Innovation and Commercialisation: A Business Report on Essence Drink

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Innovation and Commercialisation

INTRODUCTION......................................................................................................................1
TASK 1......................................................................................................................................2
P1 Explaining Innovation and its importance to organisation in comparison to invention...2
P2, M1 explaining the way organisational vision, leadership, culture and teamwork can
shape innovation and commercialisation...............................................................................4
TASK 2......................................................................................................................................6
P3, M2 Explaining 4P’s of innovation and use of Innovation funnel in innovation ideas.. . .6
P4, M3, D1 Explaining development in frugal innovation with relevant examples and its
role in organisation.................................................................................................................9
TASK 3....................................................................................................................................10
P5 Explaining the importance of commercial funnel and application of NPD in
commercialisation................................................................................................................10
P6, M4 Building an Innovation Business case for Essence Drink and ways to assess funds
..............................................................................................................................................12
TASK 4....................................................................................................................................13
P7, M5 Evaluating different tools that organisation use to develop retain and protect
knowledge and intellectual property....................................................................................13
D2 critically evaluating the nature of innovation and solution to overcome challenges top
develop successful innovation..............................................................................................13
CONCLISION..........................................................................................................................15
REFERENCES.........................................................................................................................16

LIST OF TABLES
Table 1: Difference between innovation and invention.............................................................3

LIST OF FIGURES
Figure 1: 4P's of Innovation.......................................................................................................1
Figure 2 Innovation Funnel........................................................................................................3
Figure 3 Sales Funnel.................................................................................................................2

