Innovation and Commercialisation: A Case Study of Essence Drinks

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Innovation and commercialisation

Contents
Introduction......................................................................................................................................1
LO1..................................................................................................................................................2
P1 Explain innovation and determine its importance to organisations in comparison with
invention......................................................................................................................................2
P2 Explain how organisational vision, leadership, culture and teamwork can shape innovation
and commercialisation.................................................................................................................4
M1 Analyse different sources of innovation, and how organization can foster and develop an
environment and culture of innovation........................................................................................6
LO2..................................................................................................................................................8
P3 explain the 4Ps of innovation and explain the use of the innovation funnel to examine and
shape innovative ideas.................................................................................................................8
P4 Explain developments in frugal innovation and provide examples of how it is used in an
organizational context................................................................................................................10
M2 analyze and apply the innovation funnel in an organizational context...............................11
M3 Evaluate the role of frugal innovation.................................................................................11
LO3................................................................................................................................................12
P5 Explain the importance of the commercial funnel and the application of new product
development (NPD) processing for commercialisation of innovation......................................12
P6 Build an innovation business case for an organisation, including ways to access funding..13
M4 Build a detailed innovation business case which includes how to measure its overall
effectiveness using appropriate techniques available to test, iterate and improve....................14
LO4................................................................................................................................................15
P7 Evaluate the different tools that organisation can use to develop, retain and protect
knowledge and intellectual property..........................................................................................15

M5 present supported evidence based evaluation of these different tools in the context of the
wider business environment......................................................................................................16
Conclusion.....................................................................................................................................17
References......................................................................................................................................18

