The Role of Innovation in Business Growth: Tesla and Apple's Success

This report provides a comprehensive analysis of how Tesla and Apple, two leading product-based companies, have leveraged innovation to achieve and sustain significant business growth. The study begins by highlighting the importance of innovation in today's competitive market, emphasizing its role in creating a competitive advantage and adapting to rapidly changing market conditions. The report then delves into detailed case studies of Tesla and Apple, examining their respective approaches to innovation. For Tesla, the analysis focuses on its disruptive innovations in the electric vehicle market, including the development of autonomous vehicles, the establishment of a Supercharger network, and the leadership of Elon Musk. The report explores how Tesla has challenged established automakers and generated a competitive advantage through continuous innovation. Regarding Apple, the report examines the company's history of innovation, from the early days under Steve Jobs to the introduction of iconic products like the iPod and iPhone. The analysis highlights Apple's focus on customer-centric design, eco-friendly practices, and the launch of new innovative products like the Apple Watch with ECG. The report concludes by emphasizing the role of innovation as a key element for companies to create and sustain business growth, and the importance of adapting to changing market trends, customer preferences, and technologies.

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Innovation and Creativity

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In today’s competitive business world, organisations are facing fierce competition in the
industries, and they focus on implementing strategic policies to generate a competitive
advantage. Organisations focus on generating a competitive advantage by adopting an
innovative approach in the business which enables them to address challenges caused due
to adverse market conditions, and it assists them in sustaining their business growth
(Herrera, 2015). The corporations which did not rely on innovations find it difficult to stay
relevant in the rapidly changing market conditions. Innovation enables them to create
products or services which caters to the demand of customers which is continuously
changing. New challengers are able to give strong competition to incumbents and disrupt
their customer base by relying on innovation to develop products and services based on the
demand of customers (Reed, Storrud-Barnes and Jessup, 2012). This paper will evaluate the
example of Tesla and Apple to understand how both corporations use innovation to create
and sustain their business growth.
Innovation does not only mean inventing new products, services or processes; however,
innovation also means changing the business model and adopting changes in the business
environment to deliver better products or services of the company. Organisations have to
take measures in order to ensure that they use the changes in market trends, customer
preference and technologies to their advantage (Christensen and Raynor, 2013). They can
use these changes to introduce new products or services, or they can use them to improve
their processes to reduce costs, increase customer base, branch into new industries and
increase their profits. Once they establish a strong position in the market, companies have
to continue to rely on innovation in order to ensure that they introduce new products and
services to customers and improve current offerings to stay relevant in the market
(Christensen, Bartman and Van Bever, 2016). Rapid changes in technologies and customer
preferences make it difficult for companies to keep up with these changes; however,
innovation enables them to step one step ahead of the competition and effectively use their
resources to sustain their growth in the market.
In order to understand the role of innovation, the case of Tesla can be evaluated because
the sole reason for its success was its ability to innovate. Tesla Motors Incorporation is an
American automotive and energy company which specialised in electric car manufacturing.
The company has established multiple productions and assembly plants, and it also

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manufactures batteries, solar panels and other related products (Stringham, Miller and
Clark, 2015). Tesla disrupted the automobile industry by relying on innovations; for
example, the company successfully launched its autonomous vehicles in the United States
and sustained its growth in the market. The early models of its cars looked like ‘toy car’
because they were basic and not aesthetically pleasing. However, the reason why Tesla
stands out in the electronic vehicle industry is because of the fact that it designs desirable
electronic vehicles. Moreover, the company has also announced the ‘Roadster’ which is
claimed to be the quickest car in the world with the ability to accelerate from 0-60 in just
1.9 seconds (Howard, 2017). The corporation has also brought the prices of its cheapest car
down to $35,000, and the company is also working hard to bring these prices even lower.
The corporation has also established over 10,000 Superchargers around the world which
gives it a substantial competitive advantage over its competitors most of which have not
launched any successful electronic vehicles (Fingas, 2018). The success of Tesla is linked with
the ability of its management to rely on innovation in order to find different ways to achieve
success.
Elon Musk, CEO of Tesla, stated that the pace of innovation is all that matters in the long
run, and this innovative approach has enabled Tesla to reshape the automobile industry and
generate a competitive advantage over major brands such as General Motors, Volkswagen,
Honda, BMW, Audi, Toyota and others (Vance, 2015). While all these companies were
focused on developing better petrol and diesel cars, Tesla launched an electric vehicle in the
industry which disrupted these companies position in the market (Cooper, 2018). Moreover,
Tesla continued to improve its products by relying on innovation through which it launched
autonomous vehicles which are able to drive themselves without any human assistance. All
Tesla vehicles have hardware which is needed for full self-driving capabilities at a safety
level which is substantially greater than compared to a human driver (Tesla, 2019).
Customers can pay a little extra to get the autopilot feature in their Tesla cars which give
them access to features such as automatic driving, automatic parking, summoning the car
and others. Based on the continuous innovative offerings of Tesla, it has become more
valuable than many other major incumbents in the automobile industry such as General
Motors, Ford and BMW (Electrive, 2018). It shows that Tesla did not stop after making its
mark on the automobile industry and it relied on creativity in order to build products which

