Report: Innovation and Commercialisation in Business Development

This report comprehensively examines the concepts of innovation and commercialization, emphasizing their significance for organizational success. It differentiates between innovation and invention, highlighting the importance of organizational vision, leadership, culture, and teamwork in shaping innovation and commercialization strategies. The report explores various sources of innovation, the 4Ps of innovation (Product, Position, Process, and Paradigm), and the use of the innovation funnel to shape innovative ideas. It also delves into frugal innovation and its role in business development. Furthermore, the report discusses the commercial funnel, the application of New Product Development (NPD) processes, and the creation of an innovation business case, including ways to access funding. Finally, it covers different tools organizations can use to develop, retain, and protect knowledge and intellectual property, providing a holistic view of innovation management within a business context, with specific reference to F-drones as a case study.

Unit 8 – Innovation and
Commercialisation

Table of Contents
INTRODUCTION .........................................................................................................................3
LO1..................................................................................................................................................3
Innovation and its importance to organisation in comparison with invention ............................3
How organisational vision, leadership, culture and teamwork can shape innovation and
commercialisation .......................................................................................................................4
Different sources of innovation and how organisation can foster and develop environment and
culture of innovation....................................................................................................................5
LO2..................................................................................................................................................6
4Ps of innovation and use of the innovation funnel to examine and shape innovative ideas .....6
Innovation funnel and its application to F-drones ......................................................................7
Developments in frugal innovation..............................................................................................8
Role of frugal innovation.............................................................................................................9
LO3..................................................................................................................................................9
Importance of the commercial funnel and the application of New Product Development (NPD)
processing for commercialisation of innovation..........................................................................9
Innovation Business Case and ways to access funding.............................................................11
LO4................................................................................................................................................12
Different tools that organisations can use to develop, retain and protect knowledge and
intellectual property...................................................................................................................12
Different tools in the context of the wider business environment.............................................13
CONCLUSION .............................................................................................................................14
REFERENCES .............................................................................................................................15

INTRODUCTION
Innovation can be defined as introduction of something new in which idea is
implemented by creating a new product or service. Innovation in present business environment
has become very important for success and growth of organisations. This report will discuss
about innovation and its importance and its difference from invention. Followed by this report
will discuss about contribution of organisational leadership, culture in shaping innovation and
will also include 4 Ps of innovation. In addition to this report will also discuss about frugal
innovation. In second part report will involve discussion regarding commercial funnel and
application of new product development and will also involve creating an innovation case for
business. Lastly, report will involve different tools that organisations can use to develop retain,
and protect and intellectual property. This discussion will contextualise F-drones, company is
building world’s first transition drone to enable aerial deliveries to ships and offshore platforms.
This is an innovative case in which company is working on creating effective innovations to
provide solutions for aerial deliveries at low cost and considering higher standards of safety and
reliability.
Innovation and its importance to organisation in comparison with invention
Innovation is a process of identifying and developing new ideas and creating ideas into
product or service that can be offered to customers. Organisations in present environment of
business have become highly conscious regarding innovation in organisation. Often innovation is
used interchangeably with invention however invention is different from innovation (Meissner,
Polt and Vonortas, 2017). Invention is concerned with occurrence of an idea for products or
services that have never had any existence before on the innovation are concerned with
implementation of an idea for the first time. This means that invention is creation of new product
or service whereas innovation involves enhancing and adding value to an existing product or
service that already exists. In relation with F-drones invention is creation of first drone and
innovation is adding value to drones and increasing their quality and reducing cost associated
with and through aerial drones.
Importance of innovation to an organisation is as follows-

