MBA501: Dynamic Strategy & Disruptive Innovation: EFS Report

This report provides a comprehensive analysis of Essendon Food Solutions (EFS), focusing on its disruptive innovation capabilities and strategic leadership. It examines the internal factors impacting innovation, such as the top-down managerial structure, lack of young talent, and limited experience in senior management. The report also investigates external factors, including weak stakeholder relationships and limited market reach. Furthermore, it analyzes the marketing perspective, highlighting the organization's approach to customers and ineffective marketing strategies. The technological perspective assesses EFS's outdated processes and slow R&D approaches. The report recommends the use of TRIZ for technological improvements. Finally, it evaluates the leadership styles of Jonathan and Henry, and the CFO, providing recommendations for improvement. The conclusion emphasizes the need for structural changes, improved marketing approaches, and the adoption of disruptive innovation to increase technology use and adapt to market trends.

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Title: Dynamic Strategy & Disruptive Innovation
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Contents
Introduction......................................................................................................................................2
Disruptive Innovation Capabilities..................................................................................................2
Internal Perspective.....................................................................................................................2
External Perspective....................................................................................................................3
Marketing Perspective.................................................................................................................5
Technological Perspective...........................................................................................................6
Strategic Leadership........................................................................................................................6
Conclusion.......................................................................................................................................7
References........................................................................................................................................8

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Introduction
The organization Essendon Food Solutions has been functioning for ages. The
organizational structure is extremely tight, which is mainly made of employees who have a
background in microbiology and hold humongous experience, as they have been working with
Essendon Food Solutions for decades. But due to the current changes in the market with
increasing competition, the organization needs to change its organizational structure, as it is the
main cause of the low level of innovation in the organization. In addition to this, the organization
needs to improve its research and development approaches, along with improving and building
better relationships with the stakeholders. Both the subsidiaries of the organization EnzymeTech
and Essendon Emulsifiers require massive changes, as the organization tight structure and
working processes have already started impacting its profits and position in the market.
Disruptive Innovation Capabilities
Disruptive Innovation can be explained as a new development that helps in changing the
organization’s structure and also, the organization’s process and activities (Kumaraswamy,
Garud and Ansari, 2018). Disruptive innovation involves the use of technology, which can
disrupt or upset an organizational structure (Christensen et al., 2018). Essendon Foods Solutions
in the current circumstances require transformation, which can only be achieved through
disruptive innovation.
Internal Perspective
Some of the key internal structure factors that are affecting the innovation of the organization
are –

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 The organization has a top-down managerial structure. This type of organization structure
curbs the innovation of the employees by demoralizing them to follow specific
instructions. Along with this, due to this approach the top management of the
organization never identifies or appreciates the talent of the employees at the lower level.
 The lack of young minds and young talent in the senior management team. The average
age of the employees in the senior management team is 53. In addition to this, all these
people do not hold any experience from another firm or industry. In addition to this, they
have been following the same processes and activities, along with an attitude that does
not encourage changes. It is due to this that the organisation’s innovation level is
extremely low.
For managing, these different internal structure factors, it is recommended that the
organization –
 Needs to change its top-down working strategy with a bottom-up strategy. The
organization needs to utilize new minds, which have innovative ideas for managing
the current environment of the market appropriately. With this approach, the
organization will be able to identify the talent at the lower level and will also be able
to encourage the entire workforce to improve the level of their productivity.
 The organization needs to employ new employees, who hold experience in different
industries and also, different organizations. The organization should attract some of
the most prominent and important employees of a competitor’s organization, with
attracting offers. This will help in managing the growing competition in the market,
which has resulted in loss of profits for Essendon Foods Solutions.

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External Perspective
Some of the key external factors that are affecting the organization’s innovation are –
 The organization shares a weak relationship with its stakeholders. The involvement of the
stakeholders is minimal in the organization, which restricts the stakeholders from
building a good relationship with the senior management and also, the stakeholders do
not feel part of the organization. It is due to this reason that the stakeholders are not
offered with the facility to make any suggestions to the organization, which affects
innovation. In addition to this, the organization is mostly in dearth of funds for higher and
better research and development projects.
 The other external aspect that is affecting the organization is limited distributors of the
organization. The Essendon Emulsifiers have limited distributors, which are limited to
Australia. Now, the Australian market for the organization has matured, which will also
be stagnant for a decade. Therefore, for the organization, there are no growth
opportunities in the Australian market for a decade.
Some of the recommendations for the organization are –
 The organization needs to increase the involvement of the stakeholders in the
organization. From taking their opinions on different projects, they also need to inform
them about the new strategies and plans the organization is going to implement in the
organization. This will help in building a strong relationship and also, the organization
will also receive financial support from the stakeholders in time of need (Tadao
Kawamoto and Giovinazzo Spers, 2019).
 It is extremely important for the organization to enter new markets. With the growing
opportunities in the different Asian markets, the organization should enter markets. This

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will provide them with more growth opportunities, as the customers of the organization
will also increase drastically (Gemici and Alpkan, 2015).
Marketing Perspective
Some of the marketing perspective factors affecting innovation in the organization are –
 The Essendon Food Solutions approach of overlooking the customers. The organization
has an ignorant attitude towards the changing needs and demands of the customers. It is
due to this reason that the organization has not changed its products and are producing
similar products for ages. It is due to this reason too that the organization is not entering
new markets, because of its non-existing relationship with the customers (Raynor, 2011).
 The organisation marketing approaches are ineffective, as its sales team does not possess
appropriate technical skills, which can help the organization in building better marketing
approaches (Hahn, Jensen and Tanev, 2014).
Some of the marketing recommendations for the organization are –
 The organization should attain regular feedback from the customers, with the help of
surveys. This will help in building a good relationship with the customers, as they will
build products, on the basis of the information attained from the surveys. The
organization should also utilize customer visit programs for attaining customer insights
(Adner and Kapoor, 2010).
 The organization should utilize empathetic design for understanding its customers in a
better way. (Mattelmäki, Vaajakallio, and Koskinen, 2014) Through empathetic designs,
the organization will be able to understand the customer’s feelings and emotions. For

