Innovation and Commercialisation

This assignment explores the concepts of innovation and commercialisation in business. It discusses the difference between invention and innovation, the sources of innovation in IKEA, and the link between innovation and teamwork, organizational culture, and leadership. It also covers the 4 P's of innovation, the value of frugal innovation and innovation funnel, the importance of the commercial funnel and the new product development process. Additionally, it provides an overview of intellectual property rights.

INNOVATION AND COMMERCIALISATION
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Table of Contents
INTRODUCTION .........................................................................................................................................3
BACKGROUND OF IKEA .............................................................................................................................4
DIFFERENCE BETWEEN INVENTION AND INNOVATION.............................................................................4
SOURCES OF INNOVATION AS CORE BUSINESS PROCESS IN IKEA .............................................................5
LINK BETWEEN INNOVATIVENSS IN IKEA AND ITS TEAMWORK, ORGANZATION CULTURE, LEADERSHIP .5
4 P’s OF INNOVATION ...............................................................................................................................6
VALUE OF FRUGAL INNOVATION AND INNOVATION FUNNEL ..................................................................7
IMPORTANCE OF COMMERCIAL FUNNEL AND THE NEW PRODUCT DEVELOPMENT ..............................10
COMMERICAL FUNNEL ........................................................................................................................10
NEW PRODUCT DEVELOPMENT ..........................................................................................................11
PLAN OF NEW PRODUCT DEVELOPMENT ...............................................................................................14
INTELLECTUAL PROPERTY .......................................................................................................................15
CONCLUSION ...........................................................................................................................................17
REFERENCES ............................................................................................................................................18
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INTRODUCTION
As per the growing competition, it is very essential for the business to emphasize
innovation and creativity for gaining a long term competitive environment by using
various new technology and methods. The assignment includes the difference between
invention and innovation and then 4P's of innovation and value of frugal innovation and
new product development. Then new product development process is explained at ends
an intellectual property right is discussed in this report.
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BACKGROUND OF IKEA
IKEA is the multinational conglomerates which sell and designs various products such as
assembling furniture, home accessories, food product, and homeware. IKEA is the private
retail company founded in 1943 by Ingvar Kamprad and operating in 433 locations. IKEA
is one of the largest furniture since the 2008. The first IKEA stores opened in the Almhult
1958. IKEA is one of the innovative companies(IKEA ,2020)
IKEA is a Swedish multinational company who are operating their business on
international level and having good reputation in Retail market. Organization is selling
varieties of the product and services that includes Home accessories, home services and
kitchen appliances. IKEA is using trending technology and within their stores like auto
billing, Credit card facilities etc. that is helping them to take competitive advantages. .
DIFFERENCE BETWEEN INVENTION AND INNOVATION
INVENTION
The invention is the process or idea that commonly defined as the carrying out the
new combinations that include introduction of the new method or the development in the
product to make it more efficient and effective for the users and add value in their life
(Aksoy, 2017).
INNOVATION
Innovation is a process which brings the new and creative product and services in
organizations which are very important for organization success this help business gain
competitive advantages(Cantwell, 2017).
Difference between innovation and invention
Basis Invention Innovation
Meaning Innovation and invention
are two different terms,
innovation is the part of the
invention in which company
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invention can be defined as
the creation of the product
or company introduce a
product for the firs
time(Aksoy, 2017).
innovate the product and do
some changes to make things
more effective. For examples-
Customization of the home
appliances to make them more
attractive and useful.
Concept Creation of new idea Changes in existing product
Skills required In this scientific skills are
required.
In this practical implementation
of a new idea is needed.
Occurs when It is a new idea launched by
scientists(Boon and Edler,
2018).
In this existing improvement of
product is there.
Concerned with Never been introduced by
any other before
Make product more effective
Activities It is dependent on the R&D
department.
This is spread in all
organizations.