Increasing value- This means that through innovation organisation can increase value of the
product or services. Increasing value of product adds in satisfaction of customers and also
increases customers for a product. Increasing value involves increasing utility or reducing price
of the product or services. This is possible through innovation in organisation. F-drones have
also worked on increasing value of drones by increasing quality and reducing cost.
Increased productivity- This is another important reason for organisation to undertake and
work on innovation. F-drones can increase their productivity through innovation. This can be
done in both ways including increasing production of F-drones at low prices and also through
increasing demand for product leading to increase in productivity.
Competitive advantage- This is another importance of innovation because innovation provides
competitive advantage to the organisation (Yu, 2018). Competitive advantage because
organisation has differentiated and high quality and high value products and services.
Competitive advantage is concerned with advantage that an organisation has over its competitors
and through which they are able to attract customers. Competitive advantage can be created
through innovation and adding value to products and services.
How organisational vision, leadership, culture and teamwork can shape innovation and
commercialisation
Commercialisation is concerned with introducing new product or service into market and
making it available to be used by customers or consumers. For the purpose of innovation and
commercialisation vision, leadership, culture and teamwork plays very important.
Concerned with vision of F-drones it plays very important role in innovation. This is
because vision outlines what a company aims to achieve and also provide direction and guidance
regarding how they can do so (Modranský, Jakabová and Oláh, 2020). This is why in order to
direct and provide standards of activities of organisation and its people it is very important to
have a vision. Vision of F-drones helps in highlighting long term achievement goals and when
goals and vision includes elements like quality, innovation they help in shaping innovation and
commercialisation in F-drones. This also helps organisation and its members regarding extent to
which innovation and commercialisation can be done easily.

Leadership is another important element and contributor of innovation and
commercialisation. Leaders in organisation help in guiding, directing and coaching their
subordinates and employees in F-drones. They have significant influence on actions and thoughts
of employees and this is why they actions can make important contribution in shaping innovation
and commercialisation in F-drones. In addition to this leaders also provide require support and
assistance to employees about how they can innovate and also ways in which their innovation
can be commercialised. Leadership also plays important role in identifying and recognising
unique and useful idea for F-drones and this contributes in motivating employees to innovate. In
this participative leadership style is very important in which leaders include employees and their
suggestions in decisions making. Through this, employees become able to share their creative
and innovative ideas and it shapes innovation and commercialisation.
Culture is a factor that integrates and combines beliefs, assumptions, values of an
organisation. This is why it is very important that organisation have right beliefs, values and
assumptions that complement or support innovation within organisation. Culture of creativity is
very important for encouraging employees to think creatively and this shapes innovation within
F-drones. Regarding culture certain elements are very important such as time and space, it is
very important that employees in F-drones are provided adequate time and space for shaping
their ideas and which ultimately shape innovation within F-drones. It is also important that
mistakes are forgiven and employees are empowered within organisation so that they can make
decisions and their ideas can be frequently applied.
Teams within F-drones are also very important contributor to shape innovation within F-
drones. Cross-functional teams can important contribution because they consist of people with
different types of knowledge and expertise and shapes innovation within F-drones. Teams might
also include quality circle who work on improving quality of organisational products and their
creativity shapes innovation within organisation.
Innovation and commercialisation is a complex act and individual alone cannot do
everything to innovate and commercialise (Srisathan, Ketkaew and Naruetharadhol, 2020). This
requires support of team members of F-drones so that right decisions regarding innovation and
commercialisation can be made and also takes actions to commercialise and innovate.

Different sources of innovation and how organisation can foster and develop environment and
culture of innovation
Innovation is application of unique and valuable idea to enhance existing product service.
This innovation can be sourced from several sources and these sources are-
The unexpected- This means that innovation can place unexpectedly and can happen by chance.
This means that while creating and looking for something, something else can be found.
Necessity- This is one of the very important source of innovation in which innovation becomes
important and take place when there is a requirement for innovation.
New knowledge- Developing and getting new knowledge is also a source of innovation. In this,
source application of new knowledge helps in creating innovation.
Industry and market trends- This is also one of the very important source of innovation in
which with changing requirements F-drones have to develop innovative solutions for survival
and growth in market.
There are several ways in which F-drones can develop environment and culture of
innovation. In order to do so F-drones requires allowing failures, this means that failures should
not be reason for punishment (de Paula and et.al., 2019). Building effective teams and setting
standards for best and creating flat management structure are some of the ways through which F-
drones can shape innovation within organisation.
LO2
4Ps of innovation and use of the innovation funnel to examine and shape innovative ideas
Paradigm- This is concerned with business model and paradigm innovation involves changes in
how and where product is used. This involves innovation in way, company operates and
undertakes its functioning. In addition to this paradigm innovation involves changes in purpose
and regular functioning of the organisation and its products. F-drones in this innovation requires
to change its product utility or change its business model.

