the product in such a way,
whichcan attract the prospective customers. Once the customer is attracted to the product, he
or she feels interested in purchasing the product. The next step is the purchase of the product
by the customer. The purchased product must please the customer with the quality because
that will lead to another purchase by the customer. Therefore, it is very important to market a
product in such a way, which can attract the customers to make a purchase. In the context of
Backbone Connect, which provides the networking and data platform solutions, the company
should come up with a common platform for all its services and should try to bring the data
centres in one place so they can operate their entire business more efficiently.
Another innovative technique can help the company to attract its customers. The
company can upgrade its servers to better ones because a faster server means faster
connectivity and enterprise network solutions and in this competitive market,every company
looks for a faster and better connectivity option. NPD or new product development is a part
of innovation where the innovation comes through a new product that is fresh in the market.
A new product development strategy is mainly divided into eight steps – Idea generation,
idea screening, development of concept and testing them, business analysis, product
development, test marketing, commercialisation and launch of the product. Any new product,
which is developed by Apple, goes through these steps before finally become available in the
stores.
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The funnel concept is important in its application as it used to filter the material often
with the increment sieve or filter paper. Different organisation uses funnel in different ways
like cooks use the funnel to transfer the liquids, herbs, mixtures powder into the bottle or
containers so that wastage can be minimised. In development and commercialization, funnel
concept is important as it first filters the product after preparation and then product is
introduced at the commercial level. Filtration is also done by using various tools and
techniques and equipments.
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P6. Building an Innovation Business Case including ways to access funding:
Backbone Connect is a fast growing farm in the UK Tech SME scenario. The
company has gained much attention when it became a European Level 3 communication
partner. The main objective and mission of the organisation is to provide the premium
collocation services and managed networks for the business. The organisation is taking steps
to develop the cloud computing services. The benefit of this product development is that the
data would be stored at the large scale and small organisation will be interested in storing
their data that will reduce their problem of storage and cost effective. This will accrue great
profits to the organisation. Development of timeline will show the roles and responsibility of
the employees in developing the cloud.
Figure 1: Sample image of timeline activity for cloud
(Source: Image of Gantt chart for cloud computing, 2017)
However, the company should not stop innovating and generating new ideas, rather it
should now test new ideas and concepts because it has become a reputed farm in the
networking business scenario in UK. The company is already into networking business. They
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can start their own cloud storage service like Apple’s cloud service. There are a number of
cloud storage providers in the market and that is why the service should be innovative. The
company can make a ultra secure cloud computing platform for every platform. Cornish et al.
(2013, p.58) stressed that, the cloud service should contain every office tool to make changes
in documents and the cloud service should synchronize data from other cloud servers too but
all under strict internet firewall. The cloud service should not possess any kind of
vulnerability and the company can give the cloud service free of cost to its clients. Another
innovative can be making an employee management platform for farms which will be both
free and paid. The paid version will have some extra functionality.
To fund this project the company can seek help from government and in return can
provide free secure cloud storage for all the government departments, which will give the
government to effectively transfer files between departments over cloud. This will time
saving for the government. The company can join hands with other enterprise security and
cloud platforms and can ask them to work in collaboration.
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Task 4:
LO 4: Evaluating the range of methods for protecting ideas and understanding their
advantages and disadvantages
P7 Evaluating the different tools that Backbone Connect Company can use to develop,
retain and protect knowledge and intellectual property with practical examples where
necessary
Neophytou (2014, p.616) opined that, different people have different knowledge
regarding the term invention but the intellectual property is something more than noticing the
inventions. It is rather an understanding the definition of the intellectual property, the creation
of intellectual property, the usefulness of created knowledge, the ways of protecting
intellectual properties. The intellectual property is an another mode of delineating essential
knowledge- the knowledge of the ways of running a business, different processes, making
products, and the customers of the company. This type of management takes value as result.
It intends to provide relevant information and materials to the different organisations. It also
notices the different roles of the different employees in different parts of a company.
Zakic et al. (2012, p.20), the intellectual property tool elaborates varieties of property
that are made by artists, musicians, inventors, and authors. The intellectual property
management is related to external and internal business context in order to help the
organisations in making effective decisions like what products they have to create and the
effective ways to protect them. So, the intellectual property needs to be linked with the
company strategies as they are interconnected. It is all about maximising the profit of the
company. The technology manager must be used to the non-legal or legal aspects of
intellectual property. The intellectual property is not easy to be stored because that is not
physical assets which can be built again. So securing intellectual property is very essential
and they are supposed to be secured under the intellectual property rights. The intellectual
property is generally dealt by the information and personnel management system of the
organisations. The Backbone Connect Company needs to work with this management group
externally and internally in order to observe the several ways that may help the company in
securing the intellectual properties for the sake of Backbone Connect Company and the
employees. This management is also useful in detecting the prospective domain where
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Backbone Connect may utilise innovations. The higher committee intends to decide the
proper domain for those innovations after getting the documented reports by the company.