Commercial exploitation nnovation- invention+ commercial
exploitation
SOURCES OF INNOVATION AS CORE BUSINESS PROCESS IN IKEA
IKEA is one of the innovative companies and the business leader in the retail
industry. IKEA communicates the innovation strategy to customers and employees and
offers a new product at low prices while maintaining good quality. IKEA has well-defined
governance and organizational structure for managing innovation culture in the
workplace. IKEA also launch flat-pack furniture by changing the ways people are
shopping by redesign shops to attract the customers. IKEA also launch an advertising
campaign for transforming the attitudes to the design. IKEA also offered refugees an
alternative to the tents. By taking care of the environment IKEA also launches products
made from recycling materials by eliminating plastic bottles(Boon and Edler, 2018).
LINK BETWEEN INNOVATIVENSS IN IKEA AND ITS TEAMWORK, ORGANZATION
CULTURE, LEADERSHIP
The innovation has linked with the organization culture, teamwork, culture leadership for
successful operation this help to create an innovative workplace in IKEA (Totterdill,
2020).
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Teamwork – The success of the IKEA is teamwork of employees which help an
organization to achieve their objectives as per the prearranged standards for achieving
the goal of the organization, all the employees are given the responsibility of working in a
team as per their defined roles. Forming a team can be beneficial for the IKEA because
together e employees come up with the new idea and find ways new ways to do their
work. On the other side individually employees cannot do their work effectively and due
to less communication they cannot share ideas to the others.
Organizational culture – The culture of IKEA help in clearly defining the vision of
employees to do work successfully so, that all employees are always encouraged for taking
initiatives so, give new and innovative ideas, IKEA always keeps culture as an integral part
of their workplace to promote innovation(Weyrauch and Herstatt, 2017). On the other
side having a bad workplace environment can demotivate the employees, and they will
not able to achieve the goals and objectives of the IKEA company.
Leadership – With leadership help IKEA to run the operation of the workplace in a
smooth manner for achieving objectives there are various the leadership styles such as
laissez –fair, autocratic, democratic the leader of IKEA opt best-fitted leadership styles as
per the situation. Having a effective leadership, can affect the performance of the company
because they cannot lead the employees and in the decision-making of the company they
will not able to provide innovative ideas to the company.
4 P’s OF INNOVATION
The four P’s of innovation help IKEA in understanding how and where IKEA can
innovate the new product for improving the paradigm, product, process, and positions.
This also helps IKEA in directing what changes they need to implement, so they can take
competitive advantages within the market.
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Figure – 4 P’s of innovation
Sources-(Podeschi and Trimble, 2016).
Product – This helps to exhibit IKEA to make the product better through opting for
innovative techniques and methods. IKEA company should innovate their product and
services according to the customers need and demand, marketing team is responsible to
identify the needs and demand, this information is used by the production team where
they modify the product accordingly. For examples- new designers or segments in the
IKEA products(Mourtzis, 2018).
Paradigm – Paradigm is used for improving business innovative ideas, in this change can
be drastic by keeping all the factors in mind (Podeschi and Trimble, 2016). Paradigm will
take place if the IKEA company decided to change whole product and services. For
examples- if company is selling wooden furniture then they start making furniture with
iron because of the customers demand.
Process –In the process IKEA involves the hiring of innovative and skilled people,
workflow, and supplying products all included in process of IKEA. In this, all product
innovation stages are involved. Implementation of the new technology and system can
help IKEA to take competitive advantages within the market. Process makes company
more effective. They can implement new process like Inventory management process that
will help them to manage their resources.
Position- In the innovation sectors position is best which helps IKEA in deciding product
frame and brand image in the market for becoming the market leader. Example – IKEA can
give the best customer services with timely innovation to gain competitive
advantages(Mourtzis, 2018).
VALUE OF FRUGAL INNOVATION AND INNOVATION FUNNEL
Innovation funnel
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The innovation funnel is a concept of developing a new idea by doing taking the
detailed steps by providing the best of the customer services, in the innovation funnel
there are different types of the thinking and idea from which the best outcome can be
driven and processed for maximizing goals and objectives of IKEA(Kusi-Sarpong, and
Sarkis 2019). In the innovation funnel, there is a continuous torrent of ideas with which
IKEA divide the feasibility and help IKEA organization in process of the product growth by
following the 3 steps which are -
Figure – Innovation funnel
Sources-( Weyrauch, and Herstatt 2017)
 The very first step is the ideas range created for doing the innovation from various
sources through clarifying and filtered it out in later stages.
