Innovation and Commercialization: A Report on Essence Drinks

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Innovation and commercialization

Table of Contents
Introduction......................................................................................................................................3
LO1 Explain the context for innovation and determine the difference between invention and
innovation........................................................................................................................................4
P1.................................................................................................................................................4
P2.................................................................................................................................................5
M1................................................................................................................................................6
LO2 Explain the different types of innovation................................................................................7
P3.................................................................................................................................................7
P4.................................................................................................................................................9
M2..............................................................................................................................................10
M3..............................................................................................................................................11
LO3 Discuss the process required to commercialize innovation...................................................12
P5...............................................................................................................................................12
P6...............................................................................................................................................14
M4..............................................................................................................................................15
LO4 Evaluate the range of methods for protecting ideas and understand their advantages and
disadvantages.................................................................................................................................16
P7...............................................................................................................................................16
M5..............................................................................................................................................17
Conclusion.....................................................................................................................................18
References......................................................................................................................................19

Introduction
The world has many organizations and every organization have to deal with different kind of
satisfaction and demands of the customer and the success of an organization depends on the
fulfilment of their demand and satisfaction. This assignment will provide better understanding of
innovation, invention and commercialization of the product and services in the significance of
essence drinks that deals in range of beverages such as classic London tonic, grapefruit and
rosemary tonic, elderflower tonic, etc. innovation refers to the process of reinvigorate of products
that are already existing and adding unlike values to it. The invention refers to the process of
bringing and introducing new ideas of different product into the market and commercialization
refers to the process of bringing the customers for that product. This assignment will also involve
the organization culture, vision, teamwork and leadership that how it helps in inventing and
commercializing the product and services. It will also help in understanding 4P’s of innovation,
commercialization of the product and innovation funnel and how these aspects affect the
innovation process and also frugal innovation. It also discusses the intellectual property and it
influences the process of invention, innovation and commercialization towards the success of the
company.

LO1 Explain the context for innovation and determine the difference between
invention and innovation
P1
Innovation-
Innovation is the process of introducing or bringing new ideas in the organization about the
product or services that impose a great impact on the success of the organization (Pullen, et al.,
2012). There are various drivers that impose innovation process in the organization such as
intellectuality, differentiating, courage and thinking that might be the driving force for the
innovation process.
Invention-
The invention refers to the process of accomplishment of unique thinking or new idea into action
which is the second step of inventing the new product or services (Pullen, et al., 2012). Whereas
innovation refers to bringing new ideas or unique thinking for an existing product and bringing it
into the market refers to the invention by shaping that product in an actual manner.
Difference between invention and innovation-
INVENTION INNOVATION
The invention refers to the novel product,
process, or the concept.
Innovation refers to the introduction of a new
and better product or solution in order to meet
the existing market needs or new requirements.
The process of invention requires
competencies, knowledge and financial aid.
Innovation process requires competences,
technical knowledge about trends, market
needs and financial support.
Examples- an invention of the telephone,
electricity, the computer, etc.
Examples- the introduction of the laptop,
iPhone, flat screen TV, tablet, etc.
Importance of innovation in comparison to the invention in case of essence drinks-

The invention is the creation of new products or the introduction of the initiation of a new
process for the first time. Invention always needs to be crucially different from the previous
creations or invention (West and Bogers, 2014). There are many inventors who do minor
improvements in the existing invention that might not certify for the patents. Innovation refers to
add some values to the existing products or services that fulfil the needs of customers. Innovation
is determined only when some makes improvement or contribution to the existing process or
product. Essence drinks a beverage company of London in the UK that has started to sell healthy
mango lassi for two years. This company has highly developed because of its innovative formula
and distribution capabilities, but the sales drop down when the company entered the third year.
Due to this, the company is introducing some new innovative drinks and the company is using a
different form of innovation to introduce their innovative product.
P2
Diversity is proved as very beneficial as it brings various viewpoints together and widens the
pool of ideas in the company. The culture of the organization which allows expressing different
viewpoints, team efforts that help in converting ideas into products and services and the mission
and vision that helps to differentiate noise from work.
Leadership is important to develop a vision in the organization as well as the organizational
structure which is essential for effective process in the company (Pullen, et al., 2012). The clear
vision, mission, goal and value of the company. These important elements help the organization
in its commercialization. Not only leadership but the team is also very necessary to get the
success as employees with the right skills are required who are willing to adopt changes and
work with the team.
Organizational culture shows the strong environment of the origination that leads to a positive
culture in the company which enhances the employee's engaged in the organization (West and
Bogers, 2014). This resulted in more profit, more success, and more sales and most importantly
supports positive company culture.

Culture of innovation must the basic part of any business in order to survive in this fast moving
market. Nowadays, the company's needs to direct themselves towards innovation to sustain in the
market.
M1
According to Peter F Drucker, there are seven sources of innovation which are as follows-
1. Unexpected- the innovation can happen by chance or take place unexpectedly.
2. Incongruity- innovation can be born if the need incongruent with the demand or supply.
3. Market structure- innovation can take place due to the existing market structure.
4. Necessity- necessity is known as the mother of invention and innovation (West and
Bogers, 2014). Need always find a way or set us thinking.
5. Demographics- innovation can be sourced through our lifestyle according to lifestyle
needs.
6. New knowledge- a source of knowledge can also be the reason for innovation.
7. Changing perception- changes in thinking or perception can also lead or give birth to
innovation.
To foster the innovative culture organization must follow these simple steps-
 Leaders must lead the team from the front in order to embrace changes
 Building a culture of innovation to make the people perform better
 Creation of effective team so that various requirement can be fulfilled
 Provide recognition as this promotes employees creativity and innovation
 Resolution of clients problem leads and encourage organizations innovation
 The setting of standardization in order to do best
 Development of flat management structure