Product- This is most common type of innovation that an company can have and this involves
creating and providing innovative products to customers. F-drones created innovation in form of
high quality and more reliable drones for aerial or off-shore delivery and this innovation known
as product innovation.
Position- This is concerned with possible customers for an organisation. This involves chang9ng
customers or target market of the company. Innovation in this involves identifying and
developing market where drones have never been introduced and this will provide benefit in
terms of gaining market share.
Process- This is concerned with process through which products and services are prepared and
provided to customers. Innovation in process helps in reducing cost and increasing quality of the
processes and also products that are being produced through processes.
In relation with innovation and identifying its applicability innovation funnel can be very
useful. Innovation funnel is a process of collecting ideas and converting ideas into products. This
figure outlines innovation funnel and its stages-
Innovation funnel can be very useful in examination of ideas that are collected for the
purpose innovation in F-drones. This innovation funnel helps in dividing different activities into
different stages and this provide clarity regarding how F-drones can shape innovation ideas in

order to convert it into products (Yun, 2017). With help of innovation funnel F-drones can
simplify overall process through innovation process.
In this first stage is about collecting ideas and after that another stage involves
management of idea in which idea is analysed on the basis of its potential success of market plan
for innovation is developed to create products and services. This further leads to protection and
exploration of products that has been developed in F-drones. Followed by this product is
introduced in market which involves communicating to market about existence of product.
Innovation funnel and its application to F-drones
F-drones can make use of innovation funnel while innovating for organisation.
Innovation funnel involves collecting ideas and later creating product from ideas and presenting
it to potential customers. In this, F-drones require to create a system and method where they can
collect ideas from employees. It is important that every ideas should be valued and after
collecting ideas, ideas should be evaluated in terms of their practical application and their
viability in market. Once analysed idea suitable idea is selected that can be implemented. Later
project is developed for developing product for innovation and this requires undertaking
activities like planning, organisation and coordination of efforts (Abramova and et.al., 2019).
This is followed by development of products and introduction of product in target market. This is
followed by analysis of performance of product in market and on the basis of identification of
reviews additional changes are made to made product according to requirements of customers.
Developments in frugal innovation
Frugal innovation refers to innovation in which innovation involves reducing complexity
and cost of products or services. In order to reduce cost of goods, extra and unnecessary elements
are removed from product or service. This is often done with goods that are durable and durable
goods refers to goods that are used for long term, removing nonessential elements reduces cost of
the product. Important objective of frugal innovation is to make products in such way that they
can be sold in developing economies and emerging countries (Weyrauch and Herstatt, 2017).
This is because customers in emerging economies are price conscious and goods with less cost
can be easily sold in such markets. F-drones create drones that are used for aerial delivery to
ships and offshore platforms. For F-drones frugal innovation it requires to develop drones that
are less costly by reducing unnecessary elements of the drones. However, regarding services they

need to reduce cost of services by reducing nonessential elements of the services in order to
make drones viable in emerging economies. Developments in frugal innovation are done on the
basis of some principles and these principles includes-
Engage and iterate- This involves engaging employees and F-drones into research and
development activities and involving customers in early stage, and aligned incentives and taking
inspiration from start-ups.
Flexing assets- This involves creating flexibility in assets of the organisation. This involves
green manufacturing, identifying and developing new material and tools and considering social
and collaborative manufacturing.
Creating sustainable solutions- This is concerned with identifying and developing solutions for
manufacturing and production by F-drones that are sustainable that focuses on both sustainable
for organisation as well as for environment.
Shaping customer behaviour- In this, F-drones requires working on shaping behaviour of
customers and should make frugality desired and aspirational for customers.
Co-creating value with prosumers- This is concerned with co-creating in different phases and
stages of innovation (Hossain, 2018). These stages include discovery of innovation, design and
development and other stages.
Role of frugal innovation
Frugal innovation is concerned with removing nonessential features and reducing cost for
products. Frugal innovation can be useful for F-drones in this it can increase its market in
developing and emerging economies. They can also reduce complexity in their processes of F-
drones by removing nonessential features of the processes. This will also simplify process and
will enhance quality of the products and will increase productivity of F-drones. Product of F-
drones is of durable nature and in addition to this, F-drones can also reduce cost of services that
are potentially successful in emerging economies (Hossain, 2017). F-drones can also identify and
develop alternative products by reducing nonessential features and this will be used for some
other purposes.