INTRODUCTION
Innovation and commercialisation is crucial in order to meet up the changing demand of the
customers in market. It is an essential process to increases the sales and customers and stay
comparative in market. Essence Drink is a successful small enterprise which raises its market
value with a unique product. But with the rapid changing business world, competition has
increases in UK market which leads to declining in sales of company. It lades to raise the
need for innovation of new products. In context of that, the report will aim to highlight the
different aspects of innovation and commercialisation of new product of Essence drink. The
report will suggest the new product for the organisation such as- Almond Lassi with
cardamom flavour through which they can increase their lassi sales in the market and satisfy
the needs of their customers.
Report will highlights importance of innovation to organisation in comparison to invention. It
will also mention the way organisational vision, leadership, culture and teamwork can shape
innovation and commercialisation. Further, 4P’s of innovation and use of Innovation funnel
in innovation ideas will also be elaborate. Report will also include development in frugal
innovation and its role in Essence Drink. Report will highlight the importance of commercial
funnel and application of NPD in commercialisation. In addition to that, Innovation Business
case for Essence Drink and ways to assess funds will also include. Report will also highlight
different tools that organisation use to develop, retain and protect knowledge and intellectual
property.
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TASK 1
P1 Explaining Innovation and its importance to organisation in comparison to invention
With the rapid change in the business world, the need for the new product in market is also
increases. It is due to the change in the needs and demands of the customers related to a
particular product or services. In order to constantly develop new products in order to meet
the changing needs of customers and to remain competitive in market, many organisations are
coming up with innovation method. It is an effective way to exploit the new opportunity in
market which will help an organisation to first come up with innovative idea for a new
product (Goffin and Mitchell, 2016). In order to increase the sales of Essence drink, the
owner wants to take innovation for a new products in order to increases profit and achieve the
objectives.
Definition of Innovation: Innovation can be defines as “a process that involves multiple
activities to uncover new way to do things”. It is a process of creating and developing new
ideas in order to introduce a new product in market. It is an effective way that Essence drink
can use to introduce a new product in order to raise sales and attain competitive advantage in
UK market.
However, being a small organisation essence drink will have to face certain challenge in an
innovation process as compared to any large organisation. Lack of capital for effective R&D,
lack and proper marketing research leads to fail in many innovation opportunities for small
businesses. Despites of that, small businesses like Essence drink can utilise the innovation
more effectively with string strategic plans.
Some of the significance of innovation for the organisation is listed below:
Meeting customer needs: innovation plays an effective role in come up with the new ideas
in order to meet the rapidly changing needs and preferences of customers in market (Martín-
de Castro, 2015). Through innovation, Essence can satisfy the needs of customers and keep
increasing its sales in market.
New opportunities: market trend at global level are changing with fast phase, R&D
department works in order to combine the change market trend with the social needs to create
an innovative idea regarding new products. It will assist in coming up with new product than
other competitors results in achieving competitive advantage.
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Overall growth of organisation: Innovation is crucial for growth of any enterprise.
Innovation culture in organisation leads the employees to work with innovative methods that
inverses productivity efficiently and outcomes with better quality products in order to
satisfying customers. It leads to increasing sales with profitability leads to overall growth and
development of organisation.
Different between innovation and invention
In context to innovation, sometimes invention is being replaced with innovation. However,
they both are different in related respective in finding something new. Invention can be
defined as” Invention is the act of inventing something that has never been made or used
before (Goodman and Dingli, 2017). There is a fine line between both invention and
innovation. The difference between both can be described as below:
Table 1: Difference between innovation and invention
Basis of difference Innovation Invention
Meaning It concerns with implementing idea for a
new product or process. Innovation is
considered if some of the ingredient will be
added in the existing product by the
organisation.
It is creation of an idea
regarding new product or
process that has never done
before. Invention shows that
this product is invented very
first time by the inventor.
Activities involved It involves the overall skills of organisation.
The main activities that are included in the
innovation are market analysis so that
customer expectations will be analysed.
Market research will help to innovate the
product as per their customers changed taste
and preferences.
It is limited to the research and
development. Inventor cover the
skills in which requirement in
the market in respect of the
product will be analysed so that
invention of the product will be
done.
Skill required It includes marketing, technical and
management process as well. These are the
key skills through which innovation in the
existing product will be done as per their
customers’ requirements.
It required effective scientific
skills. For invention of the
product the organisation mainly
wants one scientist who has
skill of new product invention.
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Thus, it can be said innovation process are essential in order to bring new product of Essence
drink in market.
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P2, M1 explaining the way organisational vision, leadership, culture and teamwork can shape
innovation and commercialisation
Innovation is required to be an integral part in Essence organisation in order to foster the
innovation and commercialisation. Innovation culture is the working environment that
encourages the belief that innovation is not a process for top management and leaders rather
it can come from anywhere in organisation. It can be said that effective leadership, teamwork,
vision and team work is the way that can assist in creating an innovation culture that leads to
support the innovation and commercialisation.
As per the given information about organisation it is analysed that in the previous year’s
organisation gain profit with their mango lassi and also received positive and high response
from the customers. But with the passing time, taste of the customers has changed and that
decreases the sales of Essence Drinks. So, now main objective of the organisation is to bring
new lassi product to increase their sales and customer base in the market.
Their role in fostering innovation is as follows:
Organisational vision: Essence Drinks’ vision to meet the customer needs through
supplying the best quality drinks is an essential statement that assists in increasing the
efficiency of organisation (Biemans, 2018). The vision of Essence will assist the management
to encourage the innovation culture in organisation, which foster the process of innovation in
operational and creating new products to meet market needs.
Leadership: It is responsibility of a leader to encourage their employees to explore their new
ideas that can contribute to the organisation’s innovation process. The leader can recruit a
high talent employee with innovative and creative ability. Through various strategies, a leader
in essence drink which stimulates the communication process to employee’s regarding their
ideas and suggestions. Delegating difficult task to employees is an effective way to carry out
the innovative ideas to perform the task effectively.
Organisation culture: it is the most effective way to be applied by organisation in order to
encourage the innovation and commercialisation. An organisation culture with the belief of
trying new and creative in order to increasing productivity efficiently is crucial in cultivating
an innovation process (Breuer and Lüdeke-Freund, 2016). Management of Essence can create
a culture where, employee free to share their view and ideas in regards to the new products.
Innovation and commercialisation will enhance with a positive working environment.
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Teamwork: One of the most effective ways to encourage innovation is teamwork. it is a
dynamic conceit that can be applied by essence in organisation, so that the task can be
completed in creative and innovative manner. Forming a team for completing a task will
leads to create an innovative idea that can be essential for a new product.
Sources of Innovation
Change in market structure: With the change in industry, an organisation needs to try
something new to meet up with changing structure such as technological change, political,
change, increasing competition leads to create an opportunity for innovation.
Demographics: Changes in country’s population, age, gender leads to create an opportunity
to innovate different products in order to meet the new demands of the different customers.
New knowledge: With the increasing in the technological advantage, there is different
opportunity for organisation to grasp in order to create an innovative idea for new product
(Gershon, 2016). Acquiring new knowledge to match with the revolution in technological
advancement serves as another source for innovation.
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TASK 2
P3, M2 Explaining 4P’s of innovation and use of Innovation funnel in innovation ideas.
Innovation tool or innovation space serves as an essential tool that leads to stimulate the
innovation process and make further improvement in order bring the new products.
Innovation space is a model which will identify the need for improvement in the innovation
process of new Almond lassi with cardamom flavour of Essence drink so that it will
effectively achieve the objectives of organisation. Innovation space model uses the radical
innovation type which states the overall change in the new product through exploring new
technology.
The 4P’s of innovation that can be applied in Essence drink are as follows:
Figure 1: 4P's of Innovation
Product Innovation: It refers to offer a new product to the customers in market. In order to
meet the changing demands, Essence drink needs to introduce new product in market to
remain competitive. Essence drink is going to introduce a new product Almond Lassi with
cardamom flavour which will be healthier as previous product. As there are several
competitors in market, the new product will add with almond and cardamom flavour which
adds value to the customers by providing completely new product.
Process Invocation: It is the way through which the new product will be delivered to the
customers. It includes manufacturing, packaging and supplying the new products in target
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market in a cost-effective manner. Process innovation lades to improve the procedures of
commercialising the product in market and deliver to the final customer (Westland, 2016). It
is crucial in order to improve the process of innovation from idea generation to final delivery
of products in market.
Position Innovation: This process will lead to improve and make strategies to effectively
lunch the new products in market. It will help Essence Drink to identify the potential market,
its customer, and the method of promotion and the strategies for promotion and advertising of
product. It will also assist in improving the method through which product will communicate
in the market in order to achieve goals and objectives of Essence drink.
Paradigm Innovation: It is a planned process that an organisation faces in order to innovate
a new product of Essence drinks. It includes all activities that Essence will undertake in order
enter and expand in the market with the new product with innovation. Almond Lassi with
cardamom flavour is the new product organisation is planning to bring so that they can
increase their sales once again and for this paradigm innovation factor help the to expand
their share in the market by launching this new product (Almond Lassi with cardamom
flavour).
Innovation Funnel for Essence Drink’s new product:
Innovation funnel is an importance process which is used to describe the steps involves in the
development of a new product. It is an important concept that can be applied for the
innovation of Essence Drinks new product. Innovation funnel is like a funnel that will assist
the organisation to successfully creating the new product in profitable manner. Innovation
funnels involves three stages which helps in successfully implementing the innovative idea
for new product.
The first step is the mouth of funnel which aims to collect as many ideas related to the new
products and market research based information (Bucciarelli, 2015). The second stage will
refine the ideas as per the goals and customers demand. The innovation manager along with
R&D evaluate the stage with potential challenges that organisation might face. Finally in last
stage, after taking approval from top-management, the final idea will get selected for product
of Almond Lassi with cardamom flavour will come on floor as action.
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