Introduction
Innovation and commercialisation of any new product in the market is significant because the
process related to this will mainly help the business to re-establish its brand position within the
market. The report will discuss the case of Essence Drinks which provides healthy mango within
the market of the UK but after sometime its sales get decreased, they are now planning to bring
some innovation in their existing product line. The report will suggest new flavours in the lassi
that will support the firm to improve its sales along with revenue. The report will further provide
strategies suggestions which will help them to recreate their brand name in the market. The
report will also provide suggestions by which firm can easily protect its intellectual properties.
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LO1
P1 Explain innovation and determine its importance to organisations in comparison with
invention
Introduction to Essence Drinks organisation
This organisation starts its business two years ago and provides healthy lassi with mango flavour
within the UK market, which helps organisation to enhance its sales and also to attract its large
range of customers. After two years, the founder of the organisation (Akshay Kumar) felt that
sales of the Mango Lassi are getting decreased and that put an impact on their market share,
customer base and brand image. Now the organisation wants to bring a new taste of drinks but
they do not want to move away from the lassi drink.
Innovation
Innovation will be considered as the application based on new concepts or ideas that the
organisation uses to implement few changes and improvisation in its existing products or
services. The concept of innovation is adopted by the organisation when they want to implement
changes in their products as per the market trends. The innovation process can be considered as
the advancement in technology, improvisation in the current product or services and
implementation of the new ideas to achieve competitive benefits (Tidd and Bessant, 2018). This
process will help the organisation to achieve high competitive advantages and that help them to
increase brand image and cash flow in the market.
Figure 1: Innovation elements
(Source: Philip Bell, 2017)
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Importance of innovation in Essence Drinks
As it is already that Essence Drinks is the organisation which provides healthy Lassi with the
flavour of Mango within the market of UK with high sales but from past few years their sales are
getting decreased so it is importance for them to apply the concept of innovation. The major
problem that Essence Drinks is currently facing is related to the reduction in their Lassi sales due
to which their market image is getting affected. According to this problem they decided to adopt
a new product development concept by bringing some innovation in their Lassi (Meissner et al,
2017). The organisation can go for “healthy chocolate lassi with vanilla flavour”. According to
the youth and teenagers taste the mixed flavour of chocolate and vanilla in Lassi will help them
to attract the customers, and that increases their sales. The execution of this drink will increase
their sales, brand image; customer base and market share in the UK market.
Figure 2: healthy chocolate lassi with vanilla flavour
Comparison between invention and innovation
Invention and innovation both are different concepts as innovation means bringing of some
improvisation in the existing product category through new ideas but invention means bringing a
new product or new concept within market. In the Essence Drinks context, they want innovation
in their current lassi product so the innovation of “healthy chocolate lassi with vanilla flavour”
is the best option for them. But if they move towards new soda drink, then this will be called the
invention of a new product (Godin, 2012).
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P2 Explain how organisational vision, leadership, culture and teamwork can shape innovation
and commercialisation
Leadership, teamwork and organisational culture are the major factors on which process of
innovation is based as these factors help the innovation team of Essence Drinks to plan and
execute their innovation process effectively. Use of the technology in this process will also help
Essence Drinks to implement some changes in their existing Lassi product as this will help them
to attract new customers through the new product.
Organisational vision: Setting of the vision and mission by the managers and leaders of
organisation will help the innovation and commercialisation team to set the direction of the
innovation process. The vision set by the Essence Drinks is planning to execute some innovation
in their Lassi product by adding new flavour or new ingredient so that they can bring new
innovative drink without moving away from the Lassi product range (Dodge et al, 2017). So, for
this, they decided to go for “healthy chocolate lassi with vanilla flavour” product.
Leadership: Leadership is the leader’s characteristics through which they influence their team
members to increase their efforts for achieving the set goals of the organisation. The leaders of
Essence Drinks motivate their innovation team to share their opinions regarding innovation in
Lassi so that quality of idea can be adopted. Leadership also help to bring coordination in the
team members so that planning, designing and implementation of the innovation process can be
done effectively.
Organisational culture: The internal culture of Essence Drinks also influences the whole
process of an innovation project. In the Essence Drinks context, it is analysed that the values
their employees and workers which help them to maintain the positive culture at their workplace.
They also support employees by providing working flexibility so that they can balance their
professional life with personal life (Hao and Yazdanifard, 2015). This type of motivation and
encouragement increases the efficiency level of every employee, and that enhance innovation
productivity.
Teamwork spirit: Teamwork and collaborating working improve the understanding level
among innovation team, which will bring effective implementation of the idea. Team working
also supports the process of innovation and commercialisation based on new ideas. The new idea
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of discussion and sharing among the team members also bring the best idea which improves the
sales and financial condition of Essence Drinks.
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M1 Analyse different sources of innovation, and how organization can foster and develop an
environment and culture of innovation
Peter Drucker explains the some sources of innovation which are effective to search the new
opportunities and ideas to mitigate the risk. Innovation sources are- The unexpected, the
incongruity, process need and demographics. The unexpected innovation source is the essential
source because this source helps Essence Drinks to analyse the new market opportunities through
market research for reducing their sales problem. The incongruity source supports the Essence
Drinks organisation to analyse the best opportunity to bring the innovation within their existing
product range. For example, poor feedback of the customers helps the Essence Drinks to bring a
new flavour of Lassi in the UK market (Tamayo-Torres et al, 2016).
Process need source helps the organisation to analyse the lacking areas which are related to their
existing process so that they can implement changes for improvement. For example, due to poor
feedback of customers analysed that mango flavour is outdated, so they need to bring chocolate
flavour Lassi to attract youth. Demographic source mainly focuses on the customer’s income
level, market trends and human capital so that Essence Drinks can target a particular segment of
customers. For example, a decrease in the mango Lassi sales helps the Essence Drinks to
segment new market by targeting youth and teenagers (Joe, 2017).
Figure 3: Sources of Innovation
(Source: www.biggerplate.com, 2019)
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The internal and external environment and culture play a vital role to foster the innovation
process. The Essence Drinks employees are assigned with the task to suggest new ideas so that
they can select one best innovation idea by reducing their idle time. The organisational managers
or leaders encouraged people to take this risk and execute the changes in lassi product for
fostering innovation (Tidd and Bessant, 2018). Proper training, employee’s rewards and working
flexibility are some of the aspects of Essence Drinks through which they maintain their
workplace culture which fosters the innovation process.
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LO2
P3 explain the 4Ps of innovation and explain the use of the innovation funnel to examine and
shape innovative ideas
4Ps of innovation are as follows that supports organisation for improving its current product
through which their lassi sales will increase their sales for gaining the competitive benefits:
Product: Essence Drinks is specialised in the Lassi products as they provide Healthy Mango
Lassi to their customers. The taste of Lassi is the key factor behind their success but now their
sales getting decreased along with the revenue. So, for bringing innovation in Lassi product they
can add new chocolate with vanilla flavour Lassi.
Process: This factor in the Essence Drink organisation will refer to the supplying of products
process in the market to their customers. A process under this also covers recruitment, selecting
and training of the employees so that the plan must be executed effectively (Akgun et al, 2017).
Online distribution of the new lassi will also cover under the process to enhance their
productivity and profitability.
Position: Effective distribution process helps Essence Drinks to change their customer’s mindset
and through strategic planning, they can attain customer’s attention. Innovation in the current
process is the best way for achieving its customer’s attention and competitive benefits. This is
the way through which organisation can establish their brand position in the market. Digital
marketing is one of the effective strategies that will helps to improve and enhance their brand
awareness in the market.
Paradigm: Proper process will help in depicting some changes and change the customer’s
behaviour towards the organization. Chocolate lassi with vanilla flavour will be produced by
Essence Drinks exhibit higher prices as compared to their competitors. So, it is essential for the
organization to spread awareness among the customers to increase lassi price and increase the
taste of lassi (Godin, 2012).
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Innovation funnel significance
Innovation funnel is considered as the tool which will support the organisation for conducting the
market analysis based on the innovation plan which will be formulated by the essence Drinks.
Market information and different ideas will be combined through which strategies can be
effectively formulated by the organization. Innovation funnel next stage is to focus on the
communication process with their employees and stakeholders so that they can bring innovation
within existing product according to target market perception (Vanhaverbeke et al, 2017).
Figure 4: Process of innovation funnel
(Source: slidemodel.com, 2019)
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