Frugal innovation can be very important and valued for F-Drones and the reason for this
is that they will be able to sale their product in developing and low income countries. Selling in
developing and low income countries will help F-Drones in increasing market share.
LO3
Importance of the commercial funnel and the application of New Product Development (NPD)
processing for commercialisation of innovation
Commercial funnel can be defined as process of buying and selling companies lead to
customers while purchasing products. Commercial funnel involves different stages that include
awareness, interest, desire and action. This model divides stages of sales into different parts from
how consumers become aware of products and later what leads them to take action.
There are several reasons that commercial funnel is important for F-drones and the reason
that it is important is that commercial funnel can help organisations in visualising journey of
customers (Paschen, Wilson and Ferreira, 2020). Commercial funnel includes different stages of
customers purchasing journey and on the basis of this organization can developed different
strategies and identify areas that require major focus in order to lead customers towards taking
action for purchasing this is why commercial funnel are very beneficial to help organization in
developing right strategies. Commercial funnel are also important as the help organisations in
effectively understanding the target market and identify how organisation can attract their target
market and customer. This is because every target market has different elements that enables and
encourages them for buying and this is why it becomes very important for organisations to make
effective strategies according to target market.
New product development is a process of developing a new product by organisation and in order
to initialise innovation this process is very important.

Figure 1 New product development process
On the basis of above figure different stages of new product development can be
identified and how different stages lead organisation to commercialize innovation (Cheng and
Krumwiede, 2018). Very first stage of process is involves Idea generation that is the first and
foremost requirement of innovation. Followed by this process includes a screening of Idea that
involves whether idea is practical and viable for target market or not. Later concerned with Idea
concept is developed and Organisation for the purpose of commercialisation develop a marketing
strategy. Effective marketing strategy plays a very important role in successful
commercialisation of innovation developed by F-drones. Later organisation analyses their
business and this stage includes developing innovative product and services by organisation.
Once product has been developed this leads to test marketing of a product. Test marketing is a
process in which F-drones launches its product in market in order to test whether the product is
as per requirement of market or not (Echeveste, Rozenfeld and Fettermann, 2017). Test

marketing also helps F-drones in getting views and opinion of users regarding product and this
becomes basis for improvement of product. After test marketing commercialisation of innovation
takes place and innovative product becomes available for everyone in market.
Innovation Business Case and ways to access funding
F-drones are an organisation that creates transition drones to enable aerial deliveries to
ships and offshore platforms. This product is also an innovation that F-drones offer to its
customers. Innovation that F-drones can consider is developing drones for contactless delivery
by tracking mobile number. Retail organisations can use this service for making deliveries and F-
drones can utilise its capabilities to create high quality and more reliable drones and will
facilitate and enhancing experience of users by enabling them with smart technology.
This product will enable F-drones to increase its target market and customers and will
expand its availability in big market (Björklund and Forslund, 2018). In addition to this F-drones
also have strong capabilities through which they can create smart technology based drones for
delivering products.
In order to identify utility and success of this product F-drones can utilise several
methods. Methods for this includes market survey, this is a method through which F-drones can
identify and understand requirements of customers and this will also provide knowledge and
information about how F-drones can make right and effective drones. In addition to this, F-
drones can also utilise test marketing method for analysing and identifying success and
effectiveness of drones in market. This is a method in which first product is introduced in market
and followed by this organisation collects reviews and opinion of users. On the basis of this
improvement and modification are made for products so that product can be according to
requirement of customers. Both these methods can be used to test effectiveness of products and
iterate and improve products.
In order to innovate it is very important that organisation have adequate funding. This is
because no innovation can take place without adequate investment by organisation.
Ways through which F-drones can access funding includes-