LO2 Explain the different types of innovation
P3
The company Essence drinks aim to increase the volume of their product sales, to do so; the
company must follow a different kind of innovations to make the increment in its sales. Here are
some different forms of innovation that are mentioned below.
 Radical innovation- talking about the types of innovation, radical innovation refers to the
innovation which includes the establishment of new industry and developing
revolutionary technology (Triguero et al., 2013).
 Disruptive innovation- disruptive innovation is also known as stealth innovation. This
innovation refers to implement the new technology and process in the company.
 Incremental innovation- incremental innovation refers to an increase in the utilization of
the existing technology and value of the customer in the company.
 Architectural innovation- architectural innovation refers to overall skills, technology and
lessons that are used for product in a different market.
In order to increase the profit and sales of the business company can apply some effective sales
techniques to its company which are as follows-
 Paradigm innovation-this innovation involves mental model frames of the organizational
activities and this innovation helps in changing the model.
 Process innovation- this innovation involves the changing process in the methods in
which they are already created and delivered (Noppers, et al, 2014).
 Product innovation- this involves changes in the company’s product.
 Position innovation- position innovation includes changes in the context of the product
introduction.

Figure 1- Model 4 Ps of innovation
Source: Bessant & Tidd, 2013
The 4P’s of marketing is going to be discussed here that can help in the innovation of essence
drinks which are as follows-
Product- product is the first component of 4P’s of marketing. As the product is the only thing
that fulfils the need of customers. So before marketing any product, the company must make sure
that their product has unique features.
Price- after analyzing the proper knowledge and information about the product, the company
should set its prices. As the profit, demand and supply of the company totally depend on the
establishment of the price of the company product (Triguero et al., 2013).

Promotion- the next step is the promotion of the product. Promotion involves many things such
as social media, email marketing, video marketing, advertisement and public relations.
Place- this is the last step of innovation that helps in putting the right product at the right place
(Noppers, et al, 2014). In this step, the company needs to choose the right place in order to covert
the target customers into actual customers.
The company needs to follow the product innovation process in order to increase the profit
margin and sales volume because when the company offers good quality products the product
sale will increase naturally.
P4
The essential part of any business is its sales and sales related revenues. The company can take
various innovative ideas for their business which are as follows-
Get social- the company must engage its customers through social media in order to build good
relation and interaction between the public and business. The persona of the company through
social media can be driven by reputable partners that are in an online marketing firm.
Sponsor community events- the company can achieve marketing opportunities which can also
offset the other companies grow. It can also help in creating higher visibility of its brand and the
company can become the partner with the business in its swift market (Triguero et al., 2013).
Enhance resource- the company must become the resources to its valuable customers. By doing
so, the company can increase its sale. Therefore, the company should deliver support to clients,
information and guidance.
Here are some significant steps for essence drink that can be taken by the company to drive
innovativeness and new drinks which are as follows-
1. The company needs to reshape its portfolio in order to grow operating profit.
2. The company needs to become first in the market to find the latent demand and price-
inelasticity.

3. The company needs to connect the performance and the function in order to deliver
operating profit growth (Noppers, et al, 2014).
4. Set target and use commercial investment in effective manner.
5. The company needs to handle and manage the balance of power and require tackling it.
6. The company should also build a mid-term strategy and value creating to its retail
partners.
M2
By taking this idea that is a concept to reality through the conversion of a particular product is
the objective of any product or service. In economical and manufacturable form product can
fulfil the market requirements or needs. To manage development funnel this involves various
different challenges. And the first challenge is to make funnel neck narrow-the ideas which are
newly generated should be resource focused and screened by the attractive opportunities. Then
the (Triguero et al., 2013) second challenges are to make wider the mouth of a tunnel which
means the company should access the information that can enhance the number of product and
new process ideas which may expand the knowledge base.
Here is a model of innovation funnel which is as follows-
Figure 2- the innovation funnel
Source- Ernst C.S., 2015.

M3
Frugal innovation refers to the process of reducing the cost and complexity of the product in an
organization. The main focus of frugal innovation is to remove the unnecessary features of the
product.
The main components of frugal innovation are discovering the new business models,
reconfiguring value chains and redesigning of product in order to serve better to users (Noppers,
et al, 2014). The innovation basically includes overcoming or tapping of organizational resource
constraints in order to develop a more inclusive market.
This is the extreme case of innovation where the innovation includes innovated applications for
an environment of resource constraints and extreme cost (Triguero et al., 2013). The information
is all about how the company use and organize frugal innovation for an organizational purpose
that will be tiny if the occurrence of frugal innovation is relating to the outlook of the product.

LO3 Discuss the process required to commercialize innovation
P5
Commercial funnel is also known as purchase funnel. The commercial funnel depicts the journey
of customers towards the purchasing of product and services (Dmitriev, et al., 2014).
Commercial funnel involves five steps which are- awareness, opinion, consideration, preference
and last is purchase. Essence drink is a company from UK deals in healthy drinks. This company
was started two years ago with having only one drink that is mango lassi. This company has
achieved highly rise in its product sales by using innovative formula and distribution capabilities.
But when the company entered into the third year the sales of the company drastically decreased
as the consumers of the UK like a variety of flavours in Lassi. Thus, the consumers of the UK
attracted towards the companies who offer various flavoured drinks. In order to resolve this
problem, the company needs to provide variety and flavoured drinks to their consumers. The
product quality or healthy drink must be superior. The company can launch drinks including
these elements-
 Tasty
 Free from caffeine and taurine
 Offer a variety of flavours in drinks
 Fat-free drinks
 Enriched in nutrition’s and naturals