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meet the demand of customers. Through this approach, Tesla generated a competitive
advantage in the market which has sustained its future growth.
Another good example of a product based company that has sustained its growth through
innovation is Apple Incorporation. From its beginning, Apple is known as one of the most
innovative companies in this era which lead the industry by its carefully crafted and
innovative products and services (Jun and Sung Park, 2013). It is an American technology
company that was incorporated in 1976 by Steve Jobs, Steve Wozniak and Ronald Wayne.
The company started its operations by manufacturing computers, but it since branched into
different industries including consumer appliances, computer hardware, software, digital
distribution, semiconductors and others. The innovation in Apple was led by its former CEO
and co-founder, Steve Jobs, who was known for his simple approach towards technological
innovations (Guidolin and Guseo, 2014). Steve was focused on developing products while
considering the demands of customers to ensure that these products meet their
requirements. It is a key principle of innovation which provides that companies should focus
on building products while taking into consideration the demands and needs of customers
to ensure that they expand their customer base (Gershon, 2013).
In the case of Apple, the company started losing its position in the market when it fired
Steve Jobs and started focusing on mass producing its computers without innovative its
offerings. This approach brings Apple to the verge of insolvency; however, this situation
quickly changed when Apple again hired Steve Jobs as its CEO. Steve discontinued most of
the products of the company in order to focus on a few products such as Macintosh to
create high-quality products which are made while focusing on the needs of customers
(Entrepreneur, 2011). These products were way ahead of their times since Apple relied on
innovation to introduce features which customers did not know that they want. For
example, the introduction of beautiful fonts and transparent design become popular among
customers that expanded the customer base of Apple. However, Steve Jobs did not stop,
and he builds a team of experts to work on side projects after which Apple introduced iPod
that changed that face of the music industry. This innovation was simple and easy to use,
and it enables users to store 1000 songs in their pocket which was a big deal at the time
(Bull, 2015). After the launch of the iPod, Apple did not stop, and it launched iPhone which
becomes the most famous and highest selling smartphone range in the world.

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Later Apple launched many other innovative products such as Apple Watch, iPad, MacBook,
Siri, AirPods, Homepod and others. Innovation is the key to the success of Apple which
made it the first technology company to reach the milestone of $1 trillion (Streitfeld, 2018).
The company also uses eco-friendly operations while manufacturing its products to avoid
using harmful materials in the process such as lead, mercury and others. The company also
has recently announced that 100 percent of its stores across the globe are powered by
renewable energy sources which show Apple’s commitment towards the environment
(Statt, 2018). All these become possible due to the innovative approach of Apple towards its
products and services and the company still manages to introduce new innovative products.
A good example is the launch of ECG in Apple Watch which is considered as a major medical
innovation which brings the industry forward (Fitzpatrick, 2018). It shows that innovation is
a key element to ensure the success of a company which can be achieved through persistent
focus and dedication towards customers’ needs which enable companies to sustain their
future growth.
In conclusion, innovation is a key element for companies to create and sustain business
growth. Innovation enables companies to find solutions to major problems which resulted in
improving their products and services and allow them to generate a competitive advantage
over their competitors. The example of Tesla and Apple shows that both the company has
sustained its growth in the market by adopting an innovative business approach. Tesla
improved its products by launching self-driving vehicles and stylish cars. Apple’s focus on
innovative products and dedication towards environmental friendly processes resulted in
sustaining the growth of the company. Both the product-based companies rely on
innovation to improve their products and services to expand their customer base which
allows them to beat their competitors and sustain their growth in the market.

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