Innovation and Commercialization: Essence Drink UK Case Study

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Innovation and Commercialization
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Executive Summary
The entire study is based on the innovative strategies that are applied by the company Essence
Drink in UK. All the facts are evaluated in the systematic manner that will provide a clear image
of different types of innovations, methods, strategies and many more. The related facts such as
frugal innovation and funnel innovation is explained in the below study.
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Table of Content
Introduction......................................................................................................................................3
Task 1...............................................................................................................................................4
P1 Explain innovation and determine its importance to organisations in comparison with
invention..........................................................................................................................................4
P2 Explain how organisational vision, leadership, culture and teamwork can shape innovation
and commercialisation.....................................................................................................................5
M1 Analyse different sources of innovation, and how organisations can foster and develop an
environment and culture of innovation............................................................................................5
P3 Explain the 4Ps of innovation and explain the use of the innovation funnel to examine and
shape innovative ideas (M2)............................................................................................................7
P4 Explain developments in frugal innovation and provide examples of how it is used in an
organisational context (M3)...........................................................................................................10
D1 Critically analyse how innovation is developed, embedded and measured in an organisational
context............................................................................................................................................10
P5 Explain the importance of the commercial funnel and the application of New Product
Development (NPD) processing for commercialisation of innovation.........................................11
P6 Build an Innovation Business Case for an organisation, including ways to access funding
(M4)...............................................................................................................................................12
P7 Evaluate the different tools that organisations can use to develop, retain and protect
knowledge and intellectual property (M5)....................................................................................13
D2 Critically evaluate the nature of innovation and the context in which it is developed,
providing evidence-based judgements on how organisations can overcome challenges to develop
successful innovations...................................................................................................................14
Conclusion.....................................................................................................................................16
References......................................................................................................................................17
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Introduction
The decisive facts that are underpinned to the innovation and commercialization is discussed in
the study with reference to the company Essence Drink, UK based company launched by Akshay
Kumar. The company is established with a motive to provide a healthy mango lassi all around
the UK. The company has achieved a huge success within two years of its establishment due the
innovative formula and distribution capability. The increase of competitors in the market the
average sale of the company decreased. Therefore, the main founder of company decided to
apply some innovative ideas and launch new products in the market to raise the position of the
company. Thus, in the given assignment all the details related to the development of new product
and commercial funnel irrespective to innovative process and commercialisation will be
evaluated.
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Task 1
P1 Explain innovation and determine its importance to organisations in comparison with
invention.
The process that involves transformation of inventions and idea into services and products in
order to create value for which that potential customer is ready to pay is termed as innovation. In
order to be called as innovations, the facts, points and ideas must be capable to be exchanged in
an economic cost and must be capable in order to satisfy needs and desire of the customers
(Bonazzi and Zilber, 2013). Moreover, innovation is the term that involves excessive
involvement of imaginations, initiative and information so that the greater value can be extracted
from the sources. This extraction accentuates all new ideas that are generated and converted into
some different products (Petkovska, 2015).
Importance of innovations to the organizations in comparison to the invention is discussed
below:
Innovation Invention
● Innovation is the systematic process
that changes the value of the existing
products and its uses to its customers.
● The idea for the process or products is
implemented for the first time.
● Innovations demand the wide set of
strategic skills, technical’s and
marketing. .
● Innovation may not require the need of
any new discovery.
● Invention is the production of the new
products and services in market.
● It is the new idea of process or product
that occurs for the first time.
● Invention is the process of coming up
with a fresh new ideas to be launched
in the market.
● The invention on the other hand
requires right approach and skills with
scientific process thought.
Table1: Comparison of Innovation and Invention
(Source: Created by Author)
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P2 Explain how organisational vision, leadership, culture and teamwork can shape
innovation and commercialisation
Organisational goals, vision and objectives
The crucial vision of the Essence Drink UK is to achieve the highest sales volume of its
products. Moreover, the goals and objective is to raise the overall sale of the product in the
market and expand the business unit (Dereli, 2015). In order to achieve such vision Essence
Drink has enhance its innovation and creativity in order to develop new product that are assumed
to gain a positive reviews by the potential customers.