 Then in the second stage growth concept is prepared by the most successful idea in
there is a valuation of possible ideas(Kuo, 2017).
 In the last and final stage, IEKA does finalization and the delivery of innovating
product by analyzing all actors like profit margin cost, manufacturing before
getting ready to go in the market.
Frugal innovation
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The frugal innovation is also known as frugal engineering this help organization in
reducing manufacturing and production cost for avoiding the complexities in process of
production. The frugal process is helpful to all types of the organization in this non –
effective feature of product and services can be removed for gaining good competitive
advantages in a business environment(Kusi-Sarpong, and Sarkis 2019).
IKEA can follow the fungal innovation and they can remove the extra things from
their product that have no use or add the value in the customers life. It will help to reduce
the cost of the product and company will able to provide better product in lower price,
and they will able to gain locality of the customers.
Figure – Frugal innovation
Sources-( Turker and Vural, 2017)
The frugal innovation depends on country factors such as political, social, environmental
which driving frugal innovation forces this is very effective in the innovation process of
IEKA.
The benefit of innovation funnel and frugal innovation
The benefit of the innovation funnel
 Innovation funnel is an excellent tool that will help IEKA to prioritize the
innovative idea by ensuring that the best product is developed by taking all the
factors into consideration.
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 It will elimate the wate pfrom the product and their home applinace and funiture
will be avlable with lower price and ligh wate.
 The innovation funnel helps IEKA in increasing their turnover by improving the
production process and also reducing mistakes(Mohsenabad and Azadehdel,
2016).
The benefit of frugal innovation
 The frugal innovation help IKEA in capturing the emerging market through
developing IKEA minimum product range at affordable price.
 Frugal innovation is used by IKEA to use the limited resources by increasing
organization profit.
IMPORTANCE OF COMMERCIAL FUNNEL AND THE NEW PRODUCT DEVELOPMENT
COMMERICAL FUNNEL
The commercial funnel is known as a pictorial metaphor which is used for listing the more
potential customers in IEKA after this marketing sop is done for achieving the higher
points from usual for attracting customers, this also helps IEKA in attracting more of a
customer from usual. The commercial funnel is in form of an inverted pyramid in which at
top of the funnel mobile app user and website visitors are there and at the bottom, there is
a commercial event usually(Kusi-Sarpong, and Sarkis, 2019).
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Figure – Commercial funnel
Sources-( Kusi-Sarpong and Sarkis, 2019)
The IEKA use the commercial funnel for generating more leads by engaging more
customers in IEKA for growth of the business through –
Awareness
Awareness phase is the first stage where people aware about product sell by the
IEKA thorough social media, friends and randomly on website.
Interest phase
This is the stage where customers make the interest to buy by doing the research
about product. It is necessary or the IKEA to provide offer to those customers who are
searching about the products sell by them.
Desire
This is the stage where customers buy the product from the company and try
product for the first time.
Action
This is the last stage where customer uses the product and take decision if they will
buy product again in the future from the IKEA or not.
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NEW PRODUCT DEVELOPMENT
In the process of the new product development, new product and services are launched by
IEKA in the market, the new product development is one of the very essential processes
for getting the long time success in the competitive market. The development of a new
product depends on the business manufacturing process. It includes the following stages –
Figure – Process of NDP
Sources-(Turker and Vural, 2017).
Idea Generation
In this IEKA develop a new idea for identifying the method to launch new products and
services. In this IEKA create the new ideas by launching a new product or do new addition
in an existing product.
Idea Evolution
In this IEKA do ideas selection and by doing research they approved as per the
understanding of the current market through putting ideas into practice.
Concept Development
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In this IEKA do illustrates their product specification, in this IEKA uses step for showing a
variety of product to customers by adding differentiation(Turker and Vural, 2017).
Marketing Strategy
For introducing the new product IEKA analyses their market condition first by seeing
demand before the launch of the product.
Product Development
In this IEKA includes proper execution of strategies by doing the improvement by
collecting feedback of customers and new trends(Rainville, 2017).
Test Marketing
In this IEKA create a sample of a new product for testing and also measuring their benefits
as per customer reviews.