The managers should play an important role in employing people with profound
intellect maintaining good strategies for Backbone Connect Company. The managers need to
store the knowledge; they should also retain them and apply the expertise, intellect, concepts
and experience of the employees in the development of their products. For this, the managers
of Backbone Connect Company need to take the intellectual property management system as
a tool which looks after the inventories and also examines the modes through which the
intellectual property in Backbone Company can be increased. It also helps the intellectual
property to be channelized throughout the organisation.
The organisation in the relevant scenario uses the intellectual property that includes
patents and copyrights. It is important because as the planning to introduce their own product
development to provide effective services to the customers. The competitors of the
organisation make the use of the same technology and can prepare similar product that
impacts the profits of the organisation. Every organisation needs to bring innovation in their
product to enhance their growth and sustainability. But the most important point for
consideration in developing the new product, the organisation should not forget about its core
competent product which is the gaining sector. Challenges and limitations are the symbols in
developing the new product that should also be taken into account and suitable steps to be
made.
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Conclusion
As the CEO of the Backbone Connect Company, the learner has done several
innovation and commercialisations like explaining innovation and determining its importance
to Backbone Connect in comparison with invention, explaining how organisational vision,
leadership, culture and teamwork can shape innovation and commercialisation and the 4Ps of
innovation and explaining the use of the innovation funnel to examine and shape innovative
ideas. The learner has also intended to explain developments in frugal innovation and
provided examples of how it is used in the context of Backbone Connect Company, and
explained the importance of the commercial funnel and the application of New Product
Development (NPD) processing for commercialisation of innovation. The learner has also
built an Innovation Business case for Backbone Connect Company, including ways to access
funding, and evaluated the different tools that Backbone Connect Company can use to
develop, retain and protect knowledge and intellectual property.
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Reference List:
Annacchino, M. (2007). The pursuit of new product development. Amsterdam: Butterworth-
Heinemann.
Apple (United Kingdom). (2016). Apple (United Kingdom). Available at:
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2016].
Backboneconnect.co.uk. (2016). About Us | Backbone Connect. Available at:
http://www.backboneconnect.co.uk/about-us.html [Last Accessed on 19th Dec. 2016].
Backboneconnect.co.uk. (2016). London Data Centres | Backbone Connect. Available at:
http://www.backboneconnect.co.uk/#0 [Last Accessed on 19th Dec. 2016].
Bicen, P. and Johnson, W. (2015). Radical Innovation with Limited Resources in High-
Turbulent Markets: The Role of Lean Innovation Capability. Creativity and Innovation
Management, 24(2), pp.278-299.
Capitol Records. (2016). Virgin Records. Available at: http://www.virginrecords.com/ [Last
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trade marks & allied rights.
Morgeson, F.P., DeRue, D.S. and Karam, E.P., (2012). Leadership in teams: A functional
approach to understanding leadership structures and processes. Journal of management, 4(1),
pp.25-41
Neophytou, J. (2014). Intellectual property and finance. Journal of Intellectual Property Law
& Practice, 9(7), pp.616-617.
Pellikka, J. and Pellikka, J. (2012). Are commercialisation process models beneficial for
small technology firms?. International Journal of Technology Transfer and
Commercialisation, 10(3/4), p.229.
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Project!, W. (2016). Android Open Source Project. Source.android.com. Available at:
https://source.android.com/ [Last Accessed on 19th Dec. 2016].
Sohmen, V.S., (2013). Leadership and teamwork: Two sides of the same coin. Journal of
Information Technology and Economic Development, 4(2), pp.1-11
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on 19th Dec. 2016].
Urbancová, H., (2013). Competitive advantage achievement through innovation and
knowledge. Journal of Competitiveness, 5(1), pp.47-68.
Virgin. (2016). About us. Available at: https://www.virgin.com/virgingroup/content/about-us
[Last Accessed on 19th Dec. 2016].
Virgin. (2016). Virgin. Available at: https://www.virgin.com/ [Last Accessed on 19th Dec.
2016].
Zakic, N., Jovanovic, A. and Stamatovic, M., (2012). External and internal factors affecting
the product and business process innovation. Economics and Organization, 5(1), pp.17-29.
Appendices:
Appendix 1:
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