Leadership
In Essence Drink the leadership helps the company to shape the innovation and
commercialisation by framing the problems and questions that arises at the time of innovation of
the products. Thus, the leadership lead to influence the solutions. It frames the problems and
issues by analysing all the threats and opportunities in the market.
Culture
The cultural environment in Essence Drink is friendly irrespective to its workforce. The HR
department of the company seeks all the crucial and intrinsic factors that might arise in future.
All the controversies are smoothly handled and solutions are provided.
Teamwork
The working environment is very effective that leads to the great achieve of productivity. The
teamwork is accurately maintained with proper coordinates and communications between the
employees and the employers (Biemans, 2018). Moreover, the company organizes several
programs that relate to increase the effectiveness of the communication and teamwork in the
company.
M1 Analyse different sources of innovation, and how organisations can foster and develop
an environment and culture of innovation
The main objective of Essence Drink, UK is to expand its sales of products in the market.
Therefore, irrespective to achieve the target company can apply various sources of innovations
that an organisation can foster as well as develop culture and environment of innovations are
discussed below:
● Unexpected
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Why innovations are created without the intention to create then it termed as a source of the
unexpected innovation (Lee et al., 2015). This is a practice that is enacted in Essence Drink
while creating something different and new product line. Many experiments and causal mixes are
performed which leaded to invent a new form of healthy and exclusively tasty drink for people.
● Incongruity
Incongruity is another method that is applied by the company Essence Drink irrespective to
produce new product and increase the sale in the market. Essence Drink applies this source of
technical innovation in order to create different products in the competitive market.
● Market Structure
The innovation sometimes generates by the marketing structure that involves the demands of the
potential customers. Thus, Essence Drink collects all the information that are spread in the
market through World Wide Web and evaluate the ingredients accordingly. Likewise the
respected company prefers to produce only healthy drinks that are highly demanded in the
market.
● Necessity
Needs are the base of every invention as well as innovations. Innovations can be done only by
accentuating the basis needs and then develop the further procedure of creating new products. In
Essence Drink the basis necessity of the customer was to have a drink that provides them a good
source of health (Bogers et al., 2017). Thus, keeping in mind the crucial point of health mango
lassi was formulated.
● Demographics
The products of Essence Drink is been formulated keeping the point of generic lifestyle and
preference of the public. Its taste, essence and smell are the highly appreciable to all the potential
customers.
● Changing perception
The changing perception that is the changes in the taste and preferences are highly noted by the
company at the time of production (Lefebvre et al., 2015). Thus, it was rated as one of the best
drink that is supplied in the market of UK irrespective to its healthy factors.
● New knowledge
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Essence Drink, UK keeps on collecting all the new and latest information related to its drinks in
the market. This vivid source of information leads them to think and innovate its products that
will be suitable for the marketing demand.
Figure 1: Significance of innovation
(Source: Created by Author)
P3 Explain the 4Ps of innovation and explain the use of the innovation funnel to examine
and shape innovative ideas (M2)
The 4Ps of innovations that are applied by the company Essence Drink are evaluated below:
● Product
In the list of 4Ps of innovation that first and the foremost element is the product that is offered in
the market for a certain values. The product must be such that should ensure all the crucial facts
in order to satisfy utmost needs of the customers (Bucciarelli, 2015). Therefore, Essence Drinks
concentrates all the facts that are demanded by the customers and then develop the innovative
ideas for the products.
● Price
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The company follows the policies of price discrimination while deciding the price of its
products. The price is very relevant and suitable irrespective to the demands of market.
● Promotion
After setting up the price of the products that company is required to promote its products in the
market in order to inform about the availability of the products. With the help of promotion
company is able to deliver all the crucial and necessary details about its products to its potential
customers (Resnick et al., 2016).
● Place
The Company has selected the best location and areas in order to supply its product. It is
important to supply the product at the right place and at the time in order to maintain the
importance of the products to its customers (Hong et al., 2016).
Figure 2: 4 P's of Innovation
(Source: Created by Author)
Innovation Funnel
Innovation funnel is the commonly used model by the organizations in order to innovate new
idea as well as conceptualize products. The respected company applied this model irrespective to
manage NPD that is New Product Development. Some of the main part of the NPD is discussed
below:
● Opportunity assessment
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This is the part of innovation funnel in which the organization analyzes through the customers
knowledge as well as the market data and several other sources information (Yun, 2017). It leads
to identify the types of opportunity that exist while producing new line of product.