Commercialization
In this IEKA conformed idea to launch a new product in the marketplace, in this product is
delivered to customers(Mohsenabad and Azadehdel, 2016).
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PLAN OF NEW PRODUCT DEVELOPMENT
Executive summary
As per the report has covered new product launched by IKEA which is a foldable
sofa sets. It has discussed product and services, target customers, market strategy,
competitive advantages and monitoring and controlling techniques.
Services and product
IKEA new product will be foldable sofa that will be easily folded by the users, and
they can save some space for the other things and use the sofa whenever they want by
unfolding it. Additionally, company will provide 1 year of maintenance services to their
customers and 3 year o guaranty.
Customers
IKEA targets will target the old age customers because young age customers will
rarely look for the furniture and other products that sold by the IKEA. Customers between
the age 35 to 65 will be targeted through social media advertisement.
Market strategy/development
IKEA will use competitive pricing strategy to sell their new product. Their new
foldable sofa set will be affordable for the customers that will help customer to satisfy
their needs in lower prices.
Competitive advantages
IKEA is operating their business on the international level and on global level
company need a unique products and services. New product sofa set will helps IKEA to
take competitive advantages, and they will able to gain loyalty of the curtness.
Monitor /control
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To measure the whole product development process IKEA company will use the
360 feedback techniques and collect feedback from employees within the product team.
Sources of funding
For launching the new product the sources of funding IEKA use are -
Bank loans- The bank loan is a method that is very trustworthy and one of the safest
sources of funding that IEKA can opt for expanding their operation in the marketplace.
Ordinary shares- One other option that IEKA can opt for is issuing their shares for a fund
like treasury shares, shares outstanding, to various company stakeholders while
highlighting IEKA profits(Goffin, 2017).
INTELLECTUAL PROPERTY
The intellectual property is the human mind which is an imperceptible property that is
usually voiced or explained by human mind creation, concept of intellectual property made
through a combination of property and intellectual that is invisible. Intellectual property rights
will help IKEA company to secure their new product foldable sofa set. Other organization
cannot copy their new product design and facilities without taking permission from the
real right owner IKEA.
Trademark- Trademark is defined as shape, name, color, a symbol for identifying a
trademark of the brand. The services and product with help of a trademark easily
identified by customers so, that product is protected from the outside market so, no one
can copy it and if anyone did he will get punished, a trademark is a forever symbol.
Trademark will give IEKA a separate identity by safeguarding their logo and brand
name(Chang and Taylor, 2016). IKEA can put trademark on their new fold-able sofa set so
customers can recognize that IKEA is the owner of the product.
Copyright – The copyright use is done for exceptions in this government is giving the
owner the copyright for creator and eligibility, validity this is given till owner death and
after owner death of 70 years the product and services will be recognized with particular
person name this is used by a business for avoiding copying art. So, IEKA can take
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copyright for their new product fold-able sofa set which is a legal right for keeping their
product and services private so, it can’t be stolen in the market.
Patent – Patent is an agreement which is used for new product and ideas of the company
and person for the right of monopoly, in this government gives fixed time duration like 20
years, and then after fix time gets over it will transfer to the third person.
This can be used by IKEA for their new product fold-able sofa set so, that their
competitive company cannot copy their product and new idea concept for a particular
duration if any competitor copied it in that duration then IEKA can file the case against
them in court.
All the above tools of the Intellectual property will help IEKA to secure and save their
business idea, the Patent, trademark, and the copyright help IEKA to represent their
product through legal right so, no one can copy their product without the permission and
authority(Stenson and Gray, 2018).
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CONCLUSION
The above report discusses the concept of innovation and invention which help the
business to gain competitive advantages and a good market position as compared to their
competitors. Then report also contain the difference between innovation and invention
then the concept of teamwork, culture, and leadership in the context of innovation is also
discussed in this report, then the concept of 4 P's innovation is also discussed, Method of
funnel method and it's benefits to IKEA is also explained, then the concept of a commercial
funnel and new product development is also discussed. Then a new development plan of
IEKA is also discussed then at last intellectual property right is also mentioned in this
report.
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