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building loyal customers for the organization and also for attracting the new customers,
the empathetic design will be very effective (Carlgren, Elmquist and Rauth, 2016).
Technological Perspective
The organization Essendon Food Solutions due to its tight organizational structure and
old business processes, the innovation level in the organization is very low. The organization’s
majority of the staff that has the responsibility to build major strategies and approaches have
academic skills, but they do not have knowledge but new skills and technology (Adner, 2012). It
is due to this reason that the organization has not utilized any new technological tools for
improving its organizational processes or for attracting the customers. In addition to this, the
research and development approaches of the organization are laid-back, which are extremely
slow.
It is due to this reason that the organization needs to utilize new technological approaches
for enhancing the level of innovation in the organization’s process. The best technological
approach which the organization can utilize is TRIZ (Gaikwad, Sunnapwar and Teli, 2016).
Through this approach, the organization will be able to organize its different issues in a
systematic manner, which will help in exhibiting different aspects that require consideration. In
addition to this, through TRIZ, the organization will attain lateral solutions, which will help in
increasing the level of innovation in the organization too (Taioun Kim, 2015).
Strategic Leadership
The two main leaders of the organization are Henry and Jonathan. Both of them play a
humongous role in the organization, but they also need to improve themselves.
 Jonathan

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Jonathan is one of the main pillars of the organization, but his leadership
approaches are traditional. It is due to this reason that he suggested the approach of
utilizing an existing employee for bringing a change in the organization. In addition to
this, as a leader, Jonathan does not possess the skills of thinking out of the box. Though
Jonathan understands the importance of stakeholders in the organization, he does not
understands the effectiveness of transformational leadership in the organization.
 Henry
On the other hand, Henry has great leadership skills, as he believes in changing
the working environment of the organization by taking help from outside. He possesses
great knowledge about the internal and external factors that are affecting the innovation
in the organization. It is due to this reason that Henry wants to tackle this issue, by
utilizing transformational leadership. In addition to this, Henry also has great managerial
skills, which will help in managing the old and new staff of the organization in a better
way.
The other leader of the organization who also plays a crucial role is the CFO of the
organization. The CFO also utilized transformational leadership for bringing a change in the
organization, by hiring a new professional who has great experience of working in different
organizations and industries.
Conclusion
With this, it can be concluded that currently in the organization Essendon Food Solutions,
there is a need for changing the organizational structure of the organization. The organization
needs to address the different internal and external factors that are affecting the innovation in the
organization. Essendon Food Solutions need to improve its marketing approaches by utilizing

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disruptive innovation, which will help in increasing the use of technology in the organization.
This will help in making the different processes and activities of the organization more
innovative, organized, and in accord with the new trends of the market, which the organization is
planning to enter in the future.

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References
Adner, R. (2012). The wide lens. 1st ed. [Kennett Square, PA]: Soundview Executive Book
Summaries.
Adner, R. and Kapoor, R. (2010). Value creation in innovation ecosystems: how the structure of
technological interdependence affects firm performance in new technology
generations. Strategic Management Journal, 31(3), pp.306-333.
Carlgren, L., Elmquist, M. and Rauth, I. (2016). The Challenges of Using Design Thinking in
Industry - Experiences from Five Large Firms. Creativity and Innovation Management, 25(3),
pp.344-362.
Christensen, C., McDonald, R., Altman, E. and Palmer, J. (2018). Disruptive Innovation: An
Intellectual History and Directions for Future Research. Journal of Management Studies, 55(7),
pp.1043-1078.
Gaikwad, L., Sunnapwar, V. and Teli, S. (2016). Adaption of TRIZ method for problem solving:
a case study. International Journal of Six Sigma and Competitive Advantage, 10(2), p.146.
Gemici, E. and Alpkan, L. (2015). An Application of Disruptive Innovation Theory to Create a
Competitive Strategy in Turkish Air Transportation Industry. Procedia - Social and Behavioral
Sciences, 207(1), pp.797-806.
Hahn, F., Jensen, S. and Tanev, S. (2014). Disruptive Innovation vs Disruptive Technology: The
Disruptive Potential of the Value Propositions of 3D Printing Technology Startups. Technology
Innovation Management Review, 4(12), pp.27-36.

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Kumaraswamy, A., Garud, R. and Ansari, S. (2018). Perspectives on Disruptive
Innovations. Journal of Management Studies, 55(7), pp.1025-1042.
Mattelmäki, T., Vaajakallio, K. and Koskinen, I. (2014). What Happened to Empathic
Design?. Design Issues, 30(1), pp.67-77.
Raynor, M. (2011). Disruption theory as a predictor of innovation success/failure. Strategy &
Leadership, 39(4), pp.27-30.
Tadao Kawamoto, C. and Giovinazzo Spers, R. (2019). A Systematic Review of the Debate and
the Researchers of Disruptive Innovation. Journal of technology management & innovation,
14(1), pp.73-82.
Taioun Kim (2015). Creative Problem Solving Process using TRIZ Contradiction
Analysis. Journal of Engineering Education Research, 18(3), pp.30-45.