● Ideation based on insights
With the help of insight process the organization decided different kinds of opportunity that will
be preferable for the strategy that will help in ideate various kinds of products that would
capitalize the opportunity.
● Conceptualization
Using this method the company design the actual concepts of the products that lead to the
ideation of stages. This includes advertising copy, different configuration and packaging mock-
ups irrespective to the product traits.
● Benchmarking and evaluation
The company applies this funnel in order to test the various concepts of the targeted customers in
the market. This includes actual user testing and choice modelling (Goffin and Mitchell, 2016).
Based on the concept of the different tests, the company iterate and then re-test its products.
Figure 3: Innovation Funnel
(Source: Created by Author)
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P4 Explain developments in frugal innovation and provide examples of how it is used in an
organisational context (M3)
Frugal innovation is considered as the process that is based on reducing the cost and complexity
of the products at the time of productivity. The company Essence Drink apply this process
irrespective to achieve its main target (Rosca et al., 2017). As commonly stated the revenue and
the sale is the life board of the business, thus in order to achieve that company may apply
different innovative ideas which include the following.
Get social
The company is required to get interacted with its potential customers through social media as
the mass amount of people are active over there and can be a great source of promotions. This
method leads to build the gap between the customer and the company (Khan, 2016). Thus, the
Essence Drink derives by its partner through social media persona with an established online
marketing.
Sponsor community events
The company is required to achieve the great source of sponsors that will lead to off shoot all its
competitors in the market (Weyrauch. and Herstatt, 2017). The proper sponsor community
events help to spread the name of the brand and quality in the market that increase the position
and reputation of the company.
Become a resource
The company has to become a kind of monotonous source to its customers. This can be done by
increasing the smell of the products irrespective to the deliver the clients guidance support and
information.
D1 Critically analyse how innovation is developed, embedded and measured in an
organisational context
Some of the crucial steps that can be taken by the Essence Drink in order to derive its
innovations in respect to the new drink are.
● The company is required to reshape its portfolio to achieve profit growth in operating and
explore latent demands and price-inelastic in the market
● Linking the performance of its function that will lead to achieve the operating profit growth
and stay focused to avoid traps.
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● The company is required to maintain a midterm strategy of value creating to all its retail
partners and make efficient use and targeting of commercial investment
All the above are the crucial points that can be applied by Essence Drinks in order to achieve its
aim that is expanding the volume of sales in the market.
P5 Explain the importance of the commercial funnel and the application of New Product
Development (NPD) processing for commercialisation of innovation
The commercial funnel is the mechanism that leads to constant stream of knowledge and ideas
that can be used at the time of innovations and inventions. It is therefore evaluated as the source
to the potential consumers towards the selection and purchase of products and services. There are
five main steps in commercial funnel that includes opinion, consideration, preferences, purchase
and awareness.
In the given study Essence Drink is one of the healthy drink producing company in UK that has
great economic position in the market. Two years ago, the company started its business with a
sign product that is mango lassi. As mentioned above due to the innovation techniques and
distribution capability of the respected company, huge benefit from the economy market is been
enjoyed. Due to the increase of competition in the market the sale of the product reduces
drastically in the third year of its business. However, it has been observed that the public was
attracted to the other sources who are offering different flavours in the health drinks.
Therefore, to solve this issues company innovated and created many different flavours that are
cherish by the public. The quality and the standard of the new products are maintained equally.
Irrespective to introduce the new products in the market of the healthy drink the company
delivered all the necessary details that includes different flavours, 100% fat free, no tureen and
caffeine, highly natural and nutritional and many other homogeneous facts.
While introducing the new products in the market of healthy drinks the company had to face
several issues and risk. One of the issues was launching new product took long time to get
identified by the public which leaded to raise the cost of productivity. Irrespective to the
commercial funnel the company has be assure that the consumers must be aware of the
availability of the product in the market so that they can show their interest. The main objective
of the company in order to introduce the new product was to inform all the public about the
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